Contract Law - Week 15 Lectures Exclusion clauses 2 Statutory controls . Unfair Contract Terms Act 1977 (UCTA)- now applies only to Business to Business Contracts. . Consumer Rights Act 2015- which replaces the Unfair Terms in Consumer Contracts Regulations 1999 (UTCCR). UCTA 1977 · Concerned primarily with 'business liability' . ... breach of obligations arising (a) from things done or to be done in the course of a business ... or (b) from the occupation of premises used for the business purposes of the occupier.' - sec 1(3) · 'Business' includes professions, government departments, local government, public authorities - sec 14 UCTA 1977 - negligence liability · Sec 1(1) - covers tortious negligence and contractual negligence. · Sec 2 (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. - cannot exclude liability for negligence liability if it results in someone dying or being injured . Sec 2 (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.' Strict liability in contract . UCTA, sec 3 - applies where one party deals on the other's written standard terms. . A matter of one party pushing their thoughts onto the other · Example: o Bigs Ltd contracts with Smalls Ltd on Smalls Ltd's standard terms - sec 3 applies. Effect of section 3 You can only exclude for breach of contract if it satisfies the requirements of reasonablenees . '.as against that party, the other cannot by reference to any contract term: . when himself in breach of contract, exclude or restrict any liability of his in respect of the breach; or · claim to be entitled: . to render a contractual performance substantially different from that which was reasonably expected of him; or . in respect of the whole or any part of his contractual obligation, to render no performance at all, . except in so far as (in all of the cases mentioned above in this sub-section) the contract term satisfies the requirement of reasonableness. Requirement of reasonableness
· UCTA sec 11(1) - 'Fair and reasonable' to include in the contract. · Sec 11(4) where the clause limits monetary liability, consideration should be had to: . Resources available to defendant · Availability of insurance · Sec 11(5) - burden of proof on defendant - C doesn't have a duty to show the reasonableness of the clause · Schedule 2 factors- applies to supply of goods contracts (ss. 6 & 7), but, can be used more widely in determining reasonableness. Schedule 2 - relevant factors · Strength of bargaining position. • Watford Electronics Ltd v Sanderson CFL [2001] · Contract between two business parties of equal bargaining power • Clause was upheld · Did claimant receive an inducement (e.g discount) to