What principle is primarily used to determine the reasonableness of exclusion clauses under the Unfair Contract Terms Act 1977?

The principle that is primarily used to determine the reasonableness of exclusion clauses under the Unfair Contract Terms Act 1977 is centered on the concept of fairness and balance in bargaining strength. This principle addresses whether the terms of the contract, including any exclusion clauses, are reasonable in the context of the specific circumstances surrounding the agreement.

The law seeks to protect parties, especially those who may be at a disadvantage, from unfair terms that could exploit this imbalance. Factors considered under this principle include the relative strength of the parties during negotiations, whether the clause was intended to be negotiated, and the availability of alternative means to obtain the services or goods without the restrictive terms. If one party has significantly more leverage, it can lead to a finding that an exclusion clause is unreasonable.

In contrast, the other options, while potentially relevant in a broader sense, do not capture the key determiner of reasonableness as effectively. For example, previous conduct might suggest a pattern but does not dictate the fairness of a specific clause within the context of a single contract. The essential nature of goods or services could play a role in assessing the reasonableness of exclusions but does not address the disparities between the contracting parties. Explicit agreement of both parties is important, but the focus