Week 4- LAWS1104

• Incorporation of Terms into a Contract

  1. Express Terms

  2. Implied Terms

  3. Course of Dealing

  4. Custom and Usage

  5. Reference to Standard Terms
• Interpretation of Contractual Clauses

  Determining the meaning of the terms and provisions within the contract
• Principles of interpretation


  • Literal Rule
  • Golden Rule
  • Mischief Rule
  • Ejusdem Generis
• Implied Terms

  Terms can be implied into contracts by law, custom, or the intentions of the parties
• Ways contracts can be implied

  • Terms necessary to give effect to the parties' intentions
  • Terms implied by statute
  • Terms implied by the courts to fill gaps in the contract
  • Terms based on custom or usage of a particular trade or industry
  • Terms inferred from the parties' conduct or the circumstances surrounding the contract
• Termination of Contracts

  1. Performance

  2. Agreement

  3. Frustration

  4. Breach

  5. Operation of Law
• Damages for Breach of Contract

  Intended to compensate the innocent party for losses suffered as a result of the breach
• Express Terms: Terms explicitly agreed upon by the parties and included in the contract, either orally or in writing.
• • Implied Terms: Terms that are not expressly stated but are implied by law, custom, or the parties' conduct.
• • Course of Dealing: Terms that have been established by the parties' previous interactions or business dealings.
• • Custom and Usage: Terms that are commonly understood and accepted within a particular trade or industry.
• • Reference to Standard Terms: Terms incorporated by reference to standard form contracts or terms and conditions provided by one party.
• • Literal Rule: Interpretation based on the ordinary and literal meaning of the words used in the contract.
• • Golden Rule: Interpretation that allows the court to depart from the literal meaning of words if necessary to avoid absurdity or inconsistency.
• • Mischief Rule: Interpretation based on identifying the problem or mischief that the contract was intended to remedy.
• • Ejusdem Generis: Interpretation based on the principle that general words following specific words in a list are limited to items of the same kind.
• • Expectation Damages: Damages intended to put the innocent party in the position they would have been in if the contract had been performed.
• • Reliance Damages: Damages intended to compensate the innocent party for losses incurred in reliance on the contract.
• • Restitutionary Damages: Damages intended to restore any benefits conferred by the innocent party to the breaching party.
• • Mitigation: The innocent party has a duty to mitigate their losses by taking reasonable steps to minimize damages after a breach occurs.
• Damages are the primary remedy for breach of contract and are intended to compensate the innocent party for losses suffered as a result of the breach.

  • The general principles of damages include:
  • Expectation Damages
  • Reliance Damages
  • Restitutionary Damages
  • Mitigation
• • Terms can be incorporated into a contract in various ways, including:
  • Express Terms
  • Implied Terms
  • Course of Dealing
  • Custom and Usage
  • Reference to Standard Terms