Management and Organizational Studies 2275A/B Chapter Notes - Chapter 7: Liquidated Damages, Condition Subsequent, Parol Evidence Rule
3 Oct 2016
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The terms of a contract simply refer to promises made by one party to another by virtue of offer and acceptance. A contract is a business tool that can be used to manage a business"s exposure to liability. Terms: contractual terms can be express or implied, express terms. An express term is a provision of the contract that states or makes explicit one party"s promise to another. Essential terms of a contract be expressed so that each party knows its obligations and the obligations of the other side: judicial interpretation of express terms. There may be problems interpreting what it means because the language is vague or ambiguous. The policy rationale for this rule is that the drafter should bear the risk of unclear language. The court simply asks how a reasonable person would regard the term in question and can refer to dictionaries, legal reference materials, and cases that have considered such terms in the past.
