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KembaraXtra – Legal Terms – Innominate Terms (Intermediate Terms)
Innominate terms are contractual terms that cannot be neatly classified as either conditions or warranties. Unlike conditions, whose breach automatically allows termination, or warranties, whose breach only gives rise to damages, the effect of breaching an innominate term depends on the seriousness of the consequences.
The court assesses whether the breach has deprived the innocent party of substantially the whole benefit of the contract. If it has, the contract may be treated as repudiated; if not, the remedy will be limited to damages. This flexible approach allows courts to achieve fairness based on the facts of each case.
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