As express terms are laid down by the parties, further terms may in some circumstances be read into contracts by the courts. These implied terms maybe divided into four groups: terms implied in fact; terms implied in law; terms implied by custom; terms implied by trade usage.

Terms implied in fact

These are terms not laid down in the contract, but which it is assumed both parties would have intended  to include if they had thought about it- they may be left out by mistake, or because one or both parties thought them so obvious that they did not need to be spelt out.

Terms implied by law

These are terms which the law dictates must be present in certain types of contracts, in some cases, regardless of whether or not the parties want them.

Terms implied by custom

Terms can be implied into a contract if there is evidence that under local custom they would normally be there. This was illustrated in the case of Smith v Wilson (1832).

Terms implied by trade usage

Where a term would routinely be part of a contract made by parties involved in a particular trade or business, such a term may be implied by the courts.

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