Notesale: Turn your study into money

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CONTRACT – Terms (lectures 9 and 10)
Any term of a contract must be clear and certain
...
Mere puff
(advertising hyperbole) and mere representation (statement of fact) are NOT terms
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The first step in relation to terms is to
see if the statement is incorporated into the contract
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‘Implied terms’ (terms that neither party has necessarily seen), which can be implied by the
courts at common law: in law (necessary to contract) OR in fact (business efficacy to contract –intention imputed to parties), and can implied by statute
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Implied terms are those to which
no direct reference has been made
during negotiations
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Was the statement when it was
made, was it clear the statement
was important? – Bannerman v
white
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TERMS IMPLIED IN LAW

‘Use of the word
‘condition’ is an
indication of the
parties intentions, but it
is by no means
conclusive’ – Schuler v
Wickman

2
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Reduction into writing –
Inntrepreneur Pub Co v East
Crown Ltd
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Specialist knowledge – Oscar
Chess v Williams; cf Bentley v
Harold smith (motors)
2
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However, in Hopkins v
Tanqueray, the delay was too long
i
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PAROL EVIDENCE RULEExtrinsic evidence may not be
adduced to vary an express written
contract – Jacobs v Batavia
If you have a written contract,
nothing outside should be allowed
into it
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However, in
Photolibrary Ltd v Burda Senator
Verlag, there was a course of
dealing
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The test: “something so obvious that
it goes without saying” – Shirlaw v
Southern Foundries
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Not wholly written contracts- J
Evans & Sons v Andrea Merzario
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2
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Where terms ‘onerous’ –
Interfoto v Stiletto
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Sale of Goods Act 1979 – implies
terms into a contract
S12 Title (can’t sell something you
don’t own ie nemo dat qui non
habet)– Rowland v Divall
S13 Description – Arcos v Ronaasen
S14 Quality or fitness – Priest v Last
– only applies to sales made in the
course of business
S15 Sample – Godley v Perry

Avoiding the argument
Sale of Goods & Services Act 1982
Include the entire agreement
clause – Inntrepreneur Pub Co
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If the term is a WARRANTY, the innocent
person only has a right to sue for damages only,
not to terminate
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Agent was
entitled to terminate
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Not such a serious
breach as he only missed 3 days of rehearsals
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Contingent conditions ie clause in the contract
by which the contract hangs
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Generally: Judiciary –
Hong Kong Fir v
Kawasaki Kisen Kaishi
“goes to the root of the
problem”
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ALWAYS A
CONDITION: Specific
terms: Judiciary –
precedents which have
established certain
terms as conditions:
expected ready to load
(The Mihalis Angelos);
time of performance
(Bunge v Tradex)

HOW IS A CONDITION CLASSIFIED? Statute, parties intentions, judiciary
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All conditions unless s15(A) applies ie if
business buying from another business and
breach if so slight as to make termination so
unreasonable S13-15 (the breach) might be
treated as a warranty
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Note: S13 SGSA 1982 “reasonable & skill” is
always an innominate term
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Classification by the parties
Courts usually give effect to parties intention –
Lombard North Central v Butterworths, BUT
not always – Schuker v Wickman

INNOMINATE
TERMS
Contract doesn’t
specify that it is a C or
W, OR the terms
cannot be catergorised
as being a C or W
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