Olley v Marlborough Court Ltd [1949] 1 KB 532

Material Facts:

Olley, the claimant, made payments at the reception to lodge at the defendant’s hotel. No mention was made of an exclusion clause at the reception. When Olley entered her room, there was a notice limiting the liability of the defendant for lost items. Later, Olley deposited her key at the reception before stepping out, but the key was taken and several items were stolen from Olley’s room. Olley sued for damages.

Arguments of the Claimant:

1. That the defendants had the duty of safeguarding her keys, which they failed to do.

Arguments of the Defendants:

1. That even if the defendant was negligent regarding the keys, the exclusion clause, clearly visible in the rooms, excluded the defendant’s liability.

Issues:

1. Whether or not the exclusion clause inside Olley’s room is effective in limiting the liability of the defendant?

Holding:

1. That the exclusion clause in Olley’s room cannot limit the liability of the defendant.

Ratio Decidendi:

That the contract was concluded at the reception, at which point there was no mention of an exclusion clause. That for the exclusion clause to be effective, a notice of it must be brought to the other party before or during the formation of the contract.