IMPLIED TERMS AFTERBELIZE TELECOM

Abstract

AbstractIt is five years since Lord Hoffmann delivered the advice of the Privy Council inAttorney-General of Belize v Belize Telecom Ltd. In that landmark decision, Lord Hoffmann assimilated contractual interpretation and implication with the result that when implying a term in fact the court must ask a single question: “is that what the instrument, read as a whole against the relevant background, would reasonably be understood to mean?” It might have been thought that five years was enough time for the English courts to come to terms with this approach.Belizeis regularly cited in the courts, but the judges appear to struggle with its application. There remains uncertainty as to the roles (if any) to be afforded to the traditional “business efficacy” and “officious bystander” tests, and the requirement of “necessity”. This article seeks to re-evaluateBelizefive years on. It concludes thatBelizeprovides a doctrinally coherent and workable basis for identifying and giving effect to the intention of the parties through the implication of terms. However, the article questions whether it remains necessary, or even helpful, to continue to make reference to tests based on “business efficacy” or the “officious bystander”, as the tests distract from the central idea advanced by Lord Hoffmann and have led to uncertainty in its application.