Implied Terms

            
             An implied term is a term that is not expressed by the parties (either in writing or orally) but which the court "reads into" the contract. .
             Given that courts are not supposed to make a contract for the parties, what is the justification for implied terms? The justification depends upon the type of implied term.
             In some cases, the court implies a term on the ground that the parties probably had the term in mind but simply neglected to express. Thus the court is giving effect to the actual intentions of the parties.
             In some cases the court implies a term which the parties probably did not have in mind but would have wanted had they thought of it. Again, the justification for implying the term is that the court is simply giving effect to what the parties would have wanted had they bothered to address the topic in their negotiations.
             However, there are other types of implied terms which have nothing to do with the parties' intentions. A statute (such as the Sale of Goods Act) might provide that certain terms will be implied into all contracts. .
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             Implied terms are those which are declared to be part of the contract even though the parties have not consciously included them. The courts will imply a term into a contract if they believe that the addition is necessary to make the contract truly reflect the intentions of the parties. The decision to do so will be based upon an examination of the express terms of the contract and the circumstances surrounding its formation. .
             There are four main circumstances which allow the courts to imply terms into a contract:.
             1. Trade or custom usage.
             2. Past dealings between parties.
             3. Business efficacy.
             4. Terms implied by operation of statute.
             Under the common law, terms may be implied by reference to trade or custom usage, if it is well known that certain practices traditionally apply to all contracts within the particular industry. They may also be implied under the common law by reference to previous dealings between the same parties, or to give business efficacy (commercial common sense) to the contractual arrangements.