Do your consumer products standard terms have anything unusual or onerous in them? If so, caselaw states that these must be brought to the other party's attention. Otherwise, they will be struck down. A recent construction case serves as a useful reminder of this.
Unusual or onerous clauses in your standard terms (e.g. the fine print on the back of a purchase order) could include, for example, any provisions limiting or excluding liability for damages, or indeed any provisions which might cause a significant imbalance in the other party's rights.
A recent construction case discussed whether a party's standard terms and conditions of contract had been incorporated into a contract. The judge decided that they had not, on the basis first that the other party had been given unreasonably sufficient notice of such terms and conditions (in particular, since the terms and conditions had been referred to but not actually sent by that party) and second, because they included unusual or onerous terms.
In relation to onerous terms, the judge relied on the premise that although the party receiving a document may know that it contains terms and conditions, if a particular condition relied upon is one which is a particularly onerous or unusual term, or is one which involves the removal of a right given by statute, the party sending the document must show that it has been brought fairly and reasonably to the other's attention. The judge decided that there was at least one onerous term in the terms and conditions, which should have, but had not been, brought to the other party's attention. Given that this was a construction law case, the onerous term in question related to a condition which had to be fulfilled before an extension of time for carrying out building works was granted to a sub-contractor under a building contract. However, this case is relevant to other types of commercial terms and conditions.
Suppliers of any services or goods will therefore need to be careful when sending out their standard terms and conditions to make sure that any unusual or onerous clauses are brought to the other's attention. In practice, this means printing them boldly and somewhere prominent. The more unusual or onerous the clause, the greater the notice which must be given.
Case: Cubitt Building and Interiors Limited v Richardson
Roofing (Industrial) Limited [2008] EWHC 1020 (TCC)
This article was written for Law-Now, CMS Cameron McKenna's free online information service. To register for Law-Now, please go to www.law-now.com/law-now/mondaq
Law-Now information is for general purposes and guidance only. The information and opinions expressed in all Law-Now articles are not necessarily comprehensive and do not purport to give professional or legal advice. All Law-Now information relates to circumstances prevailing at the date of its original publication and may not have been updated to reflect subsequent developments.
The original publication date for this article was 31/07/2008.
