Terms Of A Contract - Terms Flashcards
What are terms?
Terms in a contract are what the parties agreed between themselves. Define all obligations of both parties.
What is a condition?
A condition is an IMPORTANT term. If no complied with main purpose there will be a breach and the contract can be ended.
Case: Poussard v Spiers and Pond (Broke her contract as her role was central to performance but damages could be claimed)
What is a warranty?
A MINOR term, contract will not end but damages may be claimed.
Case : Bettini v Gye (singer entitled to damages, but owner couldn’t end contract as it was minor term)
What is an innominate term?
An innominate term is where it is unclear if it is a condition or warranty. The judge will make a decision depending on consequences of the breach.
What is a substantial benefit?
If the breach denies you of a substantial benefit then it is a condition, if the breach doesn’t deny you of a substantial benefit it will be a warranty.
Case : Hong Kong Fir Shipping Co. Ltd v Kawasaki Kisen Kaisha ltd (ask if breach has substantially deprived a whole innocent party of the whole benefit)
What is intention of the parties?
Judges may take into account the intention of both parties, if there is an error a judge can make a decision based on what is just rather than following a rule which would lead to injustice.
Case: Arnold v Britton (Judged based on what the reasonable person have all the background knowledge would have understood the contract to mean)
