Feedback

 

(c) That's wrong. Some of the terms in a contract are more important than others.

The word 'condition' is used to describe the most important terms in a contract. The word ‘condition’ is used to describe a term that is so important that the party who benefits from the term would not have entered the agreement without it. They are sometimes described as the 'fundamental' terms of the contract, the terms that go 'to the root' of the contract.

In this case, from what is said, it is clear that 'payment before delivery' is a fundamental term of the contract between A and B. The known facts do not justify drawing the same conclusion in relation to the promise to deliver the computer after lunch the next day.

Associated Newspapers Ltd v Bancks (1951) 83 CLR 322.

The word 'warranty' is used to describe all those terms terms of a contract that are of lesser importance than conditions. The promise to deliver the computer after lunch the next day is most likely a mere warranty.

Bettini v Gye (1876) 1 QBD 183.

Although the distinction between conditions and warranties is well established in Australian law, the courts do not always classify terms as either conditions or warranties. Sometimes the courts avoid this terminology, leaving particular terms unnamed (innominate) or treating them as 'intermediate' terms. If a breach of an inniminate term severely affects the intended outcome of the contract then it will be treated as a breach of a condition. If its consequences were minor it will be treated as a breach of a warranty.