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 defendants claim for exemption failed. The clause did not satisfy the first two tests set down in the Canada Steamship case, and the controversial third test could be ignored.
 EWHC Technology 66
Unfair Contract Terms Act 1977
England and Wales
Cited – Gillespie Bros and Co Ltd v Roy Bowles Transport Ltd CA 1973
The court looked at how it should construe the Canada Steamship guidelines with regard to an exemption clause absolving one party of responsibility for negligence. There was a express reference to negligence by the words ‘save harmless and keep . . . .
Cited – Lamport and Holt Lines v Coubro, The Raphael CA 1982
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 . .
Cited – Investors Compensation Scheme Ltd v West Bromwich Building Society HL 19-Jun-1997
Account taken of circumstances wihout ambiguity
The respondent gave advice on home income plans. The individual claimants had assigned their initial claims to the scheme, but later sought also to have their mortgages in favour of the respondent set aside.
Held: Investors having once . .
Cited – E E Caledonia Ltd v Orbit Valve Plc CA 30-May-1994
A clause providing for an indemnity against any claim arising from the manner of performance was not to be construed to cover negligence. ‘The printed conditions in the agreement in this case were plainly drafted by a lawyer. Why was an express . .
Cited – E E Caledonia Ltd v Orbit Valve Plc QBD 1994
A clause which gave an indemnity against any claim arising from the manner of performance of the contract by one party was not to be construed to exempt negligence: ‘The principle is that in the absence of clear words the parties to a contract are . .
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 – Smith v UMB Chrysler (Scotland) Ltd HL 9-Nov-1977
The principles set out in Canada Steamship apply to ‘clauses which purport to exempt one party to a contract from liability’. The principles should be applied without ‘mechanistic construction’.
Lord Keith of Kinkel said: The tests were . .
Cited – Walters v Whessoe CA 1968
The court looked at clauses exempting a party from liability for negligence.
Sellers LJ said: ‘It is well established that indemnity will not lie in respect of loss due to a person’s negligence or that of his servants unless adequate or clear . .
Limited – Canada Steamship Lines Ltd v The King PC 21-Jan-1952
A lease of a freight shed exonerated the lessor from ‘any claim . . for . . damage . . to . . Goods . . being . . in the said shed’ and requiring the lessee to indemnify the lessor ‘from and against all claims’. The negligent use of an oxy-acetylene . .
Cited – Hollier v Rambler Motors (AMC) Ltd CA 19-Nov-1971
The plaintiff left his car with the defendant garage for repair. Whilst there it was substantially damaged by fire. The defendant sought to rely upon their terms which would negative liability, saying that the terms had been incorporated by . .
Mentioned – Lamport and Holt Lines v Coubro and Scrutton (M and I) Ltd, (The Raphael) 1982
These lists may be incomplete.
Updated: 23 December 2020; Ref: scu.135712