Question 1

The court has power at common law to strike down unfair terms in a contract.

Accepted Answer

At common law, courts do not have the power to strike down unfair terms in a contract; they can only interpret and enforce the terms as agreed upon by the parties. The power to intervene in contracts to address unfair terms typically comes from statutory provisions, such as consumer protection laws.

Question 2

The contra proferentem rule is not applied stringently to clauses which exclude liability altogether.

Accepted Answer

False

Question 3

Why is the fundamental breach rule defunct? Please select all that apply.&#10;A) Major difficulties were faced in attempts to describe a 'fundamental' term.&#10;B) The very nature of the doctrine of fundamental breach made it impossible to construct a rational theory, which undermined legal certainty.&#10;C) It contradicts a basic principle of contract law; that it is for the parties, and not the court, to make the bargain.&#10;D) It could be excluded where the contract is affirmed after a fundamental breach has been committed.

Accepted Answer

A) The concept of a 'fundamental' term was too vague and subjective, leading to inconsistencies in its application. B) The doctrine's inherent ambiguity and lack of a clear, rational basis made it difficult to apply consistently, affecting legal certainty. C) The doctrine of fundamental breach potentially overrode the express terms of a contract, conflicting with the principle that the contract terms set by the parties should govern their relationship.

Question 4

Which of the following statements about the Unfair Contract Terms Act 1977 are correct? Please select all that apply.&#10;A) The Act is concerned with all contract terms which may be thought to be 'unfair'.&#10;B) The Act is not confined to contractual terms.&#10;C) The Act applies to both consumer and non-consumer contracts.&#10;D) Under the Act, terms are only considered unfair if they fail the statutory test of reasonableness.

Accepted Answer

The answer of Which of the following statements about the...

Question 5

Which of the following factors might be taken into account in assessing whether an exclusion or limitation clause is unreasonable for the purposes of UCTA 1977?&#10;A) The relative strengths of the parties' bargaining positions.&#10;B) Whether one party received an inducement to agree to the term.&#10;C) Whether it was reasonable at the time to expect that compliance with a condition which prevented the triggering of an exclusion or limitation clause.&#10;D) Whether the party knew or ought reasonably to have known of the existence and extent of the term relied on by the other party.

Accepted Answer

All of these factors are relevant under the Unfair Contract Terms Act 1977 (UCTA 1977) when assessing the reasonableness of an exclusion or limitation clause. They help determine whether such clauses were fairly negotiated and understood, and whether their enforcement would be equitable under the circumstances.

Question 6

A clause purporting to exclude or restrict liability for misrepresentation may be subject to both UCTA 1977 and the Misrepresentation Act 1967.

Accepted Answer

The answer of A clause purporting to exclude or restrict...

Question 7

What has not changed under the Consumer Rights Act 2015?&#10;A) The requirement of a significant imbalance in the parties' rights and obligations under the contract to the detriment of the consumer.&#10;B) The requirement of good faith.&#10;C) The test of unfairness is no longer limited to terms which have not been individually negotiated (standard terms)&#10;D) A term may be excluded from an assessment of fairness only if it is transparent and prominent.&#10;E) g. Director General of Fair Trading v First National Bank plc), requiring a 'significant' imbalance in the parties' rights and obligations under the contract.

Accepted Answer

The answer of What has not changed under the Consumer...

Deck 14: The Control of Exclusion Clauses and Unfair Terms