Business Law: Exclusion Clauses, Misrepresentation, and Contracts

This business law assignment delves into the legal implications of exclusion clauses within the context of contractual agreements. The assignment presents a scenario involving a TV shop's advertisement and a customer, Homer, exploring the enforceability of an exclusion clause. The analysis draws upon several key legal cases, including L’Estrange v Graucob, Curtis v Chemical Cleaning Co, Olley v Marlborough Court, Bisset v Wilkinson, McCutcheon v MacBrayne, Glynn v Margetson, and R & B Customs Brokers v United Dominion Trusts Ltd, to determine whether the exclusion clause is valid. The assignment examines issues of misrepresentation, falsification, and the importance of clear communication in contracts, concluding that the exclusion notice may not be enforceable. The student also provides a journal entry reflecting on the concepts of misrepresentation, the significance of exclusion clauses, and the application of these principles in the workplace.

Running head: BUSINESS LAW
BUSINESS LAW
Name of the Student
Name of the University
Author Note

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Assignment
Issue
The primary issue in the given scenario is what may be the legal implications in relation
to Homer and the importance in relation to exclusion clauses.
Rule
The case of L’Estrange v Graucob [1934] 2 KB 394 shall be considered to be a
significant case in this regard. In this case, a cigarette machine was purchased by the plaintiff
from defendant for the café of the plaintiff. The plaintiff contracted an agreement of sales, and
put her signature on a tiny printed paper, without properly reading the paper. In the agreement it
was stated that any particular statement, warranty or condition (implied or expressed) shall be
excluded. The machine did not function adequately. Regarding an action in relation to the
violation of the warranty, it was held that the exclusion clause shall protect the
defendants. However, afterwards this notion was changed.
The case of Curtis v Chemical Cleaning Co [1951] 1 KB 805 shall be considered to be a
significant case in this regard. In this case, the plaintiff gave wedding dress to the defendants for
the purposes of cleaning. A receipt was signed by the plaintiff, after the assistant told the plaintiff
that the cleaners shall be exempted from the accountability in relation to any damage that may be
caused to the sequins and beads. However, there was a clause in the receipt, which provided
exclusion in relation to any particular damage that may arise. The dress was severely blemished
during its return. It was discovered that the defendants shall be accountable in relation to the
damage caused regarding the substance of that dress because the scope of the exception clause
had been falsified and misrepresented by the assistant of the defendant.

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The case of Olley v Marlborough Court [1949] 1 KB 532 shall be considered to be an
important case in this regard. In this case, a stay for a week had been booked by the plaintiff at
the hotel of the defendant. A stranger somehow entered the room of the plaintiff and took the
mink coat of the plaintiff. A notice was present on the backside of the door of the bedroom, on
which it was mentioned that the proprietors shall not be accountable in relation to the articles that
might get stolen or lost, except when the articles are given to the manager for the purposes of
safe custody. It was held by the Court of Appeal that the notice had not been assimilated into the
contract that has been established between the guest and the proprietor. The contract had been
established in the hall area of hotel, that is, prior to the time when the plaintiff went to her
bedroom and prior to the time when the plaintiff had the chance to perceive the notice.
The case of Bisset v Wilkinson [1927] AC 177 shall be considered to be a significant case
in this regard. In this case, a land had been purchased by the plaintiff from in order to do sheep
farming. When the negotiations were in process, it was stated by the defendant that if work on
the land was done properly, then the land shall be able to carry at least two thousand sheep. The
land had been purchased by the plaintiff because he believed that land would carry two thousand
sheep. Both the parties had knowledge that defendant never carried on farming of sheep on that
particular land. Under normal circumstances, the statement made by the defendant would have
been considered to be a ‘statement of fact’. However, under the special circumstances of this
particular case, it was held that if there is no presence of fraud, then the purchaser shall not
possess any right to cancel the contract.
The case of McCutcheon v MacBrayne [1964] 1 WLR 125 shall be considered to be a
relevant case in this regard. In this case, the exclusion clauses were provided in twenty seven
paragraphs in a tiny print, which were contained outside and inside an office of ferry booking,

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and the exclusion clauses were also provided in a particular ‘risk note’ that the passengers
occasionally signed. It was held that the exclusion clauses shall not be incorporated. No course
regarding conduct happened because no consistency in relation to dealing existed.
The case of Glynn v Margetson [1893] AC 351 shall be considered to be a relevant case
in this regard. In this case, it was greed by the carriers to deliver the oranges from the city of
Malaga to the city of Liverpool as per a particular contract that permitted the ship to make a call
at any particular port in the continent of Europe or the continent of Africa. The ship had sailed a
distance of three hundred and fifty miles to the east from the city of Malaga so that another cargo
could be picked. However, when the ship reached to the city of Liverpool, the oranges were not
in good condition. The defendants made an attempt to take the option of an exclusion clause. It
was held that the chief objective was to transport a cargo that was perishable (oranges) to the city
of Liverpool, and because of such cargo it shall be possible to ignore the clause, and call should
have been made by the ship only at the ports that were en route. Hence, the carriers were held to
be accountable.
In the case of R & B Customs Brokers v United Dominion Trusts Ltd [1988] 1 WLR 321,
it was stated that in relation to a consumer sale it shall not be possible to exclude the implied
conditions.
Application
In the given scenario, in an advertisement the TV shop advertised that the television sets
shall be made available at a minimal price, which shall be less than the amount of half price.
However, when Homer went to purchase a TV, he was refused the scheme of availing a TV at
half price. The manager of the shop pointed at a sign that stated that sales may be withdrawn at
the discretion of the shop.

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Applying the case of L’Estrange v Graucob [1934] 2 KB 394, it may be said that
regarding an action in relation to the violation of the warranty, it was held that the exclusion
clause shall protect the defendants. However, afterwards this notion was changed.
The case of Curtis v Chemical Cleaning Co [1951] 1 KB 805 shall be applied in the
given scenario. In this case, it was discovered that the defendants shall be accountable in relation
to the damage caused regarding the substance of that dress because the scope of the exception
clause had been falsified and misrepresented by the assistant of the defendant. Hence, it may be
said that in the give scenario, the exception clause had been misrepresented.
The case of Olley v Marlborough Court [1949] 1 KB 532 shall be applied in the given
scenario. In this case, it was held by the Court of Appeal that the notice had not been assimilated
into the contract that has been established between the guest and the proprietor. The contract had
been established in the hall area of hotel, that is, prior to the time when the plaintiff went to her
bedroom and prior to the time when the plaintiff had the chance to perceive the notice.
Therefore, in a similar manner, the notice shall not be assimilated into the contract that has been
established between Homer and the TV shop.
The case of Bisset v Wilkinson [1927] AC 177 shall be applied in the given case. In this
case, a land had been purchased by the plaintiff from in order to do sheep farming. When the
negotiations were in process, it was stated by the defendant that if work on the land was done
properly, then the land shall be able to carry at least two thousand sheep. The land had been
purchased by the plaintiff because he believed that land would carry two thousand sheep. Both
the parties had knowledge that defendant never carried on farming of sheep on that particular
land. Under normal circumstances, the statement made by the defendant would have been
considered to be a ‘statement of fact’. However, under the special circumstances of this

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particular case, it was held that if there is no presence of fraud, then the purchaser shall not
possess any right to cancel the contract. Therefore, in the given scenario, it may be said that the
statement advertised by the TV shop shall be considered to be ‘statement of fact’.
Applying the case of McCutcheon v MacBrayne [1964] 1 WLR 125, it may be said that
that the exclusion notice shall not be incorporated in the contract between Homer and the TV
shop because no course regarding conduct happened as there existed no consistency in relation to
dealing.
The case of Glynn v Margetson [1893] AC 351 shall be applied in the given scenario. In
this case, it was held that the chief objective was to transport a cargo that was perishable
(oranges) to the city of Liverpool, and because of such cargo it shall be possible to ignore the
clause, and call should have been made by the ship only at the ports that were en route. Hence,
the carriers were held to be accountable. However, in the given scenario, the TV shop does not
deal in objects that may be perishable. Therefore, the TV shop shall not be able to avail the
notice of exclusion, which it falsely kept at the backside of the TV shop.
The case of R & B Customs Brokers v United Dominion Trusts Ltd [1988] 1 WLR 321
shall be applied in the given scenario. In this case, it was stated that in relation to a consumer
sale it shall not be possible to exclude the implied conditions. Therefore, in the given scenario, it
shall be considered to be a consumer sale. The TV shop expressly mentioned that the TVs shall
be made available at the amount of half price. Hence, it may be said that if implied conditions
cannot be excluded, then in case of an expressed condition, exclusion clauses shall not apply.

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Conclusion
To conclude, it may be said that the legal implications in relation to Homer shall relate to
the enforceability of the exclusion cause notice of the TV shop.
Journal Entry
The important things that I have learnt relate to misrepresentation and falsification in
relation to any particular contract. I have gained knowledge in connection to the importance and
relevancy of the exclusion clause in any particular contract. I have learnt that exclusion clause
shall be considered to be a term in any particular contract that aims to exclude any one party
from any kind of accountability. The exclusion clause restricts the accountability of the
individual to explicit listed circumstances, conditions or situations. It may be introduced into any
particular contract that purposes to exclude the accountability of a person or limit that person’s
accountability in relation to any violation of contract or any kind of negligence. I have become
aware about the instances when the exclusion clauses may become applicable and when such
exclusion clauses shall not become applicable.
At the workplace such knowledge mentioned above, shall be useful. It is important that
when contracts are established, any kind of falsification or misrepresentation should be avoided.
It is very important and crucial that a particular exclusion clause should be clear, unambiguous,
direct and well communicated to the party. It should not be unclear or unambiguous, because any
kind of ambiguity may lead to an instance, where a particular exclusion may be misrepresented.
If an exclusion clause is not communicated to the parties in a proper manner, then such lack of
communication may give rise to confusion among the parties who all are involved in a particular
contract.

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The knowledge in relation to establishment of contracts and the exclusion clauses in
relation to such contracts, shall help me to give effect to contracts and insert exclusion clauses in
a more tactful manner. For instance, whenever I have to put my signature on any kind of receipt,
then I shall be alert and read the exclusion clauses thoroughly and then put my signature on such
receipt.

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References
Bisset v Wilkinson [1927] AC 177.
Curtis v Chemical Cleaning Co [1951] 1 KB 805.
Glynn v Margetson [1893] AC 351.
L’Estrange v Graucob [1934] 2 KB 394.
McCutcheon v MacBrayne [1964] 1 WLR 125.
Olley v Marlborough Court [1949] 1 KB 532.
R & B Customs Brokers v United Dominion Trusts Ltd [1988] 1 WLR 321.
Unfair Contract Terms Act, 1977.