Exclusion And Limitation clauses Flashcards
(18 cards)
What is an exclusion clause?
A term that tries to remove liability completely (e.g. “we are not responsible for…”).
What is a limitation clause?
A term that tries to limit liability (e.g. “we are only liable up to £500”).
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What are the 3 key tests for exclusion clauses?
: ✅ Incorporation
✅ Construction
✅ Control (CRA or UCTA)
Incorporation
How can a clause be incorporated into a contract?3
By signature,
reasonable notice,
or consistent past dealings.
Incorporation
Explain incorporation by signature with two cases clue exception
In lestrange v Grauvob
Clause was valid because the contract was signed, even if unread.
However, there are exceptions
If the other party misrepresents the content of the document, the exclusion clause will not be valid
Curtis V chemical cleaning
Incorporation
Explain incorporation by notice and free things that must happen for a notice to be valid include 3 cases 
Timing: the clause must be brought to the attention of the party before or at the time of the contract olley v Marlborough court
Type of document : the clause must be on a document you would recently expect to contain contractual terms like a contracts or terms and conditions not a receipt or a ticket ChapeltonV Barry
Clarity and visibility: the more unusual are hash a term is it must be made clear this is called the red hand roll as seen in Thornton v shoe Lane parking where Lord Denning said the more unfair the term the more clearly it must be shown
Incorporation
explain incorporation by previous dealings with a case
If parties regularly contract together and always use the same terms a clause can be incorporated even if not mention every time but this only works if dealings were regular and consistent and the party’s new I should have known about the clause as seen in spurling v Bradshaw
Construction
What is the construction test for exclusion clauses?
Although the clause may be incorporated The clause must be clear and unambiguous for it to be relied on
Construction
What is the main purpose rule?
What is the contra proferentem rule?
The courts will interpret a clause in a way that does not ruin the main purpose of the contract
If the clause is vague, it’s interpreted against the person trying to rely on it.
Construction
What happened in Glynn v magertson?
What happened in Hollier v Rambler Motors?
The court applied the main purpose rule
contra proferentem rule was applied
Clause was vague and did not clearly exclude negligence = didn’t apply.
STATUTORY CONTROL – UCTA
What is UCTA 1977 used for?
Controlling unfair clauses in business contracts.
STATUTORY CONTROL – UCTA
What does s2(1) UCTA say?
: You cannot exclude liability for death or personal injury caused by negligence.
STATUTORY CONTROL – UCTA
What is the s2(2) UCTA ?
Can only exclude other negligence if reasonable
STATUTORY CONTROL – UCTA
What is the s3 UCTA ?
A business using standard terms can’t avoid responsibility for breaking contracts unless it’s reasonable
STATUTORY CONTROL – UCTA
What is the s11 UCTA ?
Provides the test for reasonableness which ask
Is the term fair based on what the party’s knew I should have known at the time the contract was made
STATUTORY CONTROL – CRA
Who does CRA 2015 protect?
Consumers in contracts with traders.
STATUTORY CONTROL – CRA
What if the consumer saw and agreed to the clause — is it still valid under CRA 2015?add sections
Under section 31 cannot exclude section 9 10 11
On the section 57 cannot exclude section 49
No — under CRA 2015, some rights (like s9, s10, s11, s49, s65) can’t be excluded at all, even if the consumer was aware of or agreed to the clause. It’s still unfair and invalid.
STATUTORY CONTROL – CRA
What does s65 CRA say?
You can’t exclude liability for death or personal injury caused by negligence.
