Please enable JavaScript.
Coggle requires JavaScript to display documents.
Contents and Interpretation (Classifying Express Terms (Conditions (terms…
Contents and Interpretation
Express Terms
Contracts in writing
:
Parol Evidence rule
- parties intended their written contract will contain all the agreed terms, evidence of other terms will not be allowed
Collateral contract
: exception to the parol evidence rule
Three conditions to be satisfied-
Collateral promise must not be inconsistent with the main contract
Collateral statement must be a contractual promise
Promisee must give consideration - usually the consideration is entering into the main contract
Van Den Esschert v Chappell
- vendor assured purchaser there were no termites in the house - collateral contract - there were termites, recover cost of treatment and damages
Incorporation by signature
: bound by signature regardless whether read or understood it before signing - contract only
Contractual in nature?
: If the document containing the clause is one which a reasonable person would not expect to contain contractual terms, would regard as a
receipt or voucher
, than an exclusion clause contained in it cannot be relied upon to exclude liability
Causer v Brown
- dress damaged at the dry cleaner - docket printed conditions - not a contract dry cleaners liable
Le Mans Grand Pix v Illiadis
- marketing form was rushed through - no notice of the contract in existence
L'Estrange v F Graucob
- exclusion clause effective because the contract was signed, 'when a document containing contractual terms is signed then in the absence of fraud party signing is bound'
Todd v Alphapharm
- court held that the person who signs has either read and approved the contents or is willing to take the chance of being bound by those contents
Partly written, partly oral and oral contracts
:
which statements were intended to be terms of the contract and which were representations
Identifying the terms
: term, mere puff, representation, promise - was an express pre-contractual statement a promise (likely to be a term) or a representation (non contractual)
-Time lapse
-Importance of the statement
-Knowledge/skill expert likely to be a term
Oscar Chess v Williams
- not correct car model as previous owner fraudulently altered the date, no promise that the car was that model, innocent misrepresentation, 'i believe' not 'i guarantee'
Dick Bently v Harold Smith
- purchase of a car under the belief it had only done 20,000 miles, court held that it was a term of the contract, influenced cause vendor was a car dealer (knowledge/expert)
Ross v Allis-Chalmers Australia
- salesman statement on a harvester was not a term of the contract, merely a statement of opinion, based on experience, not intended to be promissory
Classifying Express Terms
Conditions
(terms that are of fundamental importance / root of the contract)
terminate the contract and/or claim damages
Warranties
(terms that are of lesser importance)
damages for the loss suffered
Innominate term
(uncertain whether condition or warranty) assess nature and effect of the breach
Associate Newspaper v Banks
- cartoon published on page 3 not page 1 - court held it was a condition of the contract, breach which entitled to treat the contract as an end
Bettini v Gye
- singer arrived 2 days early not 6 days due to illness, was only a warranty not a term - not entitled to treat the contract as an end, clause did not go to the root of the contract
Hong Kong Fir Shipping v Kahasaki Kisen Kaisha
- not all contractual understandings are easily classified, assess extent of breach
Exclusion clause
: a clause that purports to limit or exclude one party's liability for loss incurred to the other
An exclusion clause will be construed strictly and any
ambiguity
resolved under the person relying on it - way to allocate risk -ambiguity in favour of consumer (contra proferentum rule)
Exclusion clause will not normally protect where the act is done
outside
the scope of the contract -
4 corners rule
Council of the City of Sydney v West
- stolen car in car park - act was 'unauthorised' parties would not contemplate it
Reasonable notice
: notice of exclusion must be given before or at the time the contract is made - after this will have no effect - steps that are reasonably sufficient in the circumstances to give notice of the exclusion clause - prior course of dealing could be reasonable notice
Alameddine v Glenwoth Valley horse riding* - contract made when activity was paid for online, application form on the day of the activity was not part of contrac
Photo Production v Securicor Transport
- fire started by security, the exclusion clause was clear and unambiguous and protected securicor from liability
Olley v Marlborough Court
- loss of clothing from hotel, contract made at the hotel desk to late when in room, hotel liable
Alameddine v Glenwoth Valley horse riding
- contract made when activity was paid for online, application form on the day of the activity was not part of contract
Ambiguity and uncertainty
/
interpretation issue
, what would a 'reasonable person' say
Look at the contract as a whole
Give effect to the objective intention
Evidence of surrounding circumstances were language is ambiguous
Common sense approach, need to arrive at a sensible commercial result
North East Solutions v Masters Home Improvements
- Woolworths breached obligation to act in good faith, must act in a manner thats fair to the deal
Insight Vacations v Young
- matter of interpretation clause did not protect the bus company, only when seated, company liable
Implied terms
Terms may be implied by the court, custom or trade usage or statute - terms implied to give '
business efficiency
' done by the courts with the presumed intention of the parties
The Moorcock
- intended that the berth would be safe for the ship, implied term, breach, no reasonable care
Codelfa
- tunnel needed to be finished by a certain time, change, couldn't work at night, not implied that that meant that the tunnel would be finished late, end of contract due to frustration
reasonable and equitable
necessary to give business efficacy to the contract so obvious that it 'goes without saying'
capable of clear expression
must not contradict any express terms of the contract