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included in the contract in the first place. As regards non-contractual notices, the issue to be decided is one of reasonableness of reliance according to s 11(3). The s 11(1) test differs from the reasonableness of reliance test adopted by the Supply of Goods (Implied Terms) Act 1973 (to which this part of the 1977 Act otherwise bears a reasonably close resemblance) and has generated a fair amount of controversy. Interestingly, the 1977 Act here adopts the proposal of the Scottish Law Commission Report (1975, para 177), the English Commission having proposed a continuation of the existing reliance test (para 183). The English Law Commission felt that judicial discretion, to take account of all circumstances, pre and post-contract, should not be curtailed. The Scottish Commission reasoned that a reliance test might undermine the planning of relationships and the allocation of risk(s), normally associated with commercial contracts. Whatever else, it seems entirely clear that (unless some form of severance is possible) a clause which, as drafted, is unreasonably wide (on a ‘reasonable’ construction!) will not be saved merely because it operates fairly in the particular circumstances. This is a clear encouragement for careful and conservative contract planning and drafting. Secondly, the burden of proof is clearly placed on the person seeking to justify the reasonableness of the clause (s 11(5)). Thirdly, there are distinct ‘guidelines’ in s 11(4) concerning limitation clauses. Finally, the specific
DOI link for included in the contract in the first place. As regards non-contractual notices, the issue to be decided is one of reasonableness of reliance according to s 11(3). The s 11(1) test differs from the reasonableness of reliance test adopted by the Supply of Goods (Implied Terms) Act 1973 (to which this part of the 1977 Act otherwise bears a reasonably close resemblance) and has generated a fair amount of controversy. Interestingly, the 1977 Act here adopts the proposal of the Scottish Law Commission Report (1975, para 177), the English Commission having proposed a continuation of the existing reliance test (para 183). The English Law Commission felt that judicial discretion, to take account of all circumstances, pre and post-contract, should not be curtailed. The Scottish Commission reasoned that a reliance test might undermine the planning of relationships and the allocation of risk(s), normally associated with commercial contracts. Whatever else, it seems entirely clear that (unless some form of severance is possible) a clause which, as drafted, is unreasonably wide (on a ‘reasonable’ construction!) will not be saved merely because it operates fairly in the particular circumstances. This is a clear encouragement for careful and conservative contract planning and drafting. Secondly, the burden of proof is clearly placed on the person seeking to justify the reasonableness of the clause (s 11(5)). Thirdly, there are distinct ‘guidelines’ in s 11(4) concerning limitation clauses. Finally, the specific
included in the contract in the first place. As regards non-contractual notices, the issue to be decided is one of reasonableness of reliance according to s 11(3). The s 11(1) test differs from the reasonableness of reliance test adopted by the Supply of Goods (Implied Terms) Act 1973 (to which this part of the 1977 Act otherwise bears a reasonably close resemblance) and has generated a fair amount of controversy. Interestingly, the 1977 Act here adopts the proposal of the Scottish Law Commission Report (1975, para 177), the English Commission having proposed a continuation of the existing reliance test (para 183). The English Law Commission felt that judicial discretion, to take account of all circumstances, pre and post-contract, should not be curtailed. The Scottish Commission reasoned that a reliance test might undermine the planning of relationships and the allocation of risk(s), normally associated with commercial contracts. Whatever else, it seems entirely clear that (unless some form of severance is possible) a clause which, as drafted, is unreasonably wide (on a ‘reasonable’ construction!) will not be saved merely because it operates fairly in the particular circumstances. This is a clear encouragement for careful and conservative contract planning and drafting. Secondly, the burden of proof is clearly placed on the person seeking to justify the reasonableness of the clause (s 11(5)). Thirdly, there are distinct ‘guidelines’ in s 11(4) concerning limitation clauses. Finally, the specific
ABSTRACT
The English Law Commission felt that judicial discretion, to take account of all circumstances, pre and post-contract, should not be curtailed. The Scottish Commission reasoned that a reliance test might undermine the planning of relationships and the allocation of risk(s), normally associated with commercial contracts. Whatever else, it seems entirely clear that (unless some form of severance is possible) a clause which, as drafted, is unreasonably wide (on a ‘reasonable’ construction!) will not be saved merely because it operates fairly in the particular circumstances. This is a clear encouragement for careful and conservative contract planning and drafting.
