Unfair Contract Terms
L.R.O.

LAWS OF TRINIDAD AND TOBAGO

Unfair Contract Terms Chap. 82:37 1

UNFAIR CONTRACT TERMS ACT

CHAPTER 82:37

Current Authorised Pages
Pages Authorised

(inclusive) by L.R.O.
1–15 ..

Act
28 of 1985

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Note on Subsidiary Legislation
This Chapter contains no subsidiary legislation.

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Unfair Contract Terms Chap. 82:37 3

CHAPTER 82:37

UNFAIR CONTRACT TERMS ACT

ARRANGEMENT OF SECTIONS
SECTION

1. Short title.
2. Interpretation.

PART I

APPLICATION, SCOPE

3. Application.
4. Scope of Part I.
5. Negligence liability.
6. Liability arising in contract.
7. Unreasonable indemnity clauses.
8. “Guarantee” of consumer goods.
9. Sale and hire purchase.

10. Miscellaneous contracts under which goods pass.
11. Effect of breach.
12. Evasion by means of secondary contract.
13. The “reasonableness” test.
14. Dealing as consumer.
15. Varieties of exemption clause.

PART II

MISCELLANEOUS
16. International supply contracts.
17. Choice of law clauses.
18. Temporary provision for sea carriage of passengers.
19. Saving.

FIRST SCHEDULE.
SECOND SCHEDULE.

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CHAPTER 82:37

UNFAIR CONTRACT TERMS ACT

An Act respecting exemption clauses in contract or for
negligence.

[20TH OCTOBER 1986]

1. This Act may be cited as the Unfair Contract Terms Act.

2. In this Act—
“business” includes a profession and the activities of any

government department or local or public authority;
“goods” includes all chattels personal other than things in action

and money; the term includes emblements, industrial
growing crops, and things attached to or forming part of the
land, which are agreed to be severed before sale or under
the contract of sale;

“hire-purchase agreement” means an agreement for the
bailment of goods under which the bailee may buy the
goods or under which the property in the goods will or
may pass to the bailee, and where by virtue of two or more
agreements, none of which by itself constitutes a hire-
purchase agreement, there is a bailment of goods and
either the bailee may buy the goods, or the property
therein will or may pass to the bailee, the agreements shall
be treated for the purposes of this Act as a simple
agreement made at the time when the last of the
agreements was made;

“negligence” has the meaning given by section 4(1);
“notice” includes an announcement, whether or not in writing, and

any other communication or pretended communication;
“personal injury” includes any disease and any impairment of

physical or mental condition.

28 of 1985.

Commencement.
[229/1986].

Short title.

Interpretation.

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Unfair Contract Terms Chap. 82:37 5

PART I

APPLICATION, SCOPE

3. Nothing in this Act applies to contracts made before the
date on which this Act comes into operation.

4. (1) For the purposes of this Part, “negligence” means
the breach—

(a) of any obligation, arising from the express or
implied terms of a contract, to take reasonable
care or exercise reasonable skill in the
performance of the contract;

(b) of any common law duty to take reasonable care
or exercise reasonable skill, but not any
stricter duty.

(2) This Part is subject to Part II; and in relation to
contracts, the operation of sections 5, 6, 7 and 10 is subject to the
exceptions made by the First Schedule.

(3) In the case of both contract and tort, sections 5 to 10
apply (except where the contrary is stated in section 9(4) ) only to
business liability, that is liability for breach of obligations or
duties arising—

(a) from things done or to be done by a person in the
course of a business (whether his own business
or another’s); or

(b) from the occupation of premises used for business
purposes of the occupier,

and references to liability are to be read accordingly.
(4) In relation to any breach of duty or obligation, it is

immaterial for any purpose of this Part whether the breach was
inadvertent or intentional, or whether liability for it arises directly
or vicariously.

5. (1) A person cannot by reference to any contract term or
to a notice given to persons generally or to particular persons
exclude or restrict his liability for death or personal injury resulting
from negligence.

Application.

Scope of Part I.

First Schedule.

Negligence
liability.

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(2) In the case of other loss or damage, a person cannot
so exclude or restrict his liability for negligence except in so far as
the term or notice satisfies the requirement of reasonableness.

(3) Where a contract term or notice purports to exclude
or restrict liability for negligence a person’s agreement to or
awareness of it is not of itself to be taken as indicating his voluntary
acceptance of any risk.

6. (1) This section applies as between contracting parties
where one of them deals as consumer or on the other’s written
standard terms of business.

(2) As against that party, the other cannot by reference to
any contract term—

(a) when himself in breach of contract, exclude or
restrict any liability of his in respect of the
breach; or

(b) claim to be entitled—
(i) to render a contractual performance

substantially different from that which was
reasonably expected of him, or

(ii) in respect of the whole or any part of his
contractual obligation, to render no
performance at all,

except in so far as (in any of the cases mentioned above in this
subsection) the contract term satisfies the requirements of
reasonableness.

7. (1) A person dealing as consumer cannot by reference to
any contract term be made to indemnify another person, whether a
party to the contract or not, in respect of liability that may be
incurred by the other for negligence or breach of contract, except
in so far as the contract term satisfies the requirement
of reasonableness.

(2) This section applies whether the liability in question—
(a) is directly that of the person to be indemnified or

is incurred by him vicariously;
(b) is to the person dealing as consumer or to

someone else.

Liability arising
in contract.

Unreasonable
indemnity
clauses.

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Unfair Contract Terms Chap. 82:37 7

8. (1) In the case of goods of a type ordinarily supplied
for private use or consumption, where loss or damage—

(a) arises from the goods proving defective while in
consumer use; and

(b) results from the negligence of a person concerned
in the manufacture or distribution of the goods,

liability for the loss or damage cannot be excluded or restricted
by reference to any contract term or notice contained in or
operating by reference to a guarantee of the goods.

(2) For these purposes—
(a) goods are to be regarded as “in consumer use”

when a person is using them, or has them in his
possession for use, otherwise than exclusively for
the purposes of a business; and

(b) anything in writing is a guarantee if it
contains or purports to contain some promise or
assurance, however worded or presented, that
defects will be made good by complete or
partial replacement, or by repair, monetary
compensation or otherwise.

(3) This section does not apply as between the parties
to a contract under or in pursuance of which possession or
ownership of the goods passed.

9. (1) Liability for breach of the obligations arising from—
(a) section 14 of the Sale of Goods Act (seller’s

implied undertakings as to title, etc.);
(b) section 10 of the Hire Purchase Act (conditions

and warranties to be implied in hire-purchase
agreements),

cannot be excluded or restricted by reference to any contract term.
(2) As against a person dealing as consumer, liability

for breach of the obligations arising from—
(a) section 15, 16 or 17 of the Sale of Goods Act

(seller’s implied undertakings as to conformity
of goods with description or sample, or as to
their quality or fitness for a particular purpose);

“Guarantee” of
consumer
goods.

Sale and hire
purchase.
Ch. 82:30.

Ch. 82:33.

Ch. 82:30.

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8 Chap. 82:37 Unfair Contract Terms

(b) section 10 of the Hire Purchase Act; cannot be
excluded or restricted by reference to any
contract term.

(3) As against a person dealing otherwise than as
consumer, the liability specified in subsection (2) can be excluded
or restricted by reference to a contract term, but only in so far as
the term satisfies the requirement of reasonableness.

(4) The liabilities referred to in this section are not only
the business liabilities defined by section 4(3), but include
those arising under any contract of sale of goods or hire
purchase agreement.

10. (1) Where the possession or ownership of goods passes
under or in pursuance of a contract not governed by the law of sale
of goods or hire purchase, subsections (2), (3) and (4) apply as
regards the effect, if any, to be given to contract terms excluding
or restricting liability for breach of obligation arising by implication
of law from the nature of the contract.

(2) As against a person dealing as consumer, liability in
respect of the goods’ correspondence with description or sample,
or their quality or fitness for any particular purpose, cannot be
excluded or restricted by reference to any such term.

(3) As against a person dealing otherwise than as
consumer, that liability can be excluded or restricted by reference
to such a term, but only in so far as the term satisfies the requirement
of reasonableness.

(4) Liability in respect of—
(a) the right to transfer ownership of the goods, or

give possession; or
(b) the assurance of quiet possession to a person

taking goods in pursuance of the contract,

cannot be excluded or restricted by reference to any such
term except in so far as the term satisfies the requirement
of reasonableness.

Ch. 82:33.

Miscellaneous
contracts under
which goods
pass.

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Unfair Contract Terms Chap. 82:37 9

11. (1) Where for reliance upon it a contract term has to
satisfy the requirement of reasonableness, it may be found to do
so and be given effect accordingly notwithstanding that the
contract has been terminated either by breach or by a party electing
to treat it as repudiated.

(2) Where on a breach the contract is nevertheless affirmed
by a party entitled to treat it as repudiated, this does not of itself
exclude the requirement of reasonableness in relation to any
contract term.

12. A person is not bound by any contract term prejudicing or
taking away rights of his which arise under, or in connection with
the performance of, another contract, so far as those rights extend
to the enforcement of another’s liability which this Part prevents
that other from excluding or restricting.

13. (1) In relation to a contract term, the requirement of
reasonableness for the purposes of this Part is that the term shall
have been 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 the contemplation of the parties when the contract
was made.

(2) In determining for the purposes of section 9 or 10
whether a contract term satisfies the requirement of reasonableness,
regard shall be had in particular to the matters specified in the
Second Schedule; but this subsection does not prevent the Court
or arbitrator from holding, in accordance with any rule of law, that
a term which purports to exclude or restrict any relevant liability is
not a term of the contract.

(3) In relation to a notice (not being a notice having
contractual effect), the requirement of reasonableness under this
Act is that it should be fair and reasonable to allow reliance on it,
having regard to all the circumstances obtaining when the liability
arose or, but for the notice, would have arisen.

(4) Where by reference to a contract term or notice a
person seeks to restrict liability to a specified sum of money, and

Effect of breach.

Evasion by
means of
secondary
contract.

The
“reasonableness”
test.

Second
Schedule.

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10 Chap. 82:37 Unfair Contract Terms

the question arises, under this or any other Act whether the term or
notice satisfies the requirement of reasonableness, regard shall be
had in particular, but without prejudice to subsection (2) in the
case of contract terms, to—

(a) the resources which he could expect to be
available to him for the purpose of meeting the
liability should it arise; and

(b) how far it was open to him to cover himself by
insurance.

(5) It is for those claiming that a contract term or notice
satisfies the requirement of reasonableness to show that it does.

14. (1) A party to a contract “deals as consumer” in relation
to another party if—

(a) he neither makes the contract in the course of a
business nor holds himself out as doing so; and

(b) the other party does make the contract in the
course of a business; and

(c) in the case of a contract governed by the law of
sale of goods or hire purchase, or by section 10
of this Act, the goods passing under or in
pursuance of the contract are of a type ordinarily
supplied for private use or consumption.

(2) But on a sale by auction or by competitive tender the
buyer is not in any circumstances to be regarded as dealing as
consumer.

(3) Subject to this, it is for those claiming that a party
does not deal as consumer to show that he does not.

15. (1) To the extent that this Part prevents the exclusion or
restriction of any liability it also prevents—

(a) making the liability or its enforcement subject to
restrictive or onerous conditions;

(b) excluding or restricting any right or remedy in
respect of the liability, or subjecting a person to
any prejudice in consequence of his pursuing any
such right or remedy;

Dealing as
consumer.

Varieties of
exemption
clause.

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Unfair Contract Terms Chap. 82:37 11

(c) excluding or restricting rules of evidence or
procedure,

and, to that extent, sections 5, 8, 9 and 10 also prevent excluding
or restricting liability by reference to terms and notices which
exclude or restrict the relevant obligation or duty.

(2) But an agreement in writing to submit present or future
differences to arbitration is not to be treated under this Part as
excluding or restricting any liability.

PART II

MISCELLANEOUS

16. (1) The limits imposed by this Act on the extent to which
a person may exclude or restrict liability by reference to a contract
term do not apply to liability arising under such a contract as is
described in subsection (3).

(2) The terms of such a contract are not subject to any
requirement of reasonableness under section 6 or 7.

(3) Subject to subsection (4), that description of contract
is one whose characteristics are the following:

(a) either it is a contract of sale of goods or it is one
under or in pursuance of which the possession or
ownership of goods passes; and

(b) it is made by parties whose places of business or,
if they have none, habitual residences, are in the
territories of different States.

(4) A contract falls within subsection (3) only if—
(a) the goods in question are, at the time of the

conclusion of the contract, in the course of a
carriage, or will be carried, from the territory of
one State to the territory of another;

(b) the acts constituting the offer and acceptance have
been done in the territories of different States; or

(c) the contract provides for the goods to be delivered
to the territory of a State other than that within
whose territory those acts were done.

International
supply
contracts.

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17. (1) Where the proper law of a contract is the law of Trinidad
and Tobago only by choice of the parties, and apart from that choice
would be the law of some country other than Trinidad and Tobago,
sections 5 to 10 do not operate as part of the proper law.

(2) This Act has effect notwithstanding any contract term
which applies or purports to apply the law of some country other
than Trinidad and Tobago, where (either or both)—

(a) the term appears to the Court, or arbitrator or
arbiter to have been imposed wholly or mainly
for the purpose of enabling the party imposing it
to evade the operation of this Act; or

(b) in the making of the contract one of the parties dealt
as consumer, and he was then habitually resident in
Trinidad and Tobago, and the essential steps
necessary for the making of the contract were taken
there, whether by him or by others on his behalf.

18. (1) This section applies to a contract for carriage by sea of
a passenger or of a passenger and his luggage where the provisions
of the Athens Convention (with or without modification) do not have,
in relation to the contract, the force of law in Trinidad and Tobago.

(2) In a case where—
(a) the contract is not made in Trinidad and

Tobago; and
(b) neither the place of departure nor the place of

destination under it is in Trinidad and Tobago,
a person is not precluded by this Act from excluding or restricting
liability for loss or damage, being loss or damage for which the
provisions of the Athens Convention would, if they had the force
of law in relation to the contract, impose liability on him.

(3) In any other case, a person is not precluded by this
Act from excluding or restricting liability for that loss or damage—

(a) in so far as the exclusion or restriction would have
been effective in that case had the provisions of
the Athens Convention had the force of law in
relation to the contract; or

Choice of law
clauses.

Temporary
provision for sea
carriage of
passengers.

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Unfair Contract Terms Chap. 82:37 13

(b) in such circumstances and to such extent as may
be prescribed by the Minister by Regulations
subject to affirmative resolution of Parliament,
by reference to a prescribed term of the contract.

(4) For the purposes of subsection (3)(a), the values which
shall be taken to be the official values in Trinidad and Tobago of
the amounts, expressed in gold francs, by reference to which liability
under the provisions of the Athens Convention is limited shall be
such amounts in Trinidad and Tobago dollars as the Minister may
after consultation with the Central Bank by Order specify.

(5) In this section—
(a) the references to excluding or restricting liability

include doing any of those things in relation to
the liability which are mentioned in section 15;

(b) “the Athens Convention” means the Athens
Convention relating to the Carriage of Passengers
and their Luggage by Sea, 1974.

19. (1) Nothing in this Act removes or restricts the effect of,
or prevents reliance upon, any contractual provision which—

(a) is authorised or required by the express terms or
necessary implication of a written law; or

(b) being made with a view to compliance with an
international agreement to which Trinidad and
Tobago is a party, does not operate more
restrictively than is contemplated by the agreement.

(2) A contract term is to be taken for the purposes of Part I,
as satisfying the requirement of reasonableness if it is incorporated
or approved by, or incorporated pursuant to a decision or ruling of,
a competent authority acting in the exercise of any specific
jurisdiction or function conferred by a written law and is not a term
in a contract to which the competent authority is itself a Party.

(3) In this section “competent authority” means any Court,
arbitrator or arbiter; government department or public authority.

Saving.

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Section 4(2). FIRST SCHEDULE
Scope of sections 5, 6, 7 and 10

1. Sections 5, 6, 7 of this Act do not extend to—
(a) any contract of insurance, including a contract to pay an annuity

on human life;
(b) any contract so far as it relates to the creation or transfer of an

interest in land, or to the termination of such an interest,
whether by extinction, merger, surrender, forfeiture or
otherwise;

(c) any contract so far as it relates to the creation or transfer of a
right or interest in any patent, trade mark, copyright, registered
design, technical or commercial information or other
intellectual property, or relates to the termination of any such
right or interest;

(d) any contract so far as it relates to the formation or dissolution
of a company which means any body corporate or
unincorporated association and includes a partnership, or its
constitution or the rights or obligations of its corporators or
members;

(e) any contract so far as it relates to the creation or transfer of
securities or of any right or interest in securities.

2. Section 5(1) extends to—
(a) any contract of marine salvage or towage;
(b) any charterparty of a ship; and
(c) any contract for the carriage of goods by ship,

but subject to this, sections 5, 6, 7 and 10 do not extend to any such contract
except in favour of a person dealing as consumer.

3. Where goods are carried by ship in pursuance of a contract
which either—

(a) specifies that as the means of carriage over part of the journey
to be covered; or

(b) makes no provision as to the means of carriage and does not
exclude that means,

then sections 5(2), 6 and 7 do not, except in favour of a person dealing as
consumer, extend to the contract as it operates for and in relation to the carriage
of the goods by that means.

4. Section 5(1) and (2) do not extend to a contract of employment, except
in favour of the employee.

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Section 13(2).SECOND SCHEDULE
“Guidelines” for Application of Reasonableness Test

The matters to which regard is to be had in particular for the purposes of
sections 9(3), 10(3), and (4) are 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 the goods were manufactured, processed or adapted
to the special order of the customer.

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