Exclusion And Limitation Clauses

Question 1

Common law rules for exclusion + limitation clauses

Answer 1

1) be incorporated into contract
2) clause must cover the breach

Question 2

3 ways clause can be incorporated into contract

Answer 2

1) by signature
2) by notice
3) previous court dealings

Question 3

Lestrange v graucob

Answer 3

If a party signs a document they’re bound even if they didn’t read it

Question 4

Olley v marlborough

Answer 4

Clause must be brought to other party’s attention before or at the time of contracting

Question 5

McCutchen v David

Answer 5

No consistency no incorporation

Question 6

Elements for clause must cover the breach

Answer 6

1) clause must refer to negligence or synonym
2) if not, is it wide enough to cover negligence
3) if ambiguous, interpretate against the person relying on it (contra proferentum rule)

Question 7

Statutory controls for exclusion and limitation clauses

Answer 7

Unfair contracts terms act 1977 and consumer rights act 2015

Question 8

Elements within unfair contract terms act 1977

Answer 8

S2(1) = cannot exclude liability for death or personal injury
S2(2) = liability for other losses eg damages to property only allowed if reasonable
3) exclusion of implied terms must be reasonable

Question 9

Reasonablness test for excluding liability for implied terms

Answer 9

S11= clause must be fair and reasonable in light of circumstances known at the time of contracting

Question 10

Relevant factors for deciding reasonablness of exclusion clause

Answer 10

1) equality of bargaining power
2) a availability of alternatives
3) whether parties knew of term

Question 11

Key rules in consumers rights act for exclusion clauses

Answer 11

1) cannot exclude death or personal injury
2) exclusion of statutory consumer rights eg fit for purpose, satisfactory quality
3) fairness test