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Distinction between a representation and a term Term constitutes a binding promise by which a party commits to fulfilling an obligation If a term

of the contract is broken, the remedy lies in an action for breach of contract. in"ured party indicates that they would not have entered the contract had the statement not been made( Bannerman v )hite *+,* Indicator 3- .pecial knowledge and skill 0ar dealer who was in a position to know the history of the car and his statement about the car turned out to be wrong( Term( -ick Bentley v Harold Smith 0ontrast- D relied on registration book and did not know the fact( /ot term( .scar Chess #td v )illiams, The seller, unless he is the first owner, is not the originator of the statement about the year in the registration book and so the statement is only a representation and not a warranty/ Routled0e v 1c2ay Commentary3 )hereas this is clearly, on the facts, a difference between the two cases, but the presence or absence of negligence should not be a decisive issue in determinin0 whether a statement is a term or a re resentation4 relying on the statement in each case4 -ick Bentley v Harold Smith, D was a car dealer. If the buyer is e pert( he should verify the truth of the statement( .scar Chess #td v )illiams/ if he does not then the statement was not a term Indicator 4- .tatement e cluded from the written contract 5arol evidence rule but sub"ect to e ceptions /ote)eilbut, .ymons 6 0o v 7uckleton ,8,2 9ord %oulton considered that the 'uestion of whether an affirmation made by a vendor at the time of sale constitutes a term, as opposed to a representation, depends on the intention of the parties to be deduced from the whole of the evidence. .o, the factors listed in not decisive test Intention of the parties is deduced from the totality of evidence.

#epresentation merely a statement of fact which may be true or false a representation proves false and falls within the definition of an actionable misrepresentation! the innocent party may have the right to rescind (set aside) the contract and may be able to claim damages for misrepresentation. The award of damages for misrepresentation depends on establishing degrees of fault, i.e. that the misrepresentor was fraudulent or negligent. If the misrepresentation is innocent, damages cannot be claimed as such but may be awarded at the court$s discretion. %isrepresentation, the award of damages is on the tortious basis designed to put the party into the position they would have been in had the contract never been entered into

Differentiate btw Term and #epresentation &hether a statement is a term or representation is primarily a 'uestion of intention, and this is a matter that is ascertained ob"ectively depends on the intention of the parties to be deduced from the whole of the evidence ( Heilbut, Symons & Coy v Buckleton )owever, there are indicators to intention *none decisive+. Indicator ,- %anner( %aker assume responsibility .tatement of asking buyer to check about the sub"ect but did not check and turn out to be different what are e pected(/ot Term( Ecay v Godfrey 0ontrast- a statement is made with the intention of preventing the other party from finding a defect (checking)(Term as maker of the statement accepted responsibility for the soundness of the statement ( Schawel v Reade Indicator 1- Time interval longer the interval between the statement and the conclusion of the contract, the greater the presumption must be that the parties did not intend the statement to have contractual effect (Inntre reneur !ub Co "G#$ v East Crown #td %&'''(

where a contract has been breached, the innocent party has a right to claim damages if it is proved that a term has been broken. (victim of a breach of contract is in a better position than a misrepresentee)

Damages are usually based on e pectation loss! which will put the in"ured party in the position they would have been in had the contract been properly performed, i.e. if the statement embodied in the term had been true

Indicator 2- Importance of the statement

The true distinction between the two cases surely lies in the relative degree of e pertise between the maker of the statement and the party