Contract Rules Essays - XYZ Building Services Ltd

X, the MD of XYZ Building Services Ltd, is considering drafting a standard set of conditions and conditions to use in agreements with his customers.

Write a report for him explaining

  • What steps he needs to take to ensure that the standard terms are actually part of any deal he makes with a customer


  • The degree to which he's absolve to include any term he would like in his standard terms and


  • The provisions of contract legislation about termination and breach of deal which he may wish to take into account when drafting his standard conditions.


In order for the customer and XYZ to be destined by standard terms and conditions there must be a set of criterion loaded. These conditions should be cared for as exclusion clauses because they are the extreme conditions to be enforced. For these standard conditions and conditions to be enforced there has to be a valid agreement, meaning four requirements need to be satisfied. A valid contract must have the next elements; offer; acceptance; factor; capacity; and motive. These are within this agreement when XYZ offers his work and the client allows verbally or in writing. There is also intention because there is an understanding that XYZ will arrive to focus on a certain day and the customer can pay a certain payment, which is proof consideration as the customer reaches a disadvantage. That is a valid agreement, however the next area to explore is if the exclusion clause and standard conditions apply because the customer has never caused XYZ with the verbal agreement point does not suggest what his regular conditions and conditions are.

Basic Requirements of Ensuring Enforceable Standard Conditions and terms:

Under contract laws there are just three ways that they can be incorporated which can be:

  1. By signature even if they are not read;
  2. By notice where there needs to be sufficient notice
  3. By custom where there were previous dealings between your people even if the clause is added in later.

In every case XYZ should ensure that there surely is case is a personal in case there is no indication of earlier dealings, hence the client may not bound by these conditions yet. Therefore you have to consider the situation of notice, off side there is no notice as XYZ fully shows what these conditions and the question is whether the average person would have notice, especially as XYZ is an builder and the customer as a company and these could be construed as standard conditions in the business; but this would be easy to establish as notice was given credited to XYZ providing these terms and conditions prior to the contract was decided and supplying a good indication of their character at this level.

Unenforceable Standard Conditions and Conditions

In every circumstance that a signature is required it gives rise to the chance where the terms were fully portrayed but under deal law there could be one problem with the agreement if the client has received the deal in their hands and failed to read it the truth of Alderslade v Hendon Laundry Ltd if the exclusion clause can only be construed in carelessness and using circumstances then it is applicable and as The client received the most common terms and conditions before XYZ started out the work, i. e. that they had a chance to end the deal they are bound by them. However, the situation of White v John Warwick & Co has organised that responsibility for negligence will not normally be excluded. Therefore it is still really perplexing whether XYZ is excluded from the damage that the customer is seeking, which means statutory procedures of the UCTA and Sales and offer of Services Work 1982 (SGSA).

Is XYZ is liable for the damages a customer may require? In response there is little evidence in if the exclusion clauses should be backed or not. Under UCTA Section 2 it supports that negligence can't be excluded according to personal and/or fatality bat all. In relation to other loss/damage liability cannot be excluded unless there is certainly fair notice. Section 11 contains that the acceptable test is the fact the term is fair and affordable and whether the individual should have fairly known or in contemplation of when the deal was made. This is like the case law discourse; however it is written from the idea that negligence can not be excluded except in rigid circumstances. There is no real notice in this case, in particular when the verbal deal was made. Therefore it is very likely that this clause will not be upheld as the truth of Andrews Bros (Bournemouth) Ltd v Vocalist and Co Ltd holds that exclusion clauses up against the party seeking to rely on them. Yet with regards to the damage to the client it needs to be determined when there is remoteness of destruction, whereby monetary payment can be stated for a failure to perform, the burkha responsibility as this is a breach and/or the loss for any breach of a secondary obligation. According to the neglectfulness that has caused personal problems for persons regulations states that cannot be excluded under Section 1(2) of the UCTA, therefore it has been proven that the customer may claim because of this.

Reasonableness Test, Breach and Questionable Standard Conditions and Conditions

Again we should use whether there is fair notice to exclude responsibility and under the SGSA Section 16 where restricting responsibility for breach of implied conditions arising from Sections 13-15 is subject to the reasonable ensure that you provisions of the UCTA, where the reasonableness test is based upon the common laws officious bystander test that is defined in Sir Legislations v Southern Foundries Ltd which really is a stricter test for exclusion clauses where it needs to be so sensible and that the notice is sufficient that the officious bystander would agree to its terms. This basically contains that there are implied terms such as a realistic quality of goods and services and this it ought to be completed in a reasonable quality and should be usable. Which means that the exclusion of responsibility for faulty equipment and responsibility for faulty work can't be excluded. Which means that these two exclusion clauses can't be upheld. According to the negligent completion of work i. e. was there sensible reason for the carelessness. Yet it was an express term of the agreement and without realistic excuse this exclusion clause it is possibly not going to be upheld, this is rule from an early common law basic principle. Yet there is the question whether this is sensible exclusion for the trade.

However, as in the case of Edmund Murray Ltd v BSP International Foundations Ltd it happened that it had not been fair and acceptable for the get together in breach to rely by using an exclusion clause for failing to meet the features of the other party. Therefore this again will be at the mercy of the reasonableness test where in fact the test put on the whole term also to the particular reliance onto it. Therefore if it is a particular term of the contract to be done by the certain day and made clear by The client and XYZ do this as it was then it's very likely it can be excluded since it is a trade standard. Finally, if one considers the Unfair Terms in Consumer Contracts Restrictions 1999 (UTCCR) if the term does not create an unfair balance in detriment to the buyer it can be upheld. Yet as this does indeed create an unfair balance and sets the customer at a loss they will be protected from the exclusion clause as a consumer, even though she actually is acting for her business. However are the circumstances of this deviation sufficient enough for the client to claim? In case the swimming pool was properly proclaimed the work would have been completed within the period of time would variation to the agreement be satisfactory? Therefore will there be a reasonable excuse for the variant and did both the customer and XYZ have equal bargaining power? The first question to ask is whether the circumstances that lead to the variance of the contract would have frustrated the agreement, if the variation is perfectly appropriate so long as the customer had not been put under duress to accept the new terms.

  • J. Beatson (1998) Anson's Regulation of Agreement 27th Edition, Oxford College or university Press
  • Buyer (The), 2002, Areas of Annoyance, Buyer 24(12)
  • Groves, 2004, Push Majeure, Bus Advertising 2. 10 (2)
  • David Kelly, Ann Holmes & Ruth Hayward (2002) Business Legislation 4th Edition, Cavendish
  • Lunney & Oliphant, 2000, Tort Law: Text message & Materials, Oxford Uni Press
  • Ewan McIntyre, (2004) Business Law, Longman
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