Management and Organizational Studies 2275A/B Chapter 7: Chapter 7.docx

• School: Western University
• Department: Management and Organizational Studies
• Course: Management and Organizational Studies 2275A/B
• Professor: Loren King

Document Summary

The terms of a contract simply refer to promises made by one party to another by virtue of offer and acceptance. Express term: a provision of a contract that states a promise explicitly. It is important to include all the essential terms of a contract so that each party knows its obligations and the obligations of the other side. Even when a term is express, there may be problems interpreting what it means because the language is vague or ambiguous. Assuming that the existence of the contract is not in doubt, the court assigns as reasonable a meaning as possible to vague or ambiguous terms. As well, if the contract has been drafted by one of the parties, any ambiguity in language will be construed against that party in favour of the other. The rationale behind this rule is that the drafter should bear the risk of unclear language.