Exclusion Clauses. Flashcards
What is the main case?
Watford Electronics Ltd v Sanderson.
What is the general principle?
Valid when based on genuine consent.
What are the 3 rules?
- Incorporation.
- Interpretation.
- Statute.
What is incorporation?
Can the party relying on the clause prove it has been incorporated into the contract?
What is interpretation?
Can the party relying on the clause prove that it does exclude or limit the loss suffered.
What is statute?
Can party challenging validity of clause prove its invalidation by statute?
What is contra proferentem?
Interpreted strictly and against party offering term.
What is the 1977 statute?
Unfair Contract Terms Act (UCTA 1977).
What does UCTA exclude liability for?
- Only applies to business liability.
- Negligence.
- Breach of contract where there are written standard terms.
What is contractual negligence and what is the section?
S.13 Supply of Goods and Services Act 1982: failure to carry out a service or supply goods with “reasonable care and skill.”
What does UCTA say about negligence liability (and section)?
S.2:
1. Cannot exclude for death or personal injury from negligence.
2. Cannot if doesn’t satisfy reasonableness test.
What is the reasonableness test section?
S.11.
What is the reasonable test (and case)?
Was the clause fair and reasonable at the time the contract was made rather than in specific circumstances in question? George Mitchell v Finney Lock Seeds.
What are the Sch.2 guidelines for the reasonableness test? (5)
- Strength of bargaining positions.
- Whether customer received inducement.
- Whether customer knew of existence and extent of term.
- Whether condition was practicable.
- Whether goods were a special order.
Bargaining strength (and case)?
If parties roughly equal, likely to be reasonable. St. Albans Council.
