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Legal advice for Equipment Hire Limited.

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Introduction

To: Equipment Hire Limited From: XXX Legal Advisors Subject: Legal Advice Date: 02/06/04 Abstract Equipment Hire Limited (EHL) is a business whose service is to hire out plant and equipment to both business and individuals. Sunil, a window cleaner by trade, regularly hires ladders from EHL. Sunil hired a ladder from the company to paint the outside of his house upon which he paid �50 deposit and was issued with a receipt stating an exclusion cause: 'Conditions of Hire: EHL accepts no responsibility for any loss or damage suffered as a result of use of the equipment. Hirers use the equipment at their own risk' Unfortunately due to a defect, Sunil fell of the ladder and landed on his personal radio, which was irreparably damaged, and suffered a broken leg. EHL seek legal advice as to their liability for damages, if any, concerning Sunil's broken leg and the damaged stereo. 1.0 Introduction To establish damages owing in the incident concerning the client, EHL, and their customer Sunil, the following report aims to advise EHL and distinguish differences in liability of damages regarding Sunil as a consumer and as a business. In this case EHL are attempting to exclude liability for damages with their exclusion cause. This report explores the legal rules that control contracts for The Supply of Goods and Services Act 1982, The Unfair Contract Terms Act 1977 and The Unfair Terms in Consumer Contracts Regulations 1999. ...read more.

Middle

3.0 EHL's Liability Concerning Sunil as a Consumer. EHL's receipt of hire states an exclusion cause excluding liability for injury and damages. The definition of a consumer is stated in the Unfair Contract Terms Act 1977 in section 12: 'where one party makes the contract in the course of business and the other does not AND any goods supplied are of a type ordinarily supplied for private use.' In this case Sunil is using the ladder to paint the outside of his house so he is hiring the ladder as a consumer. Sunil can claim for injury as section 2(1) of UCTA 1977 covers negligence liability and states: 'A Business cannot (by contract or notice) exclude or restrict liability for death or personal injury resulting from negligence.' Therefore EHL's exclusion cause is deemed void and Sunil will be compensated, whether Sunil is acting as a consumer or not, as EHL have been negligent in supplying faulty goods and services as discussed in 2.0. Sunil as a consumer can also claim to replace his broken radio as section 7 - 'Miscellaneous contracts under which goods pass' of UCTA 1977; section 7(2) states: 'As against a person dealing as a consumer, liability in respect of the goods' correspondence with description or sample, or their quality or fitness for any particular purpose, cannot be excluded or restricted by reference to any such term.' ...read more.

Conclusion

Sunil could argue that he didn't know of the exclusion clause. However the terms are clearly stated on the receipt; and come under section 11(2) of the act which refers to schedule 2 of the act (appendix A). Sunil regularly hires equipment from EHL for his window cleaning trade, which means he should know the terms of hire. In court the judge will use case law. Case law in the past has decided the exclusion cause is acceptable and the company is not liable for damage, even if on the last occasion the exclusion clause was not seen, due to a course of regular dealing (Spurling v Bradshaw 1956). 867 When applying the test of reasonableness in section 11 the judge will look at the cause and see if it covers the situation. EHL's clause only seems to exclude liability for wrong of equipment only. This means EHL are liable for the Radio as well. Also when the court looks at the situation they will consider Sunil's bargaining power which schedule 2 of the act states: 'the strength of the bargaining positions of the parties relative to each other, taking into account (among other things) alternative means by which the customer's requirements could have been met.' For instance, are there any other hire companies Sunil could have gone too? If so Sunil may have been able to go elsewhere in which the incident may have never occurred. PART 1b SID Number: 0365570/1 Module Code: LWB1029 ...read more.

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