Unfair Contract Terms Act 1977: Part I and Negligence Liability, Study notes of Art

Download Unfair Contract Terms Act 1977: Part I and Negligence Liability and more Study notes Art in PDF only on Docsity! Changes to legislation: There are currently no known outstanding effects for the Unfair Contract Terms Act 1977, PART I . (See end of Document for details) Unfair Contract Terms Act 1977 1977 CHAPTER 50 PART I AMENDMENT OF LAW FOR ENGLAND AND WALES AND NORTHERN IRELAND Modifications etc. (not altering text) C1 Pt. I applied (3.1.1995): by 1973 c. 13, s. 11A (as inserted (3.1.1995) by 1994 c. 35, ss. 7, 8(2)(3), Sch. 2 para. 4(6)); by 1979 c. 54, s. 61(5A) (as inserted (3.1.1995) by 1994 c. 35, ss. 7, 8(2)(3), Sch. 2 para. 5(9)(c)); by 1982 c. 29, s. 18(3) (as inserted (3.1.1995) by 1994 c. 35, ss. 7, 8(2)(3), Sch. 2 para. 6(10)) Introductory 1 Scope of Part I. (1) For the purposes of this Part of this Act, “negligence” means the breach— (a) of any obligation, arising from the express or implied terms of a contract, to take reasonable care or exercise reasonable skill in the performance of the contract; (b) of any common law duty to take reasonable care or exercise reasonable skill (but not any stricter duty); (c) of the common duty of care imposed by the M1 Occupiers’ Liability Act 1957 or the M2 Occupiers’ Liability Act (Northern Ireland) 1957. F1(2) This Part of this Act is subject to Part III; and in relation to contracts, the operation of sections 2 [F1 , 3] and 7 is subject to the exceptions made by Schedule 1. (3) In the case of both contract and tort, sections 2 to 7 apply (except where the contrary is stated in section 6(4)) only to business liability, that is liability for breach of obligations or duties arising— (a) from things done or to be done by a person in the course of a business (whether his own business or another’s); or 2 Unfair Contract Terms Act 1977 (c. 50) PART I – AMENDMENT OF LAW FOR ENGLAND AND WALES AND NORTHERN IRELAND Document Generated: 2021-12-14 Changes to legislation: There are currently no known outstanding effects for the Unfair Contract Terms Act 1977, PART I . (See end of Document for details) (b) from the occupation of premises used for business purposes of the occupier; and references to liability are to be read accordingly [F2but liability of an occupier of premises for breach of an obligation or duty towards a person obtaining access to the premises for recreational or educational purposes, being liability for loss or damage suffered by reason of the dangerous state of the premises, is not a business liability of the occupier unless granting that person such access for the purposes concerned falls within the business purposes of the occupier]. (4) In relation to any breach of duty or obligation, it is,immaterial for any purpose of this Part of this Act whether the breach was inadvertent or intentional, or whether liability for it arises directly or vicariously. Textual Amendments F1 Words in s. 1(2) substituted (1.10.2015 for specified purposes, 1.10.2016 in so far as not already in force) by Consumer Rights Act 2015 (c. 15), s. 100(5), Sch. 4 para. 3; S.I. 2015/1630, arts. 3(g), 4(c) (with art. 6(1)(2)) F2 Words added by Occupiers' Liability Act 1984 (c. 3, SIF 122:2), s. 2 (E.W.) and by the Occupiers' Liability (Northern Ireland) Order 1987 S.I. 1987/1280 (N.I.15), art 4 Marginal Citations M1 1957 c. 31 M2 1957 c. 25 (N.I.) Avoidence of liability for negligence, breach of contract, etc. 2 Negligence liability. (1) A person cannot by reference to any contract term or to a notice given to persons generally or to particular persons exclude or restrict his liability for death or personal injury resulting from negligence. (2) In the case of other loss or damage, a person cannot so exclude or restrict his liability for negligence except in so far as the term or notice satisfies the requirement of reasonableness. (3) Where a contract term or notice purports to exclude or restrict liability for negligence a person’s agreement to or awareness of it is not of itself to be taken as indicating his voluntary acceptance of any risk. [F3(4) This section does not apply to— (a) a term in a consumer contract, or (b) a notice to the extent that it is a consumer notice, (but see the provision made about such contracts and notices in sections 62 and 65 of the Consumer Rights Act 2015).] Textual Amendments F3 S. 2(4) inserted (1.10.2015 for specified purposes, 1.10.2016 in so far as not already in force) by Consumer Rights Act 2015 (c. 15), s. 100(5), Sch. 4 para. 4; S.I. 2015/1630, arts. 3(g), 4(c) (with art. 6(1)(2)) Unfair Contract Terms Act 1977 (c. 50) PART I – AMENDMENT OF LAW FOR ENGLAND AND WALES AND NORTHERN IRELAND Document Generated: 2021-12-14 5 Changes to legislation: There are currently no known outstanding effects for the Unfair Contract Terms Act 1977, PART I . (See end of Document for details) Marginal Citations M3 1973 c. 13. 7 Miscellaneous contracts under which goods pass. (1) Where the possession or ownership of goods passes under or in pursuance of a contract not governed by the law of sale of goods or hire-purchase, subsections (2) to (4) below apply as regards the effect (if any) to be given to contract terms excluding or restricting liability for breach of obligation arising by implication of law from the nature of the contract. [F12(1A) Liability in respect of the goods' correspondence with description or sample, or their quality or fitness for any particular purpose, cannot be excluded or restricted by reference to such a term except in so far as the term satisfies the requirement of reasonableness.] F13(2) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . F13(3) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . [F14(3A) Liability for breach of the obligations arising under section 2 of the Supply of Goods and Services Act 1982 (implied terms about title etc. in certain contracts for the transfer of the property in goods) cannot be excluded or restricted by reference to any such term.] (4) Liability in respect of— (a) the right to transfer ownership of the goods, or give possession; or (b) the assurance of quiet possession to a person taking goods in pursuance of the contract, cannot [F15(in a case to which subsection (3A) above does not apply)], be excluded or restricted by reference to any such term except in so far as the term satisfies the requirement of reasonableness. [F16(4A) This section does not apply to a consumer contract (but see the provision made about such contracts in section 31 of the Consumer Rights Act 2015).] (5) F17. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Textual Amendments F12 S. 7(1A) inserted (1.10.2015) by Consumer Rights Act 2015 (c. 15), s. 100(5), Sch. 4 para. 9(2); S.I. 2015/1630, art. 3(g) (with art. 6(1)) F13 S. 7(2)(3) omitted (1.10.2015) by virtue of Consumer Rights Act 2015 (c. 15), s. 100(5), Sch. 4 para. 9(3); S.I. 2015/1630, art. 3(g) (with art. 6(1)); S.I. 2015/1630, art. 3(g) (with art. 6(1)) F14 S. 7(3A) inserted by Supply of Goods and Services Act 1982 (c. 29, SIF 109:1), ss. 17(2), 20(5) F15 Words inserted by Supply of Goods and Services Act 1982 (c. 29, SIF 109:1), ss. 17(3), 20(5) F16 S. 7(4A) inserted (1.10.2015) by Consumer Rights Act 2015 (c. 15), s. 100(5), Sch. 4 para. 9(4); S.I. 2015/1630, art. 3(g) (with art. 6(1)) F17 S. 7(5) repealed (E.W.) (6.4.2005) by The Regulatory Reform (Trading Stamps) Order 2005 (S.I. 2005/871), art. 6, Sch. 6 Unfair Contract Terms Act 1977 (c. 50) PART I – AMENDMENT OF LAW FOR ENGLAND AND WALES AND NORTHERN IRELAND Document Generated: 2021-12-14 Changes to legislation: There are currently no known outstanding effects for the Unfair Contract Terms Act 1977, PART I . (See end of Document for details) Other provisions about contracts 8 X1 Misrepresentation. (1) In the M4 Misrepresentation Act 1967, the following is substituted for section 3— “3 Avoidance of provision excluding liability for misrepresentation. If a contract contains a term which would exclude or restrict— (a) any liability to which a party to a contract may be subject by reason of any misrepresentation made by him before the contract was made; or (b) any remedy available to another party to the contract by reason of such a misrepresentation, that term shall be of no effect except in so far as it satisfies the requirement of reasonableness as stated in section 11(1) of the Unfair Contract Terms Act 1977; and it is for those claiming that the term satisfies that requirement to show that it does.”. (2) The same section is substituted for section 3 of the M5 Misrepresentation Act (Northern Ireland) 1967. Editorial Information X1 The text of s. 8 is in the form in which it was originally enacted: it was not reproduced in Statutes in Force and does not reflect any amendments or repeals which may have been made prior to 1.2.1991. Marginal Citations M4 1967 c. 7 M5 1967 c. 14 (N.I.) F189 Effect of breach. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Textual Amendments F18 S. 9 omitted (1.10.2015 for specified purposes, 1.10.2016 in so far as not already in force) by virtue of Consumer Rights Act 2015 (c. 15), s. 100(5), Sch. 4 para. 10; S.I. 2015/1630, arts. 3(g), 4(c) (with art. 6(1)(2)) 10 Evasion by means of secondary contract. A person is not bound by any contract term prejudicing or taking away rights of his which arise under, or in connection with the performance of, another contract, so far as those rights extend to the enforcement of another’s liability which this Part of this Act prevents that other from excluding or restricting. Unfair Contract Terms Act 1977 (c. 50) PART I – AMENDMENT OF LAW FOR ENGLAND AND WALES AND NORTHERN IRELAND Document Generated: 2021-12-14 7 Changes to legislation: There are currently no known outstanding effects for the Unfair Contract Terms Act 1977, PART I . (See end of Document for details) Explanatory provisions 11 The “reasonableness” test. (1) In relation to a contract term, the requirement of reasonableness for the purposes of this Part of this Act, section 3 of the M6 Misrepresentation Act 1967 and section 3 of the M7 Misrepresentation Act (Northern Ireland) 1967 is that the term shall have been a fair and reasonable one to be included having regard to the circumstances which were, or ought reasonably to have been, known to or in the contemplation of the parties when the contract was made. (2) ln determining for the purposes of section 6 or 7 above whether a contract term satisfies the requirement of reasonableness, regard shall be had in particular to the matters specified in Schedule 2 to this Act; but this subsection does not prevent the court or arbitrator from holding, in accordance with any rule of law, that a term which purports to exclude or restrict any relevant liability is not a term of the contract. (3) In relation to a notice (not being a notice having contractual effect), the requirement of reasonableness under this Act is that it should be fair and reasonable to allow reliance on it, having regard to all the circumstances obtaining when the liability arose or (but for the notice) would have arisen. (4) Where by reference to a contract term or notice a person seeks to restrict liability to a specified sum of money, and the question arises (under this or any other Act) whether the term or notice satisfies the requirement of reasonableness, regard shall be had in particular (but without prejudice to subsection (2) above in the case of contract terms) to— (a) the resources which he could expect to be available to him for the purpose of meeting the liability should it arise; and (b) how far it was open to him to cover himself by insurance. (5) lt is for those claiming that a contract term or notice satisfies the requirement of reasonableness to show that it does. Marginal Citations M6 1967 c. 7 M7 1967 c. 14(N.I.) F1912 “Dealing as a consumer”. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Textual Amendments F19 S. 12 omitted (1.10.2015 for specified purposes, 1.10.2016 in so far as not already in force) by virtue of Consumer Rights Act 2015 (c. 15), s. 100(5), Sch. 4 para. 11; S.I. 2015/1630, arts. 3(g), 4(c) (with art. 6(1)(2))