Contractual Terms Flashcards
Conditions
Warranties
Innominate terms
Conditions: ‘go to the root’ of the contract. Most important terms. Contract may be repudiated, damages claimed.
Warranties: Term of lesser importance than a condition. Contract may continue, damages may be claimed.
Innominate terms: Terms whose classification is only determined once the effects of its breach are known.
Contract does not state classification of term, importance does.
Eg. Term may be labelled a ‘condition’ in the contract but deemed by the courts to be a warranty.
J Evans and Son (Portsmouth) Ltd v. Andrea Mezario Ltd 1976
Parties formed contract for transport of goods.
Defendants reserved right to determine how goods were transported in writing.
Oral agreement that goods were to be transported below deck.
Goods stored on deck, container lost in swell, going overboard.
Held: Oral agreement considered a term of contract.
Defendants liable for breach.
L’Estrange v. Graucob 1934
Claimant ordered a cigarette machine from defendants.
Signed contract stated that ‘any express or implied condition, statement or warranty, statutory or otherwise not stated herein is hereby excluded’.
Machine was faulty, claimant brought case that machine was unfit for purpose and that she had not seen clause in contract.
Held: Where a contract is signed, parties are bound by terms and assumed to have read all terms regardless of whether they have or not.
NOTE: Case pre dates Unfair Terms of Contract Act
Bannerman v. White 1861
D purchased hops.
Stated that if hops had been treated with sulfur he ‘Did not even want to know the price of them’.
Claimant assured him (Inaccurately) that they had not been.
Upon learning that they had been so treated he repudiated on contract.
Claimant sued, stating that discussions were preliminary and did not form terms.
Held: Point was clearly of great importance to buyer and was thus incorporated into the contract.
Claim failed.
Dick Bentley Productions Ltd v. Harold Smith (Motors) Ltd 1965
Claimant asked defendants to source a well vetted Bentley.
Sale made on claim that 20k miles had been done, actually 100k.
Claimed breach of contract.
Held: Claimant relied on expert knowledge of D, mileage statement held to be term of contract.
CONTRAST: Oscar Chess Ltd v. Williams 1956, sale made by private seller who was not an expert.
Made erroneous but honestly held statement of mileage.
Purchaser was a car dealer and capable of discovering mileage for himself.
Claim failed.
Poussard v. Spiers and Pond 1876
Actress contracted to appear in an opera.
Taken ill on first night, role given to understudy.
Once recovered she claimed for breach of contract.
Held: As lead performer, she was crucial to opera.
She had breached contract by failing to appear in first performances.
Producers entitled to repudiate and terminate the contract.
Contrast with Bettini v. Gye 1876
Bettini v. Gye 1876
Singer did not attend three of six rehearsals contracted before show.
Producers replaced him.
Singer sued for breach of contract.
Held: Singer successful.
Rehearsals were peripheral to concert itself.
Producers could sue for damages of breach, but not terminate contract.
Contrast with Poussard v Spiers.
Routledge v. McKay 1954
Sale of motorcycle registered erroneously as 1941 instead of 1939.
Seller unaware and used said info in sale.
Buyer later discovered true age and claimed for breach of a term.
Held: Elapsed time too great to infer that age was treated as term.
Statement not incorporated into contract.
Claim failed.
Hong Kong Fir Shipping Co. Ltd v. Kawasaki Kisen Kaisha Ltd 1962
Kawasaki contracted with Hing Kong Fir for use of a ship for a period of two years.
Term stated that ship would be maintained and seaworthy.
Soon after voyage started incompetent engine room staff led to breakdown, further maintenance issues discovered.
Ship not in use for 18 weeks.
Kawasaki repudiated contract.
Held: HK Shipping in breach.
Term not substantial enough to repudiate contract.
Innominate terms
The Moorcock 1889
Ship moored on Thames.
Broke up on rocks at low tide.
Owner claimed damages.
D claimed safety of ship not assured in contract.
Held: Safety of ship implied.
Necessary to give the contract business efficacy.
Defendants in breach, liable.
Liverpool City Council v. Irwin 1976
Council block condition deteriorated so that lifts and stairs unusable, rubbish chutes blocked, etc.
Claimant brought case for breach of contract of quiet enjoyment of premises.
Held: Implied term of lease that property kept in state of repair.
Not implied in fact (Bystander test, business efficacy), but desirable to place obligation on landlord in law.
