Contract seminar 7
1) Consumer rights act 2015 makes a clear distinction between business to business contracts
and business to consumer contracts.
Legislation Unfair contract terms act 1977 was amended by the consumer rights act 2015
and s1 (3) applies to business liability.
Clauses covered- s13 relates to exemption clauses and those closely aligned to such clauses
so those removing the right to a remedy which would normally be available.
Section 2 is negligence-
S2(1) prevents entirely the exclusion or restriction of liability for negligently caused death or
personal injury.
S2(2) other injury- the clause will only be effective if it satisfies the requirement of
reasonableness
S2(3) is a clear attempt to limit the effectiveness of the defence of volenti non fit injuria
Section 3 deals with the other party’s written standard terms of business.
S3(2)a This prevents a party from relying on a term to restrict or exclude liability unless that
term satisfies the requirement of reasonableness.
S3(2)b tackles exclusion clauses in disguise, so that a party who deals on his own written
standard terms or with someone who deals as a consumer cannot in effect render a
substantially different performance than was reasonably expected or provide no
performance at all, unless the term satisfies the requirement of reasonableness.
Section 6 & 7 is the sale and supply of goods.
S6 Sale of Goods Some of this extends beyond business liability but not all!!
S6(1)(a) No exclusion of S12 SofGA 1979 in any circumstances, so extends beyond business
liability.
S6(1A) Liability for breach of S13-15 of SofGA can be excluded but only if the term satisfies
the requirement of reasonableness
S7(3A) Supply of Goods and Service Act S2 of that Act can’t be excluded (transfer of goods in
a work and materials contract)
S7(4) However the right to transfer possession of goods in a hire contract can be subject to
an exemption clause, so long as it satisfies the requirement of reasonableness.
S7(1A) The obligations over quality, etc can only be restricted if the clause satisfies the
requirement of reasonableness.
Section 11 is the requirement of reasonableness.
S11(1) This is to be gauged from the time of contracting.
S11(5) The burden of proving reasonableness lies with the party seeking to rely on the
exemption clause.
S11(2) Those terms relating to the Sale or Supply of Goods reference should be made to
Schedule 2.
S11(4) Clauses limiting liability
Treated differently more leniently but with reference to the resources available.
2) Unfairness
1) Consumer rights act 2015 makes a clear distinction between business to business contracts
and business to consumer contracts.
Legislation Unfair contract terms act 1977 was amended by the consumer rights act 2015
and s1 (3) applies to business liability.
Clauses covered- s13 relates to exemption clauses and those closely aligned to such clauses
so those removing the right to a remedy which would normally be available.
Section 2 is negligence-
S2(1) prevents entirely the exclusion or restriction of liability for negligently caused death or
personal injury.
S2(2) other injury- the clause will only be effective if it satisfies the requirement of
reasonableness
S2(3) is a clear attempt to limit the effectiveness of the defence of volenti non fit injuria
Section 3 deals with the other party’s written standard terms of business.
S3(2)a This prevents a party from relying on a term to restrict or exclude liability unless that
term satisfies the requirement of reasonableness.
S3(2)b tackles exclusion clauses in disguise, so that a party who deals on his own written
standard terms or with someone who deals as a consumer cannot in effect render a
substantially different performance than was reasonably expected or provide no
performance at all, unless the term satisfies the requirement of reasonableness.
Section 6 & 7 is the sale and supply of goods.
S6 Sale of Goods Some of this extends beyond business liability but not all!!
S6(1)(a) No exclusion of S12 SofGA 1979 in any circumstances, so extends beyond business
liability.
S6(1A) Liability for breach of S13-15 of SofGA can be excluded but only if the term satisfies
the requirement of reasonableness
S7(3A) Supply of Goods and Service Act S2 of that Act can’t be excluded (transfer of goods in
a work and materials contract)
S7(4) However the right to transfer possession of goods in a hire contract can be subject to
an exemption clause, so long as it satisfies the requirement of reasonableness.
S7(1A) The obligations over quality, etc can only be restricted if the clause satisfies the
requirement of reasonableness.
Section 11 is the requirement of reasonableness.
S11(1) This is to be gauged from the time of contracting.
S11(5) The burden of proving reasonableness lies with the party seeking to rely on the
exemption clause.
S11(2) Those terms relating to the Sale or Supply of Goods reference should be made to
Schedule 2.
S11(4) Clauses limiting liability
Treated differently more leniently but with reference to the resources available.
2) Unfairness
