Contract law lecture 24b Content of the contract, preparing for the exam Content of the contract - Determining the content - 3 key questions · Is a statement a term or merely a representation? . Can any other terms be implied? . Is a term a condition, a warranty or innominate term? (categorisation) - Terms or representations? . Statements may be made prior to the finalisation of a contract (e.g. during negotiations) - pre-contractual statement . Questions arise when there are disputes as to whether or not the statements were intended to form part of the contract . If such a statement amounts to a promise which forms part of the contract, that is a term in the contract a party in breach will be liable for the full range of contractual remedies . If the statement turns out not to be a term (e.g. not part of the contract), and turns out to be untrue, it may still give rise to remedies, but on a restricted basis. - Identifying the terms - approach of the courts . Intentions of the parties- did the parties actually intend the statement to be contractually binding? . what would a reasonable third party have taken the parties to have intended? ie objective test . In determining these, the courts consider a number of factors- . Knowledge of parties- Oscar Chess Ltd v Williams; Bentley (Dick) Prod. v Smith (Harold) Motors Ltd -> Oscar Chess Ltd v Williams - A statement made about the cars age was made by a member of the public with no expertise o a PRIVATE seller (like someone on Autotrader selling their own car) described a car as a 1948 Morris 10 saloon when in fact it turned out to be a 1939 model and was worth considerably less. The court held that his statement was a representation because the private seller didn't have specialist knowledge. The person he sold it to was a car dealer so he was actually in a better position than the private seller to discover the truth of the statement. > Bentley (Dick) Prod. v Smith (Harold) Motors Ltd - The statements about a cars mileage was made by a car dealer o a car dealer stated that a car had done 20,000 miles. Relying upon this statement, C bought the car. There were then problems with the car and C discovered that it had actually done 100,000 miles. The C brought an action for breach of contract arguing that the statement about mileage was a term of the contract. The COA said that because it was made by the car dealer who had specialist skill and was therefore in a better position to find out the mileage of the car, his statement was a term of the contract.
. Reliance/Importance at the time - Bannerman v White; Schawel v Reade > Bannerman v White - the seller of some hops stated to the purchaser that no sulphur had been used in their production