The opportunity for abuse of exclusion clauses is great, particularly with the advent of standard form contracts, where the terms of contracts are not negotiated, but rather imposed. It is against this background that the law seeks to exercise control over exclusion clauses.
Whilst the common law rules do not differentiate between contracts made between businesses and those made between businesses and consumers, the law does recognize the great opportunity for businesses to exploit consumers as seen in Mark’s case.
An exclusion clause will only operate if it is a part of the contract. The simplest way in which an exclusion clause may become a term of a contract is if it is a written document which is signed by the parties. In this instance the parties are taken to have assented to the clause.
In L’Estrange v Graucob1, the defendant sold to the claimant, Miss L’Estrange, who owned a café in Llandudno, a cigarette slot machine, inserting in the sales agreement the following clause:” Any express or implied condition, statement or warranty, statutory or otherwise, is hereby excluded.”
The claimant signed the agreement but did not read the relevant clause, because she thought it was merely an order form, and she sued for breach of what is now s.14(3) of the Sale of goods Act 1979, in respect of the unsatisfactory nature of the machine supplied which often jummed and soon became unusable.
“Where a document contains contractual terms is signed, then in the absence of fraud, or I will add, misrepresentation, the party signing it is bound, and it is wholly immaterial whether he has read the document or not.”2
In Curtis v Chemical Cleaning & Dying Co.3, the claimant took a wedding dress, with beads and sequins to the defendant’s shop for cleaning. She was asked to sign a receipt which contained the following clause:” This article is accepted on condition that the company is not liable for any damage howsoever