Construction Law: Contract Terms

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Questions and Answers

What is the principle that guides the interpretation of general terms in a contract?

Positive Interpretation Principle

Ejusdem Generis Principle (correct)

Literal Interpretation Principle

Contextual Interpretation Principle

According to Article 1735, what is the basis for determining the matters that a contract relates to?

The context in which the contract was signed

The intention of the parties as apparent from the contract (correct)

The general terms used in the contract

The literal meaning of the words used in the contract

What is the primary consideration when interpreting ambiguous terms in a contract?

The context of the contract

The subject matter of the contract (correct)

The literal meaning of the words

The intention of the parties

What is the purpose of the Positive Interpretation Principle as outlined in Article 1737?

To give provisions a meaning that renders them effective Signup and view all the answers

When a word in a contract has two possible meanings, which meaning should be preferred?

The meaning that makes the contract valid Signup and view all the answers

What is the significance of the context in interpreting the provisions of a contract?

It is the primary consideration in interpreting the contract Signup and view all the answers

What is the role of the Ejusdem Generis Principle in contract interpretation?

It helps in understanding general terms in their context Signup and view all the answers

What is the guiding principle in interpreting the provisions of a contract?

The context and the subject matter of the contract Signup and view all the answers

What is the essential condition of a lawful contract that refers to the ability of parties to enter into a contract?

Capacity of the parties Signup and view all the answers

What are the terms of the contract that are not specifically agreed by the contracting parties but are implied by law?

Implied Terms Signup and view all the answers

According to Article 1713, what are the three principal sources of terms that are implied into contracts?

Customs, equity and good faith Signup and view all the answers

What type of terms are considered to be the 'core' of the contract?

Fundamental Terms Signup and view all the answers

What is the term used to describe the terms of the contract that are expressly agreed in written contracts at the time the contract is made?

Express Terms Signup and view all the answers

Which of the following is an example of Implied Terms in the construction industry?

Environmental Protection Signup and view all the answers

What is the classification of terms of the contract that is based on the importance of the terms in the contract?

Fundamental and Incidental Terms Signup and view all the answers

Which of the following is NOT a source of Implied Terms?

Free Consent Signup and view all the answers

What does the interpretation of a contract involve?

Ascertaining the intention of the contract maker Signup and view all the answers

What are incidental terms in a contract?

Terms that are collateral to the fundamental terms Signup and view all the answers

What happens when a law is silent?

We use non-exclusive method Signup and view all the answers

What is the purpose of interpreting a contract?

To reduce the law into reality Signup and view all the answers

What is the approach used when a law is ambiguous?

Contextual interpretation Signup and view all the answers

What is the approach used when a law is clear but unreasonable?

Interpretation according to good faith, morality, and reasonableness Signup and view all the answers

What do rules of interpretation of the law in Ethiopia include?

Various rules, including good faith, morality, and reasonableness Signup and view all the answers

What takes precedence when there is a conflict between laws?

The higher law Signup and view all the answers

Study Notes

Incidental Terms in Construction Law

Incidental terms are those terms of a contract that are collateral to the fundamental terms and the non-performance of which may give rise to a claim for damages but not to a repudiation of the contract.

Interpretation of Contracts

Interpretation of a contract is the process of giving meaning to the phraseology of the contract.
It involves discovering and expounding the intended signification of the language used, which is the meaning the authors of the contract designed to convey to others.
There are two types of meanings: narrow (literal meaning) and wide (intention of the contract/law maker).
Rules of interpretation of the law in Ethiopia include:
- Where the law is clear but unreasonable: interpret according to good faith, morality, and reasonableness.
- Where the law is ambiguous: use contextual interpretation or exposé de motif.
- Where the law is silent: use non-exclusive method.
- Where the law is contradictory: the higher law prevails over the lower, the special law prevails over the general, or the recent law over the old one.

General Terms and Their Interpretation

Ejusdem Generis Principle: general terms are understood in their context, not in their literal dictionary meanings.
Article 1735 of the Civil Code: a contract shall be deemed to relate to such matters only on which it appears that the parties intended to contract, however general the terms used.
Contextual Interpretation (Article 1736): provisions of a contract shall be interpreted through one another and each provision shall be given the meaning required by the whole contract.
Ambiguous terms shall be given such meaning as is more likely, having regard to the subject matter of the contract.
Positive Interpretation (Article 1737): provisions capable of two meanings shall be given a meaning to render them effective rather than a meaning which would render them ineffective.

Essential Conditions of a Lawful Contract

The parties must have the intention to enter into legal relations.
There must be free consent.
There must be an offer made by one party to the other.
The offer must be accepted by the other party.
The parties must have the capacity to enter into a contract.
The object of the contract must be lawful.
The contract must be in a valid form.

Terms of the Contract

The terms of the contract can be classified into Express Terms and Implied Terms.
Expressed Terms are those terms that are expressly agreed in written contracts at the time the contract is made.
Implied Terms are those terms that are implied into the contract by law, the Civil Code, or courts.
Common implied terms in the construction industry include Environmental Protection, Gender Violence, Labor Law, and OHS.
Article 1713 of the Civil Code provides for terms to be implied into contracts from three principal sources: customs, equity, and good faith.

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Description

Learn about incidental terms in construction contracts, including their interpretation and implications on contract performance.