Terms implied by the courts
The courts also intervene to decide when statutory terms should be implied
in uncertain circumstances, and will themselves imply terms if necessary.
See, for example, the case below regarding the general implication that
goods are fit for the purpose for which they are supplied.
Terms will be implied in various circumstances. One common example is
that in a lease of a furnished house, it is understood that the
accommodation will be reasonably fit for habitation at the beginning of the
lease period.
The same principle could apply to the hire of a boat which was claimed
to be ready for use by the customer, but which did not contain a fire
extinguisher; or to a car hired ready for use, but which did not contain a
spare wheel.
The readiness to imply terms has been refined somewhat through cases,
and there does seem to be a much harsher approach, evident in Liverpool
City Council v Irwin (see p. 105).
Business efficacy and the intentions of the parties
It should be remembered that the general rule is that parties are presumed
to have expressed their intentions fully in a written contract. However, it
may be that parties who have formed a written contract have forgotten to
include a term, or have failed to allow for a situation which later arises.
Generally the court will only intervene in contracts where it is absolutely
necessary, following through the idea of freedom to contract. However, the
aim of the courts generally is to support contracts, or bargains, where
possible, rather than destroy them on technicalities, such as where there is
obviously a missing term, so the following principles have been
established. The courts will imply a term into a contract:
- to give effect to the clear and obvious intentions of the parties, or
- to give business efficacy to the contract.
Incorporation of terms 103Samuels v Davis (1943)
A set of false teeth did not fit well and could not be used. It was
claimed that they were not fit for the purpose for which they were sold
under the Sale of Goods Act 1979, but a defence was raised that they
were not ‘goods’ to be sold, since the fitting of the teeth was a service.
It was held that rights established under the Sale of Goods Act 1979
should be applied to this sale by analogy. The teeth were not strictly
goods, but there was an item to hand over at the end of the transaction,
and the customer was entitled the expect that it would be fit to use.