ABSTRACT
So far in this section of the book we have concentrated on the terms of a contract and how these reflect the obligations the parties owe to each other. This chapter shifts the focus to look at how the judiciary has dealt with certain types of unfair terms in contracts which seek to exclude or limit liability. As in other chapters, it is important to start by making it clear that different approaches to unfair bargains are apparent from case law, and these reflect different conceptions of the role of contract law and notions of what is fair and reasonable. Whilst the classical model of contract recognises that unfairness occurs, the focus is on procedural rather than substantive unfairness. This means that traditionalists have been willing in some circumstances to intervene to upset a contract which has been negotiated in an unfair way but not to regulate unfair exchanges. Even with the introduction of legislation and the development of doctrines to protect the parties against manifestly unfair contracts, it remains the case that contractual terms are not set aside lightly. The courts and legislature will only intervene to mitigate the effects of extreme behaviour. Atiyah (1979) has likened the approach to a contest or game in which there are rules to protect how it is played, to outlaw fouls and so on, but there is no scope for revisiting whether the outcome was fair.
