Implied Terms Implied terms can be (i) in law and (ii) in fact Implied terms in statute By statute Sale

e of Goods Act ss12 15 makes explicit mention of the implied terms Supply of Goods and Services Act ss 13 and 14: sale by description and implied term about quality Where there is a contract for the sale of goods by description, there is an implied term that the goods will correspond with the description. goods are of satisfactory quality Implied terms in Common Law In law:

Liverpool City Council v Irwin

Local authority owned tower block where appellant lived Tenancy agreement contained obligations on tenants but none on landlords Appellants withheld rent as protest Landlord sough possession, appellant want to claim damages saying landlord was in breach of duty Question: was there any implied duty/term as the duty of the local authority to repair and maintain common parts of building Held that nature of contract required term to be implied for an obligation to take reasonable care of the common parts but on facts, it had taken reasonable care

Scally v Southern Health

Plaintiff employed by defendant under employment contract which included regulations Regulations require work for 42 years to be eligible for pension There was a right to purchase extra years Plaintiff was not notified of this right Held where the terms of employment contract not individually negotiated but by a representative body, it was implied term that employer bring the term to attention to the employee in the case that he would not have otherwise noticed

Mahmud v BCCI SA
BCCI business collapsed and authorities found that business was carried on fraudulently Applicants were former employees and could not seek job elsewhere due to stigma Sought compensation

Held that if there was implied term of trust and confidence then it was reasonably foreseeable that breach of obligation would result in serious damage of employees career and can claim damages

Crossley v Faithful
Claimant was absent at work due to illness, defendant suggested to him to resigned Held that there was an implied term for an employer to take reasonable care an employees economic well being

Such a term was too large an extension of law and impose burden on employers In context of terms implied in law, better to focus on questions of reasonableness and fairness instead of necessity but cannot be implied simply because it is reasonable (Lord Bridge in Scally) Terms implied in fact Courts look at what the parties actually intended

AG of Belize v Belize Telecom

Provision of article gave right to appoint and remove 2 directors for shareholders that have a certain amount of share Qualifying shareholder made the appointment but when later lost the holding Question was whether the appointment of the directors could be removed No one fulfilling criteria to appoint Is it an implied term to provide the directors vacate office because shareholder was gone? Privy Council dismissed officious bystander test (assumed attentions) and focused on the construction of the parties from what was already there (construe articles) Therefore there was no shareholder and the appointment should be removed

*old test for business efficacy was The Moorcock pre-Belize case: Equitable Life Assurance Society v Hyman ELA issue policy with lower bonus and gave directors discretion to the amount Necessary to imply a term in fact that directors were not to adopt policy depriving of the original purpose as it was supposed to ensure that holders would be better off Reasonable expectation that they would exercise discretion, implied term

*here it was deemed necessary to give effect to an implied term, still relevant in

Mediterranean Salvage v Seamar Trading

Owner of the ship sought to incorporate term that charter will ensure ship will be safe Term seen as onerous

Any implied term had to be necessary and reasonable, not only reasonable