Mahin formed a binding contract with FabFilms when he offered 20 to stream the special edition of Gladiator, and FabFilms

accepted by confirming payment for the movie, analogous to the situation where a customer offers payment as consideration for goods or services at a cashier: Pharmaceutical Society of Great Britain v Boots Cash Chemists [1953]. An assumption is that FabFilms is operating under UK law, irrespective whether it is a UKbased company or has chosen to be bound by UK law, and that it has complied with the Electronic Commerce (EC Directive) Regulations 2002 in its dealings with Mahin. Hence, the issue arises whether FabFilms limitation of liability from delay in downloading any film from FabFilmss website to 5- a term which clearly covers Mahins situation- has been incorporated into the contract. That Mahin has had past dealings with FabFilms does not automatically incorporate the term into this contract: Hollier v Rambler Motors (AMC) Ltd [1972]. The first requirement for FabFilms to succeed is fulfilled as the notice came before the payment screen, and consequently, before the offer was accepted and the contract concluded: Thorton v Shoe Lane Parking [1971]. The second requirement that the terms must have been contained or referred to in a document intended to have contractual effect is also fulfilled as the terms were clearly referenced in a distinct web page intended to have legal effect, rather than on a confirmation email or receipt: Chapelton v Barry UDC [1940]. The third and final requirement is that the party relying on the clause (FabFilms) must have taken reasonable steps to bring it to Mahins attention, which the courts are likely to find in FabFilmss case, especially if it required an express acknowledgement of the terms incorporation: Ocean Chemical Transport Inc v Exnor Craggs Ltd [2000]. For example, FabFilms may have required him to click an Accept hyperlink or to mark a box demonstrating express agreement with FabFilmss terms and conditions, as websites frequently do. It is no benefit to Mahins case that he simply chose not to read the terms, as he was aware of their existence: Parker v South Eastern Railway (1877). The courts may find that the notice was insufficient in the case where the terms are found to be especially onerous or unusual, as the more unreasonable a clause is, the greater the notice which must be given of it: J Spurling Ltd v Bradshaw [1956]. The dimming of the screen to dark blue to draw attention to the existence of the terms may not be as

effective as Lord Dennings imagery of a red hand pointing specifically at the relevant clause, but a reference to their existence may be all that is required: Thompson v London, Midland & Scottish Railway Co. (1930). Whether or not this term is particularly unusual would depend on the typical commercial practices of service providers like FabFilms: OBrien v MGN Ltd [2002]. Beyond incorporation, the term may not be valid on grounds of interpretation. In the case where the delay was caused by FabFilms negligence, this term does not expressly exempt them from liability for their own negligence and is therefore too broad: Canada Steamship Lines Ltd v The King [1952] AC 192. It is also unclear whether the term truly covers Mahins situation, since the delay was so long as to mean that Mahin was never able to stream the movie in full, and the term may only have been intended to cover delays in streaming films that nonetheless streamed completely in one sitting. In cases of ambiguity like this, the courts will generally apply the Contra Proferentem rule; that is, the courts will construe ambiguity in wording against the company seeking to rely on the term in favour of the consumer, possibly declaring that the delay considered in the term does not apply to situations where the film does not download completely even after eight hours: Houghton v Trafalgar Insurance Co. Ltd (1954). More generally, such clauses may not cover delays that amount to non-performance or fundamental breach: Bovis Construction (Scotland) Ltd v Whatlings Construction Ltd [1995]. Lastly, Mahin may be able to challenge the validity of the terms under the Unfair Contract Terms Act 1977 (UCTA) or the Unfair Terms in Consumer Contracts Regulations 1999 (Regs). Both apply as Mahin is a consumer dealing with a business: s12 UCTA, Reg 3 UTCCR. As the delay constituted a breach, Mahin can rely on s3 UCTA, which permits the limitation clause only insofar as it is reasonable as established by s11, particularly with consideration of the resources which [FabFilms] could expect to be available to [it] for the purpose of meeting the liability should it arise; and how far it was open to [it] to cover [itself] by insurance. The onus of proof is on FabFilms: s12(5) UCTA. The figure of 5 does not seem to be a realistic one, constituting only 25% of the films streaming price, and FabFilms will probably be required to introduce evidence demonstrating justification for this low

figure, such as the turnover of the company, or the insurance coverage available to it. The courts will also look at Schedule 2 to decide whether the term is reasonable: the bargaining power of Mahin is inferior to that of FabFilms, and the term seems uncommon in the industry (e.g. cinemas will typically offer full refunds if a movie screening is cancelled): George Mitchell (Chesterhall) v Finney Lock Seeds [1983]. If there was an option to contract at a higher price without the limitation clause (e.g. paying extra for a movie-streaming guarantee), the courts are more likely to find the term reasonable. If it is found to be unreasonable, the entire clause is invalid and FabFilms cannot rely on it. UTCCR applies to this term as it was not individually negotiated and was not a core term: Reg 4, Reg 6. The limitation clause will be unfair if contrary to the requirements of good faith, it causes a signicant imbalance in the partys rights and obligations arising under the contract, to the detriment of the consumer: Reg 5. This clause is possibly unfair as listed under Schedule 2, Reg 5(5) UTCCR, but whether it inappropriately *excludes+ or [limits] the legal rights of the consumer vis--vis the seller *+ in the event of total or partial non-performance or inadequate performance by the seller or supplier of any of the contractual obligations is unclear. In this case, it seems the same considerations aforementioned under the UCTA will apply, on top of the fact that Mahin did not seek professional advice: Murkenbeck & Marshall v Harold [2005]. Since both pieces of legislation make it clear that they wish to protect the consumer, it seems likely the outcome will be favourable to Mahin. It seems likely he will be able to recover damages. Rather than risk the legal costs, Mahin can raise a complaint to the Office of Fair Trade instead: Reg 10. Word Count: 1154