BLAW10001 Study Guide - Final Guide: Efficiency Ratio, Passive Underwater Fire Control Feasibility System, Parol Evidence Rule
BLAW CH 6 – THE TERMS OF A CONTRACT
WHAT IS A TERM?
• A particular agreed promise made in circumstances that enables the inference that it
was legally binding
• Tes of a otat → the entire contents of a legally enforceable agreement
• Terms define the rights & duties of parties
• Terms are the yardstick by which contractual performance is measured
FREEDOM TO CONTRACT:
• The law allows contracting parties the freedom to form contracts w/o interference
• Some general limits – illegal undertakings not enforceable
PROVING THE TERMS OF A CONTRACT:
WHOLLY ORAL CONTRACTS
• Terms established by evidence from parties/other witnesses
PARTLY WRITTEN/PARTLY ORAL CONTACTS
• Terms established by oral & written evidence
o SEE: Van den Esschert v Chappell (1960)
WHOLLY WRITTEN CONTRACTS
• Terms proved with reference to the written contract alone
o parol evidee ule
o Ciustaes hee this ule DOESNT appl:
▪ Evidence supporting rectification (correction)
▪ Evidence that written contract only part of agreement
▪ Uncertainty in written document (via interpretation)
STATEMENTS NOT TERMS OF CONTRACT:
PUFFS
• Exaggerated statements made by a party to engage, attract others into contracts
• Do not become part of the contract
OPINIONS
• Statements of personal views/beliefs
• Even if wrong, the opinion does not create legal liability if honestly made
REPRESENTATIONS
• A statement of fact made by one party when negotiating a contract
• Do not become terms of the contract unless the statement was intended to be a binding promise
o SEE: Oscar Chess Ltd v Williams (1957); Handbury v Nolan (1977)
• A representation that proves untrue = misrepresentation
o Misrepresentations can be:
▪ Deliberate (fraudulent)
▪ Careless (negligent)
▪ Result of error (innocent)
o Misrepresentations are still not terms of the contract & do not amount to a breach
TYPES OF TERMS IN A CONTRACT:
CONDITIONS
• Terms fundamental to the contract
WARRANTIES
• Terms of less important than conditions
• Determining whether terms are conditions or warranties → test of essentiality
o Would the party have entered the contract without this specific term?
o Factors relevant in assessing this include:
▪ Previous decisions
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Document Summary
Freedom to contract: the law allows contracting parties the freedom to form contracts w/o interference, some general limits illegal undertakings not enforceable. Partly written/partly oral contacts: terms established by evidence from parties/other witnesses, terms established by oral & written evidence, see: van den esschert v chappell (1960) Opinions: exaggerated statements made by a party to engage, attract others into contracts, do not become part of the contract, statements of personal views/beliefs, even if wrong, the opinion does not create legal liability if honestly made. Blaw ch 6 the terms of a contract. Language used to describe obligation: other terms of the contract. Innominate terms: so(cid:373)eti(cid:373)es (cid:272)ou(cid:396)ts (cid:272)all te(cid:396)(cid:373)s i(cid:374)(cid:374)o(cid:373)i(cid:374)ate i(cid:374)stead of (cid:858)(cid:272)o(cid:374)ditio(cid:374)s(cid:859) & (cid:858)(cid:449)a(cid:396)(cid:396)a(cid:374)ties(cid:859, see: associated newspapers (1951); bettini v gye (1876) Expressed terms: terms that have been declared or definitely stated (written or oral, terms expressly agreed to by, being discussed. Included in a signed document: referred to on a ticket/notice.
