Terms & Exclusion Clauses Flashcards
Excluding liabilty death or personal injury
Business to business - Under the Unfair Contract Terms Act 1977 (‘UCTA’) (which deals with business to business transactions), any clause which purports to exclude liability for death or personal injury as a result of negligence will be void Consumer contracts - void under Consumer Rights Act
Sale of stolen goods
Legislation implies terms into a contract in relation to the seller’s right to sell the goods, in other words, that the seller has good title. The Sale of Goods Act 1979 (‘SGA’) implies this term in relation to a contract between two businesses. The Consumer Rights Act 2015 implies this term to consumer contracts
Unfair term - Consumer Rights Act 2015
A term is unfair where, contrary to the requirements of good faith, it causes a significant imbalance in the parties’ rights and obligations to the detriment of the consumer. Whether a term is fair is determined taking into account the nature of the subject matter of the contract, and by reference to all the circumstances existing when the term was agreed and to all of the other terms of the contract or of any other contract on which it depends.
Prevail clause
Comes up in battle of the forms - It is a clause which states that either offer or acceptance form will prevail.
Prevail clauses are rarely effective because by making a counteroffer, the other party rejects the entire original offer, including the prevail clause.
Therefore, should follow the rule of the battle of the forms - which means the person who fires the last shot wins.
What is a restraint of trade clause and when will it bind the parties?
It is a clause which attempts to restrict the freedom to enter into a contract as they see fit.
eg. clause (restrictive covenant) which restrict employee from competing against former employer.
Such a clause will be VOID unless it is reasonable.
Court will also consider whether there is a legitimate interest - whether the clause is reasonably necessary for its legitimate interest.
NOTE - A restraint of trade clause is a clause which restricts activities after a contract has come to an end. If prohibition is part of an ongoing relationship then it is not a restraint of trade clause.
In commercial contracts, what legislation implies that goods supplied must be reasonably fit for purpose and of satisfactory quality?
Under the Sale of Goods Act 1979, when a seller sells goods in the course of a business and the buyer, expressly or by implication, makes known to the seller any particular purpose for which the goods are being bought, there is an implied term that the goods supplied under the contract must be reasonably fit for that purpose, whether or not that is a purpose for which such goods are commonly supplied.
**There is also an implied term that the goods must be of satisfactory quality, that is, fit for the purpose for which such goods are generally used
Under the [BLANK A] Act any term excluding liability for death or personal injury caused by negligence will be [BLANK B] in business to business transactions
BLANK A: Unfair Contract Terms Act 1977 (‘UCTA’)
BLANK B: Void
