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Breach Of Contract Exclusion Of Liability I - International Commercial Law

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(1): Claimant’s cause of action

Step 1 Relevant Terms in the Contract

Say there is a contract between S & B to____. Include all info relating to performance of the contract. (Mind ST&C being exchanged as this will change offer and acceptance order.)

  • Express:

  • Implied:

s. 10 Time is not of the essence (Unless delivery date expressly stated (Hartley v Hymans))

s.12 to pass good title

s.13 description

s.14(2) Satisfactory quality

s.29 S to deliver the goods

s.27 B to accept Delivery & Pay

s.30 Delivery of wrong quantity

s.14(3) Fitness for purpose

s.15 Sample

Step 2 ¿Are the terms incorporated? Either by:

  • Signature

  • Notice

  • Previous Course of dealings

Step 3 Identify the Breach of Contract + Remedy

Say which relevant terms of the contract and how they have been breached and remedy:

  • Breach of Condition: Repudiate Cont + Recover Price + Damages (Hadley v Baxendale)

  • Breach of Warranty : Damages but NO right to repudiate Contract

  • ¿What does the Client actually want?

Breach - Damages may be awarded + interests under: Law Reform Act + Late Payment of Commercial Debts Act + Late Payment of Commercial Debts Regulations. (S wants own i rate to avoid having to rely on these)(incentivise B to pay quickly by giving an early payment discount)

  • If breach of an express term, say that it goes to the heart of the contract, so will be a condition. Therefore, can (e.g. reject the goods) terminate the contract and seek damages.

(2): Defence ¿Has liability been excluded?

Step 4 Slight Breach + Acceptance:

  • s.15A = B’s right to reject is lost where the sale is not a consumer sale and the breach is so light that it would be unreasonable for B to reject the goods. Applies only to ss.13, 14 & 15, NOT to a stipulation concerning time of delivery. If a slight breach occurs it renders the term a warranty rather than a condition (nor right to reject/terminate). Apply to facts

  • s.35 = B’s lost of right to reject when B: tells S it has accepted the goods, or does something inconsistent with S’s ownership after the goods have been delivered to it.

  • s.35(4) = B losses right to reject it retains the goods beyond reasonable period under s.34(B’s right to inspect the goods)

Step 5 ¿Is the Exclusion Clause incorporated into the Contract? Either by:

  • Signature

  • Notice

  • Previous Course of dealings

NB. Look out whose ST&Cs apply. In the battle of the forms “The last shot wins”.

Step 5 Construction:

¿Does...
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