Contract 1Contractual terms, Express terms

Statements made (

•The injured party may not have entered into the contract were it not for the statement (Bannerman v White – claimant enquired whether sulphur was in the hops because he would not be able to use it. The seller assured that there was none. Action succeeded because the sellers word amounted to a term

Was it reduced in writing

•If the statement was not incorporated then it was not intended to be a part of the contract (Routeledge v Mckay – no mention was made of date or model of the motor bike . Held that what the parties intended to agree on was recorded)

Special knowledge/skill of the maker

•Maker of the statement has specialist knowledge (Oscar Chessman v Williams – def sold a car he introduced as being of a certain year as was seen on the registration that was altered without his knowledge. Turned out the car was of a different age. Court held that the statement was not a term of the contract because the seller had no special knowledge

Importance of the P/Buyer’s promise

•Level of reliance on the statement. (Bannerman v White)

Terms of contract – indicates the scope and nature of the obligations

Terms forms a part of the contract and if they are untrue they represent a breach (full range of remedies (Bannerman v White)

Representation does not form a part of the contract but helps to persuade/induce the contract ( limited remedies – Oscar Chessman –sale of morris car under the wrong date)

Representation v Terms

Things that are not essential will not be allowed to vary the contract e.g exclusion of oral statements to add to, vary or contradict

The Principle: refers to the Parole evidence, the use of collateral contract, Incorporation. It also considers Condition, innominate terms, warranty

Written Contract

•Grounds of convenience on this rule certainty in written agreements, timing of contract and what was said (Normally reviewed what was said in the negotiations and that may be admissible

•Note the exceptions

Record or transaction embodied and extrinsic

evidence is not admissible to vary or interpret the

document•Gillespie v Cheney – even though the parties have a written agreement it is deemed that they intended the terms . It is open for either of the parties to allege that there was in addition to what is written an antecedent stipulation, which ought not to have been excluded.

Partly oral and Partly written is admissible

Implied Terms – Contract is silent on a matter which is a term implied by law (sales of goods act, fact and conduct

(Smith v Hughes), parole evidence may be given to

support or rebutt

Parol Evidence

• Pym V campbell – a written agreement was drawn up for the sale of patent and evidence was issued of an oral stipulation that the agreement should not be operative until a 3rd party had approved the inventionParole evidence can be

used that the contract is not yet operative:

• (City & Westminster Properties v Mudd – Def had been a tenant over a course of time and at his least renewal, it included a clause indicating that it was for business purposes. Before signing he asked whether he could sleep there and when he was told yes he continued to sign. Assurance contradicted the lease but evidence of it was admissible to prove a collateral contract

Collateral Contract: Cannot add anything but shows that the

parties made related contracts

Inclusion of terms recognized as valid must be fulfilled:

1) Notice must be given before or during the agreement of contract (Olley v Marlborough –a notice in the hotel room that sought to exclude them from liability in anything was lost. Notice was ineffective contract was already signed, and was a not a part

Must be in a document contractually binding( Chappel ton v Barry – Plaintiff received a receipt that stated that the def would not be responsible any accident or damage. P fell through the torn canvass, though UDC was negligent the notice on the ticket prevented liability

Reasonable steps by the party who formed the term to inform the others party (Obrien v MGN – newspaper offered a scratch card completion and by mistake the cards awarded more prize than anticipated, they tried to have the rules excluded since they had not printed in the newspaper that day, the rules were incorporated and continually binding because the card stated that there were rules

Incorporation in terms

Conditions –

• Sets rights and obligations for the parties in a contract, (Pym V campbell – a written agreement was drawn up for the sale of patent and evidence was issued of an oral stipulation that the agreement should not be operative until a 3rd party had approved the invention

• May be called Condition –should be brought to an end on the happening of a given event

Innominate terms

• Is not a condition/warranty, rather examines the breach and whether the innocent party suffered substantially so as to end the contract.

• Hong Fir Shipping v Kawasaki – P ended contract because ship for hire was suppose to operate for 2 years but broke down for 5 weeks. P still had 20 weeks and so it was not a substantial lost and should not have needed the contract

Warranties

• Are minor terms not central to the root of contract (Betini v Gye –Plaintiff missed several rehearsals and was sacked. Held that missing rehearsals did not go to the root of the contract)

• For breach the innocent party can claim but cannot end the contract

Categorization of terms