Case Law on Exclusion and Limitation Clauses in Contracts and Boilerplate Clauses, Study notes of Contract Law

Download Case Law on Exclusion and Limitation Clauses in Contracts and Boilerplate Clauses and more Study notes Contract Law in PDF only on Docsity! 1 Exclusion, Limitation and Standard Clauses I Pre- reading activity 1 Common people entering into a contract sometimes neglect reading it, because of its length, small print etc. What are the dangers of such a behaviour? 2 Do you think a perfect contract can eliminate future problems? 2 Reading for gist Skim the following cases and decide whether these statements are true or false: 1 In Parker v South Eastern Railway the plaintiff gave a bag into a cloak-room at the defendant´s station and got a ticket which read: See a notice next to the door. 2 On the back of a ticket there were printed some clauses, one of them excluding ESR from liability for any package of value higher than ₤10. 3 Mellish LJ stated in his opinion that a person receiving a ticket is in each case bound by the conditions. 4 Subject-matter of Thompson v Railway case was the right of action of excursion participants against the company in respect of any injury, however caused. 5 In Olley v Marlborough Court case the plaintiff registered for a 2-week stay at the defendant´s hotel. 6 One of the members of hotel staff entered her room and stole her fox fur coat. 7 Although there was a notice on the bedroom door, the clause excluding liability of the hotel owner for the things stolen or lost from the room was not incorporated in a contract. 8 The plaintiff, who could not read was informed about the conditions and regulations relating to excursion by her niece. 9 The jury decided that the defendants took all the necessary steps to inform a plaintiff, nevertheless, the Court entered in Thompson case judgment for the plaintiff. 3 Close reading Read the article closely and answer the following questions: 1 What is the common feature of all the presented cases? 2 Why did Parker sue the SER? 3 What were the merits of Olley v Marlborough Court case? 4 Who won? 5 Did Thompson have a right of action against LMS Railway as to any injury? 6 Which question was left to the jury in this case? 7 In whose favour was the judgment entered in the aforementioned case? 8 Was the plaintiff´s illiteracy relevant for the case? 9 What does the abbreviation MR in Lord Hanworth title mean? 2 4 Text Parker v South Eastern Railway (1877) 2 CPD 416 The plaintiff deposited a bag in a cloak-room at the defendants' railway station. He received a paper ticket which read 'See back'. On the other side were printed several clauses including "The company will not be responsible for any package exceeding the value of �10." The plaintiff presented his ticket on the same day, but his bag could not be found. He claimed �24 10s. as the value of his bag, and the company pleaded the limitation clause in defence. In the Court of Appeal, Mellish LJ gave the following opinion: � If the person receiving the ticket did not see or know that there was any writing on the ticket, he is not bound by the conditions; � If he knew there was writing, and knew or believed that the writing contained conditions, then he is bound by the conditions; � If he knew there was writing on the ticket, but did not know or believe that the writing contained conditions, nevertheless he would be bound, if the delivering of the ticket to him in such a manner that he could see there was writing upon it, was reasonable notice that the writing contained conditions. Olley v Marlborough Court [1949] The plaintiff booked in for a week's stay at the defendants' hotel. A stranger gained access to her room and stole her mink coat. There was a notice on the back of the bedroom door which stated that "the proprieters will not hold themselves responsible for articles lost or stolen unless handed to the manageress for safe custody." The Court of Appeal held that the notice was not incorporated in the contract between the proprietors and the guest. The contract was made in the hall of the hotel before the plaintiff entered her bedroom and before she had an opportunity to see the notice. Thompson v LMS Railway [1930] The plaintiff who could not read gave her niece the money to buy an excursion ticket. On the face of the ticket was printed "Excursion, For Conditions see back"; and on the back, "Issued subject to the conditions and regulations in the company's time-tables and notices and excursion and other bills." The conditions provided that excursion ticket holders should have no right of action against the company in respect of any injury, however caused. The plaintiff stepped out of a train before it reached the platform and was injured. The trial judge left to the jury the question whether the defendants had taken reasonable steps to bring the conditions to the notice of the plaintiff. The jury found that they had not but the judge, nevertheless, entered judgment for the defendants. The Court of Appeal held that the judge was right. The Court thought that the verdict of the jury was probably based on the fact that the passenger had to make a considerable search to find the conditions; but that was no answer. Lord Hanworth MR said that anyone who took the ticket was conscious that there were some conditions and it was obvious that the company did not provide for the price of an excursion ticket what it provided for the usual fare. Having regard to the condition of education in this country, it was irrelevant that the plaintiff could not read. 5 jurisdiction, unfair, duty, indirect, to exclude, written, force, governing, severance, to impose, to limit, consequential, boiler-plate, force-majeure, reasonable, exclusion, negligence 1 It is typical for commercial contracts to .......... liability for damage. 2 These types of contract also try ............. liability for breach of contract. 3 The company bears no liability for any ......... or ............. loss sustained by the buyer. 4 It is irrelevant whether the harm was caused by breach of ............., tort or the company´s ............ . 5 Legislation .......... limits on the use of ............contract terms. 6 The parties often rely on binding power of ............ clauses if such are included in .......... contract. 7 The so called ............. clauses, placed at the end of a contract, usually standardize some terms. 8 ......-... .....clause may release parties from liability for the events outside their ............... control. 9 A ............ clause provides that, if some parts of a contract are illegal, the other ones remain in .................. . 10 If a dispute relating to a contract arises, then ................ law and .......... clause are important. 4 Create word families: verb noun adjective exclusion consequential to bargain to purport assignment governing to prevail exhaustive to release access 5 Fill in the proper prepositions: To be ... liability, to impose limits ..., injury attributable ... negligence, to release party ... liability, to call the courts ... , to assign rights ... third parties, need ... written consent, to plead ... defence, to hand sth ... sb, to provide ... the price, to leave the question ... jury, action ... the company ... respect ... any injury. 7 Practice your translation skills 6 1 Obchodné zmluvy často obsahujú dodatky, ktoré obmedzujú zodpovednosť zmluvných strán napr. doložku o vylúčení a obmedzujúcu doložku. 2 Ak kupujúci utrpí následnú alebo nepriamu škodu, spoločnosť nie je v žiadnom prípade zodpovedná, bez ohľadu na to, ako daná škoda vznikla. 3 K následným a nepriamym škodám patria napr. strata zisku, dobrého mena, poškodenie majetku kupujúceho, zranenie osoby atď. 4 Zmluvné strany sa spoliehali na to, že podmienky obsiahnuté v doložke o vylúčení sú záväzné. 5 Vďaka zákonom, ktoré obmedzujú tzv. znevýhodňujúce zmluvné podmienky, nedošlo k poškodeniu žalobcu. 6 Ak sú takéto doložky nejasné, je potrebné obrátiť sa na súd kvôli výkladu. 7 Zmluvné strany môžu použiť štandardné doložky, aby sa zabezpečili proti prípadným problémom a škodám. 8 Jednou z najznámejších štandardných doložiek je doložka o vyššej moci, cieľom ktorej je zbaviť strany zodpovednosti za udalosti, ktoré nemôžu kontrolovať, napr. zásah vyššej moci, požiar, záplavy, zemetrasenie, štrajky atď. 9 Doložka o časovom obmedzení hlavnej zmluvnej podmienky upresňuje, či lehoty v zmluve sú naozaj hlavnými zmluvnými podmienkami. 10 Doložka postúpenia práv je potrebná vtedy, ak sú zmluvné práva postúpené tretím osobám a stanovuje podmienku predchádzajúceho písomného súhlasu. 11 Ak vznikne spor týkajúci sa zmluvy, je nevyhnutné v klauzule o výbere platného práva a jurisdikcie určiť ďalší postup. 12 Väčšina zmlúv obsahuje aj doložku o jazyku, ktorý bude použitý pri preklade zmluvy. 13 Rozhodcovská doložka umožňuje ušetriť zbytočné náklady za právne poplatky v prípade sporu. 14 Ak osoba nevie, že na rubovej strane lístka z úschovne batožiny sa nachádza upozornenie, nie je ním viazaná. 15 Upozornenie, že majiteľ hotela nezodpovedá za veci odložené v izbe hosťa, musí byť súčasťou zmluvy, v opačnom prípade je za ich stratu zodpovedný majiteľ. 7 16 Súd vo svojom odôvodnení nevzal do úvahy skutočnosť, že žalobca nevie čítať a oslobodil železnice od zodpovednosti za jeho zranenie. 8 Subject-matter comprehension check Use as much new vocabulary and information from the seminar and RS as possible to discuss: 1 Characteristics of exclusion and limitation clauses 2 Concept and main purposes of boiler-plate clauses 3 Statutes supporting exclusion clauses 11 Write a brief summary of four cases where the aforementioned clauses were subject of a dispute