Sale of Goods and Supply of Services Act 1980


Fair and Reasonable Terms

Section 2 (3).

1. In determining for the purposes of section 13, 31, 40 or 46 of this Act or section 55 of the Act of 1893 (inserted by section 22 of this Act) if a term is fair and reasonable the test is that it shall be a fair and reasonable one to be included having regard to the circumstances which were, or ought reasonably to have been, known to or in contemplation of the parties when the contract was made.

2. Regard is to be had in particular to any of the following which appear to be relevant:

( a) 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;

( b) whether the customer received an inducement to agree to the term, or in accepting it had an opportunity of entering into a similar contract with other persons, but without having to accept a similar term;

( c) whether the customer knew or ought reasonably to have known of the existence and extent of the term (having regard, among other things, to any custom of the trade and any previous course of dealing between the parties);

( d) where the term excludes or restricts any relevant liability if some condition is not complied with, whether it was reasonable at the time of the contract to expect that compliance with that condition would be practicable;

( e) whether any goods involved were manufactured, processed or adapted to the special order of the customer.

3. In this Schedule—

contract” includes “ agreement”,

term” includes “ agreement” and “ provision”.