Contract Law

Exception Clauses p. 838
•    Warranty, in its technical meaning, is a sub-contract
•    It has a technical meaning
o    Close reading; strict construction
•    Wallis v. Pratt – “warranty” did not apply to exclude the implied statutory “condition” of the Sale of Goods Act that products must correspond to their description.
o    ¶5 - exclusion of “any warranty of condition” does not avail a seller if there has been a ‘negligent misstatement’
o    ¶6 – in the absesnce of an explicit mention of negligence, a judge is likely to find that exemption cluases do not exclude liability for negligence.
•    Judges believe that it should be very difficult to exclude oneself from the possibility of negligence, and that it must at the very least be explicit.
•    “The rule in Canada Steamships” – adopted this extreme example of reading down.  If an exemption clause could be given a meaning but the meaning was not broad enough to extend to negligence, then it does not extend to negligence.
•    If the exemption clause could refer to something other than negligence, then it is deemed to refer to that thing.
•    P. 839 – Inconsistency.
o    A number of ways that judges tackel ‘internal inconsistency’
•    To say that the provision that the parties agreed on explicitly takes precedence over some provision that is simply there as part of a form-document.
o    The passage on 839 is accurate, but misleadingly simplistic.

Parker v. Southeast Railway
•    A case that refers to the imp. of railway
•    Bottom Page 849 – caput lupinum – “Having the head of the wolf”.  Anyone might legally ‘kill’ them.
•    Railway companies were often the targets of juries, as insurance companies are today.
•    Railway takes the pos. that the passenger signed away their rights.
o    There was a notice on the wall of the cloak-room
o    There were conditions written on the ticket
•    Page 847 – “see back”; several clauses relating to articles left by passengers – “The company will not be resonsible for any package exceeding the value of £10.”
•    Bag could not be found.  Claimed that his bag was worth £24 10s.
•    Mellish L.J. – “In and ordinary case, where an action is brought on a written agreement which is signed by the defendant, the agreement is proved by proving his signature, and, in the absesnce of fraud, it si wholly immaterial that he has not read the agreement and does not know its content …in the case [where the agreement has been reduced to writing so that the writing is the sole evidence of the agreement without signing it]there must be evidence of the agreement itself to prove that the defendant assented to it.”
•    P said that he knew there was writing on the ticket, but not what the writing was.  Said thought it may have been a receipt ¶3.
o    No question that had he read the writing, he would have been bound.
•    Contract law presumes that people, if given something to read, will read it.
•    Bramwell L.J.
o    For this judge, the question is whether the person who does not read the conditions in a better condition than he who does.
•    Bottom 848 – Mellish’s famous repropositions:
o    ¶3 – 3 propositions.  I am of the opionion there fore that the proper direction to leave to the jury in these cases is:
•    1)  That if the person receiving the ticket did not see or know that there was writing on the ticket, he is not bound by the conditions;
•    2)  that if he knew there was writing, and knew or believed that the writing contained conditions, then he is bound by the conditions;
•    [should this be subject to the condition that the writing be relevant and ‘usual’ to the circumstances?; that anything out of the ordinary would be brought specifically to the attention of the purchaser?]
•    3)  that if he knew there was writing on the ticket, but did not know or believe that the writing contained conditions, nevertheless he would be bound, if the delivering of the ticket to him in such a manner that he could see there was writing upon it, was, in the opinion of the jury, reasonable notice that the writing contained conditions.
•    [Would the purchaser be bound to every single condition on the ticket, or just the not-unusual contractual provisions?  Could they insert provisions to do with seizing first-born children and have done with it?]
•    page 849 – Bramwell L.J.
o    Bramwell is skeptical
o    Proposes that putting it into his hand should be no different than saying “read that” by the porter.  Asks what more the railway company could have done
o    Page 850 – qualifies what he says – says that the market has the answer.  If railway companies (or anyone else) began putting unreasonably terms in their contracts, then the public would hear of it and begin using alternative [forms of transportation, for example].
o    “What if there was ome unreasonable condition… Would the depositor be bound?  I might content myself by asking:  Would be be, if here were told ‘our conditions are on this ticket,’ and he did not read them.  In my judgment, he would not be bound in either case.  I think there is an implied understanding that there is no condition unreasonable to the  knowledge of the party tendering the document and not insisting on its being read – no condition not relevant to the atter in hand.”
•    Important qualification regarding ‘unreasonable conditions’

Note 5 page 851
•    J. Spurling Ltd. v. Bradshaw
o    Post-war case involving 8 casks of orange juice.
o    Most of the OJ disappeared while being stored in a bailee warehouse.
o    Decision of Denning L.
•    “I agree that the more unreasonable a clause is, the greater the notice which must be given of it.  Some clauses which I have seen would need t be printed in red ink on the face of the docuent with a read hand pointing to it before the notice could be held to be sufficient.”
•    “Next it was said that the landing account and invoice were issued after goods had been received and could not therefre be part of the cotract of bailment:  but the defendant admitted that he had receive many landing accounts before.  True, he had not troubled to read them.  True, he had not troubled to read them.  On receiving this account, he took no objection to it, left the goods there, and went on paying the warehouse rent for months afterwards.  It seems to be that by the course of business and conduct of the parties, these conditions were part of the contrat.  In these circumstances, the plaintiffs were entitled to rely on this exempting condition…”

read p 851-852

Thornton v. Shoe Lane Parking Ltd. – page 857
•    sign at entrance:  “All cars parked at ownder’s risk”.
•    Then drive up a ramp and press a button for a ticket.
•    Denning L. finds that the ramp is the offer, and driving up the ramp and pressing the button is the acceptance.
•    Even if the ticker were part of the conditions, how could one be bound by conditions that one could not see until after ‘acceptance’?
•    Same as the conditions posted inside the garage.
•    ¶2 – offer accepted when the P drove up the entrance and had the ticket thrust at him by the weight-sensor.  The contract was the concluded, and could not be altered by any words printed on the ticket.
•    ¶3 - Then gives analogy whereby the ticket machine is a booking clerk ‘in disguise’
o    goes back to 3 questions pose by Mellish L.J. in Parker
o    ¶4 – counsel for the ds admitted that the Ds did not do what was reasonably sufficient to give the P notice of the exempting condition.
o    “I do not pause to enquire whether the exempting condition is void for unreasonableness.”
•    BE CAREFUL.  There is no jurisprudence that allows courts to say that an exempting clause was void for unreasonableness.  Denning L.J. was likely trying to begin this jurisprudence, but it didn’t take.
•    Denning determines that the P was not bound by the exempting condition as there was no evi. that he knew of it.

Page 860 – Signed Contracts
•    “When a documet containing contractual terms is signed, then, in the absense of fraud, or I will add, misrepresentation, the party signing is bound, as it is wholly immaterial whether he has read the codument or not.”
o    Ie:  You signed, you’re bound.
•    Courts often want to save people from their own folly.
o    This causes tension.

For next day:  Tilden, Photo Production.