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condition


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N.

1 A major term of a contract. It is frequently described as a term that goes to the root of a contract or is of the essence of a contract (see also time provisions in contracts); it is contrasted with a warranty, which is a term of minor importance. Breach of a condition constitutes a fundamental breach of the contract and entitles the injured party to treat it as discharged, whereas breach of warranty is remediable only by an action for damages, subject to any contrary provision in a contract (see breach of contract). A condition or a warranty may be either an express term or an implied term. In the case of an express term, the fact that the contract labels it a condition or a warranty is not regarded by the courts as conclusive of its status (L Schuler AG v Wickman Machine Tools Sales Ltd [1974] AC 235 (HL). See also innominate terms.

2 A provision that does not form part of a contractual obligation but operates either to suspend the contract until a specified event has happened (a condition precedent) or to bring it to an end in certain specified circumstances (a condition subsequent). When X agrees to buy Y's car if it passes its MOT test, this is a condition precedent; a condition in a contract for the sale of goods that entitles the purchaser to return the goods if dissatisfied with them is a condition subsequent.

Subjects: Law.


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