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Concept
Incorporation of terms in English law
Summary
Incorporation of terms in English law is the inclusion of terms in contracts formed under English law in such a way that the courts recognise them as valid. For a term to be considered incorporated it must fulfil three requirements. Firstly, notice of the terms should be given before or during the agreement of the contract. Secondly, the terms must be found in a document intended to be contractual. Thirdly, "reasonable steps" must be taken by the party who forms the term to bring it to the attention of the other party. The rules on incorporating terms in English law are almost all at a common law level.
For a written term to be considered incorporated by the courts, it must fulfil three requirements. Firstly, notice of the terms should be given before or during the agreement of the contract. Secondly, the terms must be found in a document intended to be contractual. Thirdly, "reasonable steps" must be taken by the party who forms the term to bring it to the attention of the other party.
For a term to be considered incorporated into a contract, notice of that term must be given before or during the time of contracting, something established by Olley v Marlborough Court Hotel [1949] 1 KB 532. The claimant booked a room in a hotel owned by the defendant. Inside the door of her room was a notice stating that the hotel was not liable for anything lost or stolen unless the item had been given to the management to look after. When the fur coat of the claimant was stolen from her room, she sued the defendant for damages. It was held that because the contract had been made at the reception desk before the parties got to the room, and because notice of the term was only given after the formation of the contract, it was not an incorporated term and the claimant could sue the defendant for damages.
An exception to the rule on notice is past dealings. If the parties have had similar dealings in the past, the courts have previously found that notice is not necessarily required if their past dealings represent a "consistent course of action".
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