Avoiding Liability for Breach of Contract

Large powerful firms have legal teams at their disposal for the writing of contracts. These contracts may be cleverly and creatively worded so that in cases of a breach, their liability is limited or even excluded. Legislation in the form of the Unfair Contract Terms Act 1977 and the Unfair Terms in Consumer Contracts Regulations 1999 have been introduced to protect consumers from the imposition of such clauses where they are considered to be unfairly biased in this way. This is dealt with here.

But not all limitation or exclusion clauses are unfair. Consider use of the phrase: “Management cannot accept liability for any possessions lost, stolen or damaged on the premises”. But what if this were to be used in relation to a cloakroom or left luggage room? In those situations one party may try to rely on such a clause in order to avoid negligence and having to pay damages. But the other party may claim that the clause in legally invalid and cannot be used to escape liability. So what does the law say about exclusion clauses and whether they can be successfully relied on?

Well, there are two considerations, firstly whether the exclusion clause has actually been incorporated into the contract through the agreement of both parties, by reasonable notice or by strong implication. Secondly, a court will consider whether the clause does in fact cover the issue which is in dispute. It may be that the wording is vague, ambiguous or incomprehensible, in which case it cannot be said to apply to the issue, and therefore the party in breach cannot escape liability.

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6 comments… add one

  • Theron Navarro 8 April, 5:17 am

  • zak 29 August, 4:40 am

    I ordered a product 6 weeks ago and left a deposit. Its made to order so they said 10 weeks to delivery and then we pay the rest. They have now contacted me and said they got the price wrong….6 weeks later and that – have to pay £300 more or cancel the order!! Just wanted ppls advice about this? Do i have to pay extra if I want this product??

  • sue 20 February, 11:31 am

    My uncle agreed to have new windows via Dunraven Windows at the end of January – He was going to pay cash for them with no credit agreement. He’s not been well and loks after his two sibblings with mental disorders and feels that he cannot afford to have his windows replaced. So Feb 16 cancelled the agreement (after the 7 days cooling off) he has now received a letter from Dunraven saying that he will be charged for said windows as it is a breech of contract and that they have already manufactured the windows and that he will have to have a credit agreement if he can’t afford to pay. He is in a no win situation. Can anyone help??

  • S.Hearn 26 October, 3:57 pm

    I am in in dispute concerning the facilities provided at a holiday farmhouse in France. There were only 4 usable bedrooms, not the 5 advertised and no adherence to French swimming pool law. Having been unable to gain any satisfaction from either the owner or the substantial InternetVendingCompany advertising same I have turned to my bank, through whom the payment was made to the IVC.via their credit card.There was no option offered to pay the owner direct.I have claimed Breach of Contract but the bank simply inform me that they are unable to assist me,considering that S.75 of Consumer creditAct is not applicable.They state that no debtor/creditor supplier agreement existed between themselves and the supplier – the house ownerThat notwithstanding the advertising and payment to the IVC.via by bankcard that company offers no Warranyt or Endorsement of any individual property and is not responsible for the final presentation of same acting only as booking agent”. Is this deccision lawful and can/how is it challenged.

  • karen 21 October, 5:15 pm

    we have bought the lease on a licensed premises which turned out to have no license plus no trade as it ha been closed for 9 months which we wasn’t told, do we have time to terminate the contrac?

  • angela pattison 25 January, 10:42 pm

    I’ve purchased a horse for my daughter. It was agreed that I pay a £200 deposit and £50 each week. I have sofar paid a total of £1950 (NO missed payments) which mean I still owe£1550 (I also pay all expenses and stabling for the horse). They have now said I can’t have the horse and they will change the agreement/contract to a short term lease. My young duaghter is devestated. What are my rights and are they entitled to do this. I have said I’m not going to sign a change as I’ve want the horse and own more than half. I am not going to sign any changed contract. Please help. Need advise by this Tuesday. I