Krell v Henry [1903] 2 KB 740

KEY POINTS

• According to the parties’ presumed intention, an implicit warranty or condition may be implied.

• If the nature of the contract made it clear to both parties from the outset that the contract could only be fulfilled if a particular condition existed at the time the contract was fulfilled, then it was assumed when they entered into the contract that this condition would continue to exist.

• It is crucial to consider not only the contract's language but also the contextual circumstances and the parties' awareness of those facts when determining whether an implied condition, warranty, or representation should be applied in a contract.

FACTS

• The defendant, C.S. Henry, agreed to rent a flat in Pall Mall from the plaintiff, Paul Krell, for June 26 and 27, with the expectation that coronation processions would pass by.

• However, the contract did not explicitly mention the processions or any specific purpose for renting the flat.

• A deposit was paid initially, but since the processions did not occur as planned on those days, the defendant refused to pay the remaining rent.

JUDGEMENT

• Appeal dismissed.

COMMENTARY

• The case emphasizes the value of taking into account the context and the parties' knowledge when interpreting a contract.

• Here, the court used factors other than the written provisions of the contract to ascertain the parties' intentions.

• This principle highlights the need to take into account the larger environment in which the contract was created while resolving legal problems.

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