Exclusion and limitation clauses

Question 1

What are exclusion clauses

Answer 1

Exclusion clauses exclude or limit liability for breach of the contract

In general, the courts allow the parties to agree any terms they like under freedom of contract, however, as one party may be much stronger than the other the court have found ways to limit the effectiveness of exclusion clauses

Question 2

How will courts decide whether an exclusion course is part of a contract

Answer 2

• Whether the agreement is signed
• Whether any notice with the term in it is incorporated in the contract
• Whether the term is incorporated as a result of previous dealings with the parties

Question 3

Thornton v Shoe lane parking

Answer 3

Exclusion course not part of the contract so could not be effective

Question 4

L’Estrange v Graucob 1934

Answer 4

• whether the agreement is signed
  exclusion clause was part of the contract as it was in written form that she signed so she accepted it

Later on, the Consumer Act 2015 stated that you cannot exclude liability for implied terms

Question 5

Curtis v Chemical Cleaning

Answer 5

• whether the agreement was signed
  the effect of an oral statement - if you do not understand something in a contract and you ask, whatever they reply with becomes the exclusion clause

Question 7

whether any notice with the term in it is incorporated in the contract

Answer 7

If the contract isn’t signed the exclusion clause must be brought to the attention of the offeree at the time the contract is made

Question 8

Olley v Marlborough

Answer 8

• Whether any notice with the term in it is incorporated in the contract
  they were not made aware of that exclusion clause when they made the agreement at the reception

Question 9

Hollier v Rambler Motors

Answer 9

• Whether the term is incorporated as a result of previous dealings with the parties
  exclusion clauses can be implied in a contract through previous dealings but only if they are frequent

Question 10

The Contra Proferentem rule

Answer 10

Where there is doubt about the meaning of a term in a contract, the words will be construed against the person who put them in the contract (courts will interpret it against the person who wrote it)

Question 11

Transocean Drilling UK ltd v Province Resources plc

Answer 11

exclusion clause is not clear, but because of the agreement being sophisticated, it stood (the rule is used when the term is both one-sided and ambiguous)

Question 12

McCutcheon v David MacBrayne

Answer 12

not part of the contract as too vague if the exclusion clause is always part of the contract