What is reasonably satisfactory, MSCD 12.335 says that it is a concise way of making it clear that an objective standard is provided. But I wonder if a clearer alternative to acme would be reasonably satisfactory to a reasonable person in Acme`s position. L`Heureux-Dubé J. wrote for the Court, noting that the contract, which establishes the bank`s right to realize its securities, provides that it may do so without notice. Nevertheless, the Court held that such a seemingly absolute right should be mitigated by the principle of reasonable time. Therefore, notwithstanding the absence of an explicit standard of adequacy in a financing document, a court examines the actions of a lender on the basis of the principle of ”adequacy” to determine whether the lender has abused its contractual rights. UCTA has the potential to influence commercial contracts in terms of negligence and misrepresentation. Negligence is expressed in Article 2(2) of the UCTA according to which ”a party may not exclude or limit liability for negligence unless the clause satisfies the requirement of reasonableness”. However, a provision that attempts to exclude or limit liability for death or personal injury caused by negligence is still ineffective. In my last article on moral reprehensibility, I noticed that I found the phrase ”his reasonable but gullible opinion” strange, and a few commentators commented on it. So I thought I should take a more general look at the relationship between these two concepts.
A lender`s right of consent is usually found in a financing document. It is important for a lender to understand what the implications of the adequacy standard are and what other standards may apply to its obligations. However, the SCC concluded that the very short period of time (only a few hours) between the claim for payment and the realisation of the securities or the liquidation of the assets was inappropriate. It found that the bank had therefore abused its contractual rights to recall the loan and exercise its securities. The use of reasonableness is quite simple, but reasonably raises some questions. Fair and reasonable contract terms are applied by the Unfair Contract Terms Act 1977 (UCTA).3 min read The legal principles set out in Welbow have been used by the courts to interpret similar provisions outside the owner-tenant relationship3 and may be applicable with respect to financial services. And what is reasonably necessary? Something is necessary, or it is not. For what purposes is it reasonably served? Here is what I suspect the author of the fragment quoted above tried to say: an amount necessary to satisfy emergency needs, as determined by a reasonable person in the participant`s position. Article 11(1) of the UCTA states that the duration of the contract is `. a fair and appropriate reception, having regard to the circumstances known or should have been known to the parties at the time of the conclusion of the contract, in order to satisfy the criterion of adequacy.
In addition, Annex 2 of the UTCA includes additional guidance to provide factors that can help determine suitability. A common case where the ”standard of adequacy” could be imposed on lenders concerns agreements that require the lender`s consent to assign rights and obligations, where that consent ”shall not be unreasonably withheld.” Fair and reasonable contract terms are applied by the Unfair Contract Terms Act 1977 (UCTA). UCTA limits the limit that companies can set potential liabilities when drafting commercial contracts. UCTA focuses on contractual provisions and notices that limit or exclude liability. This also includes non-contractual terms and is intended to prevent applicable general laws from being overused. Any company that relies on the terms of the contract to assess liability should review ucta before challenging it in court. Lewinson1 describes the interpretation of contracts as the determination of the service that the document would convey to a reasonable person who possesses all the basic knowledge that would reasonably have been available to the parties in the situation in which they found themselves at the time of the contract. The terms must be drafted in a clear and modern style and comply with the standards of the law and the jurisdiction of the contract.
Model license agreements follow the same rule. Do not use a US model for a contractual agreement in the UK. If the parties involved draft the contract without judicial intervention, the terms are more likely to be considered fair, reasonable and non-discriminatory. At first glance, both pieces of legislation provide an opportunity to combat contract terms that are considered unfair. In practice, they tend to vary the interpretation of laws and therefore make it difficult to define the law. The UCTA does not cover all exemption clauses. The result is a conceptual hole in which an exception clause and an obligation nullify each other and, therefore, no final decision can be made in the matter. .