Cheap Airlines Inc, a US-based airline, has bought a second-hand 747 fromDown Under Airways (DUA).Cheap is well known internationally for its no- frills airfares and wants to start offering flights to the South Pole from New York for US$1,000 return. To offer fares at this price, it must be able to have as many paying passengers as possible.

DUA is also well known internationally for its European, Middle Eastern and Asian long-haul services, particularly its business class and premium economy services. It is a profitable airline notwithstanding the fact that its planes typically carry fewer passengers on these routes than its cheaper (and less profitable) rivals.

The day before the two parties signed a written contract for the sale of theplane, Cheap's CEO asked the Chief Engineer of DUA about the 747's payload capacity. DUA's Chief Engineer directed Cheap's CEO to Boeing's website for technical specifications. Cheap's CEO then asked whether the plane wouldcarry at least 330 passengers non-stop from the South Pole to New York. TheChief Engineer replied, somewhat haltingly, 'Hmmm...potentially...yes.'

It now appears that the plane can only carry 200 passengers on this route because of the large quantity of fuel necessary to cover that distance without stopping to refuel.

Advise Cheap

In the alternative, what would be the effect of a clause in the contractdeclaring "This document embodies the whole of the agreement between the parties"?