Monday, 1 December 2008

Contractual Terms - two interesting cases

A2 students - read the judgment of Lord Denning in British Crane Hire v Ipswich Crane Hire here.

This is a case about a dragline crane getting stuck in the mud. If you are desparate to see a dragline crane in action, you're very sad, but you can watch the video at the bottom of this post!
This case has two main applications:

1. It is an example of the court referring to trade practice ("course of dealings") when deciding whether a certain term is part of a contract;

2. It is also an example of the court deciding the importance of such a term based on trade practice.

It is also a great example of how to summarise a case! Read Lord Denning's opening paragraph to the judgment...

An interesting recent case on types of terms is Parham v F Parham Limited (2006). This case shows how important the meaning of a contractual term can be. In this case the Court held that an employee was entitled to receive an annual 10% increase in salary on a compound basis from his employers, a successful company which owns a marina and a shopping centre, amongst other things.

This added up to an awful lot over the years! The judge held them to this based on the wording they had used. This is why people drafting contracts have to be careful about the words they choose!

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