The document discusses terms and standard form contracts. Key points include: - Terms are obligations that parties must fulfill under a contract. Terms against regulations or that are unfair may render the contract void or unenforceable. - When terms are broken, the non-breaching party can seek legal remedies. This can lead to lawsuits and damaged relationships between parties. - Standard form contracts are standard documents used by one party to contract with customers. Customers often have no choice but to accept the terms. Exclusion clauses aim to limit liability but may be void if unreasonable or against consumer protection laws.

1. Terms and Standard Form
Contract

2. Terms
• Terms in the contract are obligations that the
Terms in the contract are obligations that the
contracting parties are to fulfill.
• Terms which are against the statutory
Terms which are against the statutory
regulations may render the contract void
• Terms that are legally unfair may be
Terms that are legally unfair may be
unenforcible
• It is therefore important that terms are to be
It is therefore important that terms are to be
clearly understood by contracting parties
before they sign on the agreement.

3. When terms are broken
When terms are broken
• When the terms in the agreement are broken
When the terms in the agreement are broken
by a party, the other party may seek for
remedies through legal action.
remedies through legal action
• When terms are broken, it may lead to impact
including lawsuits and ill feeling between
including lawsuits and ill feeling between
parties. This may further lead to termination
of relationship between parties and both may
of relationship between parties and both may
incur expenses for costly legal tussles.

4. Representation and
Representation and terms
• Statements made during the process of
made during the process of
negotiation that leads to formation of a
contract can be either
contract can be either
– A representation, something said before the
contract
– A term in the contract
• Representation Not written in the contract
Representation – Not written in the contract
• Terms – Written in the contract Pg 104

5. Remedies
• Different remedies are available depending on
Different remedies are available depending on
whether
– A term is broken; or
;
– A representation is untrue ‐ misrepresentation
• You can claim for breach of contract if the
statement is not true and it becomes a term of
the contract
• Usually, lesser remedy is given to
representation than terms in contract Pg 104

6. A person with special knowledge
A person with special knowledge
• If the statement made by a person with
If the statement made by a person with
special knowledge, it is more likely to be
treated as a contract term
treated as a contract term
Page 105
P 105

7. Express terms
Express terms
• Legal agreement must be complete in its
Legal agreement must be complete in its
terms to be a valid contract
• When an agreement appears vague or
When an agreement appears vague or
incomplete, the court will seek to uphold it by
looking at the intention of the parties
looking at the intention of the parties
Page 105

8. Oral evidence
Oral evidence
• Parol evidence rule
– When a contract is in writing, and all the necessary
terms are present, the court will interpret the terms
of the contract by reference to the written document
of the contract by reference to the written document
only except
– Oral evidence may be given of trade practice or
custom
– The parties may agree orally that their written
consent should not take effect until a condition
precedent has been satisfied
precedent has been satisfied
– The document is not intended to comprise all the
agreed terms Page 106

9. Discuss
• Activity 1 Pg 107
Activity 1, Pg 107

10. Standard form contract Pg 51
Standard form contract – Pg 51
• The standard form contract is a standard
The standard form contract is a standard
document containing terms and conditions on
which they contract with their customers.
which they contract with their customers
• Th i di id l
The individual must usually take it or leave it
ll k i l i
probably because the supplier is the only
supplier in the market.
li i h k

11. Standard form contract
Standard form contract
• For example you have no choice but to sign on
For example, you have no choice but to sign on
the standard form contract if you want to
advertise in, say, newspaper or TV station even
, y, p p
though if you don't agree with some of the terms.
• One of the problems with standard form contract
is that the dominating party tries to exclude
is that the dominating party tries to exclude
liability for the terms in the contract
Pg 115
Pg 115

12. Exclusion clauses
Exclusion clauses
• A clause in a contract to exclude liability or to
A clause in a contract to exclude liability or to
restrict it by limiting damages
• Also known as exemption clause
Page 115
g

13. Statutory safeguard
Statutory safeguard
• To protect consumers
To protect consumers
• Statutory safeguard provided by the Unfair
Contract Terms Act 1997
Contract Terms Act 1997
• The courts – protect consumers from the
harsher effects of exclusion clause in 2 ways:
h h ff f l i l i 2
– Exclusion clause must be incorporated into a
contract before they have legal effect;
b f h h l l ff
– Exclusion clause are interpreted strictly Pg 115

14. Unfair contract terms
contract terms
• Voidable by statute
Voidable by statute
– E.g. A clause which exclude death or personal
injury resulting from negligence is void Pg 121
injury resulting from negligence is void Pg 121
– Anti‐competition
• Test of reasonableness
Test of reasonableness
– E.g. A person cannot introduce a clause restricting
his liability for negligence unless the terms is
his liability for negligence unless the terms is
reasonable Pg 121

15. Consumer protection
Consumer protection
• The law also seeks to protect consumers who are
e a a so see s to p otect co su e s o a e
usually the weaker party to the contract from the
full force of exclusion clauses.
• The person who uses a standard form contract in
dealing with a consumer cannot, unless the term
is reasonable, restrict liability for his own breach.
i bl t i t li bilit f hi b h
• For example, a clause attempts to restrict liability
for other loss or damage arising from negligence
for other loss or damage arising from negligence
is void unless it can be shown to be reasonable.
Pg 121
Pg 121

16. Contractual documents
Contractual documents
• Where the exclusion clause is contained in an
Where the exclusion clause is contained in an
unsigned document it must be shown that this
document is an integral part of the contract
and is one which could be expected to contain
terms
• See Chapelton v Barry UDC 1940
• See Thompson v LMS Railway 1930
Pg 113

17. Signed contracts
Signed contracts
• If you sign a document containing a term you
If you sign a document containing a term, you
are held to have agreed to the term even if
you had not read the document
you had not read the document
• But this is not so if the other party puts
forward the document for signature gives a
forward the document for signature gives a
misleading explanation of the term’s legal
effect
effect
Page 116

18. Discuss
• Activity 4 page 117
Activity 4, page 117

19. Unsigned contracts and notices
Unsigned contracts and notices
• Each party must be aware of the contract’s
Each party must be aware of the contract s
terms before or at the time of entering into
the agreement if they are to be binding
the agreement if they are to be binding
• Exception:
– Wh b th
When both parties had consistent dealings; or
ti h d i t t d li
– When both party sufficiently aware of the terms
at the time making the latest contract
at the time making the latest contract
Page 117

20. Discuss
• Activity 5 page 118
Activity 5, page 118
• Activity 6, page 118

21. Onerous terms
Onerous terms
• E g fine print
E.g. fine print
• Unusual terms should be highlighted
• Failure to do so may mean that it does not
il d h i d
become incorporated into the contract
Page 119

22. Discuss
• Activity 7 page 119
Activity 7, page 119

23. Assignment 1 Claim 4
Assignment 1 – Claim 4
• Discuss
– 2a
– 2b

25. Claim 4
Claim 4 ‐ Plaster
• Keith tendered for the contract to supply plaster
pp y p
300 tonnes at $5,000 per tonne to John
• Agreement:
– John cannot buy plaster from other supplier
h b l f h l
– Keith did not undertake quality or fitness of plaster
and no compensation if plaster is unsatisfactory
p p y
• John wanted to
– discontinue supply on the unsatisfied fourth delivery
– Switch to Fred for plaster at lowe price
h df l l
• Keith seeked injunction, payment of 4th payment
and loss of profit on future 220 tonnes
and loss of profit on future 220 tonnes

26. Discuss
Based on the case given,
Based on the case given
• Analyse the importance of terms in the
contract
• What are the impact when terms are broken?
• Analyse and apply the law of standard form
contract
Relate to case
Relate to case