Which statement correctly distinguishes express terms from implied terms?

• A. Express terms are stated in the contract; implied terms arise by statute or common law.
• B. Express terms arise by statute; implied terms are stated in the contract.
• C. Express terms are only about price; implied terms arise from the date of formation.
• D. Implied terms are never enforceable.

Answer: (C)

Express terms are the provisions the parties have explicitly agreed and set out in the contract, whether in writing or spoken. Implied terms, by contrast, are not written or spoken but are read into the contract because the law requires them or because the parties’ intentions, dealings, or the nature of the contract suggest they should be there.

So express terms can cover any aspect the contract deals with—price, delivery, quality, timing, performance standards, etc. The statement that express terms are only about price is not correct because the contract can contain express terms on many different topics.

Implied terms arise for specific reasons: some are imposed by statute (for example, terms about satisfactory quality or fitness for purpose in consumer or sale-of-goods contexts), some come from common law (such as expectations of reasonable care and skill in services), and some come from the parties’ implied intentions or business efficacy. They can apply from formation or during performance, not just from a single “date of formation.”

In short, express terms are expressly stated; implied terms fill gaps created by law, the contract’s nature, or the parties’ presumed intentions.