Citation: 184 ConLR 145
A defendant could not rely on its general terms and conditions to exclude liability when a copy of such terms and conditions were not attached to the final quotation, despite referring to these in its quotation and providing a copy in earlier correspondence.
The claimant purchased five mineral sorting machines from the defendant for its business of extracting, sorting and trading in silica sand.
The defendant represented that the machines would meet the claimant’s specification to produce silica sand with a particle size of between 100µm and 500µm containing no more than 2% of produce outside that specification and handling a certain throughput.
The claimant sent a sample of the sand which formed its feedstock to the defendant and the defendant issued an initial quotation for supply of the machines in April 2010. Further discussions and quotations followed through to July 2010 and the defendant commenced manufacture of the machines.
Problems arose with the machines which meant they could not be put into commercial production until February 2014, following certain modifications recommended by the defendant.
The claimant alleged that the machines were not capable of achieving the throughput specified in the defendant’s quotation and claimed damages for misrepresentation or breach of contract.
The defendant acknowledged that the machines it supplied were not in accordance with the description given in its quotation and that the error was not discovered as soon as it should have been. However, the defendant alleged that its standard terms and conditions applied such that it would be under no liability for any loss save for the replacement of goods within 12 months of the date of delivery. Further, it claimed that the sand used by the claimant as the feed material differed significantly from that which it had been sent for testing the machines, or that the claimant had not proved that it had suffered any loss as a result of the admitted breach.
Following a 2-week trial, the TCC held:
The defendant’s terms and conditions had not been incorporated. The contract was made when the defendant proceeded to manufacture and supply the machines, following receipt of the claimant’s purchase order, which had referred to a quotation from the defendant sent at the end of June 2010. Although the defendant’s terms and conditions had been provided to the claimant in earlier exchanges, these were not part of the contract because there was no form of words, either by reference or directly, which incorporated them into the contract. Although the quotation at the end of June 2010 included the statement ‘see attached general terms and conditions of sale’, no such terms and conditions had in fact been attached to the quotation.
The claimant’s claim for loss of profits failed due to lack of proof. On the evidence, it had failed to show that in the future the machines would not be able to achieve the required throughput levels due to the defendant’s actions. However, the claimant had suffered some losses which were reasonably unavoidable as a result of the defendant’s failure to supply machines which could perform in accordance with the quotation and as represented. Although a claim for such losses had not been formulated, the claimant had been delayed in bringing the machines into production and the court assessed damages on this basis.
