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Contractual terms are statements that form part of a contract. Parties to a contract will normally be bound to perform any promise that they have agreed to, and failure to perform this promises, or a unsatisfactory performance, may lead to an action for breach of contract. Some statements, however, do not form part of a contract, even though they might have led the other party into entering into the contract in the first place. These pre-contractual statements are known as representations. The consequence of such representations turning out to be false is an action for misrepresentation, not an action for breach of contract. The key consequence of this distinction is that each of these actions provides different remedies. It is important, therefore, to decide precisely what promises are included in the contract. Types of contractual terms Once it is decided that a statement is a term, rather than merely...

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