Express Terms Contracted with Representations Flashcards
What distinguishes a contractual term from a representation?
A. A term is a statement intended to be legally binding
B. A representation is always made in writing
C. A representation is part of the final written contract
D. A term cannot be used as a basis for rescission
A. A term is a statement intended to be legally binding
Explanation: A term is intended to form part of the contract and be binding, whereas a representation is not.
A buyer asks if hops have been treated with sulphur. The seller replies no. The buyer says they would not buy if sulphur was used. Later, it’s found that some had been treated. What is the likely legal classification of the statement?
A. A mere puff
B. A misrepresentation only
C. A term of the contract
D. An unenforceable opinion
C. A term of the contract
Explanation: As in Bannerman v White, where a buyer makes clear a fact is crucial, the court may find it is a term.
Which of the following factors is least likely to suggest a statement is a term?
A. The statement was made just before the contract was signed
B. The statement was made by someone with specialist knowledge
C. The statement was made early in negotiations and omitted from the written contract
D. The recipient relied on the statement heavily
C. The statement was made early in negotiations and omitted from the written contract
Explanation: This points away from it being a term, especially if not included in the final agreement.
A seller of a boat tells the buyer it is sound but also advises them to get a survey. The buyer does not. The boat turns out to be defective. What is the likely legal consequence?
A. The seller’s statement is a term
B. The statement is a representation, not a term
C. The seller has committed fraudulent misrepresentation
D. The buyer is entitled to damages for breach of contract
B. The statement is a representation, not a term
Explanation: As in Ecay v Godfrey, advising the buyer to get the boat checked shows the seller did not intend the statement to be binding.
A non-expert seller mistakenly tells a car dealer that a vehicle is from 1948. The car turns out to be a 1939 model. The dealer sues. Which case best supports the outcome that this is a representation, not a term?
A. Bannerman v White
B. Dick Bentley v Harold Smith
C. Routledge v McKay
D. Oscar Chess v Williams
D. Oscar Chess v Williams
Explanation: In Oscar Chess, the seller was not at fault and not an expert, so the statement was not a term.
A buyer asks about the soundness of a horse for stud. The seller says “you don’t need to check – he’s perfect.” The horse is unfit. What principle likely applies?
A. The seller’s statement is a mere puff
B. The buyer has no remedy if the horse was visually sound
C. The statement is a representation
D. The statement is a term due to assumption of responsibility
D. The statement is a term due to assumption of responsibility
Explanation: In Schawel v Reade, the seller’s insistence that no checks were needed meant they assumed responsibility.
Which of the following is true regarding statements made before a contract is signed?
A. All pre-contract statements become terms
B. A statement is a term if the maker had no special knowledge
C. A representation may still result in remedies
D. Timing is irrelevant in determining legal classification
C. A representation may still result in remedies
Explanation: A false representation can still lead to misrepresentation claims, even if not a contractual term.
A car dealer tells a customer that a car has done 20,000 miles since engine replacement. The buyer relies on this and buys the car. It turns out to be false. Which of the following best applies?
A. The statement is a representation because it was repeated
B. The buyer has no claim because the mileage was on the clock
C. The statement is a term, due to dealer’s expertise
D. The contract is void automatically
C. The statement is a term, due to dealer’s expertise
Explanation: As in Dick Bentley, where a car dealer made the statement, it was a term due to specialist knowledge.
