Gap Filling in Contracts

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Contracts are legally binding documents that dictate the terms and conditions of agreements between two or more parties. One important aspect of contract writing is the concept of gap filling. Gap filling occurs when a contract does not explicitly address a specific issue or situation. In this article, we will dive deeper into the significance of gap filling in contracts.

First, it is important to understand why gaps might exist in a contract. One reason could be oversight or a lack of attention to detail during the drafting phase. Another reason could be unforeseeable circumstances that arise, requiring additional terms that were not initially considered.

Regardless of the reason, gaps in a contract can create significant legal issues down the line. If a dispute arises where a gap exists, it can be incredibly difficult to determine the intent of the parties involved. This is where gap filling comes into play.

Gap filling is the process by which courts or arbitrators fill in the missing details of a contract. The objective of this process is to ensure that the intent of the parties is carried out as much as possible. Gap filling can occur in various ways, including through the use of implied terms, custom and usage, and the application of statutory or common law.

Implied terms are terms that are not explicitly stated in a contract, but are nonetheless considered to be part of the agreement. These terms can be inferred from the context of the contract, the conduct of the parties, or the commercial purpose of the agreement.

Custom and usage refer to industry-specific practices that are considered standard among parties in that industry. For example, if a contract involves a product delivery, it might be common practice for the buyer to inspect the goods upon delivery. Custom and usage can be used to fill in the gaps of a contract by incorporating these industry-specific practices.

Statutory and common law are also used to fill in gaps in contracts. Statutory law refers to legislation passed by governing bodies that applies to specific industries or situations. Common law refers to legal principles that have been established over time through court decisions. Both statutory and common law can be used to fill in gaps in a contract.

In conclusion, gap filling in contracts is a necessary process to ensure that the intent of the parties is carried out as much as possible. Gaps can occur for various reasons, but they must be addressed to avoid legal issues down the line. Implied terms, custom and usage, and statutory and common law are all methods used to fill in the gaps of a contract. As a professional, it is important to understand the significance of gap filling in contracts and to ensure that contracts are drafted with attention to detail to minimize the potential for gaps.