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Terms - Coggle Diagram
Terms
Types of Terms
Conditions
A term which is fundamental to the contract - failing to perform this term would make the whole contract meaningless. (Poussard v Spiers) Breaking a condition allows repudiation and/or damages.
Warranties
A minor or secondary term to the contract. The contract is not meaningless if it is breached. (Bettini v Gye) Breach of a warranty allows a party to sue for damages only.
Innominate Terms
A term which cannot be identified as either a condition or warranty until it is breached. (Hong Kong shipping v Kawasaki) The court will look at the effect of the breach to determine what it is - has it substantially deprived the party of the benefit of the whole contract.
Implied Terms
Implied by Fact - terms that are not laid down in the contract but it is assumed both parties would have intended to include it. (Equitable life assurance v Hyman) Courts consider if it is:
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Implied by Statute - terms that the law says have to be included, regardless of the wishes of the parties. (Liverpool City council v Irwin spring v Guardian assurance)
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Express Terms
Pre-contractual statements that become a part of the contract as a term. In order for a statement to be a contract term, it must be incorporated into the contract and the courts will consider:
Importance attached
Where parties communicate how important an aspect is then it will be considered as incorporated into the contract as an express term. (Bannerman v White)
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Timing of the Statement
Courts will look at when the statement was made to consider if it was incorporated or not - the greater the time between the statement the less likely it is for it to be incorporated. (Routledge v Mckay)
Agreements in Writing
Courts will look at what it is actually written/included in the contract. if something is not written it isn't likely to be incorporated. (Routledge v Mckay)
Exclusion Clauses
Terms which limit or exclude contract liability. They must cover the alleged breach and must be incorporated by:
Signature - If a document is signed at the time of making the contract its contents becomes a term of the contract. (L'estrange v Graucob)
Reasonable Notice - if separate written terms are presented, they only become incorporated if it can be said the recipient had reasonable notice of them. (Parker v South eastern railway)
Previous Course of Dealings - If previous contracts contained exclusion clauses then these may apply to subsequent transactions. (Spurling v Bradshaw)
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Business - Business contracts is limited under Unfair contract terms act 1977 and imposes limitations.
UCTA 1977
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S.11 - is the term "reasonable and fair in all the circumstances which where known when making the contract".
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