Terms that specify the parties' contractual obligations are included in every contract that parties engage into. These contract terms may be either warranties or conditions, and the parties should specify which terms will be conditions and which will be promises. In the case of a breach of the agreed contractual terms and the remedies to be pursued, the precise identification of the two terms becomes extremely important. A contract may contain explicit or implied terms. While express terms are expressly agreed on by the contracting parties implied terms may not be put in writing or even agreed upon orally but may seem quite obvious to the contracting parties. These terms may arise from the parties’ intention, operation of the law or through custom and usage.
Application
From the case in point, Mikaela prior to the formation of contract inquired from Tower Flours through Ricky if their almond flour was gluten free.
Ricky’s response was in the affirmative. That was an indication that Tower flours’ almond flour did not contain any gluten. Ricky’s response was not with regard to a portion of Tower Flours’ almond flour but the almond flour in general. Based on that understanding Mikaela went on to place an order for almond flour. Though the online order did not specifically contain the provision for gluten free almond flour, there was an implied term that the almond flour would not contain any gluten. This was based on the information that the company’s flour did not contain any gluten from Ricky’s response.
Mikaela made known to Tower Flours that she intended to order for gluten-free almond. The Tower flours in this case therefore breached the said implied term by supplying Mikaela with almond flour that contained gluten. The breach by Tower Flours in this case may amount to defective performance whereby a party though delivering on their promise fails to adhere to the agreed standards or quality. Tower Flours did deliver the almond flour but which turned out to contain gluten.
Conclusion
From the discussion above therefore, it was a term in the contract that the almond flour be gluten-free.
Question 2
Issue
Was there an implied term in Dan and Jacob’s contract with Mikaela that their wedding cake would be gluten-free?
Rules
The common law principles recognize implied terms as those terms though not expressly stated are deemed obvious to the contract.
Application
Dan and Jacob entered into a contract to with Mikaela for the baking of a wedding cake from almond flour. Mikaela went on to perform her contractual obligation by baking the cake as ordered, which cake however Dan severely reacted to due to the Coelic disease he was suffering from. The information of the disease was however not disclosed at the formation of the contract, neither were there any specifications from Jacob and Dan that the almond flour was to be gluten-free.
The presence of a term in a contract brings about the aspect of breach if any. A breach in a contract happens where one of the parties to a contract fails to honor their contractual obligations and further fails to avail any legitimate reason for it. A party may only breach the terms to a contract and not non-existent. Therefore in establishing any breach by a party, one has to look into what the terms of the contract were.
Conclusion
In Dan and Jacob’s contract with Mikaela in terms of the contract, the terms were that Mikaela bakes for the two a wedding cake from almond flour. There was therefore no term whether express or implied as to the specifications on the almond flour content. Mikaela has not breached any term in the contract entered into with Jacob and Dan. She can also not be held liable for any breach as it non-existent.
Question 3
Issue
Was the icing colour on Kimiko’s cake a condition or a warranty of the contract with Mikaela.
Rules
A condition in a contract goes to the very root of what the contract is all about, the basis of its formation. Therefore its breach may lead to a repudiation of the contract by the aggrieved party. Warranties on the other hand form minor and incidental terms to a contract. They do not necessarily go the basis of the contracts existence. The breach of a warranty may result to a claim for damages and not necessarily repudiation of the contract.
The common law principles on contracts stipulate what amount to a warranty or a condition. This is because a condition is central to the formation of a contract while a warranty is not. Understanding the difference between the two is relevant in determining on what remedies Kimiko can explore.
Application
At the formation of the contract, Komiko ordered for a chocolate cake, round in shape with purple and blue colours on the icing. Mikaela baked the cake but failed to incorporate the colours on the icing sugar as instructed by Kimiko. At the formation of the contract Komiko did not expressly state to Mikaela the purpose of the cake and but it was expressly stated that the icing colours were to be purple and blue.
The cake as it turned out was for a sports function and therefore the colours may have been a symbol of something at the function. The baked cake does not fit the description given by Kimiko. There were specific instructions as to the colours. Those instructions go to the root of the contract.
In Poussard v. Spiers, a party entered into a contract where for three months she would perform as a singer. Five days into the commencement of the performance she fell ill and was unable to perform for those days and had to be replaced. The court held that there been a breach of a condition by the singer.
Conclusion
From the above analysis therefore, the icing colour on the cake was a condition in the contract. The sign on the wall near the counter does not equally prevent Kimiko from complaining to Mikaela.
Question 4
Issue
Is Mikaela still responsible for the icing being the wrong color on Kimiko’s cake?
Rules
As per the common law principles earlier discussed, while warranties do not go to the root of a contract and are therefore incapable of causing a party to rescind a contract, conditions are central to the contract’s formation. Even so where a party breaches a warranty in the contract, the breach may lead to a claim for damages by the aggrieved party. In Kimiko’s case, Mikaela should still be held liable for the wrong colour on the icing.
The Common law provides for a number of remedies that an aggrieved party may seek in the event of loss or injury and damages are one those remedies. Damages are the relief or award to an aggrieved party to a contract typically in form of money as the compensation for the injury or loss suffered by that party. The reason behind the relief is to place the injured party to the initial position they were in if the party to the contract had not breached the contractual terms. Damages are categorized as being either punitive or compensatory.in the event of compensatory damages, there is a further requirement by the court to assess the quantum of the damages. The aggrieved party should however have performed their contractual obligations.
Application
In Hadley v Baxendale the court established that a party that had not breached their contractual obligations could recover damages. The facts of the case were that Hadley owned a mill which he operated. The shift of the mill broke as he operated the mill. He went on to enter into a contract with Baxendale to have the shift delivered to an engineering company at a specified date. Hadley did not however inform Baxendale of the Mill’s defect till it had been fixed. This resulted to huge losses on Hadley who sued for damages. The trial court awarded him but the decision was overturned upon appeal by Baxendale.
Kimiko in this case is the aggrieved party and is entitled to seek damages against Mikaela.
Conclusion
Mikaela’s failure to fully incorporate the instructed colour of the icing sugar on the cake therefore, amounted to a breach of a warranty in the contract. Kimiko’s entitlement to damages is premised on the fact that there was an express warranty. The condition was expressly stated by overt words of kimiku to Mikaela.
