Section B - Scenario 1
NovaStream Ltd is a tech startup developing AI software. On 1st May, NovaStream emails a supplier, DataCore, offering to buy 50 servers for £100,000, stating 'Please reply by 5th May'. On 2nd May, DataCore posts a letter accepting the offer. On 3rd May, NovaStream finds a cheaper supplier and emails DataCore revoking the offer. DataCore's letter of acceptance arrives on 6th May.
Has a binding contract been formed between NovaStream Ltd and DataCore?
ACCA · Question 47 · The law of obligations
Section B - Scenario 1
NovaStream Ltd is a tech startup developing AI software. They enter into a contract with a client, TechCorp. The contract contains a clause stating: 'NovaStream Ltd accepts no liability whatsoever for any financial loss or physical injury caused by bugs in the software.' A bug in the software causes a server to overheat and catch fire, injuring a TechCorp employee.
Under the Unfair Contract Terms Act 1977 (UCTA), what is the legal status of this exemption clause?
Answer options:
The entire clause is completely valid as it was agreed between two businesses.
The entire clause is void because it is a standard form contract.
The clause is void regarding the physical injury, and subject to the reasonableness test regarding the financial loss.
The clause is valid for physical injury but void for financial loss.
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