Exclusion clauses
Exclusion clauses

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Exclusion clauses

2.1 Signed contracts

The general rule is that an exclusion clause in a signed contract is binding, regardless of whether or not it was read by the parties. This is demonstrated by L’Estrange v F Graucob Ltd [1934] 2 KB 394.

Box 3 L’Estrange v F Graucob Ltd [1934] 2 KB 394

Mrs L’Estrange purchased a cigarette machine from the defendant for use in her café. At the time of purchase she signed a form which included a clause excludeing all implied conditions and warranties. The machine did not work properly and Mrs L’Estrange claimed there was an implied warranty that it was fit for purpose. The High Court held that by signing the form Mrs L’Estrange had agreed to be bound by its terms, regardless of whether or not she had read them. Therefore, the defendant could rely on the exclusion clause.

The rule that exclusion clauses in signed contracts are binding on the parties is not applied where there has been fraud or misrepresentation as to the scope or effect of the clause. This is illustrated by Curtis v Chemical Cleaning & Dyeing Co [1951] 1 KB 805. Here the defendant’s shop assistant innocently misrepresented the scope of the exclusion clause in the document Mrs Curtis was signing. As a result, the clause was held not to be incorporated into the contract.

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