Contract Terms: General

Question 1

What do terms of a contract do?

Answer 1

Create contractual obligations

Question 2

What do mere representations do?

Answer 2

Persuade a party to enter the agreement and they’re not binding

Question 3

What does the court determine to distinguish terms from mere representations?

Answer 3

The intention of the parties by asking what a reasonable person would consider to be the significance of the statement

Question 4

Which statements are incorporated into the contract as terms?

Answer 4

Significant statements

Question 5

What does the case CARLILL V CARBOLIC SMOKE CALL CO say about distinguishing terms from mere representations?

Answer 5

Trade puff has no effect on the contract because it is a mere boast which is not taken seriously, unless some other specific promise stated as fact is attached

Question 6

What does the case BISSET V WILKINSON say about distinguishing terms for mere representations?

Answer 6

A mere opinion has no effect on the contract because it is not based on fact and not relied upon

Question 7

What does the case ESSO V MARDON day about distinguishing terms from mere representations?

Answer 7

Expert opinions may attach liability as terms if they important enough to have been incorporated into the contract or as misrepresentations

Question 8

What are express terms?

Answer 8

Terms that have been specifically mentioned and agreed by both parties at the time the contract is made

Question 9

How can express terms be agreed?

Answer 9

Verbally or written

Question 10

What does the case BIRCH V PARAMOUNT ESTATES say about terms?

Answer 10

The more importance attached to a statement by either party, then the more likely it is that it is a term

Question 11

What does the case DICK BENTLEY PRODUCTIONS LTD V HAROLD SMITH (MOTORS) LTD say about terms?

Answer 11

A statement may be a term if the person making it has specialist expertise and the person to whom it is made is relying on that expertise in deciding to contract

Question 12

What does the car ROUTELEDGE V MCKAY say about terms?

Answer 12

If there is a significant lapse of time between the statement being made in the negotiations and the creation of the contract then the statement will not be incorporated into the contract as a term

Question 13

What does the case L’ESTRANGE V GRAUCOB say about contracts?

Answer 13

If a written contract is signed this generally makes the contents of the agreement binding irrespective of whether they have been read by the party signing

Question 14

What does the case O’BRIEN V MGN LTD say about terms?

Answer 14

As long as sufficient steps have been taken to make D aware of it, D need not actually be aware of the term

Question 15

What are terms implied by fact?

Answer 15

Intentions which are presumed but unexpressed by the parties

Question 16

What does the car HUTTON V WARREN day about implied terms by fact?

Answer 16

Implied terms by fact through custom or common trade practices must be clearly established and well known within the particular trade

Question 17

What is the officious bystander test?

Answer 17

Where implied terms by fact are a necessity to enable a commercial contract to work and/or the term is so obvious that it’s implication goes without saying

Question 18

Which case corresponds with the officious bystander test?

Answer 18

THE MOORCOCK

Question 19

What are terms implied by law?

Answer 19

Terms which the law requires to be included irrespective of the wishes of the parties

Question 20

Why has Parliament introduced statutory terms which must be implied into consumer contracts?

Answer 20

To balance the parties’ positions because of their unequal bargaining power

Question 21

What is a condition?

Answer 21

A term which is so important that a failure to perform it would render the contract meaningless and destroy the purpose

Question 22

What does the case POUSARD V SPIERS say about conditions?

Answer 22

Breach of condition gives the innocent party the right to end the agreement and/or claim damages

Question 23

What is a warranty?

Answer 23

Any other term of the contract that is minor and where the contract might continue despite their breach

Question 24

What does the case BETTINI V GYE day about warranties?

Answer 24

Breach of warranty only gives rise to a claim for damages

Question 25

What is an innominate term?

Answer 25

Statements that are not defined as a condition or warranty by the parties when the contract is made but may turn into one depending on its effect on the injured party

Question 26

What case corresponds with the definition of an innominate term?

Answer 26

HONG KONG FIR SHIPPING V KAWASAKI KISEN KAISHA