Terms v Representations Flashcards
What is the general test for incorporation?
Heilbut – a statement will be a term of the contract “provided it appears on the totality of the evidence to be so [objectively] intended at the time of the contract”
What is the relevance of the timing of the statement?
Inntrepreneur - The longer the interval between the statement and the contract, the greater the presumption that the parties did not intend the statement to have contractual effect in relation to a subsequent deal.
What is the relevance of intervening negotiations?
Inntrepreneur - if the statement is followed by further negotiations and a written contract not containing any term corresponding to the statement, the prima facie assumption is that the written contract includes all the statements the parties wanted to be binding between them.
Couchman
The statement was about the most important aspect of the subject matter so far as C was concerned (that the heifer he was buying was “unserved”); the court was thus persuaded the statement was a term.
What is the significance of the relative knowledge of the parties?
Where an expert makes a statement to an amateur (Dick Bentley), the statement is more likely to be a term; where the roles reversed, more likely to be a mere representation (Oscar Chess)
Oscar Chess
It is more difficult to imply a warranty where the seller, when stating a fact, makes it clear that he has no knowledge of his own, but is merely passing on info he got elsewhere.
Dick Bentley (r/s w/ Oscar Chess)
“If a representation is made in the course of dealings for a contract for the purpose of inducing C to act on it, and actually inducing him to act upon it by entering into the contract, this is prima facie grounds for inferring it was intended as a warranty.”
In Oscar Chess D rebutted this inference by showing that he honest and reasonably believed the statement was true and was completely innocent of any fault; moreover in Oscar Chess D was an amateur making a statement to a (relative) expert.
Dick Bentley (+ r/s w/ Oscar Chess)
“If a representation is made in the course of dealings for a contract for the purpose of inducing C to act on it, and actually inducing him to act upon it by entering into the contract, this is prima facie grounds for inferring it was intended as a warranty.”
In Oscar Chess D rebutted this inference by showing that he honest and reasonably believed the statement was true and was completely innocent of any fault; moreover in Oscar Chess D was an amateur making a statement to a (relative) expert.
What is the significance of the relative knowledge of the parties?
Where an expert makes a statement to an amateur (Dick Bentley; Esso Petroleum), the statement is more likely to be a term; where the roles reversed, more likely to be a mere representation (Oscar Chess)
Esso Petroleum
If D is a relative expert, making a forecast intending that C should act upon it and on which D does act, the statement may be interpreted as containing a warranty that the forecast is made with reasonable care and skill.
Esso Petroleum (r/s w/ Dick Bentley)
If D is a relative expert, making a forecast intending that C should act upon it and on which D does act, the statement may be interpreted as containing a warranty that the forecast is made with reasonable care and skill
(NOTE the statement was NOT interpreted as a warranty that the forecast was accurate - probably because it was a forecast and not a statement of ascertainable fact, as in Dick Bentley)
Shawel v Reade
Where D encouraged C to rely on his assurance w/o seeking external verification of its accuracy this will readily persuade the court that the statement was a term
Ecay v Godfrey
D had recommended that C have a survey of the boat, and this encouragement of external verification was inconsistent w/ any supposed intention of D to warrant that the boat was fine
