LAWS11-212 Study Guide - Final Guide: Breach (Security Exploit), Divisor, Dmg Media
SID: 13484273 SUBJECT CODE: LAWS11-212_171
12
- Extra steps should have reasonable
steps to bring her attention to it
- Exclusion clauses are not onerous
Only for unsigned documents can it be
onerous (Toll v Alphapharm)
CONSTRUCTION OF TERMS
Construction: refers to the process of
ascertaining the meaning and legal effect
of contractual words (objectively)
- Focus on contract as a whole
- Give effect to bargain
- Avoid interpretation
- Take into account commercial reality
- Reasonable bystander
Admissibility of Extrinsic evidence:
evidence of prior negotiation is generally
inadmissible
EXCEPTION:
- Give plain meaning &to assist where there is
ambiguity (Codelfa) - Must follow
(Western Export)
- Contextual approach: broader contracts
for commercial contracts, factual matrix
(Inventsors Compensation) how is
business usual done?
FACTUAL MATRIX:
Includes all objective background
knowledge that would have reasonably
been available to the parties at the time of
agreement
✓ market
✓ “legal” background
✓ relative knowledge/experience of parties
✓ what else are they doing
(interconnected arrangements)
✓ known needs of parties
DOES NOT INCLUDE
matters in respect of which one party
has no reasonable knowledge
pre-contractual
communications/negotiations
subsequent conduct
extra-territorial practices
Constructing exclusion clauses
- an “exclusion cluse”: excludes qualifies
or limits the liability of a party for breach
of contract on his part
- the principles of construction apply
uniformly (Darlington Futures)
CONSTRUCTING EXCLUSION CLAUSE
1. is the relevant clause properly
incorporated?
2. who is the person seeking to rely on the
clause? Are there privity issues?
3. as a matter of construction, does the
clause apply to exclude or limit liability in
relation to this dispute?
Such clauses are constructed according to
their “natural and ordinary meaning”
(Darling Futures), (Insight Vacations)
✓ look at contract as whole
✓ give clause ordinary and natural
meaning
CONTRA PROFERENTEM
Where ambiguous, interpret against party
who proffered the term
(Wallis Son & Wells) ‘warranties’ is
ambiguous, CP meaning the condition was
not excluded and the buyer brought a claim.
FUNDAMENTAL BREACH
Substantially deprives the plaintiff of the
benefits that he was to enjoy under the
contract
(Photo Production) was a fundamental
breach.
FOUR CORNERS RULE
If act which occasions loss is not authorised
or contemplated by the contract, generally
cannot rely on exclusion clauses, “outside
the four corners of the contract” (Council of
the City of Sydney)
NEGLIGENCE
1. if there is an express exclusion of
liability for negligence will be effective
2. even if there is no express reference
the clause will be effective if, as a
matter of construction, that was the
parties’ intentions
(Davis v Pearce)
• “at owners risk” therefore not
liable
SID: 13484273 SUBJECT CODE: LAWS11-212_171
13
3. even if the words are wide enough,
they will not be effective if the plaintiff
can show that his or her claim could be
based on some other head of liability
than negligence (i.e. strict liability)
“however caused”
Therefore, where 2 heads of possible
liability, courts are more likely to exclude
strict liability over fault-based liability (White
v John Warwick).
• If you use wide words = look to
intention of parties to see if they
exclude negligence or not
• If at time of contracting, there is only
one possible head of liability, one
being strict, or fault based, the clause
will interpret the clause as
excluding that, as that must have
been what the parties intended.
TERMINATION (OR DISCHARGE)
An innocent party will have the right to
terminate a contract early.
4 ways
1. Mutual performance
2. Discharged by consent
3. For breach of contract or repudiation
4. Automatic discharge in event of
frustration
BREACH FOR REPUDIATION AND
DELAY
If you have a strict obligation you have to
perform accordingly (fault is irrelevant)
RIGHT TO TERMINATE?:
1) What provision has been breached? How
does this sit as a contract as a whole?
✓ Condition?: entitled to terminate
✓ Warranty?: not entitled
✓ Intermediate term
TEST OF ESSENTIALITY: Is it an essential
term?
Would the innocent party enter the contract
if they had not been informed on strict and
substantial performance (Advertising v
Luna Park), (Associated Newspapers v
Bancks) If yes, then a condition
The quality of essentiality depends on:
• take close account of the importance
which the parties have attached to the
provisions … applied
circumstances(DTR Nominees)
TEST WARRANTY: not condition
TEST INTERMEDIATE:
Depends on the gravity and the
consequences of the breach – can only
terminate if the consequences are serious
enough that would deprive the party of
what they contracted (Koomphatoo)
(Hong Kong Fir Shipping) Held:
intermediate term that did not justify
termination
(Koomphatoo) Held: serious breach of
intermediate term “less than an essential
term but more than a warrantee”
TERMINATION FOR REPUDIATION
Repudiation: rejection of contract where a
party articulates/or through conduct are
rejecting the contract. When/after
performance is due
OBJECTIVE TEST: Has one party
“manifested an unwillingness or inability to
perform”
• Must relate to whole of contract, to a
condition… or “fundamental”
ANTICIPARTORY BREACH: termination
before performance is due. Unwilling to
perform condition
1) express or implied language
2) physically impossible (Universal
Cargo Carriers)
OBJECTIVE TEST: “has the allegedly
repudiating party acted in such way as to
lead a reasonable person in the other’s
shoes to believe that he does not have a
contract or the substantial benefit of the
contract”
DANGER: If you repudiate and do not have
the right… you will be negligent
Document Summary
Extra steps should have reasonable steps to bring her attention to it. Only for unsigned documents can it be onerous (toll v alphapharm) Construction: refers to the process of ascertaining the meaning and legal effect of contractual words (objectively) Admissibility evidence: evidence of prior negotiation is generally inadmissible. Give plain meaning &to assist where there is follow (codelfa) Includes background knowledge that would have reasonably been available to the parties at the time of agreement. What they (interconnected arrangements) else are doing. Matters in respect of which one party has no reasonable knowledge. An exclusion cluse : excludes qualifies or limits the liability of a party for breach of contract on his part the principles of construction apply uniformly (darlington futures) is the relevant clause properly. Such clauses are constructed according to their natural and ordinary meaning (darling futures), (insight vacations)
