Terms

1. What do some statements made during negotiations remain, and what do others become?

Some statements made during negotiations remain representations - something said by one of the parties to the other - but some become actual terms of the contract.

2. Why is the distinction between representations and terms important?

This is an important distinction: if a representation is broken, the innocent party’s action is for misrepresentation; if a term is broken, the innocent party’s action is for breach of contract. These two actions have different remedies.

3. How might the courts distinguish between representations and terms?

The courts will look at different factors to distinguish between representations and terms.

4 (OIR). What is one factor when distinguishing between representations and terms relating to importance?「」

The importance attached to the representation (Couchman v Hill).

5 (OIR). What is one factor when distinguishing between representations and terms relating to specialist knowledge or skills?「」

The courts will ask whether the person who made the statement had a special knowledge or skill compared to the other party. If he did, then it is more likely that the statement is a term rather than a representation (Oscar Chess Ltd v Williams).

6 (OIR). What is one factor when distinguishing between representations and terms relating to time?「」

A general but not invariable rule is that the less time there is between the making of the statement and the formation of the contract, the more likely it is that the statement is a term rather than a mere representation (Routledge v Mckay).

7 (OIR). What is one factor when distinguishing between representations and terms relating to oral and written statements?「」

If the statement was oral and then the contract was put into writing, then arguably the parties did not intend the statement to be included as a term of the contract.