The essence of a Contract is its terms and that will tell you what the contract will do for you. An example of this will be when you buy goods, the time of delivery, the description of the goods and its price will all be the terms of contract for those goods. Hence a contractual term is any provision that forms a part of the contract and out of each term arises a contractual obligation, failure to which may bring a lawsuit. All terms will not be specifically stated and some terms weigh legally lesser as they are the outskirts of the contract objectives.

Conditions: These are terms, which go into the depths of the contrac. A breach of these will nullify the contract, which will allow the other party to reject the contract. Warrant: This is not as important to a contract as is conditions but breach of either of these can result in damages. An example will help explain a term as a condition or warranty.

The obligation of an actor to perform on opening night in a particular theater is a condition & the obligation of a singer to perform on the first three days of a rehearsal is a warranty. A statue, which is a formal written enactment of authority that has legislative powers, this statue may declare the nature of a term to be either a condition or a warranty.

Further the breach of a term known as an Innominate term, may or may not be a breach of conditions or warranty but will certainly give rise to damage and the contract may not be considered to be valid depending on whether the legal benefit has been taken away from the innocent party.

Status as a term: This is important as a party can only take action legally for non fulfillment of the term instead of delivering mere puffs. Legally, contractual obligations can only be created by statements that amount to a term. Statements are divided into the following types.

Puff: It is a statement that no reasonable person will take seriously and there is no action mentioned in a contract to deal with such puffs.

Representation: This is a statement of fact that does not amount to the terms of the contract and this is one where the maker does not have to guarantee this as truth.

Term: A term is a representation, which is a statement of truth and the speaker has to guarantee it so that it can bring about a contractual obligation.

It is important to note that timing, content of statement, knowledge & expertise and Reduction to writing are factors that courts take into account in determining the nature of statement.