Implied terms in contract law refer to the provisions that are assumed to be included in a contract, even if they are not explicitly stated. These terms are generally based on the common understanding between the parties involved in the contract.
There are two types of implied terms in contract law: terms implied in fact and terms implied in law.
Terms implied in fact are those that are inferred from the circumstances surrounding the contract. These can include the parties` prior dealings, industry custom, or the parties` intentions. For example, if two companies have been doing business together for years, it can be assumed that they both understand the terms of the contract and that certain things do not need to be explicitly stated.
Terms implied in law, on the other hand, are terms that are not specifically included in the contract but are nonetheless enforced by law. These are generally terms that are deemed necessary to give effect to the contract. For example, if a contract does not include a deadline for payment, the law will imply a reasonable time frame for payment to be made.
Implied terms are important because they help to ensure that contracts are fair and reasonable. They can also help to avoid disputes between parties by making it clear what is expected of each party.
However, it`s important to note that implied terms cannot override explicit terms in a contract. If a contract explicitly states that a certain provision will not apply, then it cannot be implied into the contract.
In conclusion, implied terms in contract law are provisions that are assumed to be included in a contract, even if they are not explicitly stated. These terms can be implied in fact or in law and are important for ensuring that contracts are fair and reasonable. However, they cannot override explicit terms in a contract.