2

The two cases are

Condition 8 was the same in both, and "stated that the defendant’s driver should be regarded as the claimant’s employee, and the claimant should be responsible for all claims arising in connection to negligence owing to the driver."

Mindy Chen-Wishart. Contract Law (2018 6 edn). pp 431-432.

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The quote beneath expatiates why the outcomes are bizarre, but not why they're "inconsistent". I still don't understand the red underline overhead.

Ewan McKendrick. Contract Law: Text, Cases, and Materials (2018 8 ed) pp 449-450.

While the Court of Appeal in Phillips refused to draw a distinction between a clause that ‘excluded or restricted’ a liability and a clause which ‘transferred’ a liability, the Court of Appeal in Thompson drew a distinction between a clause that ‘shared’ a liability and one which ‘excluded or restricted’ a liability. It did so by reading the words ‘to the victim of the negligence’ into section 2(1) so that the subsection only regulates attempts to exclude or restrict a liability towards the victim of the negligence. This reading of section 2 can, however, have some bizarre consequences. [emboldening mine] Suppose that Mr Hyland in Phillips had damaged the property of a third party instead of the property of the plaintiffs. If the third party sued and recovered damages from Phillips in respect of the property damage, Phillips would have been entitled to an indemnity from Hamstead under condition 8 because, on these facts, there would be no attempt to exclude or restrict a liability towards the victim of the negligence (the third party). But why should the application of the Unfair Contract Terms Act 1977 to condition 8 depend upon whose property has been damaged? Either it is a reasonable condition or it is not. This is not, however, the view of the Court of Appeal. Te validity of the clause will turn upon such fortuitous circumstances as the identity of the person who suffers loss as a result of the negligence of the driver.

  • The second bold passage (expanded in the following two sentences) explains exactly why it is the author's opinion that the two cases lead to an inconsistent result. It's not a legal fact, but nowhere is it stated to be so. Could you clarify your question? – Tim Lymington supports Monica Aug 1 at 17:03

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