Terms of a contract

Question 1

define a term

Answer 1

‘what the parties have agreed between themselves and define the extent and limit of their respective obligations’

Question 2

what is a representation

Answer 2

a pre-contractual statement

Question 3

if representation is broken, what is the innocent party’s action for

Answer 3

misrepresentation

Question 4

if a term is broken, what is the innocent party’s actions for

Answer 4

breach of contract

Question 5

what are the 4 guidelines for distinguishing between a term or representation

Answer 5

1. the importance attached to the representation
2. special knowledge/ skill of party making the representation
3. time between making representation + contract
4. whether agreement including the statement is in writing

Question 6

what case refers to the first guideline (the importance attached to the representation) + LP

Answer 6

Chouchman v Hill - statement to farmer was so important that farmer could claim for breach of contract

Question 7

in what case did the dealer relying on their own skill result in the statement not being a term, just misrepresentation

Answer 7

Oscar Chess Ltd. v Williams

Question 8

in what case did the representor using their own special knowledge result in the representation becoming a term

Answer 8

Dick Bently Ltd. v Harold Smith Motors

Question 9

what case sates that the lapse of time between making the representation and the contract was too wide so the representation did not become a term

Answer 9

Routledge v McKay

Question 10

what case states that, where a contract is in writing, and a statement made orally between parties is not included, the courts generally infer that it was not intended to form part of a contract, so is mere representation

Answer 10

Routledge v McKay

Question 11

what are expressly agreed terms

Answer 11

the terms of a contract

Question 12

what are implied terms

Answer 12

terms implied into a contract even though they do not appear in a written agreement/ oral negotiations

Question 13

terms are implied for 1 of 2 reasons - what are these

Answer 13

1. court trying to give effect to the intention of the parties (TERMS IMPLIED BY FACT)
2. law requires certain obligations are included in a contract (TERMS IMPLIED BY LAW)

Question 14

what are the 4 examples of terms implied by fact

Answer 14

1) to give ‘business efficacy’ to a commercial agreement
2) terms implied by custom or habit
3) because of prior conduct of contracting parties
4) terms implied by statute

Question 15

explain ‘terms implied to give business efficacy to a commercial agreement’ with a case and the 2 tests

Answer 15

court will apply a term if necessary to make sure a contract works on a business like basis.
2 tests set out in The Moorcock for a term to be implied:
1. term needed to make contract effective
2. parties had thought of it, would they have agreed that suggested term was obviously going to be in the contract?

Question 16

in what case was a term implied into a contract as it existed as a matter of custom

Answer 16

Hutton v Warren

Question 17

explain ‘terms implied because of prior conduct of contracting parties’ with a case

Answer 17

where parties to a contract have a prior history of dealing on particular terms, if those terms are not included in a later contract they may be implied into it if the parties are dealing in otherwise similar terms - Hillas v Arcos

Question 18

what is the official bystander test and what case does it come from

Answer 18

test to identify if a term will be implied into a contract - Shirlaw v Southern Foundries

Question 19

what are terms implied by statute

Answer 19

terms which parliament decided should automatically be included in all contracts of a particular type

Question 20

what are the 3 terms implied by statute

Answer 20

i) The Consumer Rights Act 2015
ii) The Sale of Goods Act 1979
iii) Supply of Goods & Services Act 1982