The Unfair Contract Terms Act 1977
This is not in the ‘right’ order chronologically in the list of statutes in this
Chapter, as it protects the consumer in quite a different way from those
above. The statutes examined so far have been concerned with implying
terms into consumer sales, or giving the consumer rights within the
contract formed. The Unfair Contract Terms Act 1977 operates by
declaring certain terms which may already be within the consumer’s
contract to be so unfair that they are invalid. The Act stepped in largely to
give protection where consumers found that they were not protected
because of either:
- a term in written contract which they had not noticed or understood, or
- a notice which had become incorporated as a term of a contract,
unknown to the consumer, and depriving the consumer of basic rights.
The kind of term which the Unfair Contract Terms Act 1977 addresses
generally takes the form of an exemption clause, that is one which either
limits liability (a limitation clause) or excludes liability (an exclusion
clause). Because consumers, with little bargaining power, are not
realistically able to negotiate over these terms, they are in an unfair
position. The common law restricts the use of these to some extent by
requiring fair incorporation as a term – see Chapter 8 for more detail
concerning the points made here.
Consumer protection 245No slipping in terms
that the consumer
doesn’t know aboutThe lawconsumer businessFigure 16.2