Suppose you visit an adventure tour operator when you sustain bodily injuries as a result of the negligence of the Adventure Tour Operator or its employees.  As a result of the incident, you wish to hold the tour operator liable for damages.

In response to your claim for damages, the operator contends that you are contractually bound by the notice displayed at the Adventure Resort. The notice displayed is an example of an unsigned contract where one of the parties tries to impose a term on the other contracting party. An exclusionary term is one that limits one of the contracting party’s liabilities for claims for damages.

This type of clause is advantageous to the contracting party that imposes the exclusion clause in that it can prevent the other contracting party from suing the operator.

When do exclusionary terms on a notice form part of an unsigned contract?

It goes without saying that a consumer that has seen the term agreed to it, there can be no doubt that the term forms part of the unsigned contract. On the other hand, suppose the consumer claims not to have seen the notice. Does this mean that the exclusionary term does not bind the consumer?

The established rule in our law is that the consumer who did not see the term will still be bound by it, as long as the operator imposing the term did what is reasonably necessary to bring the exclusionary term to the consumer’s attention.

To determine whether, in the case of notices, the operator has done everything reasonably necessary to bring a term to a customer’s attention, the following will be considered:

  • The customer must see the notice before he enters into a contract. By way of example, if the operator wants to use a notification to impose a specific exclusionary term, the notice must be visible when the consumer enters the adventure resort.
  • The notice must be clearly visible, and the writing on the notice must be easy to read. A notice hidden out of view would not suffice under the circumstances.

If an operator attempts to impose an exclusionary term and did everything reasonably necessary to bring the term to the attention of the customer, it will be part of the contract.

The interpretation of these types of clauses is set out in the case of Durban’s Water Wonderland (Pty) Ltd vs Botha & Another 1999 (I) SA 982 (SCA). In this case, the claimant and her daughter were on an amusement ride at an amusement park when they were thrown off the machinery and injured.  An investigation found that the accident was as a result of a problem with the park’s machinery.  The claimants sued the park for damages for the injuries they sustained as a result of the incident, claiming that the park was negligent.

The park’s management refused to accept liability because there was an exclusion clause painted on the windows of the ticket office.

The clause read as follows:

“Management are unable to accept liability or responsibility for injury or damage of any nature, whether arising from negligence or any other cause whatsoever, which is suffered by any person who enters the premises and/or uses the amenities provided.

The evidence presented at the hearing of the case revealed that the notices were visible, but the claimants did not see them. The court held that the exclusionary clause was imposed on the contract between the parties because the park had done what was reasonably necessary to bring the term to the attention of its customers.

The notice was prominent and visible at the time that the customer entered into the contract, and as a result, the imposed term was part of the contract. Accordingly, the claimants could not sue the park for the bodily injuries they sustained as a result of the incident.

In considering whether the clause in question exempted the park from liability for negligence, the court makes use of the rules of interpretation which are as follows:

“The correct approach is well established.  If the language of a disclaimer or exemption clause is such that it exempts the proferens from liability in express and unambiguous terms effect must be given to that meaning.  If there is ambiguity, the language must be construed against the proferens.  That being said the alternative meaning upon which reliance is placed to demonstrate the ambiguity must be one to which the language is fairly susceptible; it must not be “fanciful” or “remote”.

This approach has been confirmed by the Supreme Court of Appeal in more recent cases.  It is now generally accepted that such a clause must be interpreted in the usual way, applying the ordinary rules of construction.

An ambiguous exemption clause, however, will be given an interpretation that least favours the party who inserted the clause. Ambiguity may thus be used to minimise the effect of an exemption clause by reducing the range of events covered that may cause loss, or to reduce the exempted legal grounds of responsibility for the damages suffered. In cases of ambiguity, therefore, the court may allow policy considerations to override the intention of at least one of the parties. The court under these circumstances would accept an interpretation unfavourable to the party that inserted the term because the contracting party had the chance to express him or herself more clearly. That being said, the rule is only applied as a last resort when other rules of constructions have failed.

If an exemption clause clearly and unambiguously exempts that party from liability or indemnifies him or her against any loss, the court must give effect to it (even if its consequences are harsh), unless the “provision is so gratuitously harsh and oppressive that public policy could not tolerate it”.

Our courts’ tend to approach exemption and indemnity clauses with circumspection, and will generally try to construe them restrictively. They will respect the clearly stated intention of the parties unless the provisions of the general rule that a contractual term must not conflict with public policy.

If you are a supplier of goods or services that needs to manage its risk or whether you are a victim of the negligence of an institution or its employees feel free to contact Kugen Pillay or Nceba Mafa at Goldberg & de Villiers Inc. Tel. number 041 501 9800.






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