Thompson v T Lohan (Plant Hire) Ltd

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Thompson v T Lohan (Plant Hire) Ltd
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Court Court of Appeal
Citation(s) [1987] 2 All ER 631
Court membership
Judge(s) sitting Fox LJ
Keywords
Unfair terms

Thompson v T Lohan (Plant Hire) Ltd [1987] 2 All ER 631 is an English contract law case on the Unfair Contract Terms Act 1977.

English contract law Law of contracts in England and Wales

English contract law is a body of law regulating contracts in England and Wales. With its roots in the lex mercatoria and the activism of the judiciary during the industrial revolution, it shares a heritage with countries across the Commonwealth, and to a lesser extent the United States. It is also experiencing gradual change because of the UK's membership of the European Union and international organisations like Unidroit. Any agreement that is enforceable in court is a contract. Because a contract is a voluntary obligation, in contrast to paying compensation for a tort and restitution to reverse unjust enrichment, English law places a high value on ensuring people have truly consented to the deals that bind them in court.

Unfair Contract Terms Act 1977

The Unfair Contract Terms Act 1977 is an Act of Parliament of the United Kingdom which regulates contracts by restricting the operation and legality of some contract terms. It extends to nearly all forms of contract and one of its most important functions is limiting the applicability of disclaimers of liability. The terms extend to both actual contract terms and notices that are seen to constitute a contractual obligation.

Contents

It is usually read with Phillips Products Ltd v Hyland and Hamstead Plant Hire Co Ltd [1] where a similar contract clause (an older version of the same standard industry term) was held to be unreasonable, but where the liability being shifted had the effect of leaving a victim of loss without a remedy. In Thompson there was no exclusion of liability to the victim of the accident.

<i>Phillips Products Ltd v Hyland and Hamstead Plant Hire Co Ltd</i>

Phillips Products Ltd v Hyland and Hamstead Plant Hire Co Ltd [1984] EWCA Civ 5 is an English contract law case concerning the Unfair Contract Terms Act 1977.

Facts

T Lohan hired out a JCB excavator and driver, Mr Hill, to JW Hurdiss Ltd, the owners of a quarry. Condition 8 of the contract said the driver was employed by JW Hurdiss Ltd. The driver caused Mr Thompson’s death. Mrs Thompson got damages from T Lohan for her husband's life. T Lohan sought to recover the cost of compensation from JW Hurdiss Ltd. JW Hurdiss argued that condition 8 was caught by UCTA 1977 section 2(1).

Judgment

Fox LJ held that condition 8 was not caught by UCTA 1977 and was effective to transfer liability to the hirers. Section 2(1) had no effect because liability was not excluded towards the victim of the negligent act, Mr Thompson. It only excluded liability towards T Lohan themselves. It transferred liability. This distinguished the case from Phillips Products Ltd v Hyland and Hamstead Plant Hire Co Ltd . [2] So there is a distinction between an exclusion and transfer of liability. In particular he noted the following.

Sir Michael John Fox was a British barrister and judge. He was a High Court judge from 1975 to 1981 and a Lord Justice of Appeal from 1981 until 1992.

See also

Notes

  1. [1987] 2 All ER 620
  2. [1987] 2 All ER 620

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References