BLAW 1320: Representations and Terms — Chapters 9, 11 & 12

Vocabulary flashcards covering representations, terms, misrepresentation, remedies, and related contract concepts from Chapters 9, 11, and 12.

Pre-contractual statements

Statements made during negotiations that may be puff, representations, or terms; puff has no legal consequences, representations induce contract, terms become enforceable promises.

Puff

Exaggerated statements about a product’s benefits with no reliable basis; generally no legal consequences.

Representations

Statements of fact made during negotiations that induce contract but are not themselves contractual promises unless incorporated as a term.

Contractual term

A promise that becomes part of the contract and is enforceable as a provision of the agreement.

Express term

A contractual term that is explicitly stated by the parties, whether spoken or written.

Implied term

A term not expressly stated but understood to form part of the contract, by court or statute.

Parol Evidence Rule

Rule limiting the use of evidence outside the written contract to change its terms, with some exceptions.

Condition (true condition precedent)

An event that must occur before the contract comes into existence; suspends creation of the contract until it occurs.

Condition subsequent

An event that, if it occurs, terminates the existing contract.

Time of essence

A clause making timely performance essential; breach may discharge the contract.

Rescission

Equitable remedy canceling the contract and restoring parties to pre-contractual positions.

Accord and Satisfaction

A new agreement with new consideration that discharge the original contract upon performance.

Novation

Replacing an old contract with a new one, potentially involving different parties; original obligations are discharged.

Release

Discharge of contractual obligations under seal, typically without new consideration.

Waiver

Voluntary relinquishment of a known right; requires clear intent and can be revoked in some cases.

Breach

Failure to fulfill a contractual promise; the breach type determines available remedies.

Condition vs. Warranty vs. Intermediate term

Condition: essential term; Warranty: less essential; Intermediate: uncertain importance—may be treated as either.

Expectation damages

Damages intended to place the plaintiff in the position as if the contract had been performed.

Reliance damages

Damages to restore the plaintiff to the position before the contract was made by reimbursing wasted costs.

Account of profits / Disgorgement

Damages equal to the defendant’s net gain from the breach; restores to plaintiff and deprives defendant of unjust benefit.

Nominal damages

A small, symbolic sum awarded when a breach occurred but no actual loss was proven.

Liquidated damages

A pre-agreed amount set in the contract to be paid on breach, valid if a genuine estimate of loss; not a penalty.

Specific performance

Equitable remedy ordering a party to perform the contractual obligation, used when damages are inadequate.

Injunction

Equitable remedy ordering a party to refrain from or to do a specific act to prevent harm.

Unjust enrichment

A cause of action where one party has benefited at another’s expense without legal justification; restitution is the remedy.

Restitution

Restoring the value of benefits conferred when there is unjust enrichment; may involve returning money, property, or its value.

Innocent misrepresentation

False statement made honestly, without knowledge of falsity; remedy typically rescission (and possibly restitution) but not tort damages.

Negligent misrepresentation

False statement made carelessly or negligently; remedies include rescission, restitution, and tort damages.

Fraudulent misrepresentation

False statement known to be false or made with reckless disregard for truth; remedies include rescission and tort damages.

Contra proferentem

Ambiguities in a contract interpreted against the drafter of the clause.