Exclusion clauses in contracts

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The issue is whether the exclusion clause Coaches Ltd intends to rely on was incorporated into the contract, and if so whether it is effective in excluding Coaches Ltd’s liability. The first point is thus whether the exclusion clause was expressly incorporated into the contract. The clause was printed on the back of the invoice sent to Chelsea Ltd after the telephone booking. As the contract was oral and took place over the telephone, this means that the clause was not expressly agreed to by the parties at the time of making the contract, and it is trite law that a party cannot later unilaterally alter the terms of the contract: Olley v Marlborough Court [1949] 1 KB 532. However, the clause may have been incorporated into the contract at the time the contract was made impliedly. The relevant form of implied incorporation here is implication by course of dealing. For this to be established, three requirements must be met. The first is that there must be a course of dealing which was both consistent and regular: McCutcheon v David MacBrayne Ltd [1964] 1 All ER 430. In McCutcheon there had been dealings between the parties on four occasions prior to the one before the court, and the House of Lords found that this was an insufficiently consistent and regular course of dealing to imply a term into the contract. On the other hand, in Hardwick Game Farm v Suffolk Agricultural Poultry Producers Association [1969] 2 AC 31 there had been three or four dealings a month between the parties over a period of three years, totalling roughly one hundred dealings, and this was found to constitute a course of dealing sufficiently consistent and regular to warrant the implication of a term into the contract. Finally, in Hollier v Rambler Motors (AMC) Ltd [1972] 2 QB 71 there had been three or four previous dealings between the claimant and the defendant garage over the course of five years. Of these, only in two had the claimant been asked to sign an invoice at the bottom of which the clause in question was printed. The Court of Appeal held, following McCutcheon, that the course of dealing was insufficient to justify the implication of the term into the contract. We are told that Chelsea Ltd had hired a coach from Coaches Ltd “without any problems for the last few years”, but we are not given sufficient information to establish, following the cases cited above, whether the course of dealing was sufficiently consistent or regular. The second requirement is that the document in question must have reasonably been expected by the parties to have contractual effect: Chapelton v Barry Urban District Council [1940] 1 KB 532. It could be argued that the invoice in the present instance was not a document which the parties would reasonably have expected to have contractual effect, particularly if the price was agreed over the phone,

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