Terms Implied At Common Law

Question 1

What are terms implied through custom?

Answer 1

Where a term is common in the trade the courts may imply a term in a contract of he same type in that trade (Hutton v Warren - farming compensation for work done).

Question 2

What are terms implied in fact?

Answer 2

These are based on the intention of the parties and two tests have developed, the business efficacy test and the officious bystander test.

Question 3

What is the business efficacy test?

Answer 3

It asks whether it was necessary to give the contract business sense (The Moorcock - damaged boat when mooring).

Question 4

What is the officious bystander test?

Answer 4

Had an officious bystander been present at the time the contract was made and suggested a term be included, it must be obvious that both parties would agree to it (Shirlaw).

Question 5

What are terms implied in law?

Answer 5

They imply them into contracts of a specific type I.e. Landlord/tenant, where the law generally offers some protection to the weaker party (Liverpool Council v Irwin).

Question 6

In what circumstances will the courts imply terms into contracts?

Answer 6

Through custom
Fact
Law