An award of damages for misrepresentation required that there had at some time been a right of rescission, not necessarily a continuing right to rescind.
An acknowledgement of non-reliance clause has become a common part of modern commercial contracts. An entire agreement clause limits the terms of the parties’ agreement to their written agreement and prevents a representation from assuming contractual force, but that it does not, without more, preclude or exclude liability for misrepresentation. As to the clause under which a party acknowledged that he had not been induced to enter the subject agreement by any representation, save those specified in a schedule.
Discussing the clause at issue, Jacob J said: ‘The problem is its scope. The Act of 1967 calls for consideration of the term as such. And it refers to ‘any liability’ and ‘any misrepresentation’. It does not call for consideration of the term so far as it applies to the misrepresentation in question or the kind of misrepresentation in question. The term is not severable: it is either reasonable as a whole or not. So one must consider its every potential effect. The clause does not seek to distinguish between fraudulent, negligent, or innocent misrepresentation. If it excludes liability for one kind of misrepresentation it does so for all. I cannot think it reasonable to exclude liability for fraudulent misrepresentation . . It may well be, with a different clause, reasonable to exclude liability for innocent misrepresentation or even negligent misrepresentation. But since the width of this clause is too great I would have held it failed the requirement of reasonableness and was of no effect.
A possible route round this latter objection would be to construe the clause so that it did not apply to a fraudulent misrepresentation. This approach is artificial. It is unnecessary now that the 1977 Act exists to destroy unreasonable exclusion clauses. The construction involves creating an implied exception in the case of fraud. What about an implied exclusion of negligence? Or gross negligence? It is not for the law to fudge a way for an exclusion to be valid. If a party wants to exclude liability for certain sorts of misrepresentation, it must spell those out clearly’.
Judges:
Jacob J
Citations:
Ind Summary 08-Aug-1994, [1996] 2 All ER 573
Statutes:
Jurisdiction:
England and Wales
Cited by:
Cited – National Westminster Bank v Utrecht-America Finance Company CA 10-May-2001
An agreement between the parties for assignment or novation of a credit agreement, contained a ‘take out’ agreement (‘TOA’). The defendant began proceedings in California to rescind the agreement, and the claimants obtained summary judgement under . .
Cited – E A Grimstead and Son Limited v McGarrigan CA 13-Oct-1998
. .
Not Followed – Zanzibar v British Aerospace (Lancaster House) Ltd QBD 31-Mar-2000
In a contract for the purchase of airplanes, the plaintiff claimed misrepresentation, and as a result, rescission and damages. The issue was whether, once the right to rescind had been lost, any claim for damages had also lapsed under section 2(2). . .
Cited – Six Continents Hotels Inc v Event Hotels Gmbh QBD 21-Sep-2006
The claimant had licensed the defendant to use its trademarks in connection with the naming of their hotels in Germany. The defendants failed to pay their fees as agreed, the claimants terminated the license and now sought payment under the . .
Cited – Senate Electrical Wholesalers Ltd v Alcatel Submarine Networks Ltd (Formerly STC Submarine Systems Ltd) CA 20-Dec-1996
. .
Cited – Senate Electrical Wholesalers Ltd v Alcatel Submarine Networks Ltd (Formerly STC Submarine Systems Ltd) CA 22-Jun-1998
Where damages were to be awarded for breach of warranty on sale of goodwill, an assessment according to a price earnings ratio was appropriate only if used in the contract or agreed as appropriate by the experts. In the context of a notice clause in . .
Cited – Crehan v Courage Limited and Byrne and Inntrepreneur Beer Supply Co Ltd and Langton v Inntrepreneur Beer Supply Co Ltd CA 27-May-1999
The court considered the validity of beer ties affecting public houses. . .
Cited – E A Grimstead and Son Ltd v McGarrigan CA 27-Oct-1999
The court considered the effect of an acknowledgement of non-reliance clause: ‘There are, as it seems to me, at least two good reasons why the courts should not refuse to give effect to an acknowledgement of non-reliance in a commercial contract . .
Cited – Floods of Queensferry Ltd, David Charles Flood v Shand Constructions Ltd, Morrison Shand Constructions Ltd, Morrison Construction Ltd TCC 17-Dec-1999
The claimant alleged that it had entered into a sub-contract relying upon misrepresentations made by the defendant, SCL that it was the main contractor, and that it was still trading. The defendant company operated through associated companies for . .
Cited – National Express Group Ltd v Campbell and Others SCS 7-Nov-2000
. .
Cited – LHS Holding Ltd v Laporte Plc CA 21-Jan-2001
. .
Cited – Watford Electronics Ltd v Sanderson CFL Ltd CA 23-Feb-2001
The plaintiff had contracted to purchase software from the respondent. The system failed to perform, and the defendant sought to rely upon its exclusion and limitation of liability clauses.
Held: It is for the party claiming that a contract . .
Cited – Pankhania and Another v Hackney and Another ChD 2-Aug-2002
The claimant sought damages alleging misrepresentation of land sold at auction. . .
Cited – Huyton Sa v Distribuidora Internacional De Productos Agricolas Sa De Cv CA 24-Jul-2003
. .
Cited – Bottin (International) Investments Limited v Venson Group Plc Grant Scriven Clive Lawson Smith ChD 3-Feb-2004
. .
Cited – Sere Holdings Ltd v Volkswagen Group United Kingdom Ltd ChD 5-Jul-2004
. .
Cited – Bottin (International) Investments Ltd v Venson Group Plc and others CA 22-Oct-2004
. .
Cited – Bottin (International) Investments Ltd v Venson Group Plcgrant Scriven Clive Lawson Smith CA 22-Oct-2004
Under a share purchase agreement, ‘notice of the claim had to be made in writing ‘specifying such details of the event or circumstances giving rise to such claim as are available to the investor and an estimate (if capable of preparation by the . .
Cited – The Rugby Group Ltd v Proforce Recruit Ltd QBD 2-Feb-2005
. .
Cited – Proforce Recruit Ltd v The Rugby Group Ltd CA 17-Feb-2006
The parties to a contract disputed the meaning of the phrase ‘preferred supplier status’ in a service cleaning agreement. The Court was asked whether an otherwise unarguable case on construction could be saved from being struck out by reference to . .
Cited – Peart Stevenson Associates Ltd v Holland QBD 30-Jul-2008
Claim for damages for breach of franchise contract. . .
Lists of cited by and citing cases may be incomplete.
Contract, Torts – Other
Updated: 19 November 2022; Ref: scu.185981