• An exemption or exclusion clause is a inserted in a contract by the stronger party exempting itself from liability or limiting extent of any liability arising under the contract.
• Exemption clauses are common in the so-called standard form contracts for example hire purchase agreement.
• For a court of law to consider the effect of an exemption clause it must be satisfied that it was an integral part of the contract. It must be satisfied that the party affected by the clause was aware of its existence when the contract was entered into.
• An exemption clause may be made an integral part of the contract by notice or signature.
• We agree with the assertion that a belated notice of an exemption clause has no effect on the contract. Such a clause is not deemed to be an integral part of the contract.
• Such a clause is not deemed to be a term of the contract. In Olley V. Malborough Court Ltd the exemption clause was brought to the notice of the plaintiffs after the contract has been concluded. It was held that the defendant could not rely on the clause to escape liability. A similar holding was made in Lougher V. Kenya Safari Lodges and Hotels Ltd. where the exemption clause near the Hotels swimming pool had not been brought to the plaintiffs notice.
• In Dodd V. Nanda it was held that although the plaintiff had been to the defendants garage before, he was not aware of the exemption clause and hence the defendant could not rely on it.
