BetterLawNotes-5 (2)

CONTRACT LAW

There are three sources of implied terms. Terms may be implied by custom, in fact, and by law.

Terms Implied by Custom

A term may be implied into a contract if it is customary in a particular trade or profession, or in certain types of contract in a particular locality. No such term may be implied where it would be inconsistent with an express, or other implied, term of the contract.

Les Affréteurs Réunis v Walford [1919] AC 801

A clause in a charterparty provided that commission on the estimated hire fell due on the signing of the charter. The shipowners argued that, on the facts, commission was not owing because of a custom within the trade that commission only became payable if hire was earned. The court held that a term based on such custom could not be implied as it would be inconsistent with an express term of the charterparty.

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