consumer rights act (exemption clause legislation)

Question 1

what contracts does the consumer rights act 2015 regulate

Answer 1

consumer to business contracts

Question 2

how does the CRA protect the consumer

Answer 2

imposes a requirement that any exclusion be prominent and transparent
broadens the definition of consumer
can examine individually negotiated terms under the test of fairness

Question 3

what is part 2 of CRA

Answer 3

decides when unfair terms are not binding to consumers

Question 4

part 2 of CRA

Answer 4

sc62- an unfair term of a contract is not binding on the consumer
an unfair consumer notice is not binding on the consumer
the consumer can rely on the term is they choose to

Question 5

what is an unfair terms under CRA

Answer 5

sc62- a term if unfair if contrary to the requirements of good faith, it causes a significant imbalance in the parties rights and obligations to the detriment of the consumer

(5) a fair terms is determined by-
a. taking into account the nature of the subject matter
b. by referencing all tehe circumstances when the term was agreed/ all other terms

Question 6

criteria that c must prove for an unfair term under CRA

Answer 6

they are a consumer
the terms was contrary to good faith
that it causes a significant imbalance between the parties
to the consumers detriment

Question 7

excluded terms from the test of fairness

Answer 7

sc64
2 types of terms that are excluded-
a. where the term specifies the main subject matter of the contract (goes to the heart of the contract)
b. the assessment is of the price payable under the contract

(1) as long as they are transparent and prominent
transparent- in plain and intelligible language
prominent- brought to the consumers attention in a way that an average consumer would be aware of the term (average consumer- reasonably well informed/observant)

Question 8

criteria 2- good faith and significant imbalance

Answer 8

general director of fair trading v first national bank- not good faith is taking advantage of the consumers lack of knowledge, imbalance is when a term is weighed in favour of the supplier
green v petfre- condition had lack of transparency and prominency so could be tested for fairness

Question 9

criteria 1- who is a consumer

Answer 9

sc2(2) trader- a person acting for purposes relating to that person trade, business or profession
(london borough of newham v khatun)

sc2(3) consumer- individual acting for purposes that are wholly or mainly outside their trade, business or profession

sc2(4)- if trader claims c was not a consumer they have to prove it (then UCTA)

Question 10

criteria 3- term must be unfair from guidance from sc62

Answer 10

may determine unfairness by taking into account the subject matter and the circumstances of the contract
guidance from the grey list or case law may help to determine this unfairness

Question 11

the grey list

Answer 11

schedule 2
indicative list of terms of consumer contracts that MAY be regarded as unfair
(if on grey list then look at s62 (4 and 5) to determine fairness)

Question 12

case law to determine unfairness

Answer 12

decision can be found in a number of previous cases in which the courts have considered what constitutes an unfair term
director general of fair trading v first national bank- gave a definition of goof faith
aziz v caixa- must consider whethe the consumer would have agreed to the term