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By the end of this topic, you should understand:
What are express terms?
Express terms are the terms (promises or obligations) that the parties clearly agree to when making a contract. They can be written down or spoken out loud. These are the terms that both parties have specifically discussed or included in their agreement.
Example: If you buy a laptop and the seller says "This laptop comes with a 2-year warranty," that warranty is an express term of your contract.
Before a contract is made, parties often make statements to each other. Not all statements become part of the contract. We need to distinguish between:
Representations = Statements made during negotiations that help persuade someone to enter a contract, but are NOT part of the contract itself.
Terms = Statements that DO become part of the contract and create legal obligations.
Why does this matter?
How do courts decide if a statement is a representation or a term?
Courts look at several factors:
Timing: Was the statement made long before the contract, or just before signing? Statements made close to contract formation are more likely to be terms.
Importance: Did the statement seem very important to the person receiving it? If the buyer made it clear that the statement was crucial to their decision, it's more likely to be a term.
Special knowledge: Did the person making the statement have special expertise or knowledge? If yes, their statement is more likely to be a term.
Written contract: If the parties later put their agreement in writing, but the statement doesn't appear in that document, it's probably just a representation.
Example: Sarah wants to buy a car. The seller, a car dealer (expert), tells her "This car has never been in an accident." This statement is likely a term because: (a) the seller is an expert, (b) it's important information, and (c) it was said just before the purchase. If it turns out the car was in an accident, Sarah can sue for breach of contract.
Incorporation means "including something as part of the contract."
The basic rule: If you sign a document, you are bound by ALL the terms in it, even if you didn't read them.
This is a strict rule. Courts assume that when you sign something, you agree to everything written in that document.
Key case principle: In L'Estrange v Graucob (1934), a café owner signed a contract to buy a cigarette machine without reading it. The contract had a term excluding liability for defects. When the machine didn't work, she couldn't complain because she had signed the document.
The only exceptions are:
Practical lesson: Always read before you sign! The law won't protect you just because you didn't bother to read the terms.
"Parol" = spoken or oral
This rule says: Once parties have written down their complete agreement, you cannot use earlier spoken statements or negotiations to contradict or add to what's written.
Purpose: The rule promotes certainty. If parties write down their agreement, that written document should be the final and complete record of what they agreed.
Example: Tom agrees to buy a bike from Maria. During negotiations, Tom asks "Does it include a helmet?" Maria says "Yes." But the written contract they sign doesn't mention a helmet. Under the parol evidence rule, Tom cannot use Maria's spoken "yes" to claim the helmet should be included, because the written contract doesn't say so.
Exceptions to the parol evidence rule:
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