Chapter 13 Self-test questions

Exclusion clauses

Quiz Content

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. Prior to the enactment of the Unfair Contract Terms Act 1977, how did the courts seek to regulate unreasonable exclusion clauses? Select all that apply..

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. Has the "old intellectual baggage of 'legal' interpretation" (per Lord Hoffmann, in Investors Compensation Scheme Ltd v. West Bromwich Building Society [1998] 1 WLR 896, at 912), in particular the use of artificial rules for the interpretation of exclusion clauses, been discarded?

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. The Unfair Contract Terms Act (UCTA) 1977 declares a minority of types of exclusion clause wholly void and subjects the majority to a test of reasonableness. Which of the following types of clause would fall into the former category?

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. The doctrine of fundamental breach caused a number of difficulties in the 1960s and 1970s, when courts sometimes used the device to control unreasonable exclusion clauses. In Harbutt's Plasticine Ltd v. Wayne Tank and Pump Co Ltd [1970] 1 QB 447, Lord Denning MR held the doctrine to entail, as a matter of law, that no party in fundamental breach could rely on an exclusion or limitation clause to escape from liability for the breach. Which of the following statements best describes the current state of the law in relation to fundamental breach?

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. In relation to the 'reasonableness' test (section 11) of the Unfair Contract Terms Act 1977, the onus of proving that the clause is unreasonable is placed on the party challenging the reasonableness of the term. True or false?

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. SmallBucks Ltd entered into a contract with Zippy & Co. Although the parties negotiated about the price, the rest of the terms are to be found in standard terms which Zippy & Co habitually use in their contracts with customers. The terms were drafted by a trade association, of which Zippy & Co is a member. SmallBucks Ltd allege that Zippy & Co is in serious breach of contract. Zippy & Co rely on an exclusion clause in the contract to defeat the claim. Smallbucks Ltd claim that not all of the terms are written down and that there are various terms which it alleges were agreed orally on which it wishes to rely. Which of the following factors would be relevant in deciding whether or not this case falls within s 3(1) of the Unfair Contract Terms Act? Select all that apply.

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. Which of the following did the court decide in the case George Mitchell Ltd v. Finney Lock Seeds Ltd [1983] 2 AC 803?

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. In Phillips Products Ltd v. Hyland [1987] 1 WLR 659, it was suggested that "a transfer of liability from A to B necessarily and inevitably involves the exclusion of liability as far as A is concerned", thereby extending the remit of the Unfair Contract Terms Act 1977 quite significantly. Thompson v. T Lohan (Plant Hire) Ltd [1987] 1 WLR 649, however, seems to make a move in the opposite direction. In which of the following ways?

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