Exclusion Clause

Question 1

Step One - model answer for incorporation through signature:

Answer 1

Signature - If the parties sign the contract, then caveat emptor (buyer beware) applies, they are bound by them - whether or not they read them or understood them ( L`Estrange v Graucob). However, where the person seeking to insert the exclusion clause makes a verbal statement as to the content of the exclusion clause that differs from the written version, the verbal version prevails (Curtis v Chemical Cleaning Company). An exclusion clause must be contained in a document in which a party would expect to find such a clause (Chapelton v Barry).
Here, the parties signed the contract when…

Question 2

Step One - model answer for incorporation through reasonable notice:

Answer 2

Reasonable notice - In the absence of a signature, an exclusion clause can be valid if reasonable notice of its terms has been given to the other party before they enter into the contract. The time of the notice is relevant. In Olley v Marlborough Court Hotel the clause wasn`t incorporated because it was not brought to the attention of the other party before the contract was made, it was on a notice inside the bedroom. Here, reasonable notice was given when..

Question 3

Step One - model answer for incorporation through course of dealing:

Answer 3

A course of dealing exists when the two parties regularly make the same contract and the terms of that contract are consistent and known (McCutcheon v McBrayne). In Hollier v Rambler Motors because the claimant had only been to the garage three or four times in the past five years, this was not enough frequency to suggest that the exclusion clause was incorporated – had there been more frequency, they would have implied it.
Here, there is incorporation through previous course of dealings as…

Question 4

Step Two - DOES THE EXCLUSION CLAUSE COVER THE ALLEGED BREACH? (CONTRA PREFERENTUM RULE)​

Answer 4

Any ambiguity in relation to the clause must be interpreted against the party proposing or having drafted the clause and wishing to rely upon it. In Hollier v Rambler Motors the garage could not rely on a clause excluding liability for fire damage as they had not stated without ambiguity this included fire caused by their negligence. Only used if ambiguity.
Here, the contract is / is not ambiguous…

Question 5

STEP 3: ARE THERE ANY ACTS OF PARLIAMENT THAT IMPACT ON THE EFFECT OF THE EXCLUSION CLAUSE?​ (UCTA)

Answer 5

UCTA 1977 - Some exclusion clauses are invalidated by the UNFAIR CONTRACT TERMS ACT 1977 and so are unenforceable.
Under s2(1) UCTA a person cannot exclude liability for death or personal injury caused by his/her negligence. So, any exclusion clause is void.
Here, as C was injured / died, exclusion clause invalid.

OR
Under s 2(2) UCTA in the case of other loss or damage, a person cannot exclude or restrict liability for negligence except when the term or notice satisfies the requirement of reasonableness. Where ‘the term shall have been a fair and reasonable one to be included having regard to the circumstances which were, or ought reasonably to have been known to or in the contemplation of the parties when the contract was made’ (the knowledge test). Reasonableness must be proved by the person relying on the clause (Warren v Trueprint).
Here, reasonable as..

Question 6

STEP 3: ARE THERE ANY ACTS OF PARLIAMENT THAT IMPACT ON THE EFFECT OF THE EXCLUSION CLAUSE?​ (Consumer Rights Act 2015)

Answer 6

This applies to trader/consumer contracts, in relation to the sale of goods s.31 prohibits a term excluding or limiting liability for goods to be of satisfactory quality (s9), fit for purpose (s10), description of the goods (s11). Here..

In relation to the supply of services s.57 prohibits a term excluding or limiting liability that the trader must perform the service with reasonable care and skill (s49).
Here….

s.65 prohibits exclusion or restriction of liability for death or personal injury resulting from negligence in a consumer contract.
Here…