In order to success in a claim, the claimant must show that,
● the producer contained a defect
● the claimant suffer damage
● the damage was caused by the defect
● the defendant was a producer, own brander or importer of the product into the EU.
According to the sales of goods act 1979 goods may be supplied on to the market by several means, such as sale and hire. As a result of supply, there may be civil liability to a person suffering loss and a criminal offence may be committed in respect of supplying defective goods.
Defence
Although the CPA 1987 imposes strict liability, there are number of defences provided by s4.
Any person have a defence if it can be shown that;
♦ the defect is attributable to compliance with a domestic or EC enactment.
♦ the supply was not in the course of business
♦the defect did not exist at the time it was supplied
♦the state of scientific and technical knowledge at the relevant time was not such that the procedure might be expected to have discovered the defect
♦more than 10 years have elapsed since the product of supplied.
The development risks defence allows the producer to show that the defect was not discoverable at the time of supplying the product. Should the producer make sure that he or she is aware of all available knowledge related to the product and then ensure that it is applied and he should do limited research bearing in mind the cost of development and potentially small risk to the consumer? The issue was examined in the following case
Abouzaid v mothercare (UK) ltd (2000)
The case is of interest because it deals with the product liability for older products. The claim related to fleecy-lined sleeping bag for a child pushchair sold by the defendant company in 1990. While helping to fix the bag on to his brother pushchair, one of the elasticised straps flew out of claimants hand and caught the claimants in the eye so he ended up with no central vision. When matter reached at the court of appeal it was decided that the defendant was not negligent at common law there was no knowledge at the time of sale. Nevertheless the product was defective under s 3 of the consumer protection act 1987. In the view of the court the defendant had not used the available method in 1990 to test the product and was not able to plead the defence. The claimant was successful.
Contributory negligence
Even though the claimant has manage to proved the negligence in the manufacturer then latter may still be able to obtain a reduction in the damages or even defeat the claim by proving that the claimant was guilt for contributory negligence as she contributed to the damage or was even entirely responsible for it by, for example failing to observe operating instructions or using the product after knowledge that it was defective.
Our client B&F has the defence in terms of the agreement signed by the davina included clauses in the small print.
“Bodgit & Frogg accepts no responsibility for latent defects equipment supplied to customer’s specification.”
In the law of sale of property the latent defect is a fault in the property that could not be discovered through inspection before sale. As such the law expects that the buyer will protect themselves in the sales contract against the defects they cannot possibly access prior to purchase. The term latent defect often used as a part of guarantee clauses in a sales contract so, the buyer can recover damages from the seller if defects turn up after the sale.
There is no automatic right for the buyer to claim against the latent defects when they are discovered, absent in agreement in contract.
Exemption clauses
An exemption clause is a term in a contract which seeks to exemption of the parties from liability such as breach of warranty, negligence, or theft of goods.
An exemption clause may become the term of contract by signature or by notice. If a person signs a document he is bound by it even if he does not read it.
L ‘ESTRANGE V GRAUCOB (1934)
P, who was a proprietor of a cafe, purchased a cigarette vending machine. He signed without reading, a sales agreement which contained a large amount of ‘small print’ .the machine was defected but the vendor was held to be protected by an exemption clause contained in that small print.
If a person’s signs a contractual document then they are bound by its terms, even if they do not read it.
Above case and the exemption clause which was signed by the davina during the contract according to which our client B&F are not responsible of any latent defect protects our client from the loss caused by any latent defect and from the loss which davina neighbour having in terms of health and stock.
Sale of goods act 1979
● the act implies condition into contracts for the sale of goods: the goods must correspond with the contract description, must be of satisfactory quality, must reasonably fit for the purpose made known by the buyer and must correspond with any sample by reference to which the goods are sold.
● It is the duty of the seller to deliver the goods and of the buyer to accept and pay for them.
● Liability for loss caused by breach of the contract cannot be excluded in consumer sales. In non-consumer sales, liability for failure to transfer title cannot be excluded, but exclusion of liability for other implied conditions of the act may be valid, subject to the requirement of reasonableness.
“Davina estimated that she lost over £ 7000 of business due to closure that is due to the work which was delayed by B&F by several weeks and the shop had to be closed over the Easter period when the business runs very good.”
Davina signed the clause in the small print which says,
“Any dates given for delivery or completions are estimates only.”
According to the supply of goods and services act 1982
In relation to any services aspect of the contract, there are implied terms that work will be carried, out with reasonable skill and care and the work will also be carried out within a reasonable time ( if no time is agreed) and that a reasonable price is payable where none was agreed .
Section 14 states that where the supplier is acting within the course of a business and the time for the service to be carried out is not fixed by the contract or determined by a course of dealing between the parties, the supplier will carry out the service within a reasonable time.
Again in the sales of goods act s.29 uk provides
29. –(2) where under the contract of sales the seller is bound to send the goods to the buyer but no time for sending them is fixed , the seller is bound to send them within a reasonable time. Hick v. Raymond, [1893] A.C. 22; Sims v. Midland
Since there was no contract made between the B&F and davina regarding the time for the delivery and to start the work therefore davina cannot claim for the losses which occurred by the delay .
Unfair contract term regulation 1999
Limitations of liability
● if a contract is to be fully and equally binding on both seller and buyer, each party should be entitled to full compensation where the other fails to honour its obligations.
●consequential loss exclusion , terms excluding claims for consequential loss are supposed to protect the supplier from remote or unforeseeable liability , such a term effectively disclaims liability for any loss or damage resulting from any breach of contract by the supplier. The OFT considers that they can stop the consumers from seeking redress in certain circumstances when it should to be available.
●suppliers can protect themselves in many ways which are not considered to be unfair under the regulations for example.
- Losses that were not see able to both parties when the contract was formed
- Losses that were not causes by any breach on the part of the supplier
- Business losses and losses to non consumers.
Exclusion of liability for delay
The law requires that goods should be delivered and services carried out, when agreed or within a reasonable time when no date is fixed so, any loss arising from the delay as it is in the case of davina where she lost £ 7000 due to closure excludes any liability from B&F and such a term particularly likely to be considered unfair after davina agreement regarding dates which were estimates only.
The fair and reasonable test
(1) Whether a contract term is fair and reasonable is to be determined by taking
Into account—
(a) the extent to which the term is transparent, and
(b) the substance and effect of the term, and all the circumstances existing
At the time it was agreed.
(2) Whether a notice is fair and reasonable is to be determined by taking into
Account—
(a) The extent to which the notice is transparent, and
(b) The substance and effect of the notice, and all the circumstances existing
At the time when the liability arose
Matters relating to the substance and effect of a contract term, and to all the
Circumstances existing at the time it was agreed, include the following—
1. The other terms of the contract,
2. The terms of any other contract on which the contract depends,
3. The balance of the parties’ interests,
4. The risks to the party adversely affected by the term,
5. Other ways in which the interests of the party adversely affected by the
term might have been protected,
6. The extent to which the term (whether alone or with others) differs from
What would have been the case in its absence.
7. The knowledge and understanding of the party adversely affected by
the term,
8. The strength of the parties’ bargaining positions,
9. The nature of the goods or services to which the contract relates.
Conclusion
The last term of the contract between davina and B&F would be considered unfair as B&f holds no responsibility for the losses as the first two clauses in the contract excluding our client’s liability and the last term causes the significant imbalance in the both parties’ rights and obligations arising under the contract conclusively it can be argued that davina cannot claim for the damages and B&F are not liable.
Reference
Abbot, k. Pendlebury, N. Wardman, k (2002) Business Law (7TH), Hampshire, Ashford colour press
K, David. Holmes, A Hayward,R (2005) Business Law(5TH), Wiltshire, Antony Rowe Limited
Keenan, D (2004) English Law (14TH), Tottenham, Stone Serif
Internet
www.Oft.gov.uk
www.Lawcom.gov.uk
www.Out-law.com
