Chapter 7: Terms Implied in Fact
INTRODUCTION 7.01 Up until this point, we have dealt with terms that are naturally implied by operation of law. We began consideration of the substantive law with terms that are implied by the courts into all contracts of a given, identifiable, type; we have designated these ‘terms implied at common law’. We continued with terms implied by the courts not as a necessary incident of contracts of the type in question, but on the basis that they are customary in the trade or locality, or (in the case of prior course of dealing) have become the ‘localized’ expectation of the parties involved. We then considered terms that are implied into contracts by statutes, some of which were formerly implied at common law. Some of these terms can be excluded by express terms, some cannot. Except for the prior course of dealing category, all of these terms are ‘out there’ and, with sufficient care and skill and patience, can be discovered. They apply to contracts of a type, or within a trade or locality, or involving categories of parties, in which any number of contracting parties might find themselves engaging. 7.02 In this final chapter, we will consider the process known as implication in fact. This process is fundamentally different from other processes of implication of terms in that it involves only the particular contract, the exact transaction, under consideration by the court. All implication of terms is, in a way, an aspect of construction of contracts, in the sense that...
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