Scribd
Upload
39 views

Exclusion Clause _Incorp_ContraProf

The Exclusion Clause

Uploaded by

afuapejemima
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
39 views

Exclusion Clause _Incorp_ContraProf

The Exclusion Clause

Uploaded by

afuapejemima
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
You are on page 1/ 11

Exclusion Clauses

Introduction

• Contractual Parties have the freedom to agree on whatever terms


they so desire - Freedom of Contract.

• Even implied terms can be expressly excluded from application in a


contract- Section 55 of the SoG Act.
• What is an Exclusion/Limitation Clause?

An exclusion clause is a term inserted into a contract which


excludes/absolves or limits a party’s liability which would have
otherwise flowed from the breach of contract.

• Exclusion Clauses are found in most contracts. However, they are


more prevalent and problematic in Standard Form Contracts.
Examples:
• Exclusion clause (clause 6) and limitation clause (clause 7) in Airpeace
Terms and Conditions.
(6) Damaged Luggage/Items
In the course of normal handling, your baggage may show evidence of
use. Air peace is never liable for destruction, loss or damage that results
from an inherent defect, quality or vice of the baggage.
Air Peace is not liable for conditions that result from normal wear and
tear such as:
* Minor cuts, scratches, scuffs, dents and soil
* Damage to wheels, feet, extending handles and items of fragile or
perishable nature
* Damage as a result of over-packed bags
* Loss of external locks, pull straps, security straps, or zipper tabs
* Manufacturer's defects

(7) Lost Luggage/Items


Compensation for lost luggage is limited to 20USD per kilogram.
Control of Exclusion Clauses

1. Rules of Incorporation
Judicial Control-------------- 2. Contra Proferentem Rule

3. Doctrine of Fundamental Breach

• Federal Competition and Consumer


Legistative Control---------- Protection Commission Act
• Unfair Contract Term Bill
Incorporation
Incorporation of the Exclusion Clause into the Contract
• For an exclusion clause to be valid it must be proved that it was
incorporated into the contract- Consent.

• An exclusion clause can be incorporated into a contract by


signature, notice or dealings.

• Different rules apply to exclusion clauses in signed and clauses


in unsigned documents.
Signed Documents
• It is trite law that in the absence of fraud and misrepresentation, a
party is bound by the exclusion clause in a contract which he
signed, whether he read the terms of the contract or not.
L’Estrange v Graucob (1934) 2 KB 394
Curtis v chemical cleaning and Dyeing Co. [1951]1 KB 805
Mekwunye v. Emirates Airlines [2019] 9 NWLR 191

• The rule for signed documents still applies when the signed
document incorporates another document which has the
exclusion clause.
Chagoury v Adebayo (1973) 3 U.I.LR 532
Chike Atu v Face to Face million Dollar Fixed Odd Pools Ltd [1972]
Unsigned Documents
• where an exclusion clause is not contained in a unsigned document,
the party seeking to rely on the clause has to show that the innocent
party had sufficient notice before or at the time of the contract.

• The guidelines for determining liability in the case for unsigned


documents was set by the court in Parker v South Eastern railway
Co (1877) 2 CPD

1. Did the recipient know that there was something written on the
ticket
2. Did he know or believe that the writing contained conditions?
3. If he did not know that the writing contained conditions, had
reasonably sufficient steps been taken to give him notice of the
written conditions before the contract was entered.
• The court also made a distinction between exclusion clauses
written in a unsigned contractual document and an exclusion clause
written in a mere receipt or ticket issued after payment.

Chapleton v Urban District Council (UDC) (1940) 1 KB 532-

Thorton v Shoe Lane Parking [1971] 2 Q.B 163

Olley v. Marlborough Court Ltd (1951) 1 KB 532-

Imo Concord Hotel v Anya (1992)4 NWLR (part 234) @ 222


Contra Proferentem Rule
• The maxim "verba chartarum fortius accipiuntur contra
proferentem“ means that the words of written documents are to be
construed more strongly against the party relying on them and in
favour of the innocent party if there is any ambiguity.

• Baldry v Marshall [1925] 1 KB 260


The exemption clause excluding ‘ any other guarantee or warranty,
express or otherwise’

• Singer [1934] 1 KB 17-


Term excluded conditions, warranties , liabilities implied by
common law, statute.

Houghton v Trafalgar Insurance [1954] 1 QB 247


Delmas v. Sunny Ositez Intl Ltd (2019) 9 NWLR (Pt. 1677) 305
Negligence
• Where a party’s contractual liability could arise from negligence and any
other cause of action, the clause must specifically refer to the negligence
for the clause to be binding.

• AG Bendel State v UBA-


Excluded liability of the bank in respect of any loss or damages arising
out of error or delay in transmission of messages or misrepresentations
or from any cause beyond the control of the bank.

• F.B.N. Plc v. Associated Motors Co. Ltd. [1998] 10 NWLR 441


"I/We also acknowledge that neither you nor your agents shall be
responsible for any delays in obtaining such foreign currency from the
Central Bank of Nigeria or any delays in remitting same.“

• Third Party- An exclusion clause will not protect a person who is not a
party to the contract which contains the clause. –

You might also like