Exclusion Clauses in Contracts

1254 WordsJul 7, 20186 Pages
The exclusion clause is an important device for allocating the risks between the contractual parties. However, the exclusion clauses could mostly be found in written contracts, especially standard form of contracts. Standard form contracts with consumers are often contained in some printed ticket, or delivery note, or receipt, or similar document. In practice, it is very common that if a person wants the product, he may have no alternative but to accept the terms drawn up by the other party even though such terms are disadvantage to him, or he may simply accept it regardless the possible unfavorable position because he does not trouble to read a long list of terms and conditions. Therefore, contracts are regularly signed, tickets are…show more content…
v Stiletto Visual Programmes Ltd, Dillon LJ also asserted that a ‘particularly onerous or unusual’ term must have special notice otherwise it would not be incorporated into the contract. But the protection of this principle would be limited if one party has given special notice but the other party does not read it ignoring its own responsibility or simple accept it. Furthermore, the exclusion clauses could also be incorporated in the contract by signature. Scrutton LJ stated that where a contract is signed, in the absence of fraud or misrepresentation, the ‘party signing is bound and it is wholly immaterial whether he has read the document or not.’_ In practice, it is quite common for people not to read what they agree to, and sign the contract, especially with statute law protecting consumers from unfair terms. Based on the analysis above, I generally agree with the statement that the ‘red ink-red hand’ does not serve much purpose in practice. Applying the ‘red ink-red hand’ rule, the court can protect people from some exceptional unfair terms without imposing an obligation upon the customers to read every word of the contract. But such protection would be very limit if the consumers themselves regardless the terms and conditions and then sign the contracts. Moreover, it could be argued that this protection is already provided in statute, therefore the common law is very limited in its protection of those who do not read the terms and
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