Contract law, Terms, OCR A level Law

The more important a representation is, the more likely it is to be a term

Couchman v Hill

Lack of knowledge means less of a term

Oscar Chess Ltd v Williams

More knowledge means more of a term

Dick Bentley Productions Ltd v Harold Smith (Motors) Ltd

A time lag can prevent a representation being included as a term

Routledge v McKay

Where a party has signed an agreement, they are bound by it

L'Estrange v Graucob (1934)

A condition is a term central to the contract, failure to perform would destroy the main purpose of the contract

Poussard v Spiers and Pond

A warranty is a minor term in a contract, main purpose of contract can be continued even after breach of warranty, can claim damages

Bettini v Gye

An innominate term is a term in a contract that is neither a condition or a warranty, they are ‘intermediate terms’

consequences of breach can be same as condition or warranty depending on seriousness of breach, so parties wait until the effect of breach to see how it is treated

Hong Kong Fir Case

Business efficacy test for implying terms

1. is the term necessary to make the contract effective?

2. if the parties had thought about the term would they have suggested it should obviously be in the contract?

The Moorcock

Officious bystander test - term so obvious that it doesn’t need to be stated in the contract as it goes without saying

Shirlaw v Southern Foundaries

if they never would have thought about it then won’t be a term - Shell v Lostock

Reasonableness is to be judged objectively when using the tests - what would a reasonable person agree to?

only one test needs to be satisfied

Marks and Spencer plc v BNP Paribas Services Trust Company (Jersey) Ltd

Terms implied by custom (local customs)

Hutton v Warren

Terms implied by prior dealings between the parties - prior conduct of the parties can indicate terms should be implied

Hillas v Arcos

Case where standard as to reasonable care and skill was reached

Thake v Maurice

Greek standards would not be rejected by reasonable holiday makers

Wilson v Best Travel

s9 CRA 2015

Goods to be of satisfactory quality  

• Reasonable person would consider them satisfactory

• Objective test

• Rogers v Parish, sale of a range rover

s.10 CRA 2015

Right of fitness for a particular purpose

s11 CRA 2015

The right relating to description (goods to be as described) - beale v taylor

S20 CRA 2015

The short-term right to reject

S23 CRA 2015

Right to replace or replace

s24 CRA 2015

Price reduction or final right to reject

s.49 CRA 2015

Contract to supply a service is treated as including a term that the trader must perform the service with reasonable care and skill

s50 cra 2015

service should be of reasonable price

s52 CRA 2015

Service has to be carried out within a reasonable time

where party misrepresents the exclusion clause it will be interpreted as the misrep not the written clause

Curtis v Chemical Cleaning and Dyeing Co. Ltd

Terms need to be made clear when a contract is made

Olley v Marlborough Court Hotel

The back of a ticket is no clear term

Chapelton v Barry Urban District Council

Thomspon v MLS Railway - especially where can’t read the clause and haven’t been told about it

Notices of the clauses need to be within view

Thornton v Shoe Lane Parking Ltd

Courts are reluctant to find implied terms from previous dealings

Mccutcheon v David MacBrayne Ltd

Exclusion clauses may not offer coverage for third parties (unless under The Contracts (Rights of Third Parties) Act 1999)

Scruttons Ltd v Midland Silicones Ltd

Contra Proferentem

Transocean Drilling UK Ltd v Providence Resources plc

s2 UCTA 1977

No exclusion of liability for personal injury or death caused by negligence

S6 UCTA 1977

Exclusion of liability in contracts for the sale of goods - clauses implied by statute like CRA cannot be excluded

S3 UCTA 1977

Liability for non performance - can't exclude unless reasonable (s11)

• Exclude or restrict liability for breach of contract

• Provide substantially different performance to that reasonably expected

• Provide no performance at all

s11 UCTA 1977

Reasonableness test  - court should ask itself whether the term was a "fair and reasonable one to be included having regard to the circumstances which were or ought reasonably have been known to the parties"

s12 ucta 1997

Party dealing as a consumer where they are not making the contract in the course of a business

Schedule 2

Can be reasonable to allow exclusion clause where:

• Customer received inducement - could have accepted higher cost w/o exclusion clause

• Customer should have known those clauses are in use in that trade

• Goods were special order of customer

• Exclusion relates to non-performance of condition whether it was reasonably practicable (capable of being put into practice) to comply with the condition

• Strength of bargaining positions

s.31 CRA 2015

Prohibits term excluding or limiting liability for following sections of Act: s9, s10, s11, s14, s15, s16, s17

S57 CRA 2015

Prohibits a term excluding or limiting liability for supply of services under s49, s50, s51, s52

S.65 CRA 2015

Prohibits exclusion or restriction of liability for death or personal injury resulting from negligence

s62 CRA 2015

Grey list

s65 CRA

Traders can’t rely on a term inserted into a consumer contract or notice which excludes or restricts liability for death or personal injury, resulting from negligence