Implied Terms

Question 1

2 ways implied terms come into a contract:

Answer 1

1) terms implied in fact
2) terms implied in law

Question 2

Will the courts imply a term contrary to one where parties have made an unambiguous express provision in their contract?

Answer 2

NO

Question 3

What is the implication based on where a term is implied on the grounds of a custom (of a particular trade)?

Answer 3

Based on the assumption that it was the intention of the parties to be bound by well known customs of a particular trade.

Question 4

Can a term be implied into an agreement on the basis that parties have dealt with each other on occasions over a long period of time?

Answer 4

Yes, when parties have followed a consistent + regular pattern.

Question 5

What happens when a term is implied to give ‘business effacy’ to a contract?

Answer 5

makes the contract produce its intended objective.

Question 6

When will business effacy be implied into a contract?

Answer 6

On the basis that without the implied term, the arrangement would be so unworkable that sensible people could not be supposed to have entered into it. - something so obvious that if suggested to the parties, they would respond

Question 7

Is an objective or subjective test used when implying terms in fact?

Answer 7

OBJ - must ask what the reasonable person would understand the contract to mean

Question 8

What does implying terms at common law give effect to?

Answer 8

legal duties which arise - eg landlord + tenant relationship

Question 9

Do statutory implied terms respect the intention of the parties?

Answer 9

No - unless there is a valid exemption clause.

eg: SGA 79, CRA 15, SGSA 82