Contractual Term
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A Contractual Term is any contract statement that specifies a contractual condition, contractual obligation, or contractual right within a contractual agreement.
- AKA: Contract Agreement (Terms and Conditions).
- Context:
- It can range from being an Enforceable Contractual Term (which is legally binding and must be adhered to by all parties involved) to being an Unenforceable Contractual Term (which cannot be legally enforced due to reasons such as vagueness, illegality, or lack of consideration), depending on the legality, clarity, and mutual agreement of the terms stipulated in the contract.
- It can range from being an Oral Contractual Term (agreed upon verbally) to being a Written Contractual Term (documented in writing).
- It can range from being an Express Contractual Term (that is explicitly stated in the contract) to being an Implied Contractual Term (that is not explicitly stated but is implied by law or the conduct of the parties), depending on how the term is established.
- It can range from being a Contract Condition Term (that goes to the root of the contract, breach of which may allow termination) to being a Contract Warranty Term (that is subsidiary to the main purpose, breach of which may only give rise to damages but not termination), depending on the severity of the consequences if the term is breached.
- It can range from being a Contract Exclusion Term (that attempts to exclude or limit a party's liability for breach of contract or negligence) to being a Contract Inclusion Term (that specifically includes certain liabilities or obligations within the scope of the contract), depending on whether the term focuses on limiting liability or defining it.
- It can range from being a Drafting Party-Favoring Term (interpreted under the doctrine of contra proferentem) to being a Drafting Party-Disfavoring Term (if the term is ambiguous and the drafting party is in a stronger bargaining position), depending on how the ambiguity of the term is interpreted under the doctrine of contra proferentem).
- It can range from being a Fair Contract Term (that is balanced and reasonable for both parties) to being an Unfair Contract Term (that creates a significant imbalance in the parties' rights and obligations to the detriment of the consumer), depending on the overall fairness and equity of the term.
- It can range from being a Contractual Clause (a broader contractual provision) to being an Atomic Contract Provision (a single, indivisible clause or term).
- It can range from a Contract Essense Defining Term (specifying details such as the price, delivery time, and description of the goods or services) to being a Minor Contract Term.
- ...
- It can relate to concepts like Offer and Acceptance, Consideration, and Contractual Capacity that influence the enforceability and validity of contractual terms.
- It can serve as a basis for Dispute Resolution mechanisms (like arbitration) if disagreements over contract interpretation arise.
- It can be affected by a Breach of Contract, where failure to meet the obligations specified in the term may lead to legal remedies.
- …
- Example(s):
- Contract Type-Specific Term, such as:
- an MSA-Specific Contractual Term that outlines the conditions under which either party and the consequences thereof may terminate the contract.
- a Explicitness-Related Contractual Term, such as:
- Implied Contract Terms, such as that goods will be of satisfactory quality and fit for their purpose (in a sales contract).
- Express Contract Terms, such as employee's salary (as written in an employee contract.
- an Enforceability-Related Contractual Term, such as:
- Enforceable Contractual Terms, such as a written obligation to pay that specifies exact amounts, due dates, and penalties for late payments.
- Unenforceable Contractual Terms, such as one which fails due to the Statute of Frauds.
- Fairness-Related Contractual Terms, such as:
- A Fair Contract Term like a Balanced Arbitration Clause that allows either party to initiate arbitration and choose a mutually agreeable arbitrator.
- An Unfair Contract Term like a Predatory Lending Term in a loan contract that imposes exorbitant interest rates and penalties, disproportionately disadvantaging the borrower.
- Contractual Expressness-Related Contractual Terms, such as:
- an Express Contractual Term like a Lease Agreement that explicitly states the monthly rental amount and due date.
- an Implied Contractual Term like an assumption that a leased residential property will provide basic amenities like heat and water, which are not specifically mentioned but are required by law.
- Contractual Liability-Related Terms, such as:
- Contract Exclusion Terms such as a Liability Waiver signed at a recreational facility that attempts to limit claims for injuries.
- Contract Inclusion Terms such as a Safety Compliance Clause in a construction contract that specifically includes responsibilities and liabilities for maintaining workplace safety.
- Contrual Term Interpretability-Related Contractual Term, such as:
- a Drafting Party-Favoring Term like a confusingly worded non-compete clause that favors the employer, placing broad restrictions on the employee post-employment.
- a Drafting Party-Disfavoring Term like a vaguely defined service scope in a consulting contract, which, if contested, may be interpreted against the consultant who drafted the contract.
- Standardness-Related Contractual Terms, such as:
- Standard Contract Terms, such as a contract termination clause that outlines the conditions under which the contract may be terminated by either party and the consequences thereof, such as notice requirements and payment obligations.
- Non-Standard Contract Terms, such as a custom delivery schedule in a supply agreement that accommodates the buyer's seasonal fluctuations in demand.
- Contractual Clarity-Associated Terms:
- An Express Contractual Term like a Lease Agreement that explicitly states the monthly rental amount and due date.
- An Implied Contractual Term like an assumption that a leased residential property will provide basic amenities like heat and water, which are not specifically mentioned but are required by law.
- Liability in Contractual Terms:
- A Contract Exclusion Term such as a Liability Waiver signed at a recreational facility that attempts to limit claims for injuries.
- A Contract Inclusion Term such as a Safety Compliance Clause in a construction contract that specifically includes responsibilities and liabilities for maintaining workplace safety.
- Contract Type-Specific Term, such as:
- Counter-Example(s):
- See: Breach of Contract, Contract Negotiation, Contract Party, Contract Law Principle.
References
2024
- (Wikipedia, 2024) ⇒ https://en.wikipedia.org/wiki/Contractual_term Retrieved:2024-4-21.
- A contractual term is "any provision forming part of a contract". Each term gives rise to a contractual obligation, the breach of which may give rise to litigation. Not all terms are stated expressly and some terms carry less legal gravity as they are peripheral to the objectives of the contract.
The terms of a contract are the essence of a contract, and tell the reader what the contract will do. For instance, the price of a good, the time of its promised delivery and the description of the good will all be terms of the contract. “Terms" and "conditions", although slightly different in their significance, are often treated together in phrases such as "standard terms and conditions", [1] or "Ts and Cs".
- NOTES:
- A Contractual Term is a provision forming part of a contract, each giving rise to a contractual obligation whose breach may result in litigation.
- Contractual Terms include both expressed and implied terms, with the latter not specifically stated but nonetheless forming a part of the contract based on law, custom, or past dealings.
- Contractual Terms can be classified as either conditions or warranties; a condition is essential to the contract's core obligations, while a warranty is less crucial, and its breach results in damages rather than contract termination.
- Contractual Terms may also be classified as innominate terms, which were established to allow the consequences of a breach to depend on the nature of the breach itself.
- Contractual Terms implied by law include those that ensure safety or performance standards, which are not explicitly mentioned in the contract but are presumed to exist due to established legal or regulatory standards.
- Contractual Terms must be enforceable, clear, and consistent with the main objectives of the contract; they cannot undermine the express terms of the contract.
- A Contractual Term might also be contingent on certain conditions ('subject to' terms), such as being subject to finance or other approvals, which can define the execution and validity of the contract.
- A contractual term is "any provision forming part of a contract". Each term gives rise to a contractual obligation, the breach of which may give rise to litigation. Not all terms are stated expressly and some terms carry less legal gravity as they are peripheral to the objectives of the contract.
2023a
- (GM-RKB ChatGPT, 2023) ⇒ Summarize the concept Contractual Term in 1- 2 paragraphs, promt.GM-RKB ChatGPT (model: gpt-4-1106-preview) Retrieved: 2023-12-24.
- QUOTE: A contractual term is any provision or condition that is part of a contract, defining the obligations, rights, and duties of the contracting parties. Terms serve as the cornerstone of a contract and are classified into several categories, such as express terms, which are explicitly stated within the contract document, and implied terms, which are not explicitly stated but are inferred by the nature of the contract, legislation, or court decisions to ensure fairness or efficiency.
The enforcement of contractual terms depends on how they are framed, whether they are clear, unambiguous, and agreed upon by all parties. Key terms typically include the scope of work or service being provided, the duration of the agreement, payment details, warranties, and specific conditions such as confidentiality clauses or termination rights. Understanding and negotiating contractual terms is critical, as they dictate the legal responsibilities and remedies if a party fails to meet their contractual obligations.
- QUOTE: A contractual term is any provision or condition that is part of a contract, defining the obligations, rights, and duties of the contracting parties. Terms serve as the cornerstone of a contract and are classified into several categories, such as express terms, which are explicitly stated within the contract document, and implied terms, which are not explicitly stated but are inferred by the nature of the contract, legislation, or court decisions to ensure fairness or efficiency.
2023b
- (Wikipedia, 2023) ⇒ https://en.wikipedia.org/wiki/Contractual_term Retrieved:2023-8-10.
- A contractual term is "any provision forming part of a contract". Each term gives rise to a contractual obligation, the breach of which may give rise to litigation. Not all terms are stated expressly and some terms carry less legal gravity as they are peripheral to the objectives of the contract.
The terms of a contract are the essence of a contract, and tell the reader what the contract will do. For instance, the price of a good, the time of its promised delivery and the description of the good will all be terms of the contract.
- A contractual term is "any provision forming part of a contract". Each term gives rise to a contractual obligation, the breach of which may give rise to litigation. Not all terms are stated expressly and some terms carry less legal gravity as they are peripheral to the objectives of the contract.
2016
- (Wikipedia, 2016) ⇒ http://en.wikipedia.org/wiki/Contractual_term
- A contractual term is "Any provision forming part of a contract". ...
- ↑ Government of Western Australia, How to prepare standard terms and conditions, accessed 12 November 2023