Entire agreement clauses aim to prevent parties claiming that pre-contractual statements not included in the final, executed agreement should form and constitute additional terms of the agreement.

In the recent case of Axa Sun Life v Campbell Martin & Others [2011] EWCA Civ 133, the Court of Appeal examined the effect of an entire agreement clause. Although not groundbreaking, this case offers some useful guidance and is a reminder of the pitfalls of using standard wording for boilerplate clauses.

The crux of the judgment dealt with misrepresentation.  It was held that an entire agreement clause does not exclude misrepresentation for matters that are not the subject of the terms of the agreement.  Therefore, if the parties want to exclude any pre-contract misrepresentations, this must be explicitly stated in a separate clause – an entire agreement clause is not a suitable place for this exclusion!

Another key part of the judgment is that any warranties which are not included in the agreement are excluded.  This provides certainty as to what warranties have been provided, without fear of reprise in relation to previously offered warranties.

Similarly, entire agreement clauses do not exclude implied terms, as the terms have been implied into the agreement and form part of the entire agreement.  If implied terms are to be excluded from the agreement, it would be prudent to explicitly state this in a separate clause.

Finally, it was held that the Unfair Contract Terms Act 1977 should apply to an entire agreement clause as it applies to other clauses.  However, it is unlikely that a standard entire agreement clause would be ruled to be an unfair contract term under UCTA. 

We will be keeping a keen eye on all our 'boilerplate' clauses to ensure they are up to date and best serve our clients' needs.