Thornton v. Shoe Lane Parking Ltd
Rule established
Where a contract is formed at an automatic machine, terms printed on a ticket issued by the machine come too late to be incorporated; the more unusual or onerous a clause, the greater the notice required to incorporate it.
Facts
- Thornton (plaintiff) drove into an automatic car park operated by Shoe Lane Parking
- At the entrance, a notice stated charges and that parking was "at owner's risk"
- Thornton put money into the machine; a ticket emerged and the barrier lifted
- The ticket stated: "This ticket is issued subject to conditions of issue as displayed on the premises"
- Conditions displayed inside the car park excluded liability for personal injury
- Thornton was injured in an accident partly caused by the car park's negligence
Issues
- When was the contract formed: before or after the ticket was issued?
- Were the conditions displayed inside the car park effectively incorporated?
- What degree of notice is required for particularly onerous or unusual clauses?
Held
- The Court of Appeal held for Thornton: the exclusion clause was not incorporated
- The contract was formed when the customer put money into the machine (offer = putting in money; acceptance = barrier lifting)
- The ticket emerged after contract formation: its terms came too late
- Lord Denning's "red hand rule": the more unusual or onerous a clause, the greater the degree of notice needed: "some clauses... would need to be printed in red ink with a red hand pointing to it before the notice could be held to be sufficient"
- Excluding liability for personal injury is highly unusual in a parking contract: greater notice was needed than mere display on interior walls
Ratio Decidendi
In automatic machine transactions, the contract is formed at the moment the customer performs the act that activates the machine (inserting money). Any terms communicated after that point (on the ticket or elsewhere) are too late for incorporation. Furthermore, the degree of notice required for incorporation is proportional to the severity and unusualness of the term: ordinary terms need only reasonable notice; extraordinary or onerous terms require exceptional notice: "the more unreasonable a clause is, the greater the notice which must be given of it."
How to use it in an exam
- The authority for: (a) timing of contract formation in machine/automated transactions; (b) the "red hand rule" for onerous clauses
- Always pair with Olley v. Marlborough Court (notice after contract = too late)
- Distinction: Parker v. SE Railway (ticket cases where notice on ticket BEFORE contract can suffice)
- Modern relevance: online "I agree" clickwrap, when does the contract form? Can terms behind a hyperlink be incorporated?
- Indian relevance: same principle: exclusion clauses must be brought to notice before acceptance
Source
Source: [1971] 2 QB 163
This is an educational summary, not the judgment itself. Cite the reported version in professional or academic work.