Podcast
Questions and Answers
What does the requirement of good faith in consumer contracts emphasize?
What does the requirement of good faith in consumer contracts emphasize?
Which of the following contract terms is likely to be deemed unfair?
Which of the following contract terms is likely to be deemed unfair?
According to the statutory controls, which terms must be transparent and prominent to not be regarded as unfair?
According to the statutory controls, which terms must be transparent and prominent to not be regarded as unfair?
What is the outcome if a contract term is deemed unfair?
What is the outcome if a contract term is deemed unfair?
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What should consumer contracts avoid to promote fairness?
What should consumer contracts avoid to promote fairness?
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What does s65 of consumer contracts stipulate about liability for death or personal injury?
What does s65 of consumer contracts stipulate about liability for death or personal injury?
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Under the Unfair Contract Terms Act 1977, which situation is NOT considered a breach concerning reasonable care?
Under the Unfair Contract Terms Act 1977, which situation is NOT considered a breach concerning reasonable care?
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Which of the following statements best describes the principle of volenti non fit injuria as mentioned in the Unfair Contract Terms Act?
Which of the following statements best describes the principle of volenti non fit injuria as mentioned in the Unfair Contract Terms Act?
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What must a party prove to rely on an exclusion clause according to the Unfair Contract Terms Act?
What must a party prove to rely on an exclusion clause according to the Unfair Contract Terms Act?
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What is the primary function of s17 of the Unfair Contract Terms Act regarding standard form contracts?
What is the primary function of s17 of the Unfair Contract Terms Act regarding standard form contracts?
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In the context of the Unfair Contract Terms Act, which of the following types of contracts does the legislation specifically apply to?
In the context of the Unfair Contract Terms Act, which of the following types of contracts does the legislation specifically apply to?
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Which of the following best describes the implications of ss. 2(1) and 16(1)(a) of the Unfair Contract Terms Act?
Which of the following best describes the implications of ss. 2(1) and 16(1)(a) of the Unfair Contract Terms Act?
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What does the Unfair Contract Terms Act require concerning the fairness of terms in a contract?
What does the Unfair Contract Terms Act require concerning the fairness of terms in a contract?
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What does the Consumer Rights Act 2015 replace regarding statutory control of contract terms?
What does the Consumer Rights Act 2015 replace regarding statutory control of contract terms?
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In a consumer contract, who is classified as a 'trader' under the Consumer Rights Act 2015?
In a consumer contract, who is classified as a 'trader' under the Consumer Rights Act 2015?
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Which of the following is NOT part of the three-part test to determine fairness in consumer contracts?
Which of the following is NOT part of the three-part test to determine fairness in consumer contracts?
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What is the consequence of an unfair term in a consumer contract?
What is the consequence of an unfair term in a consumer contract?
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What fundamental aspect must a court consider regarding unfair consumer contracts even if parties do not raise the concern?
What fundamental aspect must a court consider regarding unfair consumer contracts even if parties do not raise the concern?
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Which section of the Consumer Rights Act 2015 outlines the definition of a consumer?
Which section of the Consumer Rights Act 2015 outlines the definition of a consumer?
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When assessing the fairness of a consumer contract term, which of the following factors is NOT considered?
When assessing the fairness of a consumer contract term, which of the following factors is NOT considered?
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Which section of the Consumer Rights Act specifies that unfair terms are not binding on the consumer?
Which section of the Consumer Rights Act specifies that unfair terms are not binding on the consumer?
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Study Notes
Statutory Control of Contract Terms
- Focus: How and to what extent do statutes ensure fairness in contract terms? Specifically, the presentation explores business-to-consumer and business-to-business contracts.
Statutory Control of Contract Terms in Business to Consumer Contracts (1)
- Consumer Rights Act 2015: Part 2 replaces previous legislation (Unfair Contract Terms Act 1977, Unfair Terms in Consumer Contracts Regulations 1994 and 1999).
- Scope: Applies to contracts between a 'trader' and a 'consumer'.
- Trader Definition: A person acting for purposes related to trade, business, craft, or profession, either personally or through another.
- Consumer Definition: An individual acting for purposes outside their trade, business, craft, or profession.
- Fairness Consideration: Courts must consider the fairness of contract terms even if not raised by the parties.
Statutory Control of Contract Terms in Business to Consumer Contracts (2)
- Unfair Terms: Unfair terms and notices in consumer contracts are not binding on the consumer.
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Fairness Assessment: A three-part test determines fairness:
- Contrary to good faith
- Causes significant imbalance in rights/obligations
- Detrimental to the consumer
- Factors for Determining Fairness: The nature of the contract, circumstances when the term was agreed, and the contract terms themselves.
Statutory Control of Contract Terms in Business to Consumer Contracts (3)
- Fairness Assessment in Practice: Case examples (ParkingEye Ltd v Beavis [2015] UKSC 67, Director General of Fair Trading v First National Bank plc [2001] UKHL 52) illustrate how fairness is determined.
- Open Dealing: Fair terms are presented clearly, openly, and without concealed traps.
- Appropriate Prominence of Terms: Disadvantageous terms receive clear emphasis for the customer.
Statutory Control of Contract Terms in Business to Consumer Contracts (4)
- Unfair Contract Terms: Specific contract terms within Schedule 2 may be considered unfair.
- Restrictions on Trader Liability: Terms limiting liability for traders.
- Unilateral Decisions: Terms allowing traders to make unilateral decisions regarding price.
- Discriminatory Consumer Rights: Terms where consumer rights are far less favorable than the trader.
- Limiting Consumer Litigation: Terms restricting the consumer's right to pursue legal action.
Statutory Control of Contract Terms in Business to Consumer Contracts (5)
-
Terms Not Considered Unfair: Schedule 64 outlines terms that are generally not considered unfair, provided they're:
- Transparent
- Prominent
- About the main subject matter of the contract
- Pricing by comparison
- Ambiguous Terms: In case of ambiguity, the meaning most favorable to the consumer prevails.
Statutory Control of Contract Terms in Business to Consumer Contracts (6)
- Consequences of Unfair Terms: Unfair terms (in contracts and notices) are not binding on the consumer, and the rest of the contract remains largely intact.
- Exclusion Clauses: Traders cannot exclude or limit liability for death or personal injury due to negligence.
Statutory Control of Contract Terms in Business to Business Contracts
- Unfair Contract Terms Act 1977: Governs business-to-business contracts.
- Contract Scope: Applies to companies, firms, professionals, and local authorities.
- Liability Breach: Covers exclusions of liability, restricting liability for duty breach, and performance skill breaches.
- Occupiers' Liability considerations: Includes the duty of reasonable skill, and care breaches under specific statutes like the 1960 Scottish Occupiers' Law.
Statutory Control of Contract Terms in Business to Business Contracts (8)
- No Excluding Personal Injury: It's not permissible to exclude liability for personal injury.
- Fair and Reasonable Terms: Other terms, except for death or personal injury, will be enforceable only if the term is deemed fair and reasonable.
- External Review: Proving fairness remains on the party seeking to rely on it.
- Bargaining Power Inquiry: Relevant questions to consider include the extent of power imbalances and alternative options present.
Statutory Control of Contract Terms in Business to Business Contracts (9)
- Standard Form Contracts: Standard form contracts cannot exclude liability if they exclude, limit or restrict a breach or if performance differs significantly.
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Description
Explore the extent to which statutes like the Consumer Rights Act 2015 ensure fairness in contract terms, particularly in business-to-consumer and business-to-business contexts. This quiz examines key definitions and provisions aimed at protecting consumer rights and ensuring fair contractual practices.
