Expressed and implied terms Flashcards
What is an expressed term
Words agreed by the arties to be incorporated in their contract
What can expressed terms be
Written o verbal
What is an implied term
Terms that are not explicitly stated in a contract but are inferred
What can implied terms be inferred from
Common law or statute
What are the 2 ways in which an implied term can come from common law
The business efficacy and bystander test or by custom or prior dealings between the parties
What are the 2 parts of the business efficacy test
Is the term necessary to make the contract effective?
If the parties to the contract had thought about it, would
they have agreed that the suggested term was obviously
going to be in the contract?
What case would you use for is the term necessary to make the contract effective
Moorcock
What is the officious bystander test
If a bystander, from a 3rd party point of view, would have highlighted the obviousness of the clause
What case would you use for the bystander test
Shirlaw v Southern foundaries
Would the terms be implied if the parties would have never agreed to it if they had thought about it
They would not
What case supports terms will not be implied if the parties would never have agreed to it if they had thought about it
Shell UK v Lostock garage
In what case did the supreme court clarify the law relating to implied terms
Marks and Spencer v BNP Paribas Securities Services
What did the Marks and Spencer v BNP Paribas Securities Services case state (4 things)
● Reasonableness is to be judged objectively
● Fairness and acceptability is not enough to imply a term
● The requirement for reasonableness equitableness will usually add nothing to the other tests
● Only 1 test needs to be satisfied – business efficacy or officious bystander
What is the law around a local custom
As they sometimes survive so therefore can be implied
What case would you use for local customs
Hutton v Warren
