The court considered how it should treat the construction of a contractual clause claiming that one party should be exempt from liability for its own negligence: ‘Thus, if an exemption clause of the kind we are considering excludes liability for negligence expressly, then the Courts will give effect to the exemption. If it does not do so expressly, but its wording is clear and wide enough to do so by implication, then the question becomes whether the contracting parties so intended. If the only head of liability upon which the clause can bite in the circumstances of a given case is negligence, and the parties did or must be deemed to have applied their minds to this eventuality, then clearly it is not difficult for a Court to hold that this was what the parties intended – that this is its proper construction. Indeed to hold other wise would be contrary to commonsense. On the other hand if there is a head of liability upon which the clause could bite in addition to negligence then, because it is more unlikely than not that a party will be ready to excuse his other contracting party from the consequences of the latter’s negligence, the clause will generally be construed as not covering negligence. If the parties did or must be deemed to have applied their minds to the potential alternative head of liability at the time the contract was made then, in the absence of any express reference to negligence, the Courts can sensibly only conclude that the relevant clause was not intended to cover negligence and will refuse so to construe it. In other words, the Court asks itself what in all the relevant circumstances the parties intended the alleged exemption clause to mean.’
Judges:
May LJ
Citations:
[1982] 2 Lloyd’s Rep 42
Jurisdiction:
England and Wales
Cited by:
Cited – Industrie Chimiche v Nea Ninemia Shipping 1983
Construction of exemption clause in time charterparty: ‘Since it is inherently improbable that one party to a contract should intend to absolve the other party from the consequences of the latter’s own negligence, the court will presume a clause not . .
Cited – Stent Foundations Ltd v M J Gleeson Group Plc TCC 9-Aug-2000
The defendant company sought to rely upon an exemption clause.
Held: Applying standard rules for contract interpretation, the exemption clause was to be construed against the one proposing it. At best the clause was ambiguous, and the . .
Lists of cited by and citing cases may be incomplete.
Contract
Updated: 10 June 2022; Ref: scu.195682