Reciprocity II: the precise contours of the exchange?

Abstract

Determining contract content proves endlessly contentious. This chapter examines how courts determine whether a contractual document is binding, identify terms beyond express agreement through collateral terms, implied-in-fact terms giving business efficacy, implied-in-law terms, and mandatory statutory terms. The parol evidence rule’s sacred status for written contracts erodes through numerous exceptions. Signed documents bind conclusively; unsigned documents require reasonable notice with the red-hand rule demanding explicit highlighting for onerous terms. Courts determine whether statements are contractual terms or mere representations based on fairness considerations—relative expertise, importance to the claimant, and whether verification is suggested. Interpretation remains contested between literal and contextual approaches, with unreasonable results disfavoured. Courts cannot consider pre-contractual negotiations or post-contractual conduct. Technology challenges traditional interpretation through dynamic, hyperlinked documents that change over time and terms buried in unread digital agreements.