Unless restricted by something else, an employer ought to find work to enable a workman to perform his part of the bargain, namely, to do his work. A term will be implied into a contract only to the extent required to give the contract efficacy: ‘if it is necessary, in the business sense, to give efficacy to the contract.’ A term will not be implied in order to give business efficacy to a contract unless it is necessary to prevent such failure of consideration as cannot have been within the contemplation of either side.
Bowen LJ said: ‘In business transactions such as this, what the law desires to effect by the implication is to give such business efficacy to the transaction as must have been intended at all events by both parties who are business men . . to make each party promise in law as much, at all events, as it must have been in the contemplation of both parties that he should be responsible for.’ and
‘Now, an implied warranty, or, as it is called, a covenant in law, as distinguished from an express contract or an express warranty, really is in all cases founded upon the presumed intention of the parties, and upon reason. The implication which the law draws upon from what must obviously have been the intention of the parties, the law draws with the object of giving efficacy to the transaction and preventing such a failure of consideration as cannot have been within the contemplation of either side; and I believe that if one were to take all the cases . . of implied warranties or covenants in law, it will be found that in all of them the law is raising an implication from the presumed intention of the parties with the object of giving to the transaction such efficacy as both parties must have intended that at all events it should have.’
Bowen LJ
(1889) 14 PD 64, [1886-90] All ER 530, (1889) 5 TLR 316, (1870) LR 5
England and Wales
Cited by:
Cited – Wright v The Jockey Club QBD 15-May-1995
A jockey had been refused a jockey’s licence for medical reasons. He sought damages for his loss of earnings. The club applied to strike out the claim as showing no arguable cause of action.
Held: The duties of a body exercising a licensing . .
Cited – Dymocks Franchise Systems (NSW) Pty Limited v John Todd and Alicia B Todd Bilgola Enterprises Ltd and Lambton Quay Books Ltd PC 7-Oct-2002
PC (New Zealand) The claimants asserted that the respondents had wrongly terminated their franchise licence. The agreement was subject to the New South Wales law requiring good faith, but the court had not had . .
Cited – John Roberts Architects Ltd v Parkcare Homes (No. 2) Ltd TCC 25-Jul-2005
The defendant had taken a dispute to adjudication, but then abandoned those proceedings, upon which the adjudicator awarded costs against the defendant which the claimant now sought to enforce. The defendant argued that the award was outside the . .
Cited – Legal and General Assurance Society Ltd v Expeditors International (Uk) Ltd CA 24-Jan-2007
Leases contained break clauses which the tenant purported to exercise. The landlord replied that they were ineffective because the tenant had not complied with his repair covenants. The dispute appeared settled after negotiations, and the settlement . .
Cited – The County Homesearch Company (Thames and Chilterns) Ltd v Cowham CA 31-Jan-2008
The defendants contracted to pay estate agents to find them a house. They completed the purchase of a property mentioned to them three times by the agent, but now appealed from a finding that they were obliged to pay his commission. The judge found . .
Cited – Strydom v Vendside Ltd QBD 18-Aug-2009
The claimant sought recovery of a sum paid to the defendant as a commission by his union during his claim for personal injuries at work, relying on a term he sought to have implied into his contract, that the costs position should not be . .
Cited – Attorney General of Belize and others v Belize Telecom Ltd and Another PC 18-Mar-2009
(Belize) A company had been formed to manage telecommunications in Belize. The parties disputed the interpretation of its articles. Shares had been sold, but the company was structured so as to leave a degree of control with the government. It was . .
Cited – Marks and Spencer Plc v BNP Paribas Securities Services Trust Company (Jersey) Ltd and Another SC 2-Dec-2015
The Court considered whether, on exercising a break clause in a lease, the tenant was entitled to recover rent paid in advance.
Held: The appeal failed. The Court of Appeal had imposed what was established law. The test for whether a clause . .
Cited – Lehman Brothers International (Europe) v Exotix Partners Llp ChD 9-Sep-2019
The parties had contracted to trade global depository notes issued by the Peruvian government. Each made mistakes as to their true value, thinking them scraps worth a few thousand dollars, whereas their true value was over $8m. On the defendant . .
Lists of cited by and citing cases may be incomplete.
Contract
Leading Case
Updated: 10 November 2021; Ref: scu.197905
