Thornton v Shoe Lane Parking Ltd is a landmark English contract law decision dealing with the formation of contracts, incorporation of terms, and exclusion clauses, particularly where contracts are formed through automatic machines.
The case is frequently cited to explain when a contract is concluded and why contractual terms introduced after that point cannot bind the other party. The judgement clarifies how traditional “ticket cases” differ from situations involving automated systems, and it highlights the requirement of reasonable notice for onerous or exempting clauses.
Facts of Thornton v Shoe Lane Parking Ltd Case
Francis Thornton, described in the material as a freelance trumpeter of high professional standing, drove his car to a multi-storey car park operated by Shoe Lane Parking Ltd. The car park used an automatic ticket machine at its entrance. At the entrance, a notice displayed the charges for parking and stated that cars were parked at the owner’s risk.
Mr Thornton drove up to the entrance, where the traffic signal changed and an automatic machine issued a ticket. He took the ticket and parked his car. The ticket itself contained wording stating that it was issued subject to conditions displayed on the premises.
Inside the car park, on pillars near the paying office, further notices were displayed. One of those notices sought to exclude the company’s liability for injury to customers, however caused.
After parking, Mr Thornton suffered an accident on the premises before he was able to get back into his car. He claimed damages for his injuries. Shoe Lane Parking Ltd argued that its liability was excluded by the notice displayed inside the car park.
These facts formed the basis of the dispute in Thornton v Shoe Lane Parking Ltd, particularly concerning whether the exclusion clause had been effectively incorporated into the contract between the parties.
Legal Issues
The central issue in the case was whether the exclusion clause displayed inside the car park was part of the contract. This depended on two related questions.
First, the court had to determine when the contract was formed. If the contract was formed before the ticket was issued, then any terms appearing on the ticket or elsewhere inside the premises would come too late.
Secondly, the court had to decide whether sufficient notice had been given of the exclusion clause. Even if a term exists at the time of contract formation, it can only be incorporated if reasonable steps are taken to bring it to the customer’s attention, especially where the term is onerous or excludes liability.
These issues lay at the heart of Thornton v Shoe Lane Parking Ltd and distinguished it from earlier cases involving tickets issued by human booking clerks.
Arguments of the Parties
Shoe Lane Parking Ltd contended that the contract was formed after Mr Thornton had received the ticket and parked his car. The company argued that the ticket was a contractual document and that it clearly referred customers to the conditions displayed on the premises.
On this basis, they claimed they had taken reasonable steps to draw the exclusion clause to Mr Thornton’s attention and should therefore be protected from liability.
Mr Thornton argued the opposite. He maintained that the offer was contained in the notice at the entrance of the car park and that the contract was concluded once he accepted that offer by driving in and using the automatic machine.
As a result, any attempt to introduce new or additional terms after that point, whether on the ticket or inside the premises, was ineffective. He further argued that if exclusion clauses were to be incorporated, they had to be clearly communicated before the contract was formed.
Thornton v Shoe Lane Parking Ltd Judgement and Reasoning
The Court of Appeal, led by Lord Denning MR, held that the exclusion clause had not been incorporated into the contract. Lord Denning emphasised that the contract was concluded at the moment Mr Thornton inserted his money into the automatic machine. At that point, acceptance had taken place, and the customer was committed to the transaction.
The court explained that automatic ticket machines operate differently from traditional ticket cases. In older cases involving clerks, customers could theoretically refuse the ticket, reject the conditions, and ask for their money back. With an automatic machine, this possibility does not exist.
Once payment is made, the customer cannot withdraw. Therefore, all contractual terms must be presented before or at the exact moment of acceptance.
Lord Denning further explained that the ticket issued by the machine was not the offer, but merely a receipt or voucher confirming payment. Any additional wording on the ticket came too late to form part of the contract. The reasoning relied on established authority showing that terms introduced after contract formation are ineffective.
This reasoning formed a core part of the decision in Thornton v Shoe Lane Parking Ltd and has been repeatedly relied upon in later discussions of contract formation.
Onerous Clauses and Notice
A key part of Lord Denning’s judgement concerned the nature of the exclusion clause itself. The clause did not merely deal with damage to vehicles but attempted to exclude liability for personal injury, however caused. Lord Denning observed that the more onerous a clause is, the greater the degree of notice required to incorporate it into a contract.
He stated that such clauses must be brought to the customer’s attention in the most explicit way. Merely stating that a ticket is issued subject to “conditions” is not sufficient, as customers may reasonably assume those conditions are administrative rather than rights-excluding.
In this context, Lord Denning famously suggested that something as striking as red ink and a red hand pointing to the clause might be required.
The company admitted that it had not done what was reasonably sufficient to give notice of the exempting condition. There was also no evidence that Mr Thornton knew of the clause. Consequently, the court held that he was not bound by it. This principle was firmly established through Thornton v Shoe Lane Parking Ltd.
Agreement of the Other Judges
Megaw LJ and Sir Gordon Willmer agreed with the conclusion that the exemption clause was not incorporated because it was onerous and insufficient notice had been given. While they reserved their opinions on the precise point at which the contract was formed, they agreed that the clause could not bind Mr Thornton.
Sir Gordon Willmer, like Lord Denning, distinguished this case from earlier ticket cases by highlighting the role of human clerks. In situations involving a clerk, a customer could object to the conditions and seek a refund. That opportunity does not exist when dealing with an automatic machine, which reinforces the need for upfront notice of contractual terms.