Introduction
This essay explores a seemingly absurd scenario in a pizza parlour to unpack deeper issues in contract law, specifically the interpretation of contractual terms and the implication of unexpressed terms. When a man orders “cheese and ham” and receives uncooked ingredients instead of a pizza, the question arises: why do we find the waiter’s response absurd as a matter of contract law? This situation provides a lens to critically examine whether the customer’s expectation of a baked pizza stems from interpreting the express terms of the offer or from implying an unstated term into the agreement. By engaging with the interpretation/implication debate, this essay will assess relevant case law and scholarly perspectives to argue that the customer’s expectation likely arises from an implied term, shaped by contextual norms and reasonable expectations, rather than a strict interpretation of the literal words used. The discussion will proceed by outlining the principles of interpretation and implication, applying them to the pizza parlour scenario, and critically evaluating the balance between these approaches in contract law.
Principles of Interpretation in Contract Law
Interpretation in contract law seeks to ascertain the meaning of the parties’ agreement as expressed in their chosen words. The courts adopt an objective approach, focusing on what a reasonable person would understand the terms to mean in the context of the agreement. This principle was reaffirmed in Investors Compensation Scheme Ltd v West Bromwich Building Society (1998), where Lord Hoffmann outlined that interpretation involves considering the background knowledge reasonably available to the parties at the time of contracting (Hoffmann, 1998). Therefore, in the pizza parlour scenario, a strict interpretation of “cheese and ham” might suggest merely the ingredients, as that is the literal meaning of the phrase. However, this approach often seems inadequate in commercial contexts where language is used with an implicit understanding of trade customs or norms.
Critically, interpretation is limited to the express terms of the contract. As Arnold v Britton (2015) established, courts must prioritise the natural and ordinary meaning of the language used, even if it leads to an uncommercial result, unless the wider context compels a different reading (Arnold v Britton, 2015). Applying this to our scenario, a literal interpretation of “cheese and ham” without regard for the context of a pizza parlour could justify the waiter’s actions. Yet, this outcome feels absurd because it ignores the situational backdrop—a restaurant known for serving prepared food. This tension highlights the limits of a purely interpretative approach and suggests that implication may play a role in addressing unexpressed but obvious expectations.
The Role of Implied Terms in Contract Law
Implied terms are those not expressly stated by the parties but incorporated into the contract to reflect their presumed intentions or to ensure the contract’s efficacy. The test for implying a term in fact was clarified in Marks and Spencer plc v BNP Paribas Securities Services Trust Company (Jersey) Ltd (2015), where the Supreme Court emphasised that a term will only be implied if it is necessary to give business efficacy to the contract or is so obvious that it goes without saying (Marks and Spencer, 2015). Additionally, the term must be capable of clear expression and must not contradict any express terms.
In the pizza parlour example, it could be argued that a term requiring “cheese and ham” to be delivered as a baked pizza is so obvious that it goes without saying. Ordering food in a restaurant typically implies a request for a prepared dish, not raw ingredients, unless explicitly stated otherwise. This aligns with the contextual approach to implication, where courts consider the parties’ shared assumptions within a specific setting. Scholarly opinion supports this view; for instance, McMeel (2003) argues that implied terms often bridge the gap between literal language and commercial reality by reflecting common trade practices or reasonable expectations (McMeel, 2003). Therefore, suggesting that the waiter’s delivery of uncooked ingredients breaches an implied term appears more convincing than relying solely on interpretation of the express request.
Interpretation vs Implication in the Pizza Parlour Scenario
Applying these principles, the pizza parlour scenario reveals the interplay between interpretation and implication. A strict interpretative approach would focus on the words “cheese and ham,” potentially validating the waiter’s actions as a literal fulfilment of the request. However, as noted earlier, this outcome disregards the context—a restaurant environment where “cheese and ham” is understood to mean a pizza. The case of Chartbrook Ltd v Persimmon Homes Ltd (2009) supports a contextual interpretation, with Lord Hoffmann advocating for consideration of the “background matrix of fact” to discern meaning (Chartbrook, 2009). Yet, even with a contextual interpretation, the express term “cheese and ham” might not definitively convey “pizza” without further implication.
Conversely, implying a term that the order must be a prepared pizza seems more aligned with the parties’ intentions. The test of obviousness from Shirlaw v Southern Foundries (1939)—whether both parties would have said “of course” to the implied term—appears satisfied here (Shirlaw, 1939). A customer and waiter in a pizza parlour would likely agree that “cheese and ham” means a pizza, not raw ingredients. Furthermore, implying such a term gives business efficacy to the transaction, as a restaurant contract without an expectation of prepared food would be commercially nonsensical. This suggests that implication, rather than interpretation alone, better explains why the waiter’s actions are absurd under contract law.
Critical Evaluation of the Implication/Interpretation Debate
The broader debate between implication and interpretation reflects a tension between judicial restraint and flexibility in contract law. Interpretation prioritises the sanctity of express terms, aligning with the principle of freedom of contract—parties should be bound by what they explicitly agree. However, as critics argue, this can lead to harsh or uncommercial outcomes, as seen in Arnold v Britton (2015), where a literal reading prevailed despite practical absurdity (Arnold v Britton, 2015). Implication, by contrast, allows courts to fill gaps in agreements, ensuring fairness and reasonableness, but risks overstepping into rewriting contracts, as cautioned in Marks and Spencer (2015).
In the pizza parlour case, relying on implication raises concerns about judicial intervention. If courts too readily imply terms based on perceived obviousness, they may undermine the certainty of contractual agreements. On the other hand, a rigid interpretative stance fails to account for the reality of human communication, where not every expectation is explicitly articulated. Arguably, a balanced approach—where interpretation considers context but implication is used sparingly for necessary or obvious terms—offers the most practical framework. In this scenario, implication appears justified, reflecting the shared understanding inherent in a restaurant setting.
Conclusion
In conclusion, the absurdity of a waiter delivering uncooked cheese and ham instead of a pizza in response to a customer’s order illuminates key issues in contract law, particularly the interpretation/implication debate. While a strict interpretation of “cheese and ham” might technically justify the waiter’s actions, such an approach disregards the contextual reality of a pizza parlour, where prepared food is the norm. Instead, implying a term that the order must be a baked pizza better captures the parties’ reasonable expectations, satisfying tests of obviousness and business efficacy. Critically, this scenario underscores the limitations of pure interpretation in addressing unexpressed but essential terms, while also highlighting the need for caution in implying terms to avoid undermining contractual certainty. Ultimately, the balance struck between these approaches remains pivotal in ensuring that contract law reflects both the literal agreements and the practical intentions of the parties involved.
References
- Arnold v Britton [2015] UKSC 36.
- Chartbrook Ltd v Persimmon Homes Ltd [2009] UKHL 38.
- Hoffmann, L. (1998) Investors Compensation Scheme Ltd v West Bromwich Building Society [1998] 1 WLR 896.
- Marks and Spencer plc v BNP Paribas Securities Services Trust Company (Jersey) Ltd [2015] UKSC 72.
- McMeel, G. (2003) ‘Prior Negotiations and Subsequent Conduct – The Next Step Forward for Contractual Interpretation?’ Law Quarterly Review, 119, pp. 272-297.
- Shirlaw v Southern Foundries (1926) Ltd [1939] 2 KB 206.
