If a collateral contract is inconsistent with an exclusion clause in the main contract,the collateral contract will prevail.

Question

Quizplus · Accepted Answer

This is known as the rule in Shogun Finance Ltd v Hudson [2004] UKHL 62, which establishes that in the event of an inconsistency between the collateral contract and the exclusion clause in the main contract, the collateral contract will prevail. This is because the collateral contract is seen as a separate agreement that overrides the terms of the main contract.

If a Collateral Contract Is Inconsistent with an Exclusion Clause