Condition v' Warranty

1
Condition v. Warranty

• Contracts

2
Condition v. Warranty

• Classification of Terms
• Conditions
• Repudiation and Damages
• Warranties
• Damages
• Distinction between rescission and repudiation
• The Sale of Goods Act

3
Condition v. Warranty

• Bettini v. Gye
• Mr. Bettini is a singer, under contract to Mr.
  Gye for one year, unless it is fifty miles out of
  London and out of theater season
• He has to be in London six days prior to the
  start of the engagement for rehearsals
• He was not there in time.
• Therefore, the defendant claims that he does not
  have to pay the plaintiff.

4
Bettini v. Gye (contd)

• The effect of a breach depends on the intentions
  of the parties from the contract and the
  surrounding circumstances (paragraph 5)
• It does not matter whether the court thinks that
  the thing is important as long as the parties
  expressed themselves clearly enough (paragraph 9)

5
Bettini v. Gye (contd)

• Goes to the root of the contract (paragraph 10)
• Unlikely given the length of the engagement and
  what else Bettini is allowed to do (paragraph
  11).
• This does not rise to the level of a breach going
  to the root of the contract

6
Hongkong Fir Shipping Co. Ltd. v. Kawasaki Kisen
Kaisha Ltd.

• Hongkong Fir Shipping Co. Ltd. owns the boat
  Kawasaki Kisen Kaisha Ltd. is renting it. The
  charterparty said that if the boat was laid up
  for mechanical problems, no money would have to
  be paid for this time, and the charterers could
  add it on the back end of the charter (paragraphs
  11(A) and 23 of the charter)

7
Hongkong Fir Shipping v. Kawasaki Kisen Kaisha
Ltd. (contd)

• After being at sea for only weeks, the boat was
  off hire for a total of 18 weeks, and needed
  close to 59,000 in repairs
• The engine room crew was not large enough or
  experienced enough to care for a ship of this age
  (paragraph 3)

8
Condition v. Warranty (contd)

• Hongkong Fir Shipping Co. Ltd. v. Kawasaki Kisen
  Kaisha Ltd. (contd)
• Facts (contd)
• The charterers repudiate (paragraph 4)
• The owners sue for wrongful repudiation
  (paragraph 5)

9
Condition v. Warranty (contd)

• Holdings
• When do we allow the innocent party out of the
  contract in spite of problems?
• Paragraph 7
• does the occurrence of the event deprive the
  party who has further undertakings still to
  perform of substantially the whole benefit which
  it was the intention of the parties as expressed
  in the contract that he should obtain as the
  consideration for performing those undertakings?
• True whether there is a default or not (paragraph
  8)

10
Condition v. Warranty (contd)

• Holdings (contd)
• Conditions Paragraph 11
• Warranties Paragraph 11
• Innominate terms Paragraph 15
• The parties did intend this to be a condition
  because there was a due diligence requirement in
  paragraph 13