Exclusion Clauses

Question 1

Exclusion clauses are

Answer 1

Risk allocation devices

Exclusion: Express term in Contract that exempts one party from liability for breach

Limitation: A clause in the contract that limits the liability of one of the parties

Question 2

3 Hurdles for a party seeking to rely on Exclusion Clause:

Answer 2

1) Is the Clause Incorporated into the Contract?
2) Deos the Clause, properly interpreted, Cover the loss?
3) Is there another rule of Law that Invalidates the clause?

Question 3

Incorporation of Exclusion clauses (same as incorporation of regular clauses)

Answer 3

Incorporation by Signature:
L’Estrange v Graucob

Incorporation by Notice:
Time of notice at contracting:
Olley v Marlborough Court

Form of Notice:
Chappelton v Barry

Degree of Notice:
Parker v South Eastern Railway
Interfoto v Stiletto

Question 4

Overriding Oral Warranty

Answer 4

If you give an oral warranty that trumps the exclusion clause then the warranty will prevail
Evans v Merzario

Question 5

Contra Preferentum Rule:

Answer 5

Exclusion clauses are construed against the party who is seeking to rely on it

Only excludes if clearly done

Question 6

Interpretation fo Exclusion Clasues

Answer 6

Canada Steam Ship Lines:
1) It is clear/unambiguous and it covers the loss

2) If Negligence was not referred to, the court must consider if it is wide enough to cover the loss on its ordinary meaning
3) If not clear and there is another possible grounds for interpretation then go with that

Hollier v Rambler Motors (negligence)

Question 7

Limitation Clauses

Answer 7

These are interpreted much less restrictively than Exclusion Clauses

Britvic Soft Drinks v Messer

Question 8

Fundamental Term

Answer 8

No term can exclude liability for a breach of a fundamental Term:
Karsels v Wallis

EXCEPT: if they are sophisticated parted who wish to construe a term so narrowly that it applied to a fundamental breach:
Photo productions v Securicor

Question 9

Excluding Misrepresentation

Answer 9

You can exclude Misrep so long as it is reasonable for you to do so
Cremdean Properties v Nash

Question 10

Unfair Contract Terms Act

Answer 10

Applies to Business to Consumer and Business to Business where 1 acts as consumer Transactions.

It references Sale of Goods Act and your inability to exclude liability from that

Question 11

Unfair Contract terms Act Test of Reasonableness

Answer 11

The test of Reasonableness is set out In s.11 and Schedule 2

Watford Electronics v Sanders
Mitchell v finney Lock Seeds
Smith v Eric Bush

Question 12

Unfair Terms in Consumer contract Regulations

Answer 12

Fairness test is applied to all “non-individually negotiation” “non core term” contracts between a consumer and a business

Idea is to protect the consumer in the EU market
Oceano group v Quintero

Question 13

UTCCR Effects and Determining Unfairness

Answer 13

-Term is Struck out from the Contract

Unfair:

1) Contrary to good faith
2) Causes Imbalance in rights/liabilities
3) Imbalance is to the detriment of Consumer

Director General of Fair trading v First National Bank

Question 14

Differences Between UTCCR and UCTA:

1. Type of Dealing

Answer 14

UTCCR applies to all types of consumer Contracts

UCTA excludes certain contracts

Question 15

Differences Between UTCCR and UCTA:

2.Consumer definition

Answer 15

UTCCR is only between seller and natural consumers

UCTA is between consumers to Business or Business to Business where 1 acts as consumer

Question 16

Differences Between UTCCR and UCTA:

3. Standard form or negotiated

Answer 16

UTCCR- only applies to standard form and non negotiated contracts
UCTA- Applies to both standard form and negotiated contracts

Question 17

Differences Between UTCCR and UCTA:

4. Types of Clauses

Answer 17

UTCCR applies to all kinds of consumer terms except core terms
UCTA only applies to Exclusion and Limitation clauses

Question 18

Differences Between UTCCR and UCTA:

5. Black list or Grey List

Answer 18

UTCCR lis of terms presumed unfair in ached 2

UCTA guidelines for applicability of reasonableness test

Question 19

Differences Between UTCCR and UCTA:

6. No effect at all

Answer 19

UTCCR doesn’t strike out any clauses immediately

UCTA will simply strike out some exclusion clauses right away

Question 20

Differences Between UTCCR and UCTA:

7. Test

Answer 20

UTCCR is a fairness Test

UCTA is a reasonableness Test

Question 21

Differences Between UTCCR and UCTA:

8. Burden of Proof

Answer 21

UTCCR burden of proof on consumer to prove term unfair

UCTA puts burden of proof on party that is seeking to rely on the clause

Question 22

Differences Between UTCCR and UCTA:

9. Effectiveness of other parties

Answer 22

UTCCR office of fair trading can bring an action on an individuals behalf
UCTA only in respect to the 2 parties involved

Question 23

Differences Between UTCCR and UCTA:

10. Enforcement across UK

Answer 23

UTCCR applies to all of the Nations of the UK equally

UCTA has different rules for Scotland

Question 24

Mistake

Answer 24

1. AS to Existence of Subject Matter
2. As to identity of subject matter
3. AS to Possbility of Performing
4. AS to Quality of Subject Matter

Found=void