Terms Flashcards
What is a contractual term?
An express or implied agreement within the contract from the parties
What is a representation?
Statement encouraging party to enter contract
- Not part of contract
- Can be misrepresentations
5 ways to differentiate between a Term and Representation?
- Importance
- Special knowledge/skill
- Verification
- Whether written
- Time lag
Explain Importance
- With cases
The more important it is, the more likely it is a Term
- Couchman v Hill
Explain Special Knowledge/Skill
- With cases
More likely a term if made by person with specialist knowledge or skill
- Oscar Chess v Williams
Explain Verification
- With cases
Less likely Term if statement maker states verification is needed
- Ecay v Godfrey
Explain Whether Written
- With cases
Terms usually written into contract
- Routledge v McKay
Explain Time Lag
- With cases
The longer time elapsed after statement is made, the less likely it’s a Term
- Routledge v Mckay
What does Goss v Lord Nugent confirm about terms in contracts?
Parties are bound by all that is in contract
What does L’Estrange v Graucob confirm about Terms in contracts?
Parties are bound by their signature, whether they read the contract or not
What is an Implied Term?
A term implied into a contract through common law
- Business efficacy
- Custom/Prior Dealings
- Statute
Explain The Officious Bystander Test
- Steps of test
- Case establishing it
Two Part Test to ensure contract works from business standpoint
1) Is term necessary to make contract effective
2) If parties thought at the time, they’d would’ve agreed to put in in contract
- The Moorcock
Which case further develops step 2 of the Officious Bystander Test?
Shell v Lostock Garage
- To be implied, Parties would’ve agreed to it
Which cases establish Implied terms through customs and prior dealings?
Hutton v Warren
- Custom
Hillas v Arcos
- Prior Dealings
Which statute implies terms in contracts?
Which sections of statute?
Consumer Rights Act 2015
s9 - satisfactory quality
s10 - fit for purpose
s11 - goods match description
What a the different types of terms?
- Conditions
- Warranties
- Innominate Terms
What is a Condition?
So important, that failure to perform would ruin main purpose of contract.
Root of contract.
What is an innocent party entitled to for a breached condition?
- Supporting cases?
- Damages
- Contract Repudiation - Poussard v Spiers
What is a Warranty?
Minor Term - not root of contract
What is an innocent party entitled to for a breached Warranty?
- Supporting cases?
Damages - Bettini v Gye
What is an Innominate Term?
- Supporting case?
Neither Condition nor warranty
- Courts consider seriousness of breach to determine term status
Hong Kong Fir Shipping v Kawasaki Kisen Kaisha
What are the key elements of an Exclusion Clause?
- Incorporation - Is clause in contract?
- Construction - Is loss covered by clause?
- Legislation - Is clause legally permitted?
What are the rules of Incorporation?
- including Onerous terms
Bound by Signature
- L’Estange v Graucob
Reasonable notice
- Thornton v Shoe Lane Parking
Previous Dealings
- Hollier v Rambler Motors
Onerous terms need extra notice
- Interfoto v Stiletto
What are the rules of Construction?
Clause not permitted if destroys purpose of contract
- Glynn v Margetson
Only Exempt from what clause explicitly says
- Andrew Bros v Singer
Contra Preferentum Rule
- Wallis, son and Wells v Pratt and Haynes
Which Legislation is referred to when considering exclusion clause credibility?
- Consumer Rights Act 2015 (CRA 2015)
- Unfair Contract Terms Act 1977 (UCTA 1977)
What does the CRA 2015 state for Exclusion Clauses?
Cannot exclude:
- Death/Personal injury
- Breach of terms as to goods (s9-11)
- Breach of terms as to services (s49-52)
Unfair contract on consumer isn’t binding
- Unfair = Significant Imbalance
What does the UCTA 1977 state for Exclusion Clauses?
- Supporting Cases?
Cannot exclude:
- Death/Personal Injury
Only Valid if reasonable:
- loss from D’s negligence (Smith v Evans)
- failed/part/different performance
What is the test for reasonableness when considering UCTA 1977?
- Supporting Cases?
- Strength of bargaining power (Watford Electronics v Sanderson CFL)
- Whether customer was induced to agree
- Whether customer knew of existence/extent of term
- Whether gods were customer special order
