Exclusion clauses
Exclusion clauses

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Exclusion clauses

2 Is the exclusion clause incorporated into the contract?

For an exclusion clause to be valid it must form a part of the contract. The courts have devised a number of rules to ascertain whether or not it has been incorporated into (made part of) the contract.

The document containing the exclusion clause must be part of the contractual documentation and not a mere receipt or acknowledgement of payment. This is demonstrated by Chapelton v Barry Urban District Council [1940] 1 KB 532.

Box 2 Chapelton v Barry Urban District Council [1940] 1 KB 532

Mr Chapelton hired two deckchairs from the defendant. A sign next to the deckchair gave the price and time limit, but did not refer to any exclusion clauses. After Mr Chapelton had paid for the deckchairs he was handed two tickets. The back of the tickets stated that the defendant would ‘not be liable for any accident or damage arising from the hire of the chair’. When the plaintiff sat on the deckchair it gave way, causing him injury. The defendant relied on the exclusion clause contained on the ticket, but the High Court held that this was a voucher or receipt and did not form part of the contract.

Described image
Figure 3 A deckchair

One exception to this is a bill of lading. This is an official, detailed receipt which is given, by the master of a ship transporting goods, to the person consigning (sending) the goods. Despite acting as a receipt, it is commonly treated as part of the contract.

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