substantive doctrine, the lack of adequate consumer protection against ‘small print’ denial of basic rights has now largely been redressed by the Unfair Contract Terms Act 1977, it seems that the substantive doctrine of ‘fundamental breach’ has ‘had its day’. This, of course, still leaves the problem of the status of the earlier (principally Court of Appeal) decisions. In Photo Production, the House of Lords did overrule a small number of cases, but the majority remained unscathed. Perhaps it is simplest to say that even on a ‘rule of construction’ approach, it is hard to see that the majority of decisions could have gone any other way (Karsales is a good example of this). A final point is that the practical importance of the cases in this area will now be confined to situations in which the validity of the exemption clause is not affected by the Unfair Contract Terms Act 1977. Limitation clauses : A consistent theme in recent case law (particularly at House of Lords level) is that limitation clauses (even less than wholesale exclusions of liability) are not to be subjected to ‘strained construction’, since judicial hostility to them is less. These judicial observations reflect the more limited ‘substantive unfairness’ which limitation clauses are likely to manifest:

doi:10.4324/9781843141518-185

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substantive doctrine, the lack of adequate consumer protection against ‘small print’ denial of basic rights has now largely been redressed by the Unfair Contract Terms Act 1977, it seems that the substantive doctrine of ‘fundamental breach’ has ‘had its day’. This, of course, still leaves the problem of the status of the earlier (principally Court of Appeal) decisions. In Photo Production, the House of Lords did overrule a small number of cases, but the majority remained unscathed. Perhaps it is simplest to say that even on a ‘rule of construction’ approach, it is hard to see that the majority of decisions could have gone any other way (Karsales is a good example of this). A final point is that the practical importance of the cases in this area will now be confined to situations in which the validity of the exemption clause is not affected by the Unfair Contract Terms Act 1977. Limitation clauses

ABSTRACT

A consistent theme in recent case law (particularly at House of Lords level) is that limitation clauses (even less than wholesale exclusions of liability) are not to be subjected to ‘strained construction’, since judicial hostility to them is less.31 These judicial observations reflect the more limited ‘substantive unfairness’ which limitation clauses are likely to manifest:

Ailsa Craig Fishing Co Ltd v Malvern Fishing Co Ltd [1983] 1 WLR 964, HL Lord Wilberforce (p 966): One must not strive to create ambiguities by strained construction, as I think the appellants have striven to do. The relevant words must be given, if possible, their natural, plain meaning. Clauses of limitation are not regarded by the courts with the same hostility as clauses of exclusion; this is because they must be related to other contractual terms, in particular to the risks to which the defending party may be exposed, the remuneration which he receives and possibly also the opportunity of the other party to insure.