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Exemption Clauses II (Statutory Controls (B2B = Unfair Contract Terms Act…

- - - - Exemption = a term or clause which limits liability
        
        Also S13(1)
        
        a) Restrictive or onerous conditions
        
        b) Excluding or restricting rights or remedies or subject a person to prejudice as a resulting of their pursuing them
        
        c) Excluding or restricting rules of evidence of procedure
        
        Stewart Gill v Horatio Meyer (1992) - reasonableness requirement applicable to clause as a whole and not just section that party is relying on - court takes into account that dealing with commercial transactions
      - Deals with 'business liability' - defined in S1(3) as 'liability for breach of obligations arising...'
        
        a) From things done or to by done by a person in the course of a business
        
        b) From the occupation of premises used for business purposes
        
        Certain sections apply to non-contractual NOTICES also - S2(1) - cannot by reference to any contract term or notice restrict liability for death or personal injury resulting from negligence
- - - - Proferens must prove reasonableness - S11(5)
      - When determining reasonableness, "regard shall be had in particular to the matters specified in Schedule 2" - S11(2)
        
        Schedule 2 guidelines are "of general application to the requirement of reasonableness"
        
        Stewart Gill v Horatio Meyer (1992) - while Section 2 states that guidelines to be taken into account for ss 6 and 7, courts clarified here that they may be used more widely
        
        a) Strength of the bargaining positions of the parties
        
        Watford Electronics Ltd v Sanderson CFL Ltd (2001) - clauses deemed reasonable because contracted negotiated between experienced businessmen of equal bargaining power
        
        Granville Oil & Chemicals Ltd v Davies Turner & Co Ltd (2003) - Tucker LJ said that parties of equal bargaining power should be able to make contracts of their choosing and be bound by the terms
        
        b) Inducement
        
        c) Notice
        
        d) Condition precedents
        
        e) Special orders - aka might be taking on more risk
      - When determining specifically the reason of limitation clauses, the court should have regard to... - S11(4)
        
        Resources of the proferens for the purpose of meeting the liability - S11(4)(a), and
        
        Whether the proferens could have insured - S11(4)(b)
        
        St Albans v International Computers Ltd (1995)
- - - - Certain exemption clauses will have no effect - i.e. VOID
        
        S2(1) - exempting liability for death or personal injury resulting from negligence
        
        Definition of negligence includes S1(1) - duty to take reasonable care and skill arising from (a) express or implied terms of a contract or (b) common law
        
        E.g. SGSA S13
        
        S6(1)(a) - exempting liability relating to the implied term that the seller of goods has good title
        
        Aka SOGA S12(1)
      - Certain exemption clauses will be subject to the reasonableness test
        
        If reasonableness test is engaged, apply to clause - S11(1)
        
        S2(2) - exempting liability for loss or damage resulting from negligence
        
        S6(1A) - exempting liability for breach of other statutory or implied terms
        
        S13 - goods will correspond to description
        
        S14 - quality or fitness for purpose
        
        S15 - bulk of goods will correspond with sample
        
        S3 - exempting liability for breach of express contractual term
        
        Only applies where one party deals on the other's written standard terms - S3(1)
        
        St Albans City Council v International Computers Ltd (1995) - where a party's general terms had been the subject of negotiation, still dealing on 'standard terms' as they remained effectively untouched
        
        Commercial Management (Investments) Ltd v Mitchell Design and Construct Ltd (2016) - if limitation clauses are from one party's standard terms, then even if other clauses are negotiated or come from the other party, UCTA will apply
        
        The Flamar pride (1990) - a number of bespoke negotiated alterations to a standard form can lead to the contract being outside the scope of the UCTA
        
        If dealing on his written standard terms, a party cannot... - S3(2)
        
        a) Exclude or restrict any liability of his in respect of a breach of contract, or
        
        b) Claim to be entitled
        
        i) To render substantially different contractual performance, or
        
        ii) To render no performance at all
        
        Unless the contract term satisfies the requirement of reasonableness