Written Terms

1. Written Terms Incorporation by Notice (pp. 25) Incorporation by Signature (pp. 24) Incorporation by reference (pp. 26) Assumed to be bound regardless of awareness/understanding of terms L’Estrange v F Graucob Ltd Unsigned document (pp. 25) Sign (pp. 25-26) Website (pp. 26) Terms can be incorporated by reference to another document Smith v New South Wales Switchgear Co Notice given before formation Olly v Marlborough Court Reasonable Person (Onus on Defendant to prove) Parker v South Eastern Railway Co. Traditional principles relevant Exceptions (pp. 24) Yes – Possible Incorporation Reasonable Person (Onus on defendant to prove) Theoretically Test: Reasonable Man inc. circumstances Not contractual Signature does not signify assent L’Estrange v F Graucob Ltd Reasonable Person (Onus on defendant to prove) Balmain New Ferry Company v Robertson No extra steps taken – NOT INCORP. Notice sufficient (IE Doc. inc. terms) Reasonable steps taken by defendant to inform plaintiff: TEST OF FACT Yes: Incorp. No: Not incorp. Reasonable Man Parker v South Eastern Railway Co. Notice sufficient Misrepresentation of effect of clause Curtis v Chemical Cleaning & Dyeing Co Pass: Term Incorporated Incorporation Incorporation Notice insufficient (IE: No doc. inc. terms) Fail: Term not incorporated Notice insufficient No incorporation No incorporation Non Est Factum DJ Hill & Co v Walter H Wright No – No incorporation Contractual Assumed to be bound by terms Mendelssohn v Normand Document not believed contractual in nature Curtis v Chemical Cleaning & Dyeing Co Exception: Unusual terms for contract Test: Reasonable Man (Parker v South Eastern Railway Co.

2. Oral Terms

3. Implied Terms #1 – Presumed intention of parties Business efficacy Custom or Usage Whether the implication of term is necessary to give business efficacy to the transaction • Test of Fact • Term is known and acquiesced to. • Everyone assumes it part of contract. • Consistent with express terms • Five Tier Test • BP Refinery (Westernport) v Shire of Hastings • reasonable and equitable • Necessary to give business efficacy to contract • Interpreted strictly • Must be so obvious that it goes without saying • Must be capable of clear expression • Must not contradict any express term in contract Knowledge of implied term not required Not likely to be implied cf. other grounds Parol evidence rule N/A Parol evidence rule won’t apply Mason J To Complete Agreement More formal, less chance of implication When all terms are not finalised, terms may be implied to complete agreement Hillas & Co v Arcos Previous consistent course of dealings Applicability of parol evidence rule: Uncertain Reasonable to hold parties contracted based on & knowledge that terms in previous contracts Henry Kendal & Sons v William Lillico & Sons • Test: Reasonable man • Have parties virtually assented to terms • Must not expressly have inconsistent terms • Relevant terms are part of prev agreements • Evidence of previous consistent dealings • (Consider both # and consistency) Parties need actual knowledge of the terms Lord Devlin, McCuthcheon v David Macbrayne Not in writing thus parol evidence rule N/A Henry Kendall & Sons v William Lillico & Sons

4. Good faith, fair dealing and reasonableness Class of contract Implied Terms #2 – Terms implied regardless of intent Courts will imply terms based on policy grounds Australis Media Holdings v Telstra Corporation Duty to act in good faith etc. in ALL contracts not fully settled issue in Australia Yes, it exists: Renard Constructions (ME) v Minister for Public Works • Test: Policy Decision • Categories where terms will be implied • Goods & services • Must fit purpose for which they were supplied • Sammuels v Davis • Professional services • Reasonable care must be taken • Greaves & Co (Contractors) v Baynham • Employment • Safe place of work • Inform employees of rights in particular period • Scally v Southern Health and Social Services Board • Building • Fit for habitation • conduct professional and workmanlike • Perry v Sharon Developments Co • Franchise agreements • Good faith and fair dealing • Far Horizons v McDonald’s Australia Parol evidence rule: N/A Duty of Cooperation • Parties must do all things necessary to ensure parties have benefit of contract • Applied to ALL contracts, regardless of necessity • Butt v McDonald Parol evidence rule N/A Statute • Test: Reference to specific terms and overall substance of contract • RDJ International v Preformed Line Products (Australia) • To find: • Common intention of parties • Extent to which the duty of cooperation will require action Statutory implication of terms in contracts • Provision of consumer credit • Consumer Credit Code 1994 • Sale of Goods/Services (pp. 266 for detail) • Sale of Goods Act 1894 • Hire Purchase • Hire Purchase Act 1959 • Insurance • Insurance Contracts Act 1984

5. General Rule: Parol evidence rule will prevent an oral term from being introduced when a contract is brought down to writing Parol Evidence Rule • Application: • Applies to contract solely in writing • Gordon v MacGregor • Only when the parties intend written document to represent the entire agreement • Express clause stating above is not necessarily enough to exclude oral terms (See construction of terms) • Hope v RCA Photophone of Australia Does the Parol Evidence Rule apply? No • Exceptions: • Evidence of collateral contract • De Lassalle v Guilford • Written contract not yet in force • Pym v Campbell • Written contract later varied or discharged • Narich v Commissioner of Payroll Tax • Implied terms available (see implied terms) • Evidence is needed for rectification • NSW Medical Defence Union v Transport Industries Insurance Co Yes Do exceptions Apply? No Yes Extrinsic evidence is not permitted Extrinsic evidence is permitted