TERMS Flashcards
What are the types of term? (3)
-a condition
-a warranty
-an innominate term
what can terms either be? (2)
implied or expressed
what are implied terms? (1)
implied terms are suggested in the contract.
what are expressed terms? (1)
specifically agreed by the parties.
what are terms? (1)
terms define the obligations of each party to the contract.
what is an innominate term? (1)
a term in a contract that is not defined as a condition or a warranty.
what is a condition? (1)
a term in a contract that is central to the contract, breach of which may allow the contract to be repudiated.
what is a warranty? (1)
a minor term in a contract, breach of which does not end the contract but allows a claim for damages only.
what is meant by repudiation? (1)
the ending of a contract.
what is meant by recission? (1)
this is an equitable remedy that is made at the discretion of the judge, the purpose of this is to put the parties back in their pre-contractual position.
what cases can be used for the importance of conditions? (1)
Poussard v Spiers and Pond (1876)
what case can be used for the minority of a warranty? (1)
Bettini v Gye (1876)
how do judges work out the position of an innominate term? (1)
depends on the severity of the consequences of any breach of the term, instead of insisting at the outset of the contract, the parties wait until the effect of the breach makes it a condition or warranty.
what case can be used to clarify the origin of innominate terms? (1)
Hong Kong Fir shipping co ltd v Kawasaki Kisen Kaisha ltd (1962)
what will courts take into account when deciding if a statement is representation or a term? (4)
-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
what cases relate to importance attached to representation? (1)
Couchman v Hill (1947)
what case relates to special knowledge or skill of the person making the statement? (2)
Oscar Chess v Williams (1957)
Dick Bentley v Harold Smith Motors (1965)
what case relates to the time lag between statement and contract? (1)
Routledge v Mackay (1954)
what common law cover implied terms? (2)
-in business-to-business contracts, terms may be implied
-in a contract between a business (trader) and a consumer
what acts provide evidence for business-to-business contracts and implied terms? (2)
-the sale of goods act 1979
-the sale of goods and services act 1982
what acts provide evidence for contracts between trader and consumer and implied terms? (1)
the consumer rights act 2015
how can terms be implied through common law? (2)
-through business efficacy and the officious bystander test
-by custom or prior dealings between parties
what is meant by business efficacy? (1)
the courts will imply a term into a contract is the term is necessary to make sure that the contract works on a business-like basis.
what is the officious bystander test? (2)
this test asks two questions;
-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 can be used as evidence for business efficacy for implied terms? (1)
The Moorcock (1889)
what occurred in the case of The Moorcock and when was it? (4)
the defendants owned a wharf, they agreed to dock and unload cargos from a ship. Both parties were aware the boat would be their at low tide and the ship would rest at the bottom. The ship broke against ridge rock, The defendants argued there was no term covering, the court implied a term that the ship would be safe mooring there and it was not. (1889)
what case can be used as evidence for the officious bystander test? (1)
Shirlaw v Southern Foundaries Ltd (1939)
what occurred in the case of Shirlaw v Southern Foundaries and when was it? (4)
“prima facie that which in any contract is left to be implied and need not be expressed is something so obvious that it goes without saying; so that if, while the parties were making their bargain, an officious bystander were to suggest some express provision for it in their agreement; they would testify suppress with a common ‘oh, of course’” (1939)
what case shows evidence that if a term were to be implied but it be ridiculous to assume such? (1)
Shell UK ltd v Lostock garage ltd (1977)
what occurred in the case of Shell UK ltd v Lostock garage ltd and when was it? (4)
Shell sold oil at a lower price to other garages causing Lostock to sell at a loss. Lostock argued that there was a term in the contract that they would not discriminate against them but it failed as shell would never have agreed to this. (1977)
what case gives evidence that both parties understood each others intentions for the terms in the contract? (1)
Egan v Static control components (Europe) ltd (2004)
what occurred in the case of Egan v Static control components (Europe) ltd and when was it? (4)
SCC supplied Egan with components, before this Egan had signed contracts making him liable for debts, Egan was asked to pay these debts in the same form as usual. when the company went into liquidation Egan argued the debts only applied to after the contract was signed, court decided the reasonable person would assume debt would apply after and future debts. (2004)
what did the supreme court cover in the case of Marks and Spencer plc v BNP paribas (2015)? (6)
-reasonableness is to be judged objectively
-fairness and acceptability to the parties are not enough
-the requirement for reasonableness and equitableness will usually add nothing to the other tests
-the business efficacy and officious bystander tests are not cumulative
-the officious bystander test may be straightforward
-the test of necessity for business efficacy involves a value judgement
what case gives evidence for terms implied by custom? (1)
Hutton v Warren (1836)
what occurred in the case of Hutton v Warren and when was it? (2)
local custom meant the end of an agricultural lease, a farmer was entitled to allowance for seed and labour on land. terms of lease must be viewed by custom. (1836)
what case gives evidence for terms implied by prior dealings between the parties? (1)
Hillas v Arcos (1932)
what occurred in the case of Hillas v Arcos and when was it? (3)
contract contained clause allowing them to buy more timber in 1931but vage in terms of what timber. defendants refused to deliver the timber, they argued in the area of vagueness court argued that was no defence. (1932)
