Week Seven

Question 1

What are the three ways express terms can be incorporated?

Answer 1

Signature

Reference at the time of contracting

By course of dealing between the parties

Question 2

What cases set a precedent regarding incorporation by signature and what that means?

Answer 2

Sundolitt v Addison [2017] - A signature is an indication assent

Montgomery Litho Ltd v Maxwell 1999 - When signing an agreement, unusual or special conditions must be highlighted and brought to the parties attention

Question 3

When are terms deemed contractual?

Answer 3

Terms are incorporated if the document referring to them is contractual (e.g., a ticket for a bus).

Question 4

Why is the timing of the reference critical in the incorporation of terms?

Answer 4

The timing of the reference is critical to ensure the terms are incorporated at the time the contract is formed.

Question 5

What cases are concerned with reference to the terms and conditions? What precedent do they set?

Answer 5

Taylor v Glasgow Cooperation - A reasonable person would not inspect a voucher for contractual terms

Thornton v Shoelane Parking - There must be sufficient notice to review onerous terms for it to be enforceable

Chapelton v Barry Urban District Council - Receipts are not contractual documents and exclusion clauses require sufficient notice to be enforceable

Olley v Marlborough Court Ltd - Further terms cannot be incorporated after the contract is concluded

Question 6

What cases set a precedent regarding the knowledge of terms in a ticket?

Answer 6

Parker v South Eastern Railway Co (1877) - It must be highlighted beforehand if a ticket contains terms otherwise its unreasonable notice

Thompson v London, Midland and Scottish Railway Co - If there was reasonable steps taken to bring the terms to the attention of the person regardless of whether they can read them or not its valid

Question 7

What cases are concerned with course of dealings and the precedents they set?

Answer 7

McCutcheon v MacBrayne - Due to companies negligence there was no risk note signed, because there wasn’t a consistent course of dealings the clauses from previous deals didn’t apply

British Crane Hire Corporation Ltd v Ipswich Plant Hire - Where parties are in the same trade, it will usually be easier to establish a course of dealing

WS Karoulias SA v Drambuie Liqueur Co Ltd - no binding contract because parties an established practice of requiring formal execution for their agreements - its possible for course of dealings to preclude contractual effect

Question 8

What are the four approaches to the interpretation of a contract?

Answer 8

Literal - what does the contract say and what are the ordinary meanings of the words concerned?

Factual Matrix - Based on three key elements

The iterative approach - Mix of both literal and factual matrix approaches

Contra Proferentum - Usually applied to contract with standard terms, where the court will interpret against the party seeking to rely on the clause.

Question 9

What are the three key elements of the factual matrix approach to the interpretation of a contract?

Answer 9

The whole commercial context.

Commercial sensibility - commercial awareness of the relevant market (e.g. R&J Dempster v Motherwell Bridge and Engineering Co.)

Prior cummings - what was known to both parties before contract was concluded

Question 10

What case is concerned with the whole commercial context and what precedent it sets?

Answer 10

Arnold v Britton - commercial common sense (intention for both parties) is important but cannot be used to contradict the plain langauge of a contract

Question 11

“No need for ambuiguity of words for a contract dispute” what case?

Answer 11

Luminar Lava Ignite Ltd v Mama Group [2010] CSIH 1

Question 12

What case highlights contra profenendum and the precedent / details of the case ?

Answer 12

Life Association of Scotland v Foster (1873) - She did not conceal material facts about her health that would invalidate the insurance, so the insurance company was obliged to pay when dealing with ambiguity the courts will favour the person who relied upon the clause

Question 13

What is Contra Proferentum?

Answer 13

Contra proferentem is a legal doctrine that interprets ambiguous contract terms against the party that drafted the contract.

Question 14

What is rectification?

Answer 14

Rectification is a legal remedy that allows a court to change a written document to reflect the parties’ true intentions. It’s an equitable remedy, which means that its application is limited to certain circumstances.

Question 15

The Law Reform (Miscellaneous Provisions) (Scotland) Act 1985 concerning Rectification states what?

Answer 15

a document intended to express or to give
effect to an agreement fails to express
accurately the common intention of the
parties to the agreement at the date when
it was made – s8(1)(a)

[the court] may order the document to be
rectified in any manner that it may specify
in order to give effect to that intention –
s8(1)

Protection for third parties – s9

Question 16

What are the four latin terms introduced and what they mean?

Answer 16

condictio indebiti – a claim for
repayment of a sum not due

condictio causa data causa non secuta
– a claim for something given for a
cause that has failed

condictio ob turpem vel iniustam
causam – a claim for something given
for a corrupt or unlawful cause

condictio sine causa – a ‘sweep up’
claim for things given withou

Question 17

What are the three Rs in the context of unjustified enrichment?

Answer 17

Repetition – return of money

Restitution – return of property

Recompense – repayment of unjustified expenditure for unjustified use

Question 18

What is Negotiorum Gestio?

Answer 18

Negotiorum gestio is a legal term that describes when someone acts on behalf of another person without their consent, but with the intention of helping them

Question 19

What case is highlighted through the Iterative approach and the precedent / details of such?

Answer 19

Wood v Capita Insurance Services - Capita wanted to recover compensation due to a mis sold insurance policy under a indemnity clause, it was deemed that an indemnity clause was intended to cover loses arising from customer claims and complaints not from self reporting - Reinforces that its important to consider the contract as a whole and choose whatever is aligned with the commercial purpose of the contract

Question 20

What cases are concerned with Prior Communing and the precedents they set?

Answer 20

Bank of Scotland v Dunedin Properties 1998 SC 657 - Prior dealings indicated an understanding of breakage costs this infers that prior communication can be an indication of understanding?????

Chartbrook v Persimmon Homes [2009] - Prior negotiations are not admissible for interpreting the terms of a contract

Question 21

What cases are concerned with commercial sensisbility and the precedents of them?

Answer 21

R&J Dempster Ltd v Motherwell Bridge and Engineering Co Ltd [1964] - a contract can be binding even if some terms like price are to be agreed upon later allowing for businesses to proceed with confidence

Rainy Sky SA v Kookmin Bank [2011] - Interpretations that align with business common sense should be preferred but if language is clear and unambiguous then it must be applied even if its commercially improbable