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b.Interpretation of exclusion clauses
Courts have historically interpreted exclusion clauses narrowly and have repeatedly…
Many cases illustrate this principle in action. For instance, in Karsales v Wallis
“No condition or warranty that the vehicle is roadworthy, or as to its age, condition or fitness for any purpose is given by the owner or implied herein.”…
After purchase, the buyer observed that the car was in a “deplorable state and would not go”.
“…[a] party cannot rely on an exempting clause when he delivers something “different in kind” from that contracted for, or has broken a “fundamental term” or a “fundamental contractual obligation,” … a breach which goes to the root of the contract disentitles the party from relying on the exempting clause”.…
Similarly, in Canada Steamship v The King, the Crown leased a freight shed to Canada Steamship, which agreement provided that “the lessee shall not have any claim ... against the lessor for ... damage ... to ... goods ... being ... in the said shed…”…
The Privy Council (Canada) ruled that the Crown could not rely on the exclusion clause.…
“…it appears to their Lordships most unlikely that clause 7 was intended to protect the Crown from claims for damage resulting from the negligence of its servants in carrying out the very obligations which were imposed on the Crown by clause 8. It is difficult to imagine the Crown saying to the company, when the lease was being negotiated: “Notwithstanding that the Crown agrees to maintain the shed, at its own expense, throughout the term of the lease, and notwithstanding that such an agreement implies an obligation to use due care in its performance, if the Crown’s servants set about the work of repair in such a negligent manner that the shed and all the goods therein are destroyed, you are to have no claim for damages against the Crown,” and if the Crown had made such a suggestion, it seems unlikely that the company would have accepted it.”…
The above being said, the approach of the modern courts is to refrain from interfering…
The shift in judicial attitude to giving effect to exclusion clauses between commercial…
Notwithstanding, recent courts have reiterated the requirement for express and unambiguous…
“The court is unlikely to be satisfied that a party to a contract has abandoned valuable rights arising by operation of law unless the terms of the contract make it sufficiently clear that that was intended. The more valuable the right the clearer the language will need to be.”…
For completeness, it must be noted that Lord Fraser (whose reasoning Lords Elwyn-Jones,…
“There are later authorities which lay down very strict principles to be applied when considering the effect of clauses of exclusion or of indemnity… In my opinion these principles are not applicable in their full rigour when considering the effect of clauses merely limiting liability. Such clauses will of course be read contra proferentem and must be clearly expressed, but there is no reason why they should be judged by the specially exacting standards which are applied to exclusion and indemnity clauses.”…
a.Incorporation of exclusion clauses
2.Legislative control of exclusion clauses
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