Describe how Statues (the Law) affect Contractual Terms

The Express Terms are what you are particularly agreeing to. It may be in Writing, Verbal or a mixture of the two. There are Two Basic Types Express Terms: Conditions- this is the main points agreed to and very important. If these are not met the contract can be void and you can claim damages. Whilst Warranties- these are Secondary points in the contract that are not really important, if these are not met the contract will still be valid but the losing party may claim damages.

In my contract for the “Nationwide Cash Card Account" the Express Terms in this contract are:

‘I have read and agreed to the Terms and Conditions, the Declaration and, if applicable to me, the Charitable Assignment that I have received with this Application.’

You must be 18 or over to apply for Overdrafts, other credit facilities, a cheque guarantee and debit card.

The accounts can only be opened by individuals and must not be used for businesses purposes.

Describe in your own words the Implied Terms of the Contract.

Implied Terms is whether the contract is stated or not, there are still certain rights and responsibilities, which are automatically present as soon as a contract is made.

For Example- A bought car (that is brand new) the implied term for this car is that the car should have wheels and drivable. Another example, in a contract to lease a furnished house/flat the implied term here is that the house will be furnished and habitable.

“Nationwide Cash Card Account"- the implied term here is the bank or the banker is not responsible to repay the customer for the proceeds borrowed from the customer until the customer demands the payment. So the customer could not have a claim for debt, this term is important term of the contractual between the banker and the customer.

There are duties owed by the bank to the customer e.g. the bank has a duty to protect its customer from fraud committed by the directors and partners making the orders. There is also a duty of care by the bank to the customer when the bank is giving advice on investments or when the bank gives advice or explains security documentation. But the bank is not under a continually duty to keep the advice under review and in some situations the bank was also supposed to not have a duty of care to any third parties.

From www.inbrief.co.uk/bank-obligations-to-customers.htm

Describe the impact of both these types of terms with regards to:

Time for performance or Rejection of Goods

An example of Express Terms for Time for Performance in the Contract: A shop keeper telling a person who works for paint/building Company in the contract that he has to paint, to sort out and assemble shelves to put on the shop wall. All of this has to be done in two weeks the condition of this time performance is important because if this person does not finished the job in two weeks, the shop keeper may not be able to sell his goods to customers who are expecting his shop to be open at that time. The impact of the Express Term here is that due to the agreement of finishing the work at a certain time period, the shop keeper has the right to complain to the building/paint company. Also the shop keeper can claim compensation for any losses. Whilst the payment to this person who finished the job in the shop may not of be important because he works for the paint/building company, so the shop keeper could pay the money a day or two after the finished job this could be a Warranty since it is the least important in the contract.

An Example of Implied Terms for the Rejection of Goods: A customer recently brought an Expensive flat screen Sony TV from Currys (well-known Electronic store) when it was delivered to her house, the customer found out the Flat Screen Sony TV was a Panasonic Flat Screen TV and it did not work. The brought TV was unfit for purpose and the contract was void so the Impact Term for this case is the customer has the right to either phone the Currys store/hotline or go back to the store to the reject the good and ask for a refund. Since the Implied term for this brought TV is it would work and it would be a Sony Flat Screen TV. Plus it breached the Sales of Goods Act Implied Term which are: “The goods are as described," and “The goods are fit for the purpose for which they were brought."

Price Variations and Payment Terms

An Example for Express Terms for Price Variations and Payment Terms is: A customer at Pizza Hut ordering a special deal for Two large Pizzas, with salad and drinks. The restaurant quoted the price for the Customer’s order £18.99 and the Express Term here is that both of there parties agreed to this. Fifteen Minutes later the same member of staff gives the customer their order and charges £22.99 instead of the deal price £18.99 the staff stated the price increased suddenly due to low shortage of ingredients such as toppings and dough for the Pizza. The impact of the Express Term for this situation is that the customer can refuse this because in the beginning both parties agreed to the Verbal Express Term Contract and the customer has the right to refuse to pay £22.99 but instead the original agreement of £18.99. Another example of Express Terms for Price Variations and Payment Terms is the customer booking a summer holiday to Spain at Thomas Cook a Year in advance. In the Contract Thomas Cook would probably include Price Variation Clauses (this is time delay between agreeing the contract and its completion, whilst the inflation may have increased). The Express Term is used here just in case the price for the tickets to Spain may increase due to inflation (e.g. increase in petrol prices for planes, food, etc).

An Example of Implied Terms for Price Variations and Payment Terms: A person brings there car to a Mechanic to see what the problem is and to fix it, but the Mechanic can not give an accurate quote just an estimate (so therefore the price may vary). Later on the Mechanic estimates the costs to pay for the new car parts and to fix the car would be around £250 or over. The customer agrees to this and Mechanic starts ordering the car parts and fixing the car, after the mechanic is finished he tells the customer it will cost for the service of fixing the car and new car parts £280. The impact of the Implied Term for this example is that the customer does not have the right to complain and has to pay £280 given that the customer knew that he had to pay around £250 or over.

The quality and quantity of Goods Delivered

An Example of Quantity of Goods delivered for Express Terms would be a Primary School ordering from their regular suppliers: One hundred sets of Colouring Pencils, Fifty Red Pens, Fifty Blue Pens and Fifty Black Pens. When these ordered goods were delivered to the Primary School, the school only received Thirty-four sets of Colouring pencils, ten red pens, twenty blue pens and no black pens. The Express term here is that both parties agreed to this contract, so therefore the school expects the suppliers to deliver the right amount of goods them. The Primary School has the right to reject and return the goods at a reasonable time, due to the fact that the Quantity of goods ordered does not match to what the school orders plus the school should not pay for the returned goods the Supplies should pay for this cost.

An Example of Quality of Goods delivered for Implied Terms would be a customer going to a Mobile Phone Company website and saw a new Samsung Mobile that stated you can access internet and has 6-Megapixel camera. The customer ordered this new Samsung phone, when it was delivered to her apartment the new Samsung Phone did not have internet access and was 2-Megapixel camera instead of 6-Megapixel camera plus there were scratches on the mobile phone and the person could hardly hear their friends when using the phone to call people (bad quality). The impact of Implied Term for this mobile situation is that the customer has the right to reject this good and to Phone up the Mobile Phone Company to complain about the Samsung phone since the phone did not match the description and was very bad quality. The Implied Term for this situation is that the phone would have these features that was described and would be in good quality since it was a brand new Samsung phone also the Mobile Phone Company has also breached the Sale of Goods Act.

Any reference to Reservations of Title or Exclusion Clauses

An Example of Express Terms for the Reservation of Title is a customer giving clothes to the Drycleaners and the Express Term on the Drycleaners’ contract states “the title of the goods will not pass to the purchaser until the price has been paid in full." This means even though the customer’s clothes is her possession of goods, she will not own them until she pays the Drycleaners. The Express Term here is the Drycleaners will keep possession of the clothes/goods, until the payment is made (the Drycleaner is entitled to refuse to hand it over).

An Example of Implied Terms for Exclusion Clauses: Exclusion Clauses are clauses (statements) in the contract where the seller is specifically excluding liability for certain things. E.g. Customer enters corner shop, on their shop wall it states they are not responsible for goods and will not offer exchange or refunds. He buys a Chocolate bar that states there is Caramel filling inside the bar, the customer purchases the chocolate bar and when he eats it and there is no Caramel filling. The person complains about the Chocolate Bar to the Corner Shop Owner, and he is not responsible for the product and will not give the customer a refund and the owner said that this was stated on the shop wall. This is not true and the customer has the right to companion and ask for a refund because it states on the Implied Terms in the Sales of Goods Act: “In a consumer contract, the seller cannot rely on an exclusion clause where the seller tries to avoid their responsibilities which are; the goods are as described and the goods are fit for purpose for which they were brought."

Give advice to any customers of Citizen’s Advice Bureau who might be considering completing a Standard Form Contract like the one you have.

My advice on completing a Standard Form Contract like the one I have, which is the ‘Nationwide Cash Card Account’:

First of all you need to read the contract to check if you are eligible for the Nationwide Cash Card Account by looking at the ‘Cash Card Account Guide’ or the first three points of the actual Standard Form Contract, titled ‘Application by post for a Cash Card Account’.

If you are eligible for the Cash Card Account, then read the information about the Cash Card Account such as the features, what you need to provide, information about the Interest Rates and charges. Plus the Terms and Conditions and the small prints.

After reading through the points I mentioned you then need to read the top of the Standard Form Contract that tells the customer how to fill the form in: “This form will be scanned electronically, please write INSIDE the boxes in BLOCK CAPITALS using black ink as this will help us to process".

I will also advise you to read through the contract just in case you need to get your documents to fill in the Nationwide Cash Card Account Application such as Pay check to fill in application about your income, employment status, etc.

Another important thing you need to do is check the Contract is valid and there is no:

Misrepresentation- when toy are encouraged to buy something by

misrepresenting the truth about the product.

Double check that you are not entering a Contract by mistake e.g. you do not

want a Cash Card Account but a Current Account from Nationwide.

Exclusion Clauses (this are Clauses (statements)) in the contract where the seller is purposely excluding liability for certain things e.g. Nationwide might state on the Contract they are not responsible if they lost the customer’s money that they put on their Cash Card Account.

Lastly make sure you take your time filling in the Contract neatly, and make sure all the required details are filled in (if you are worried that you have made a mistake on the Contract, photocopy the Contract. Fill the photocopied contract and if it’s done properly, copy the details from the photocopied contract to the Actual Nationwide Cash Card Account.

Describe the extent to which your Contract imposes obligations on the business with regard to following laws:

Unfair Contract Terms Act 1977 (UCTA)

Unfair Contract Terms Act 1977 gives protection to business dealing with other businesses, it gives businesses information on legal contracts and the UCTA lays down rules regarding the use of Exclusion Clauses.

a) Exclusion for death or injury is never permitted. b) Excluding liability for losses caused by negligence is only allowed if it is reasonable. c) Excluding liability for defective/poor quality goods is only permitted if it is reasonable.

Unfair Terms in Consumer Contracts Regulations 1994 (URCCR)

The Unfair Terms in Consumer Contract Regulations covers all types of Contracts apart from employment, partnerships, family, land and inheritance contracts. It also covers Contracts for financial services and insurance contracts as well as those for goods and services generally. With regards to consumer contract the UTCCR applies Three Test: 1) ‘The relative bargaining power of the parties and any inducement to enter the contract, do the terms create a significant imbalance between the business and the consumer, with regard to their rights?’ 2) ‘Are the terms written in plain intelligible language? If not, the consumer will have the benefit of the doubt’. 3) ‘Do the terms fall within the ‘Grey list’ (this is the list of terms which are automatically classed as unfair if they are used in a contract) of 17 unfair terms?’

Consumer Protection (Distance Selling) Regulations 2005

The Consumer Protect (Distance Selling) Regulations apply in situation where a Consumer purchases goods without first having a chance to inspect them. It also includes situation where goods are sold through: The internet; Phone calls, faxes or text messaging; Mail order- catalogues or from advertisements in newspapers and magazines. The Consumer Protection Regulations state that, in these situations: 1) ‘the business must supply the customer with ‘prior information’ before the contract is entered into-clear details of the goods/service; delivery and payment information; the suppliers contact details and the consumer’s right to cancel.’ 2) ‘This information should be in a durable format- paper based or via the Internet.’ 3) ‘The consumer has a cooling-off period and can cancel the contract within seven working days.’

Electronic Commerce (EC Directive) Regulations 2002

The Electronic Commerce Regulations apply whether you are doing business online or if your business communicates using email. The main points of the regulations are that, a business website must: Include the business address-not just PO Box address; Provide direct and easy access to the business such as a telephone number or web response which would be answered by a human being; The company registration and VAT numbers; Show prices clearly and state whether or not they include the VAT and delivery charges; Make terms and conditions available to prospective buyers.

There is nothing in this Contract that reflects these laws that I mentioned.