Sale of goods

BREACH OF CONTRACT : BURDEN OF PROOF : CONTRACT TERMS : FITNESS FOR PURPOSE : IMPLIED TERMS : REASONABLENESS : SUPPLY OF GOODS : SUPPLY OF INCOMPATIBLE PARTS TO PLUMBING CONTRACTORS : BREACH OF IMPLIED TERM UNDER S.14(3) SALE OF GOODS ACT 1979 : s.14(3) SALE OF GOODS ACT 1979

A company was liable for flooding caused by its supply of materials to a plumbing contractor which were not fit for purpose under the Sale of Goods Act 1979 s.14(3).

The appellant company (B) appealed against a decision that it had breached the implied term as to fitness of purpose under the Sale of Goods Act 1979 s.14(3) when supplying materials to the respondent plumbing contractors (M). B had supplied M with materials, including piping, adaptors and valves, for the installation of a new plumbing system in a public house. A particular make of part, "Uponor", was used for the project. M requested further materials from B, specifically identifying that they were to be used in the same project. B supplied a different type of valve which was incompatible with the adaptor. A connection became insecure under pressure, resulting in substantial flooding of the public house. B were held to be liable. The judge found that M had expressly and, if not, by implication made it known to B that the valves were to be used with Uponor piping and had relied on B's skill and judgement as to the compatibility of the parts. He found that the valves were not compatible with the adaptors they were likely to be used with and were not therefore fit for purpose. B contended that the judge had (1) misdirected himself regarding the test for determining whether M had made known the purpose for which it would be using the valves; (2) wrongly concluded that M had communicated a sufficiently particular purpose to B; (3) wrongly concluded that the valves were not fit for purpose; (4) dealt inadequately with the issue of M's reliance on B's skill and judgement.

HELD: (1) The relevant questions for assessing a claim for breach of the implied term imposed by s.14(3) were identified by Clarke L.J. in Jewson Ltd v Boyhan (2003) EWCA Civ 1030, (2004) 1 Lloyd's Rep 505 as: (a) whether the buyer, expressly or by implication, had made known to the seller the purpose for which the goods were being bought; (b) if so, whether they were reasonably fit for that purpose; (c) if they were not reasonably fit for that purpose, whether the seller had shown that the buyer had not relied upon its skill and judgement or, if it had, that it had been unreasonable to do so (see para.6 of judgment). (2) B had known that M was using a Uponor system and had previously supplied Uponor components for the same project. It was an irresistible inference from M's inquiry regarding further parts that it was making known to B its intention to use the valves as a device intended to regulate or control the flow of water in pipes used in the project. It was also an obvious inference that it was making known to B that it intended to use such valves in conjunction with the Uponor plastic piping that B was aware it was using. At the very least, it had to have been apparent to B that M was likely to so use the valves and M had therefore made known a particular purpose for which the valves were intended to be used (paras 35-36). (3) The valves were not fit for the requisite purpose, as they were incompatible with the Uponor adaptors and would be likely to fail when used in conjunction with them (para.37). (4) Where a buyer had made known its purpose, there was prima facie an implied condition of fitness which the seller could defeat only by proving that the buyer had not relied on, or that it had been unreasonable to rely on, the skill and judgement of the seller, Slater v Finning Ltd (1997) AC 473 HL applied. The issue was whether B had discharged that burden. B's argument that M was content to buy any valve and was relying on B to do the tests necessary to ensure that it worked was unrealistic. B was a specialist dealer and M was relying on B to sell it a compatible valve, Henry Kendall & Sons v William Lillico & Sons Ltd (1969) 2 AC 31 HL and Ashington Piggeries Ltd v Christopher Hill Ltd (1972) AC 441 HL considered. Although the judge had not expressly dealt with the issue of whether it had been reasonable for M to rely on B's skill and judgement, he could not have overlooked that issue as he had quoted s.14(3) before focusing on the issues to be decided. The inference to be drawn was that he was satisfied that there was no question of any reliance by M as having been unreasonable and that conclusion could not be criticised (paras 40-45). (5) The judge was entitled to reach the conclusions he had, Jewson applied.

Appeal dismissed

[2011] EWCA Civ 809
BSS GROUP PLC v MAKERS (UK) LTD (T/A ALLIED SERVICES) (2011)

CA (Civ Div) (Pill LJ, Rimer LJ, Sir David Keene) 20/7/2011

�Lawtel�: 25.7.11

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