Express and implied terms

• Implied terms


  Terms that are not expressly stated but inferred by law - as seen in Priest v Last
• Ways courts can imply terms

  1. Terms implied by fact - Terms not laid down in the contract, but which it is assumed both parties would have intended to include if they had thought about it

  2. Terms implied by law - Terms the law says have to be included, despite whether the parties to the contract want them to be included
• Terms implied by fact

  Terms which are not laid down in the contract, but which it is assumed both parties would have intended to include if they had thought about it
• Terms implied by law


  Terms which the law says have to be included, despite whether the parties to the contract want them to be included
• Terms implied by law

  • Consumer Rights Act 2015 protects consumers against unfair terms – gives rules on supply of goods, supply of services, delivery etc.
  • Consumer Contracts Regulations 2013 - online shopping bringing in the EU directives, provides rules on what information traders must give, consumers right to cancel
• Representations


  Statements made by one party to the other before the contract is formed, which may or may not be incorporated into the contract
• Terms


  Provisions that are incorporated into the contract and are legally binding
• Express terms


  Terms that are explicitly stated in the contract
• Implied terms


  1. Implied by fact

  2. Implied by statute
• Exclusion clauses


  Clauses that attempt to limit or exclude liability
• Unfair Contract Terms Act 1977


  Legislation that regulates the use of exclusion clauses
• Representations


  Statements of fact made by one party to the other before the contract is made, which induce the other party to enter into the contract
• Other terms


  • Conditions
  • Warranties
  • Innominate terms
• Marks and Spencer v BNP Paribas (2015)


  • The Supreme Court ruled that the commercial contract was so detailed that it would respect the bargain struck and avoid interfering with the contract
• Terms


  Contractual promises which are legally binding
• Officious bystander test


  The Officious Bystander Test is a philosophical thought experiment that evaluates whether information is genuinely shared by gauging how obvious it seems to someone not in the know.
• Business efficacy test


  A term which one side alleges must be implied to make the contract work
• BP Refinery Property Ltd v Shire of Hastings (1978)

  • Further guidelines set out for determining whether a term should be implied
• Express terms


  Terms that are explicitly stated in the contract - as seen in Bannerman v White
• The business efficacy test and the officious bystander tests have been used in determining whether a term should be implied since Equitable Life Assurance Society v Hyman (2000)
• Implied by statute


  Terms which the law says have to be included, despite whether the parties to the contract want them to be included
• Exclusion clause


  A clause in a contract that attempts to exclude all liability or to limit liability for breaches of the contract
• Consumer Rights Act 2015


  Legislation that protects consumers against unfair terms, prevents companies saying they aren't liable for negligence and also implies that certain terms automatically go into consumer contracts
• Goods under the Consumer Rights Act 2015 must be:

  • Of satisfactory quality
  • Fit for purpose
  • As described
• 30 days


  Time period within which the consumer has a legal right to reject goods that are of unsatisfactory quality, unfit for purpose or not as described to get a full refund
• Exclusion clauses


  • The law has tried to control the use of these clauses, by common law and by statute, as they are unfair to the consumer
  • The courts have found two ways to regulate exclusion clauses: incorporated and unfair contract terms act 1977
• If a fault is discovered within six months of purchase, it is presumed to have been there since purchase, unless the retailer can prove otherwise.
• 6 years


  Time period within which the consumer has to take a claim to the small claims court
• Incorporation of exclusion clauses

  1. Notice placed on counter in shop

  2. Notice contained in signed contract

  3. Notice contained in delivery note where parties have regularly dealt on same terms

  4. Notice posted on hotel bedroom wall

  5. Notice contained in receipt

  6. Notice on back of cloakroom ticket

  7. Notice posted on machine at entrance to car park
• Retailer


  The party the consumer must bring a claim against, not the manufacturer
• Consumer Rights Act 2015 ss49-52


  Contracts for services must: be performed with reasonable care and skill, be provided within a reasonable time, and be provided for a reasonable price
• Unfair contract term


  A term that is not binding on the consumer under the Unfair Contract Terms Act 1977
• Unfair Contract Terms Act 1977- George Mitchell Ltd v Finney Lock Seeds Ltd (1983)

  • 
    

  Statutory control for exclusion and limitation clauses, applies only to liability arising in the course of a business and in relation to liability from one business to another
• Privity of a contract

  A doctrine (principle) which allows the parties to a contract to sue each other but does not allow a third party to sue
• Consumer Contracts Regulations 2013

  Regulations that cover shopping online and bring into force the Consumer Rights Directive from the EU, superseding the Distance Selling Regulations
• Tweddle v Atkinson (1861)


  Even though a person was named in a contract, he was unable to claim a third party right
• Key information a trader must provide under the Consumer Contracts Regulations

  • The main characteristics of the goods or services
  • The total price including taxes and delivery costs
  • The arrangements for payment, delivery and performance
  • The trader's identity and contact details
  • The consumer's right to cancel
• Unfair Contract Terms Act 1977 - Reasonableness test


  The court should ask whether the term in question is a fair and reasonable one to be included having regard to the circumstances which were, or should have been known to by parties when the contract was made
• 14 days


  Time period within which the consumer has the right to cancel goods or services purchased online, over the phone, from a catalogue or face to face somewhere that is not the business premises of the trader
• Contracts Act 1999

  This Act allows 3rd parties to enforce rights under a contract if it was made after 11th May 2020