Terms

Question 1

Contractual terms

Answer 1

Contracts consist of various obligations, promises, stipulations, etc. These are referred to as the terms of the contract. Terms may be expressed or implied.

Question 2

Express terms

Answer 2

Specifically agreed between two parties. Court give effect to the intention of the parties.

Question 3

Implied terms

Answer 3

Terms are inserted by the court for different reasons.

May be to introduce obligations in certain types of contracts (sales of goods). To give business efficacy top the agreement.

Question 4

Parol evidence rule

Answer 4

Oral evidence cannot be admitted to vary the terms of the written document.

Question 5

Classification of terms

Answer 5

Contractual terms are classified according to their importance.

Question 6

The classifications of contractual terms

Answer 6

1. Conditions
2. Warrenties

Question 7

Conditions

Answer 7

• A very important term.
• A term that goes to the root of the contract.
• A breach of a condition can lead to the end of the contract and give the claimant the right to claim damages.

Question 8

Warrenties

Answer 8

• Lesser importance
• The contract can withstand a breach of a warranty.
• A breach therefore only gives the right to damages.

Question 9

Poussard v Spiers [1876]

Answer 9

Due to illness, singer missed the first week of the production, including the opening night.
The obligation to attend the opening night was a condition of the contract.

Question 10

Bettini v Gye [1876]

Answer 10

Due to illness, performer missed a number of rehearsals. The obligation to attend rehearsals was held to be a warranty.

Question 11

Condition or Warranty

Answer 11

The distinction between the two depends on the intention of the parties.

Question 12

Schuler v Wickman Machine Tools [1974]

Answer 12

A statement as to the minimum number of visits to customers was held to be a warranty.

Question 13

Lord Reid: Schuler v Wickman Machine tools

Answer 13

‘Had the term been a “condition” the it would have led to an absurd result.

The more reasonable the result the less likely that the parties would have intended it.

Question 14

‘innominate’ or ‘intermediate’ terms

Answer 14

third type of term - consequence of the breach determines the status.

Question 15

Hong Kong FIR v Kawasaki Kisen Kaisha [1962]

Answer 15

“In every way fitted for ordinary cargo service.”

Failing to provide adequate maintenance was breach of a warranty. Less serious breach which an award of damages could adequately compensate.