Classification Of Terms

Question 1

Poussard v Spiers

Answer 1

To be condition:

Term must be so important that failure to fulfil defeats purpose of contract

Question 2

Bettini v Gye

Answer 2

Warranty if:

Failure to fulfil does not defeat purpose of contract

Question 3

Schuler v Wickman

Answer 3

If specified as condition or warranty, suggests that’s what parties wanted
More unreasonable it is to be condition, less likely they really wanted it to be a condition
✅ flexible, justice, bargaining power (even if specified as condition, can protect weaker party if unreasonable)
❎ uncertain, freedom of contract (even if specified as term, court can still refuse to treat it as one)

Question 4

Hong Kong Fir Shipping

Answer 4

Innominate term:
Broad so look at if purpose is defeated to determine if can be repudiated or just damages
✅ flexible- outcome varies depending on importance of breach to the contract which court can adapt outcome to enforce correct justice
❎ uncertain- breach of same type of term can lead to 2 different outcomes

Question 5

Bunge Corporation

Answer 5

Readiness to load clauses should always be conditions
✅ certain- will always be conditions
❎ freedom of contract- parties can’t take circumstances into account (inflexible) and decide themselves

Question 6

Condition & warranty evaluation

Answer 6

✅ certain (can always repudiate if condition breached, always only damages if warranty)
❎ rigid- trivial breaches of conditions can lead to repudiate contract and major breaches of warranties can only get damages which can cause injustice

Question 7

Terms automatically conditions through statute

Answer 7

Sale of Goods Act 1979 shows implied terms about goods and services are conditions
✅ certain, good business practice
❎ rigid, freedom of contract (doesn’t allow parties to decide how their own contract should work