P4 P5 D1 - Unit 21

2258 Words Jan 6th, 2012 10 Pages
P4: Describe the meaning of terms in a standard form contract
P5: Explain the effect of terms in a contract
D1: evaluate the effectiveness of terms in a given contract

In this assignment I will be…
Describing the meaning of terms in a standard form contract.
Explaining the effect of terms in a contract
I will also be evaluating the effectiveness of terms in a given contract.

A standard form contract is a contract made between 2 or more parities using their standard set of terms. A contract is a set of mutually agreed promises made between 2 or more parties with the intention of creating a legally binding agreement. It is important that the people involved in signing the contract know exactly what they are agreeing to.

Types of terms
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It is very common in business contracts to not only have express terms relating to conditions and warranties but also have a common express key terms included in the contract. For example, these may include… * Exclusion clauses limiting the parties’ responsibilities under the contract * Terms relating to the amount of damages that the parties might receive if things go wrong. * Terms allowing parties to vary the contract price known as a price variation clause.

Implied
Implied terms are not general stated in a contract. Implied terms are introduced into the contract by statute, custom and common law.

Terms implied by statute
To protect both parties in the Co-operative UK breakdown cover contractual agreements, terms are implied into the contract by virtue of legislation. The best example for the fault is the sale of goods act 1979. This sale of goods act has certain terms that have to be followed, such as… * Every seller has the right to sell goods. * Where there is a sale of goods by description there is an implied condition that the goods will correspond with that description. * Goods sold are of satisfactory condition and that they are fit for the particular purpose stated. * The sample sales have an implied term condition that the bulk order must correspond with the sample.
For example, if the Co-operative UK breakdown cover have stated something in their contract and