The issue is whether or not Quick Klean Drycleaners Pty Ltd is exempted from liability arising from the torn suit due to the presence of the exclusion clause and whether the situation would be different had Sam signed the receipt.
In Thornton v Shoe Lane Parking Ltd  2 QB 163 it was held that a customer would only be bound by an exclusion clause only if he/she is aware that the ticket has been issued subject to the conditions stipulated or that the company took reasonable steps to give the customer notice of the conditions (Minnes 20).
The incorporation of a clause in a contract is similar to the incorporation of a term. Where a party intends to incorporate an exclusion clause into a contract, such a party must notify the customer (Koornhof 10). In Thornton v Shoe Lane Parking Ltd case, Lord Denning held that where such a clause is not brought to the attention of the consumer, such a clause will not be binding (Freilich and Webb 263). In this case, when Sam took his suit to the dry cleaner, the assistant explained to him the conditions that were binding on both parties and even directed him to the clause on the back of the receipt. However, these conditions and the ticket were brought to his attention only after he had paid and given out his suit which shows that the contract was already complete. There was no way for him to read them before the ticket was given to him. As such, the exclusion clause cannot be binding on the parties (American Bar Association 35).
If the situation were such that Sam had signed the receipt, the exclusion clause would be binding. In Curtis v Chemical Cleaning Company (1951) 1 KB 805, it was held that where a customer signs a receipt, he/she is bound by the terms unless there was a misrepresentation (Tufal 1).
Sam is not bound by the exclusion clause hence he can recover from the company for the damage done to his suit. This is because the exclusion clause was brought to his attention when the contract had already been made. However, if he had signed the document, he would be bound by the clause.
The issue is whether Westminister has the right, under the contract, to forfeit the lease on the basis that Pontus was in breach of the terms by living on the premises.
In ProForce Recruit Ltd v Rugby Group Ltd (2006) EWCA Civ 69 it was held that pre-contractual materials and negotiations are allowed in court in the construction of the terms of the contract where the parties have not excluded them (Banakas 4).
The Misrepresentation Act 1967 provides that where misstatements are made in the course of contractual negotiations have the effect of inducing the contract, they can give the other party the right to rescind the contract or seek other remedies depending on the case. There is contractual liability where a party to a contract makes intentional, negligent or fraudulent misrepresentations (Rodriguez 1). Westminister wanted to include a new clause in the lease agreement to the effect that Pontus would not be allowed to continue to live above the shop. Due to the opposition by Pontus, Westminister stated that Pontus could continue to live in the shop as long as he signed the agreement with the new clause. This was a representation that Pontus relied upon in signing the new lease for three years (Schwartz 669).
According to section 2(2) of the Misrepresentation Act 1967, where a person enters into a contract because of a misrepresentation, such person would be entitled to rescind the contract (Barton 12). The fact that Westminster intends to forfeit the lease because Pontus was living on the premises means that the contract was entered into based on a misrepresentation. As such, Pontus has the right to enforce the pre-contractual statement blocking Westminster from forfeiting the lease (Bebchuk and Ben-Shahar 425).
The attempt to forfeit the lease by Westminster means that the promise made at the negotiation stage was a misrepresentation. This would mean that Pontus can apply to the court to block Westminister from forfeiting the lease based on the statement made at the negotiation stage. The statement made at the negotiations stage can be enforced.
The issue is whether there is any liability arising from negligence that can be raised against Kim for the events during the cruise.
Lord Atkin in the case of Donoghue v Stevenson (1932) established the neighbor principle which requires a person to take reasonable care to ensure that his/her actions or omissions do not cause injury to a neighbor (Stewart and Stuhmcke 185).
The law of negligence is concerned with the compensation of people who have suffered injuries as a result of the carelessness of others (Raniolo and Ellison 2). For a person to succeed in a claim in negligence, that person must show that a duty of care existed and that that duty was breached resulting in harm or injury to the person or their property (Bannister 5). In this case, Kim briefly lost her consciousness, and when she came to, she had to take a quick evasive action to avoid running into whales. As a result, several tourists were injured. Whether or not Kim was negligent depends on whether the constituent elements of negligence existed (Center for Applied Legal Studies University of Witwatersrand 4).
Due to the position held by Kim as commercial boat skipper, she had a duty to ensure the safety of all the people she took on a cruise. The injury to the tourists was as a result of the brief loss of consciousness. Kim undergoes an annual medical examination to ensure good health. There was no way she could foresee losing consciousness bearing in mind that she previously did not have any health problems. As a result, the injuries to the tourists were not as a result of the breach of the duty of care (Owen 1673).
Though Kim owed a duty of care to the tourists, the injuries that occurred did not arise from the breach of the duty. The loss of consciousness which led to the injuries was unforeseeable hence did not give rise to a breach. There is, therefore, no cause of action in negligence against Kim.
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Center for Applied Legal Studies University of Witwatersrand, The employer’s duty of care, 2009, Web 24 July 2016. (http://www.lexisnexis.co.za/pdf/3.0_THE%20EMPLOYERS%20DUTY%20OF%20CARE.pdf)
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Minnes, Jonathan, Contract Law, Queen Mary Law Society, UK, 2013.
Tufal, Asif, Cases on exclusion clauses, 2016, Web 24 July 2016. (http://www.lawteacher.net/PDF/contract-law/Exclusion%20Clauses%20Cases.pdf)
Freilich, Aviva and Webb, Eileen, The incorporation of contractual terms in unsigned documents-Is it time for a realistic, consumer-friendly approach? The University of Western Australia Law Review, 34(1), 261-273.
American Bar Association, Contracts and consumer law, 2013, Web 24 July 2016. (http://www.americanbar.org/content/dam/aba/migrated/publiced/practical/books/family/chapter_9.authcheckdam.pdf)
Rodriguez, Teresa, Pre-contractual liability, Universidad Carlos III de Madrid, 2015.
Barton, Philip, The effect of pre-contractual representations, Legalwise Contract Risk Management Seminar, Melbourne, 2013.
Bebchuk, Lucian and Ben-Shahar, Omri, Pre-contractual reliance, Journal of Legal Studies, 30(1), 423-457, 2001.
Banakas, Stathis, Liability for contractual negotiations in English law: Looking for the litmus test, University of East Anglia, 2009.
Schwartz, Alan, Pre-contractual liability and preliminary agreements, Harvard Law Review, 120(3), 661-707.