Q&As

Can a contract be rescinded if, subsequent to the contract being concluded, one party attempts to redefine the terms?

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Published on LexisPSL on 31/10/2016

The following Commercial Q&A provides comprehensive and up to date legal information covering:

  • Can a contract be rescinded if, subsequent to the contract being concluded, one party attempts to redefine the terms?
  • Pre-contractual statements
  • Misrepresentation
  • Bars to rescission as a remedy for misrepresentation
  • Attempted variation

Can a contract be rescinded if, subsequent to the contract being concluded, one party attempts to redefine the terms?

In order to determine whether an event has occurred, which enables a party to rescind a contract, it is necessary to consider whether the activity amounts to any of the grounds for rescission of a contract. Those grounds are misrepresentation, undue influence and duress. See Practice Note: Rescission of a contract for further information.

This Q&A considers:

  1. whether there may have been any pre-contractual statements, which either form part of the contract or which amount to a misrepresentation

  2. the potential for the activity to amount to a misrepresentation, and

  3. the potential for the activity to amount to an attempted variation of contract.

Pre-contractual statements

Disputes can arise around when statements made by one party to another before the contract was entered into were intended to form part of the contract. In determining whether those statements form part of the agreed terms of the contract, the courts operate a test of detached objectivity, based on the intention of the parties as seen through the eyes of a reasonable third party.

Pre-contractual statements may be oral as well as written. While any exclusion and entire agreement clauses within the contract should always be considered, they may not always provide the protection intended.

Where a pre-contractual statement is not found to be a

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