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1) Sir for an exclusion clause to be vaild, it needs to satisfy both common law and statutory rules na? IF a clause meets common law rules but it does not met statutory rules then it will be void na?
2) In Photo-production ltd v Securicor (1980), exclusion clause was vaild for the fundamental breach, but here didn’t they consider the statutory rules because under statutory rules it would have been rendered as void?
1)Under UCTA 1977 i.e Any exclusion clause which excludes or restricts liability for any loss due to negligence is void unless reasonable
2)Sir for an exclusion clause to be vaild, it needs to satisfy both common law and statutory rules na? IF a clause meets common law rules but it does not met statutory rules then it will be void na?
I asked you for the specific rule that you felt would make Securicor’s clause void
You’ve quoted the reasonableness rule
Why is Securicor’s exclusion clause unreasonable? We’re looking at two large well-established companies, both with the wealth to employ legal opinion … ie two companies with an equality of bargaining power
So what’s unreasonable?
This is from Lord Diplock in the Court of Appeal:
“Parties are free to agree to whatever exclusion or modification of all types of obligations as they please within the limits that the agreement must retain the legal characteristics of a contract; and must not offend against the equitable rule against penalties; that is to say, it must not impose upon the breaker of a primary obligation a general secondary obligation to pay to the other party a sum of money that is manifestly intended to be in excess of the amount which would fully compensate the other party for the loss sustained by him in consequence of the breach of primary obligation. Since the presumption is that the parties by entering into the contract intended to accept the implied obligations exclusion clauses are to be construed strictly and the degree of strictness appropriate to be applied to their construction may properly depend upon the extent to which they involve departure from the implied obligations. Since the obligations implied by law in a commercial contract are those which, by judicial consensus over the years or by Parliament in passing a statute, have been regarded as obligations which a reasonable businessmen would realise that he was accepting when he entered into a contract of a particular kind, the court’s view of the reasonableness of any departure from the implied obligations which would be involved in construing the express words of an exclusion clause in one sense that they are capable of bearing rather than another, is a relevant consideration in deciding what meaning the words were intended by the parties to bear. But this does not entitle the court to reject the exclusion clause, however unreasonable the court itself may think it is, if the words are clear and fairly susceptible of one meaning only.”
OK?
1)So in photo production ltd, the exclusion clause was valid and it satisfied both common law and statutory rules?
2) Secondly for an exclusion clause to be valid it need to satisfy both common law and statutory rules na? If an exclusion clause satisfy common law rules but does not satisfy statutory rules then would such exclusion clause be valid or void?
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