Unfair Contract Terms Directive, Article 2 Unfair Contract Terms Directive, Article 3, 1. Unfair Contract Terms Directive, Article 3, 3. Unfair Contract Terms Directive, ANNEX I, 1.

1. No person or body shall use, or if appropriate, continue to use in building contracts any terms in the form of the first schedule hereto annexed or any term which is intended to, or does in fact, have like effect, the said terms having been adjudged by the court to be unfair terms – see hyperlink above for list of the 15 unfair terms;
2. without prejudice to the issue of the propriety or impropriety of stage payments or interim payments in any such contract, no such building contract providing for such stage or interim payments shall provide for any interim payment such as will exceed the percentages specified in the Irish Home Builders’ Association code of practice, being the percentage set out in the second schedule hereto, or which exceed the extent and the value of works carried out at the date specified for such a payment …. – see hyperlink above for second schedule.

This order was granted following an application by the Director of Consumer Affairs, pursuant to Regulation 8 of the European Communities (Unfair Terms in Consumer Contracts) Regulations, 1995 (SI No. 27/1995).

It is reported that the Conveyancing Committee of the Law Society had urged the Director of Consumer Affairs in 1997 to take action under the Regulations against such terms. In May 2001, proceedings were issued by the Director, using 15 sample terms provided mainly by the Law Society. An application was also made by the Director in relation to stage payments.

Mr Justice Kearns, in the High Court, did not give any reasons for the declaratory order. The applicant and the interested parties were largely in agreement that the 15 terms identified were ‘unfair’, and Mr Justice Kearns appeared to have no difficulty in granting the order sought. The hyperlink above includes a synopsis of the reasons given in the pleadings why the terms should be deemed unfair – clearly this is of no legal force.

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