TERMS Flashcards
Explain express and implied terms
Express= specifically agreed between the parties Implied = implied through the contract
What the the 3 kinds of terms
- condition
- warranty
- innominate term
What is a condition
A term within a contract that is central to the contract, breach of which will allow the contract to be repudiated
(if I make a contract to buy a phone it is CENTRAL to that agreement that it works and can make phone calls)
Poussard v Spiers
D was hired as the lead role in a play however didn’t turn up for the first two performances. When she did turn up she wasnt allow to play the role. She had broken the contract by not turning up.
As the lead her presence was central to the contract.
CONDITION
What is a warranty
A minor term in a contract, breach of which does not end the contract but allows a claim for damages only
for example if a phone can only store 99 contacts instead of the stated 100 this is not central to the contract and therefore is a warranty
Bettini v Gye
Singer didn’t turn up to 3 of the 6 rehearsal days, wasn’t allowed to sing when he did turn up. He had breached a warranty so the concert organiser could not repudiate his contract. The singer was awarded damages
What is an innominate term
A term in the contract that Is not defined as a condition or a warranty Whether it is a condition or a warranty depends on the consequences of any breach of the term
Hong kong v Kawasaki
C lost use of a ship for 18 weeks after it needed repairing despite the D saying it was fit for sea. This was considered to be a breach of warranty
not all terms will easily be divided (condition or warranty) and therefore must be decided on the consequence of its effect
How do the courts decide whether a statement is a representation or a term of the contract
They will consider:
- the importance attached to the representation
- special knowledge or skill of the person making the statement
- any time lag between making the statement and making the contract
- whether there is a written contract
The importance attached to a statement.
where the statement is obviously important this will be a term
Couchman v Hill = auction manual stated a cow was not pregnant, it was and later died during labour. This was considered a term of the contract t
Special knowledge or skill of the person making the statement
Oscar v William = private seller believed a car was younger than what it actually was - Not a term
Dick Bentley = experienced car dealership stated a car had only done 20,000 miles when in fact had done 100,000. - Term to the contract due to the level of experience
The time lag between the statement and the contract
Where the contract is made later and doesnt refer to the statement it is likely to be a representation of the contract as seen in
Routledge v Mckay= time lag of 7 days, the contract didn’t refer to the statement and the statement was not considered important so representation
What act governs business-to-business sale and what act governs business-to-consumer sales
b2b = Sale of goods act 1979 and the sale of goods and services act 1982 b2c= Consumer rights act 2015
How are terms implied through common law
- Business efficacy test and the officious bystander test
- by custom or prior dealings between parties
Business efficacy
A term will be implied into a contact if the term is necessary to make sure that the contract works on a business basis. Two part 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?
The officious bystander test
Seen in Shirlaw v Southern foundry
where something is so obvious it doesnt need to be stated and the officious bystander would agree that this term should be within the contract
This or the business efficacy test needs to be satisfied
