Interfoto Picture Library Ltd. v Stiletto Visual Programmes Ltd
[1989] Q.B. 433
Court of Appeal (Civil Division)
Facts:
IPL runs a lending library for photograph transparencies. IPL delivered 47 transparencies with a delivery note, following a phone inquiry by SVP.
The delivery note stipulated a holding fee if the transparencies were not returned within 14 days. SVP did not read the conditions on the note. They returned them late and were invoiced for the late return.
SVP refused to pay, so IPL made a claim against them. IPL won at LCC.
Legal Facts / Procedural History:
Lambeth County Court (1987)
Legal Issues:
Whether the terms on the delivery note were properly incorporated into a contract.
Whether IPL gave sufficient notice of the terms to SVP.
Appellant (SVP) Arguments:
SVP had never dealt with IPL before and were unaware of the conditions that would be issued on the delivery note.
SVP were not informed of these conditions before the contract was concluded.
If they were informed of the conditions, it was not made suitably clear that these were the terms.
The contract was concluded before SVP were made aware of any conditions.
Respondent (IPL) Arguments:
The expected date of return and the conditions were clear on the delivery note.
Argues Thornton v Shoo Lane should only be applied to exemption clause cases.
Judgement (Dillon LJ and Bingham LJ):
Appeal allowed.
SVP to pay IPL a more reasonable holding fee, in line with other companies.
Dillon LJ:
It is in the interest of IPL to get their produce back to give to another customer is needed, but the holding fee is “extremely high” and “exorbitant”, making the condition “exorbitant” too.
Never any oral discussion of terms before the contract was made.
Unusual terms must be made clear by the party seeking to enforce it by bringing it to the attention of the other party (‘red hand rule’). Terms never incorporated.
Bingham LJ:
IPL under a duty to make the terms obvious to SVP if they wanted them to be enforceable. As both IPL and SVP are businesses, it is likely that both were aware that a delivery note would contain conditions. However, the terms are not incorporated as IPL did not fairly and reasonably give notice of the conditions on the delivery note, so they were never incorporated.
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