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Lecture 10

LAW 122 Lecture 10: Lecture 10_ chapter 9

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Law and Business
LAW 122
Nick Iannazzo

LAW122 March 30, 2017 Lecture 10: chapter 9 Review from last class ● There are 3 types of statements: 1. contractual term 2. pre-contractual statements a. If statement is untrue b. Than it depends if the statement was factual (if yes than legal action may be taken) c. (predictions and opinions are not factual) 3. puffing ● What is not a fact ○ An opinion ■ eg. the stock market is going to go down tomorrow ○ Statement about someone else’s intentions ○ A statement about the law ■ Just a regular person, not a lawyer (since the lawyer is a specialist in law) ■ If the statement the person made to you law wise was wrong, than you should have known that they were lying since everyone must know the law ● What is a fact ○ Clear facts ○ Expert opinion, considered to be an amplified fact ○ My intention: I know what I am going to do ○ If a statement is made about the consequence of the law ■ Eg. Let say you know you need a building permit before you buy the property, then let's say the person says they already have a building permit to get you to buy the property, but they don’t actually have one. Therefore you can go to court Case study #1 - page 232 Is this a promise, a puff, or a factual statement/opinion a. “This floor wax is the best made anywhere in the world” i. Not a promise, can be considered as factual ii. Seymour is a supplier of cleaning products and therefore has knowledge on product b. An opinion - “I personally truly believe” c. A statement of fact - “studies have shown” i. A reasonable person would think this statement was a fact d. A promise - “i’ll come over and polish the floors myself for a month” e. Puffing - “i’ll eat my hat” The extreme Biker ● Facts: the statement was “i don’t find them difficult myself” LAW122 March 30, 2017 ● This statement would be considered a personal opinion and therefore is not a fact ● However, this can be considered as an expert opinion as well and therefore a fact ● Either way, ahmad cannot go to court Interpretation of Contract Terms ● Parties agree on the words but differ on interpretations ● Most contract litigation is about “interpretation” Contractual Terms ● Legal Purpose ○ Document Title; Document Purpose; Recitals ● Parties ● Terms and conditions ○ Description of Item/Equipment ○ Price ○ Consideration ○ Disclosures ○ Delivery & Risk of Loss ○ Warranty ○ Effective Date; Expiration Date ○ Remedies ○ Applicable Laws ○ Confidentiality ○ Force Majeure Issue with express terms: whose interpretation? 4 approaches 1. Literal approach (golden rule) a. words are given their plain and ordinary meaning 2. Contextual approach a. intentions and surrounding circumstances considered 3. Golden rule a. words given ordinary meaning unless result is absurdity 4. contra proferentem a. ambiguities interpreted against person who wrote the clause Renewal Clause ● Facts: Agreement between the landlord and tenant shall be effective from the date it is made and shall continue in force for a period of 5 years from the date it is made, and therefore for successive 5 year terms, unless and until terminated by one year prior notice in writing by either party ○ The contract will renew every 5 years ○ And be terminated by having a one year notice for the next term ● The issue: tenant wants to terminate the contract in the first 5 year, but the landlord says he can only terminate after the first term is finished ● One can say that the tenant can because it says unless and until ● But the landlord sees it as the unless being a different part because of the comma LAW122 March 30, 2017 ● If the contract were to be the way the landlord wants it than the sentence would have to get rid of the second comma ● Therefore the tenant won since the grammar was in his favour ● Side note: in context you can see that the parties intended to have a locked 5 years and the start of a second term. But because of the grammar it changed it ● This case was about Rogers and ______ ● This case went even longer, since there was actually 2 contracts one in english and one in french. So the court decided to use the French contract since it was crystal clear Case 9.2 on page 219 ● Issue: students accepted the 7000, not the 28000 ● The student side: golden rule - result is absurdity ( a 400% increase) ○ They did not make a cap ○ A reasonable person ○ contra proferentem - ambiguities interpreted ○ Contextual approach - intentions and surrounding circumstances considered ■ No student would think this type of increase will occur especially as a student getting by ● The school side: the literal approach - the students agreed to the adjustment ○ And agreed to without notice ● In court ○ They favoured the schools using the literal approach ● However if this contract is keeped than that would lower the school’s applications of students as they would not want to go there anymore if this is allowed Terms of a contract c
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