Contract terms as conditions or warranties Free Essay Example, 750 words

ï » ¿Contract terms as conditions or warranties A contract is an agreement put into force with a court order and regulates every transaction between the parties concerned. Such regulations that govern the relationship between parties in a contract are contained in the contract law. It is a body of law regulating contracts. A contract being a voluntary obligation, the law ensures that people have truly consented to the deals that bind them in courts. A contract forms when one person accepts it by communicating their assent or performing the offer’s terms. Such agreements are governed by principles, which in the broad category limit the parties to specific obligations or freedom. These principles form a basis under which a contract may be categorized as either a condition or a warranty (â€Å"UK Contract Law†, n.d. ). A condition is a material, major or significant term of a contract, which underlies the formation of a contract (Weitzenbà ¶ck, 2001; Carter and Hodgekiss, 1977). In other words, a condition is a term that goes to the root of a contract and, therefore, can render a contract enforceable in the favour of an innocent party if the terms of formation of the contract are breached (Collins, 2003; Richards, 2006). We will write a custom essay sample on Contract terms as conditions or warranties or any topic specifically for you Only $17.96 $11.86/pageorder now Therefore, innocent parties have a right to repudiate a contract and get discharged from performance of any outstanding obligations, which underlie the contract as well as a right to demand for damages in event of the breach. Therefore, unlike a warranty, a condition forms the backbone of the contract and results to legal ramifications under the contract law (Ayres, 2012). It is also imperative to note that conditions can either be implied or express conditions (â€Å"Classification of conditions†, n.d. ). A good example of a case involving a condition was the case of Poussard v. Spiers a singer was contracted to perform and sing for 3 whole months with six rehearsal days. The singer, however, fell ill and thus missed the six days of rehearsals, which resulted in the defendant replacing him with another singer. However, in this case the court held that the termination of the contract was uncalled for because the failure to attend the rehearsals only amounted to a breach of warranty and not a condition and thus the singer was entitled to the contract because the breach did not go to the contract’s very root (Bettin v. Gye, 1876). Thus, based on this case contracts can be categorised as conditions if the breach of the terms of the contract significantly or materially affects the performance of a contract and, therefore, becomes unenforceable to the innocent party’s favour (Smith and Atiyah, 2006). Another example of categorizing contracts terms as conditions or warranties was best articulated in the case of British Crane vs. Ipswich Plant Hire (1974) in which both companies were engaged in contracting out earth-moving equipment. In this case the plaintiffs provided the defendants with the equipment over the phone contract promptly without articulating the contract terms. However, the claimants later sent their conditions to the defendants but before signing them, the equipment sank in a marshy place. The defendants, however, wanted to avoid liability claiming there was no contract but the court held that, they were liable because the terms of the contract were standard in the business and, therefore, were implied conditions and would be traced to the contracts root (British Crane vs. Ipswich Plant Hire, 1974; â€Å"Exclusion Clauses Cases†, n.d. ). Therefore, from the cases above it is evident that the contract terms can be categorised as conditions; either as express or implied conditions. The terms goes to contract’s root cause and are void, voidable or can be rescinded at the innocent party’s choice. Thus, conditions whether implied or express are voidable and place no legal obligations on the innocent party but rather give him/her the right to sue for specific performance or damages as demonstrated in the above illustration cases. Ultimately, conditions unlike warranties are material terms of contract, which enforces obligations on the parties concerned. References Ayres, Ian. Studies in Contract Law. Foundation Press, 2012. Bettin v. Gye, (1876). British Crane vs. Ipswich Plant Hire, (1974) Carter, John W., and C. Hodgekiss. "Conditions and Warranties: Forebears and Descendants. " Sydney L. Rev. 8 (1977): 31. Classification of conditions or warranties. (n. d.). Available at: http: //www. lawteacher. net/free-law-essays/contract-law/classification-of-conditions-or-warranties-contract-law-essay. php [Accessed 31 march 2015]. Collins, Hugh. The law of contract. Cambridge University Press, 2003. Exclusion Clauses Cases. (n. d.). Available at: http: //www. lawteacher. net/cases/contract-law/exclusion-clauses-cases. php [Accessed 31 march 2015]. Poussard v. Spiers & Poland, (1876). Richards, Paul. Law of contract. Pearson Education, 2006. Smith, Stephen A., and Patrick S. Atiyah. Atiyah's Introduction to the Law of Contract. Oxford University Press, 2006. UK Contract Law: Conditions, warranties and intermediate terms. (n. d.). Available at: http: //www. wiselinklaw. com/show_jdal. asp? newsid=325&aa= [Accessed 31 march 2015]. Weitzenbà ¶ck, Emily M. "Electronic agents and the formation of contracts. " International Journal of Law and Information Technology 9, no. 3 (2001): 204-234.