Implied Terms Flashcards
what is an implied term?
terms that are put into a contract by the law - the parties may be unaware of these terms
what is an express term?
terms that are in a contract that both parties are aware of and agreed to
why do implied terms exist?
they help to create fairness as there may be things that parties forgot to add or specify in their contract. Additionally, it also helps prevent unequal bargaining powers between parties
what 3 ways can implied terms be put into a contract?
-implied by custom trade/use (B2B)
-implied by judges or courts (B2B)
-implied by statute (B2C)
what is a custom?
a custom is something that is usually done /traditional/expected in a contract
what is the case for the trades standard contract should be implied?
British Crane Hire Corp v Ipswich Plant Hire
what does British Crane Hire Corp v Ipswich Plant Hire say?
that a company’s usual standard contract should be implied in further contracts unless stated otherwise, as it was a term that is usually in these contracts
what are the 2 ways that judges can decide to put terms into a contract?
-implied by fact
-implied by law
what does implied by fact mean?
-where parties were probably intending that the situation was covered by a term, but didn’t explicitly say this
-Irwin v LCC
-Marks and Spencers v Paribas
what does Marks and Spencers v Paribas say?
the courts said that to decide what the parties would have intended, we should look at what a reasonable person would have understood to be the intention of the parties in the circumstances
what are the 2 tests for implied by fact?
-the business efficiency test
-the officious bystander test
what is the business effeceincy test?
-where courts think that a term should be implied as the contract would not make sense without it
-The Moorcock
what is the officious bystander test?
-the term is something the parties very obviously wanted in the contract
what case sets out the officious bystander test?
Shirlaw v Southern Foundries
what is implied by statute?
-Parliament have made sure that certain things are automatically in a contract by making terms that imply these things
-a lot of this law has been compressed into the Consumer Rights Act 2015
what is the Consumer Rights Act 2015 (CRA)?
-the CRA is something that implied certain terms into all contracts for the sale of goods and services between consumers and traders
-Applies to only B2C contracts
where is consumer defined?
section 2
where is trader defined?
section 2
what is a consumer defined as?
a party entering into a contract for the purposes wholly or mainly outside of the individuals work
what is a trader defined as?
a person entering into a contract for purposes related to the individuals profession
what does section 9 or CRA say?
-the right to satisfactory goods
-the standard that a reasonable person would consider satisfactory
what 6 things are considered under s9 of CRA to deem something as satisfactory?
-price paid
-any description
-fit for purpose
-goods should be safe
-goods should be durable
-goods should be free from minor defects
what is s10 of CRA?
-the right to have goods that are fit for purpose
-where the seller tells the buyer that the goods are fit for a specific purpose, theres an implied term that says that these goods must be fit for that purpose
what is the case for s10 of CRA?
Baldry v Marshall
what is s11 of SRA?
-the right to have goods as described
-there is an implied condition that where goods are sold by description, they will correspond with that description
what is the case for s11 CRA?
Re Moore and co
what are the 3 remedies for goods?
-s20 CRA: allows consumers to reject the goods and claim a full refund as long as it is within 30 days of purchase
-s23 CRA: either within or after 30 days the consumer can ask for the goods to be repaired or replaced
-s24 CRA: if the defect is still not fixed, the consumer can insist on either a reduction in price or end the contract and receive a refund (after 6 months it is less likely to get a full refund)
