Implied Terms

Question 1

What are implied terms?

Answer 1

Terms inserted into contracts by courts, not necessarily agreed by the parties.
## Footnote
They ensure fairness and effectiveness.

Question 2

In what three ways can terms be implied?

Answer 2

By custom or trade use, common law, and statute.
## Footnote
Different methods apply in different contexts.

Question 3

How can terms be implied by custom or trade use?

Answer 3

Through established industry practice where both parties are in the same trade.
## Footnote
Applies mainly to B2B contracts.

Question 4

Which case shows terms can be implied by trade custom?

Answer 4

British Crane Hire v Ipswich Plant Hire.
## Footnote
Industry-standard terms were implied.

Question 5

How can terms be implied under common law?

Answer 5

By fact or by law.
## Footnote
Courts assess necessity or fairness.

Question 6

What does it mean to imply a term by fact?

Answer 6

Judges imply a term based on the specific facts of the case.
## Footnote
It reflects the parties’ presumed intentions.

Question 7

Which case established the tests for implying terms by fact?

Answer 7

Marks & Spencer v BNP Paribas.
## Footnote
It confirmed strict limits on implication.

Question 8

What is the business efficacy test?

Answer 8

A term is implied if necessary for the contract to work.
## Footnote
The contract must lack commercial sense without it.

Question 9

Which case introduced the business efficacy test?

Answer 9

The Moorcock.
## Footnote
The term was needed for the contract to function.

Question 10

What is the officious bystander test?

Answer 10

A term is implied if it is so obvious it goes without saying.
## Footnote
Both parties would agree instantly.

Question 11

Which case established the officious bystander test?

Answer 11

Shirlaw v Southern Foundries.
## Footnote
The term was obvious to any observer.

Question 12

What does it mean to imply a term by law?

Answer 12

Judges imply terms based on what should be part of certain contracts.
## Footnote
These terms apply as precedent.

Question 13

In what types of contracts are terms commonly implied by law?

Answer 13

Employment and banking contracts.
## Footnote
They ensure fairness and consistency.

Question 14

How can statute imply terms into contracts?

Answer 14

Through legislation that automatically inserts terms.
## Footnote
Mainly applies to consumer contracts.

Question 15

Which statute implies terms into consumer contracts?

Answer 15

Consumer Rights Act 2015.
## Footnote
Applies to B2C transactions.

Question 16

Who is a consumer under the Consumer Rights Act 2015?

Answer 16

An individual acting outside their trade or profession.
## Footnote
Defined under section 2.

Question 17

What is meant by satisfactory quality under the CRA 2015?

Answer 17

Goods meet a reasonable standard considering all factors.
## Footnote
Includes safety, durability, and appearance.

Question 18

What factors do courts consider for satisfactory quality?

Answer 18

Price, description, fitness for purpose, safety, and durability.
## Footnote
Also includes freedom from minor defects.

Question 19

What does section 10 CRA 2015 provide?

Answer 19

Goods must be fit for a particular purpose made known to the seller.
## Footnote
This becomes an implied term.

Question 20

Which case illustrates fitness for purpose?

Answer 20

Baldry v Marshall.
## Footnote
The car was unfit for the buyer’s stated purpose.

Question 21

What does section 11 CRA 2015 require?

Answer 21

Goods sold by description must match that description.
## Footnote
This is an implied condition.

Question 22

Which case illustrates sale by description?

Answer 22

Re Moore & Co.
## Footnote
Goods failed to correspond with description.

Question 23

What remedy does section 20 CRA 2015 provide?

Answer 23

Consumers can reject goods and claim a refund within 30 days.
## Footnote
Short-term right to reject.

Question 24

What remedy applies after 30 days under section 23 CRA 2015?

Answer 24

Consumer can request repair or replacement.
## Footnote
No automatic refund.

Question 25

What happens if repair or replacement is impossible?

Answer 25

Consumer can demand a price reduction or refund. ## Footnote Provided by section 24 CRA.

Question 26

How long can a consumer receive a full refund?

Answer 26

Up to six months after purchase. ## Footnote After six months, refund may be reduced.