Exclusion Clauses

• A term that aims to avoid liability for breaches of the contract.
• Judges have developed control on the use of exclusion clauses because of their potential unfairness to consumers.
• Courts try to mitigate the imbalance of power which can sometimes exist.
• For an exclusion clause to be valid a party subject to it must be able to be aware of the clause before the contract was made.

  Olley v Marlborough Court Hotels
• Express terms are negotiated and agreed by the contracting parties.
• Express terms are the words agreed by the parties to be incorporated into their contract.
• Express terms can be oral or written statements
• Written statements are signed and are more straightforward. Parties can see what the other has agreed to.
• Oral statements can cause confusion. When a contract is formed orally to can be difficult to establish statements which were made in the lead up negotiation for the contract and which were merely comments.
• A discussion might be a "puff", or "representation", or it could be "express terms".
• In order to decide if an oral statements is a representation or a term, they have made 3 guidelines:

  1. Importance of the statement
  2. Knowledge and skills
  3. Timing of the statement
• If the statement was that important, the party wouldn't have entered a contract the more likely it is to be a term.

  Bannerman v White
• If the person making the statement has some specialist skills or knowledge of the contractual subject matter or claims to have such knowledge is the presumption is that the statement is more likely to be a term.
• If the person has less knowledge, it is more likely to be representation.

  Dick Bentley Productions v Harold Smith

  Oscar Chess v Williams
• The longer the time lapse between the making of the statement and the entering of the contract is ore likely to be representation.
• The longer the time period the less important the statement was.

  Routledge v McKay