Exemption clauses

Question 1

what are exemption clauses

Answer 1

a contractual term that purports to limit or exclude a liability that would otherwise attach to one of the contracting parties

Question 2

what is an exclusion clause?

Answer 2

type of exemption clause which excludes liability

Question 3

3 factors that need to be considered under exemption clauses

Answer 3

1. incorporation - is the exemption clause part of the contract?
2. construction - does the clause cover the alleged breach and resulting loss?
3. statutory controls - what is the effect on the clause of the Unfair Contract Terms Act 1977 and the CRA 2015?

Question 4

Contra Proferentem

Answer 4

Any ambiguity in the clause will be construed against the proferens (person relying on clause)

Question 5

How do parties exclude liability for negligence/ avoid ambiguity

Answer 5

Using the word ‘negligence’ and clear words

Question 6

In relation to exemption clauses and negligence, in what circumstances may the contra proferentum rule be less relevant?

Answer 6

When an exemption clause occurs in a commercial contract between parties of equal bargaining power

Question 7

Define business liability.

Answer 7

Liability for breach of obligations or duties arising:
- from things done in course of business
- occupation of premises used for business

Question 8

Which exemption clause will be void as a result of the Unfair Contract Terms Act 1977?

Answer 8

A clause excluding liability for death or personal injury resulting from negligence.