5.1 terms overview (slides).pptx

Principles of Business TOPIC 5: TERMS OF A CONTRACT Law TERMS (OVERVIEW) Contract law topics: overview TEST TWO & FINAL EXAM Topic 5: Topic 6: Topic 4: Identifying Contractual Formation of...

Principles of Business TOPIC 5: TERMS OF A CONTRACT Law TERMS (OVERVIEW) Contract law topics: overview TEST TWO & FINAL EXAM Topic 5: Topic 6: Topic 4: Identifying Contractual Formation of contractual Performance Contracts terms and Breach Topic 8: Topic 7: Invalidating Remedies for Contracts Breach of (vitiating Contract factors) Topic 5: Identifying contractual terms: overview Video 5.1 Videos 5.5 – 5.7 1. Terms of a contract 6. Implied terms 2. Freedom of contract a) Universal terms (video 3. Terms are final once the 5.5) contract is formed b) Generic terms (video 5.6) Videos 5.2 – 5.4 c) ‘Ad hoc’ terms (video 5.7) 4. Express terms: How do terms become part of a contract? a) Signed documents (video 5.2) Video 5.8 b) Reasonable notice (video 7. Case study 5.3) c) Statements made during negotiations (video 5.4) Terms of a contract  A ‘term’ is a particular, agreed undertaking or promise.  The ‘terms of a contract’ describe the entire contents of a legally enforceable agreement.  Terms define the rights and obligations of the parties.  Terms provide the yardstick by which performance of the contract is measured. Terms of a contract (ctd) Terms can become part of a contract either:  by agreement; or  express term  implied (ad hoc term))  because they are put into the contract by operation of law  common law  legislation Freedom of contract  Generally, the law allows contracting parties the freedom to negotiate and agree to the terms of their contract.  Example: the consideration rule  Thomas v Thomas  There are some general limits on the extent to which freedom of contract operates - for example, illegal undertakings are not enforceable (Topic 8).  Some statutory intervention displaces the principle of freedom of contract:  eg the unfair terms regime in the Australian Consumer Law (Topic 9) Terms are final once the contract is formed  Once a contract has been formed, it is not possible for terms to be added unilaterally by one party.  If the parties want to terminate or vary their contract, they can do so by entering into another contract.