Property Law: Effect of Exclusionary Clauses on Contractual Liability
Added on 2023-06-09
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Running head: PROPERTY LAW
PROPERTY LAW
Name of the Student
Name of the University
Author Note
PROPERTY LAW
Name of the Student
Name of the University
Author Note
1PROPERTY LAW
Issue
In this case a racehorse was wrongly advertised as belonging to a certain bloodline. The
advertisement was accepted by a particular person who was a racehorse breeder. This was first a
verbal agreement but a formal contract was drawn up. This written contract had specific
exclusionary clause which absolved the seller form any responsibility for representations made in
furtherance of the sale (Sisk 2017). This clause would thus exclude liability for the same and
would condone the misrepresented bloodline. The issue is to determine the rights of the seller in
such a case.
Rule
The applicable rules here can be set out through the judgment delivered by the courts in
two cases where the determination of the effect of exclusionary clauses have been discussed and
adjudicated upon. The first case to be referred to here is Spindrifter (pty) ltd v Lester donovan
(pty) ltd [1986] 1 All SA 384 (A) (Christie and Bradfield 2016). This case clarified that unless an
exclusionary clause was not specifically brought to the attention of the persons signing it (in
effect agreeing to be bound by it). If the same is not clearly brought to the attention of the
shareholders then the same would mean that the exclusionary clause was not adequately
incorporated into the terms of the contract. Thus the parties to the contact would not be bound by
such a determination. This principle has also been reiterated in another landmark case concerning
an appeal. This case was Mercurius Motors v Lopez (149/2007) [2008] ZASCA 22 (Diamond
2013). Here the dispute was regarding a stolen car from a car depot where the owners of the
depot had obtained a contract that contained an exclusionary clause absolving them from
Issue
In this case a racehorse was wrongly advertised as belonging to a certain bloodline. The
advertisement was accepted by a particular person who was a racehorse breeder. This was first a
verbal agreement but a formal contract was drawn up. This written contract had specific
exclusionary clause which absolved the seller form any responsibility for representations made in
furtherance of the sale (Sisk 2017). This clause would thus exclude liability for the same and
would condone the misrepresented bloodline. The issue is to determine the rights of the seller in
such a case.
Rule
The applicable rules here can be set out through the judgment delivered by the courts in
two cases where the determination of the effect of exclusionary clauses have been discussed and
adjudicated upon. The first case to be referred to here is Spindrifter (pty) ltd v Lester donovan
(pty) ltd [1986] 1 All SA 384 (A) (Christie and Bradfield 2016). This case clarified that unless an
exclusionary clause was not specifically brought to the attention of the persons signing it (in
effect agreeing to be bound by it). If the same is not clearly brought to the attention of the
shareholders then the same would mean that the exclusionary clause was not adequately
incorporated into the terms of the contract. Thus the parties to the contact would not be bound by
such a determination. This principle has also been reiterated in another landmark case concerning
an appeal. This case was Mercurius Motors v Lopez (149/2007) [2008] ZASCA 22 (Diamond
2013). Here the dispute was regarding a stolen car from a car depot where the owners of the
depot had obtained a contract that contained an exclusionary clause absolving them from
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