Exclusion And Limitation Clauses Flashcards
What are express terms in a contract?
Express terms can be written or stated verbally and concern matters such as price.
Example case: Curtis v Chemical Cleaning.
What is the main common law control regarding express terms?
The terms must be incorporated and should generally be made available before the contract is made.
Example cases: Chapelton v Barry, Thornton v Shoe Lane Parking.
What must be done for harsh terms in a contract?
Harsh terms must be given special notice.
Example cases: Interfoto v Stiletto, Blu Sky v Be Caring Ltd.
Can tickets or receipts incorporate terms?
Yes, if it is reasonable to expect them on the back.
Example case: Thompson v LMS Railway.
Does signing a contractual document incorporate terms?
Yes, even if they have not been read, provided it is a contractual document.
Example cases: Grogan v Robin Meredith, L’Estrange v Graucob.
What is the significance of an automated signature in contracts?
An automated signature at the footer of an email will suffice for incorporating terms.
Example case: Neocleous v Rees.
How can clauses be implied in a contract?
Clauses may be implied through the course of dealings if their use is regular and consistent, even if it comes after acceptance.
Example cases: Hillas v Arcos, Kendal v Lilico, McCutcheon v MacBryan.
What is the contra proferentem rule?
It means ‘interpretation against the draftsman’. An ambiguous and one-sided term will be construed against the party that put it in the contract.
Example: Transocean Drilling v Providence.
What does Section 69 of the Consumer Rights Act 2015 state?
It prevents terms from being given a wide meaning in consumer contracts.
Example: White v John Warwick.
What happens if a clause is unclear and one-sided?
It will be construed in favor of the consumer.
Example: If the clause is clear and unambiguous to cover a claimed amount, it will not be construed in the consumer’s favor.
What are the special rules for excluding negligence liability?
Phrases like ‘loss whatsoever’ or ‘however occasioned’ will not cover an exclusion clause for negligence.
Example: Shell v P&O Roadtankers.
What does Section 31 of the Consumer Rights Act 2015 address?
It bars exclusion and limitation clauses concerning consumer rights related to goods and services.
What consumer rights are protected under Section 31?
Rights related to satisfactory quality (S.9), fit for a particular purpose (S.10), and matching a description (S.11) for goods, and reasonable care and skill (S.49) for services.
What does Section 65 of the Consumer Rights Act 2015 state?
It bars any clause excluding liability for death or personal injury caused by negligence.
What is the fairness test outlined in Section 62?
A term is unfair if it causes a significant imbalance in the parties’ rights and obligations under the contract to the detriment of the consumer.
Example: ParkingEye v Beavis.
What does Section 64 state about fairness assessment?
A clause cannot be assessed for fairness under S.62 if it is transparent and specifies the main subject matter of the contract.
Example: Office of Fair Trading v Abbey National.
What does Schedule 2 of the Consumer Rights Act 2015 contain?
A list of terms regarded as unfair, such as requiring a disproportionate amount of compensation if the consumer cancels the contract.
What does the Unfair Contract Terms Act (UCTA) 1977 relate to?
The UCTA 1977 relates to ‘business to business’ contracts.
What does the Act do to some contract terms?
The Act makes some contract terms VOID and some subject to a REASONABLENESS test.
What does Section 2(1) state about liability for death or personal injury?
Under Section 2(1), a clause excluding liability for death or personal injury caused by negligence is void.
What does Section 2(2) state about liability for loss other than death or personal injury?
Under Section 2(2), a clause excluding liability for loss other than death or personal injury will be void unless it passes the reasonableness test.
What does Section 3 state regarding standard written terms of business?
The reasonableness test applies where one party is subject to the other’s standard written terms of business, under Section 3.
What is outlined in Section 11 regarding the reasonableness test?
Section 11 sets out a test of ‘reasonableness’ where the party who inserted the clause must show it is reasonable given what the parties knew at the time of the contract.
What factors are considered in the reasonableness test?
Factors include the strength of the parties’ bargaining positions and the availability of insurance for the defendant to deal with a claim.
What example illustrates an unreasonable clause excluding liability for property damage?
An example is where the clause excluding liability for property damage is unreasonable given the vastly different bargaining strengths of the parties, the defendant knew of the poor condition of the property, and has insurance to deal with the claim.
What conclusion can be drawn regarding terms incorporated under common law?
Overall, the term has been incorporated under common law but has been barred under S65 CRA 2015.
