Contractual Terms

Question 1

Express terms

Answer 1

terms made by the parties, by which they intend to be bound. A contract can have terms agreed in writing, or agreed orally, or a mixture of the 2.

Question 2

Implied terms

Answer 2

they have not been agreed upon orally or in writing but the law deems that they exist

Question 3

A statement may be regarded as a term of the contract if it can be shown that

Answer 3

the injured party considered it so important that it would not have entered into the contract but for that statement

Question 4

What factors should be considered to determine whether parties intended a statement to be binding?

Answer 4

Importance of the statement
Timing of the statement
Reduction of the contract into writing
Special knowledge of the skill of the person making the statement
Assumption of responsibility

Question 5

If a statement is both a term and a representation, what legal action can be taken?

Answer 5

action for breach of contract and misrepresentation

Question 6

A party can express an intention to be bound by something they have not

Answer 6

read or understood

Question 7

If the document signed was not one which was intended to have any contractual effect, then the terms within it

Answer 7

will not form part of the contract

Question 8

terms will form part of the contract if reasonable steps have been taken to

Answer 8

bring them to the claimant’s attention

Question 9

where a clause is particularly onerous, what is the threshold to give sufficient notice?

Answer 9

it should be ‘printed in red ink, with a red hand pointing to it, or something equally startling’ to give sufficient notice

Question 10

Signature is

Answer 10

binding

Question 11

For clauses to be incorporated after a course of dealing, they must have been (2)

Answer 11

consistent and regular

Question 12

Why was a course of dealing not found in Hollier v Rambler Motors?

Answer 12

3-4 transactions over a period of five years was held to be insufficiently regular to establish a course of dealing.

Question 13

Entire agreement clauses

Answer 13

provides that a particular document or set of documents constitutes the entire agreement between the parties and supersedes any previous understandings and/or arrangements between them, whether oral or written.

Question 14

Entire agreement clauses typically exclude

Answer 14

misrepresentation

Question 15

When implying terms in fact, one must ask what the reasonable person

Answer 15

would understand the contract to mean rather than enquiring as to the subjective intentions of the parties

Question 16

S 15(a) Sale of Goods Act - Remedies for breach of condition

Answer 16

Section 15A provides that if the breach is so slight that it would be unreasonable for the buyer to reject the goods and repudiate the contract, the breach should be treated as a breach of warranty, which will only entitle the buyer to claim damages.

Question 17

Burden for relying on s 15(a) Sale of Goods Act falls on

Answer 17

The burden of proving that the breach is so slight and therefore unreasonable for the buyer to reject the goods falls on the seller

Question 18

Terms implied by the SGA 1979

Answer 18

the seller has the right to sell the goods (s 12)
The goods will comply with their description (s 13)
The goods will be of satisfactory quality (s 14(2))
The goods will be suitable for any purpose made known to the seller (s.14(3))
The goods will comply with any sample (s 15)

Question 19

According to s 14(2)(a), the goods are of satisfactory quality if:

Answer 19

“they meet the standard that a reasonable person would regard as satisfactory, taking account of any description of the goods, the price (if relevant) and all the other relevant circumstances”

Question 20

breach of the satisfactory quality term is a

Answer 20

breach of condition

Question 21

S.15A Sale of Goods Act provides that if the breach is so slight that it would be unreasonable for the buyer to reject the goods and repudiate the contract, the breach should be treated as a

Answer 21

breach of warranty, which will only entitle the buyer to claim damages

Question 22

a seller’s liability under ss12, 13, 14 and 15 of the SGA 1979 can be excluded and/or restricted by agreement of the parties, subject to

Answer 22

the Unfair Contract Terms Act 1977 (UCTA)

Question 23

Under s6(1A) UCTA, the implied undertakings as to description, quality, fitness for purpose or sample contained in ss13-15 of the SGA can be excluded / restricted subject to the

Answer 23

requirement of reasonableness

Question 24

The Supply of Goods and Services Act 1982 (SGSA) implies terms into

Answer 24

contracts for the hire of goods and goods supplied as part of a supply of services

Question 25

s 12 Sale of Goods Act implies that the seller has

Answer 25

title - the right to sell the goods

Question 26

Implied term, Supply of Goods and Services Act

Answer 26

the supplier will carry out the service with reasonable care and skill, within a reasonable time and the buyer will pay a reasonable charge

Question 27

Supply of Goods and Services Act does not apply to

Answer 27

consumer contracts - applies to B2B only

Question 28

CRA 2015 - contracts for goods

Answer 28

goods will be of satisfactory quality, fit for any particular purpose made known to the trader, and will comply with their description

Question 29

CRA 2015 applies to business-consumer contracts entered on or after

Answer 29

1 October 2015

Question 30

CRA 2015 defines a consumer as

Answer 30

an individual acting for purposes which are wholly/mainly outside of that individual’s trade, business, craft or profession

Question 31

CRA 2015 - digital content

Answer 31

the content will be of satisfactory quality, fit for any particular purpose made known to the trader, and will comply with its description

Question 32

CRA 2015 - contracts for services

Answer 32

the services will be performed with reasonable care and skill, provided in a reasonable time, and (where price has not been agreed) a reasonable price will be paid

Question 33

Under CRA 2015, goods sold to a consumer fail to meet requirements are regarded as

Answer 33

non-conforming

Question 34

3 remedies available to the consumer for non-conforming goods

Answer 34

- The short term right to reject - The right to repair or replacement - The right to a price reduction or the final right to reject

Question 35

terms of a contract can be classified as (3)

Answer 35

Conditions Warranties Innominate terms

Question 36

If a party breaches a condition, the innocent party has a right to

Answer 36

treat the contract as repudiated and may sue for damages immediately

Question 37

Remedy for breach of warranty

Answer 37

innocent party can sue for damages

Question 38

The distinction between a condition and a warranty is that a condition is

Answer 38

an important term 'going to the root of the contract'

Question 39

When should a term be categorised as a condition from the outset?

Answer 39

If the parties intended, at the time of contracting, that any breach of the relevant term could result in the innocent party terminating (Poussard v Spiers)

Question 40

Hong Kong Fir test

Answer 40

Does the breach deprive the party not in default of substantially the whole benefit which it was intended that he should obtain from the contract? YES → the term will be treated as a condition and the innocent party is entitled to treat the contract as repudiated and claim damages. NO → the innocent party is entitled to claim damages only

Question 41

When should you apply the Hong Kong Fir test?

Answer 41

If the court cannot determine the parties' intention, or determines that their intention was that not every breach would lead to the right to terminate, then the court is likely to decide that the term is innominate, and apply the test

Question 42

If time is of the essence, lateness will amount to a

Answer 42

repudiatory breach entitling the other party to terminate the contract

Question 43

A minor breach of an innominate nature will allow the innocent party to claim

Answer 43

damages only

Question 44

How can parties to a written contract reduce the possibility of a claim that there are binding oral terms alongside the written terms?

Answer 44

The parties can include an ‘entire agreement’ clause in their written contract

Question 45

A service that is carried out in the course of a business needs to meet what standard under the Supply of Goods and Services Act 1982?

Answer 45

Performed with reasonable care and skill

Question 46

The Consumer Rights Act 2015 regulates contracts entered into by what people?

Answer 46

a trader and a consumer

Question 47

What are the 2 remedies available to the consumer where a trader breaches the implied term that he must perform the services contract with reasonable care and skill?

Answer 47

the right to repeat performance and the right to a price reduction