Terms which Derogate from the Contract (exclusions etc)

Question 1

4 Cases Incorporation by Signature

Answer 1

L’Estrange v Graucob; Tilden Rent-a-car v Clendenning; Grogan v Robin Meredith Plant Hire

Question 2

L’Estrange v Graucob

Answer 2

The plaintiff, the owner of a cafe, agreed to buy a cigarette vending machine from the defendants, they asked her to sign a document entitled Sales Agreement which she did without reading it, the document included a general exclusion of all express or implied terms relating to the machine, when delivered, it failed to work properly and so. Jammed. The plaintiff claimed damages for. Reach if implied term that the machine would be fit for the purpose for which it was bought.

-The Divisiinal could held that the exclusions j. The co tract had been legally incorporated into it by Miss L’Estrange;S signature. So that her action failed. The trial judge had been mistaken in finding that she had received insufficient notice of the exclusions, no question if notice arose because her signature was conclusive to all the terms of the document,

Question 3

L’Estrange v Graucob: Discussion

Answer 3

-the Court held that, HAD her signature been procured by misrepresentation or fraud, or through her complete misapprehension as to the nature of the transaction (the very limited doctrine of “non est factun”) the exclusion would be invalid. The Exclusion. Clauses had been in small print on brown pepper, so that they were likely to be overlooked, but while this was regrettable it could not displace the legal effect if the signature.

Question 4

In Canadian law, the rationale of snapping-up applies to prevent one party taking advantage if another’s obvious mistake with regard to exclusion terms. Which case is referred to here?

Answer 4

Tilden Rent-a-Car v Clendenning (obvious that when offered and signed an insurance policy for car, did not read small print which actually made him liable for damage)

Question 5

Will timesheets be regarded by a reasonable person as a document likely to contain contractual terms?

Answer 5

No. Grogan v Robin Meredith Plant Hire

• case concerned how damages should be apportioned between two companies for damages caused to a third party, Mr. Grogan, An oral contract had been made between Meredith and the other company, Triact, amounting to an agreement for the hire of heavy machinery, a driver, and the rate if hire to be paid. No other terms were j clouded. At wekly I terva,S, Meredith;S driver presented Triact with a time-sheet detailing the hours he had worked fri==, for Triact to check and sign, rime sheets included : “all hire undertaken on Contractors; Plants Association rules, copies available on request.”
• CoA: be no, it was merely an administrative device for recording performance under a pre-existing contract.

Question 6

Exclusion term valid only insofar as it matches oral representation:

Answer 6

Curtis v Chemical Cleanjng and Dyejng Co.

-plaintiff took a white satin dress to the defendants’ shop to be cleaned. She was asked to sign a document headed “Receipt:. She signed, but before doing so, was Ames why her signature was needed, the shop assistant explained that it was because the business wished to exempt itself from liability for damage to sequins and beads with which the dress was trimmed, the plaintiff signed, in fact the document contained a clause excluding all liability for any damage to the dress.

Denning LJ in the Court of Appeal held the defendants were not entitled to rely on the clause, it operated only to the extent which they had represented,

Question 7

What three conclusions nodes Herling draw from Curtis v Chemical Cleaning

Answer 7

1. First that a signature procured subsequent to even an innocent misrepresentation represents an exception to the L’Estrange rule.
2. Second is that the creation of any false impression will also fall within this ratio. Does not have to fit the technicalities of misrepresentation.
3. Denning LJ’s handling of the Exclusion term is similar to an estoppel

Question 8

What is the basic rule concerning the timing of a notice intended to incorporate an Exclusion clause within a contract. Which case is this derived from?

Answer 8

The notice must be given BEFORE OR AT THE TIME OF CONTRACT FORMATION. Afterwards, invalid.

Olley v Marlborough Court Ltd

Question 9

Olley v Marlborough Court Ltd

Answer 9

The plaintiff and her husband, who intended to stay at the defendant;S hotel for an indeterminate period, paid one week’s board and lodging at the reception desk before going to their room, after they had been staying in the hotel for six months, valuables belonging to the plaintiff were stolen from the room. By way if defence, the bite, denied negligence, and in the alternative, relied upon a notice in the door of plaintiff’s room excluding liability for loss or theft of valuables

-In court of Appeal, Singleton and Denning LJJ held that the notice was not incorporated the contract which had been made upon the plaintiff’S arrival at the hotel, since it could not have been seen by her until after the contract was concluded,

Question 10

Olley v Marlborough: Extra detail on how notice might have been incorporated into contract

Answer 10

Singleton LJ asked consent, for the defendant note, to explain when and how the notice became part of the contract as he submitted it did, the answer was Thant it might have been j corporate when the plaintiff and her husband made their second payment at the end if their first week’s stay, singleton LJ rejected this however, since he was persuaded that a single contract for an jndetermejnate stay and periodic payments had been made in couple’s arrival, rather than a contract renewal,e at intervals.

-Denning LJ: “The best way of proving it is by a written document signed by the party to be bound. Another way is by handing him before or at the time if the contract a written notice specifying its terms and making it clear the contract is in those terms, A prominent public notice which is plain for all to see when he names the contract or an express oral stipulation would no doubt have similar effect.”

Question 11

Thornton v Shoe Lane Parking

Answer 11

Very similar to Denning’s idea in Curtis v Chemical Cleaning,

Plaintiff drove j; to entrance of a multi-stores car park at which he had not left his car before. At the entrance was a notice which read, “all cars parked at the owner;S risk.” As he proceeded, a light changed from red to green and a machine provided a ticket which thenplaintiff took before driving in, the ticket stated that it was J’s she’d “subject to the conditions of issue as displayed on the premises.: the plaintiff later returned to lay the parking charge and to collect his car, at this point an accident occurred part lay as a result of the defendants’ negligence, in which the plaintiff was bad,y injured, the defendants disclaimed responsibility by reference to a notice within the garage which purported to exempt them from liability for injury howsoever cahsed.m

CoA held that the defendants were liable, the notice displayed at the entrance to the car-park could not assist the defendants because it made no reference to personal injury to customers. The live question was then whether the wording of the ticket was sufficient to incorporate the notice displayed inside the car park. Denning LJ and Sir Gordon Wilmer argued that the contract had been concluded before the ticket was jsued, Megan LJ did not reject the argument on the timing but said that he would reserve a final, view in the mechanics of contracting in this situation.

Question 12

Which two cases illustrated issues of timing with regard to incorporation by notice?

Answer 12

Olley v Marlborough; Thornton v Shoe Lane Parking

Question 13

Which two cases all,h with regard to the contractual nature of the document/the expectations of the parties when incorporating Exclusion terms by notice?

Answer 13

Chapel tonight v Barry Urban District Council; British Crane Hire v Ipswich Plant Hire

Question 14

Chapelton v Barry Urban District Council

Answer 14

The council let out chairs on a beach, charge was displayed in a notice by a pile of deck chairs, the plaintiff set on a deck chair which gave way candy caused him injury, the council sought to define ed itself by reference to the exclusionary words printed in the ticket available from defendant,

-ClA he,d not incorporated since ticket not contractual document, . Plaintiff courts be expected to see it as mere receipt. Ticket came after college tract was concerned,died,

Question 15

Which cases says terms may be assumed to be incorporated when parties are in same line of business, know the terms in which business is usually conducted, and have to act urgently.

Answer 15

British Crane v Ipswich Plant Hire

Question 16

British Crane v Ipswich Plant Hire

Answer 16

Plaintiffs both let out heavy-earth moving Plant. Defendants urgently required a Crane. Their manager telephoned the plaintiff’s and agreed Hire and transport terms over the phone. At this point, British Crane sent over the order form containing Exclusion clauses (here an indemnity clause), which the defendants had signed in the course of previous transactions, but failed to sign at this point, meanwhile, the crane sank in marshy ground and was recovered at substantial loss to the plaintiffs, the paints claimed to be indemnified against Ipswich on the basis if the Exclusion clauses in the contract, Ipswich claimed that the exclusion clauses were not incorporated into the contract which had been made earlier by telephone.

The Court of Appeal held the indemnity clause was validly incorporated. The defendants m ew that the Plant Hire was carried out in conditions, and in fact they both used versions of the common from known as Contractors; Plant a]Association, Resoknding to the defendants’ urgent need, the plaintiffs had been entitled to assume the contract was being made in the normal conditions, even if in the event that was only specified lost-contractually,

Question 17

Name the two the ticket cases which shine light on what constitutes reasonable notice of an unsigned stipulation

Answer 17

Parker v the South Eastern Railway Company; Thompson v London, Midland and Scottish Railway Company

Question 18

Parker v South Eastern Railway Company- how to reconcile with Thornton v Shoe Lane Parking

Answer 18

Caution before reading: Denning in Thornton v Shoe Lane Parking distinguished Parker. Said Parker only applied to tickets issued by real people, where client could give it back. There a ticket would incorporate terms into contract, so far as the customer belkeved there was writing in it. However, with automatic machines such as in Thornton v Shoe Lane parking, you cannot give the ticket back. You are screeeewed, dooooooomed. So ticket is not incorporated.

Question 19

Parker v the South Eastern Railway Company: Facts

Answer 19

The plaintiff deposited a bag at a cloakroom in a railway station, he paid the attendant 2d and in return received a ticket. On the front of the ticket were written a number, opening hours and the words ‘see back./ on the reverse there were various clauses including one which limited the company’S liability for baggage theft at £24 10s. The company relied on its limitation clause.

Me.lish LJ stated that as long as the plaintiff knew or believed there was writing on the ticket, the cloakroom operator could reasonable assume he would read it. If he did not know or believe there was writing, cloakroom would be liable. Here plaintiff knew there was writing, just didn’t read it,

Question 20

Thompson v London, Midland and Scottish Railway Company

Answer 20

The plaintiff was injured when a train run by the defendants stopped at the very end of a platform. The defendants denied liability by reference to a clause which exempted them from responsibility for injury to excursion ticket holders bkwsoever caused, the plaintiff, who could,d not read, had booked the excursion through her niece, the front of the ticket read “excursion, for conditions see back”. The back referred to conditions to be found in the company’s timetables, noticed, and excursions and other bills. The relevant clause was to found in the timetable, of which there was one copy in the booking office, it cost 6d to to buy.

CoA found for defendants. The company had offered the excursion at a reduced price and on ascertainable terms. The plaintiff had accepted, and was bound by the terms.

-ignore that such a clause would likely fall under the Unfair Cintract Terms Act 1977 nowadays. Focus instead in the means if incorporation,

Question 21

How does the requirement of notice vary according to the increased harshness of a clause? Name the case

Answer 21

More notice needed.

“Some clauses which I have seen would need to be printed j. Red ink in the face if a document with a red hand pointing to it before the notice could be held to be sufficient,:

Question 22

Name the two cases of incorporation by notice if harsh clauses

Answer 22

Interfoto Picture v Stiletto Programmes; AEG Stiletto Visual

Question 23

Interfoto Picture Linrary v Stiletto Visual Programmes

Answer 23

-the defendants required so e photographs on 1950’s. Defendants sent some 47 transparencies same day with a delivery note, delivery note had a condition stating that for each day a transparency was held beyond an initial 14 day allowance, a £5 charge plus VAT would be levied per transparency retained.

The defendants did not see the clause and forgot they had the transparencies, the plaintiffs sent them an invoice for £3u83.5o, calculated in accordance with their clause, ‘

-Court of Appeal held that the clause had not been incorporated into the contract, although the c,Ashe was so unreasonable that it could perhaps be viewed as a disguised Le a,ty and therefore unenforceable, Bingham LJ had been prepared to assume that it would have been valid if fully and fairly drawn to the defendants’ attention. However, insufficient attention had been a,a]ertedm given the clause’s unreasonable and punitive character,

Question 24

What did Bingham LJ suggest in Interfoto Pictures v Stiletto

Answer 24

-suggested that cases of sufficiency of notice engaged two levels of analysis. One a purely technical, contractual analysis of whether one part had done enough to give the other notice of the incorporation of a term into a contract. On the other, hand, also had to take into account whether reasonable or fare to bind parties to a particular condition of an unusual and stringent nature.

Question 25

AEG (UK) Ltd v Logic Resource Ltd

Answer 25

The defendants had ordered cathode ray tube from the plaintiffs for export to customers in Iran. The goods proved to be defective and the defendants instructed their customers to return the goods, at very considerable expense, and deducted those costs from the price payable for the tubes. The plaintiffs disputed the deduction in the basis that their conditions of sale placed the cost of returning faulty foods in the buyers, these conditions had been referred to in an order confirmation noted which was clearly a contractual document,

-the Court of Appeal held unanimously that the plaintiffs could not re,y in their clause but f]gave different reasons, the nankritt considered that the c,ause was an extremely onerous and unusual condition when judged in the context if a contract for as a whiles whjfh deprived the defendants if usual rights and protections under Unfair Cintract Terms Act 1977,