Business Law - Exclusion Clauses and Unfair Contract Terms - Essay Example

Swarna1 Word count: 1239 Business law   Henry’s accident Henry is a that has been requested by his law teacher to get the latest edition of“Business law for dumb people”, by renowned author Harry Prince. When Henry went back to the bookstore to get the book, soon after entering the bookstore a big pile of books that were carelessly stored on a table fell on him and broke his right wrist, provoked some concussions on his face and broke his expensive sunglasses. On the entrance door was a big sign in red bold letters saying: “The Learned Wig does not guarantee that product descriptions written or given verbally in this store are accurate, complete, reliable, current, or error-free. Such advice is provided by The Learned Wig without constituting any representation or guarantee of any kind, express or implied, as to the information, content, materials, or products being sold in this store. To the full extent permissible by applicable law, The Learned Wig disclaims all warranties, express or implied, including but not limited to, implied warranties or merchantability and fitness for purpose, even any liability arising from the negligence of its employees. In the same way, the Learned Wig excludes any liability for any type of damage or injury that the costumer may suffer when visiting the store, even in the case of negligence of its employees or management”. “The Learned Wig” is sure that the notice posted in front of the till covers them from any claim that Henry could have related to his injuries. Using relevant case law and statutory provisions, explain whether the store has any liability for negligence in relation to Henry’s injury and property damage AND whether the notice on the door discharges its liability. Yes. The store “The Learned Wig” has to take responsibility for the damage caused to Henry. It is because of the negligence of the store, the books were not arranged properly that led to injury of Henry. It is the minimum duty and responsibility of the store to maintain proper records and arrangement of other articles and thorough supervision. Sufficient number of persons should be arranged for showing the required books to the customers. Had “ The Learned Wig” followed these basic duties properly, Henry wouldn’t have experienced any injury. Moreover, the maintenance of basic facilities in the store should be the main duty of “The Learned Wig”. Hence, Henry should be paid compensationfor the damage he sugjected due to negligence of store keeper. However, Henry has to proceed legally to get the compensation. Let us analyse the legal status of this case : Henry has to seek the justice under “The unfair contract terms act 1977”in which if the act of any person or business organization is unreasonable in terms of the safe and quality supply of the products, the supplier may be punished under court of law (Mann, 1978). This act will work in conjunction with Sale of goods act (1979) and Supply of goods and services act (1982). The legal status of this case is also judged by these two acts also. According to Part IV of the Sale of goods act (1979) the buyer has every right to reject the goods if they are not delivered in proper manner. Keeping this in view, the store keeper may be required to pay the necessary compensation to the client or customer for his negligence. “The unfair contract terms act 1977” describes the legal interpretation of cases where exemption of liability for negligence is involved (S2). Under S2(1) clause, it is stated that no person involved in the course of a business can exclude or restrict his liability in negligence for death or personal injury even if it is mentioned in terms of a contract or through notice (Unfair Contract Terms Act, 1977). According to this, even if contract is made between the store keeper and Henry, the liability for negligence in providing safe and quality goods to Henry cannot be restricted. In other words, the personal injury caused to Henry was certainly due to negligence on part of storekeeper and he should be punished for the same. Moreover, the notice was kept in front of the store cannot restrict his liability for negligence. Similarly, S2(2) of Unfair contract terms act (1977) also postulated that in case the personal injury and death was not resulted and liability for negligence for any other kind of loss or damage can be excluded provided the notice meets the requirement of reasonableness (Richard Lawson, 2005). The unfair terms in consumer contracts regulations (1999) also supports this view. According to the reasonableness principle, store keeper is highly expected to maintain safety and quality in his shop and during supply of goods. If he cannot implement the same, it would be considered as violation of principle of reasonableness. In the present case, Henry was given very poor service in supplying goods by storekeeper. Rather, the act of store keeper or his assistants doesn’t meet the minimum requisites of the principle of reasonableness. Hence, Henry should be paid reasonable amount of compensation for act of negligence by storekeeper “The Learned Wig” . Similarly, under section 3 of Unfair contract terms act (1979), it was mentioned that the exemption of liability for breach of contract when two parties are involved in transaction of goods, then the other party cannot exclude or restrict his liability for breach of contract unless the exemption clause satisfies the requirement of reasonableness. In the present case, the principle of reasonableness was not followed by the storekeeper and hence he should be punished and Henry should get the compensation. Similarly, section 4 of the same act protects the interests of the customers and discourages unreasonable indemnity clauses. It also mentions that indemnity clauses in contracts are unenforceable unless they are reasonable. Henry would certainly get justice through interpretation of section 5 of Unfair contract terms act (1979) which guarantees of consumer goods and supplier or seller cannot exclude or restrict his liability in negligence for loss arising from defects in goods ordinarily supplied for private use or consumption by means of a term or notice contained in a guarantee. Here in the present case, the store keeper failed in supply of quality goods and services resulting in personal injury to Henry. Hence Henry must be paid compensation. In addition, the section 6 ( Exemption of Implied Terms in Contracts of Sale and Hire-Purchase), section 7 (Exemption of Implied Terms in other Contracts for the Supply of Goods), section 8 (Exemption of Liability for Misrepresentation) and section 10 (Exclusion Clauses in Secondary Contracts) of Unfair contract terms act (1979) provide sufficient protection for the consumers or buyers in business transactions in cases of poor quality supply of goods. Hence Henry must be paid necessary compensation if these legal clauses are represented properly. References Mann, F.A. (1978). Unfair Contract Terms act 1977 and the Conflict of Laws. International and Comparative Law Quarterly (1978), 27:661-664. Cambridge University Press. Richard Lawson. (2005). Exclusion Clauses and Unfair Contract Terms 9th edition. Sweet & Maxwell publication. ISBN: 1847037224 Sale of goods act. (1979). Chapter 54. Part IV. Performance of the contract. Office of Public Sector Information. http://www.opsi.gov.uk/RevisedStatutes/Acts/ukpga/1979/cukpga_19790054_en_8. Supply of goods and services act (1982). Chapter 29. http://www.opsi.gov.uk/RevisedStatutes/Acts/ukpga/1982/cukpga_19820029_en_1. Unfair Contract Terms Act. (1977). CHAPTER 50. Part-1: Amendemnt of law for England, wales and Northern Ireland. Avoidance of liability for negligence and breach of contract etc. Office of Public Sector Information.Http://www.opsi.gov.uk/RevisedStatutes/Acts/ukpga/1977/cukpga_19770050_en_1. Read More