• The grounds for Ellis' claim against Floidex in relation to the contaminated Agri-Therm:
Ellis's claim is on the ground that Floidex has breached the condition of their contract. That Floidex sent a defective consignment to Ellis of which as a result Ellis lost sales to its retailers. Therefore, Ellis believes Floidex has breached the express terms of clause 7.1 and 7.1.4 of its Standard Terms and Conditions (sale of Goods) (the Terms) and the implied term of section 14(2B) of Sale of Goods Act 1979.
Under clause 7.1 and 7.1.4 of Floidex express Terms, Floidex warranties the quality and fitness of its consignment; this may impose liability on Floidex. Moreover, the implied term …show more content…
Despite Ron Ellis was unhappy about the exclusions in Clauses 7 & 8 of the Terms, he was aware of its implications when he agreed to the Terms as Ellis uses similar exclusions in its own standard terms and conditions of sale. We will assume the Terms were incorporated into contract by signatures of both parties.
However, Floidex did breach the terms of their agreement. Floidex did supplied Ellis with goods of no satisfactory quality, and the goods were not fit for purpose.
Floidex did not deny the fact that the contamination of the consignment of Agri-Therm was its fault; it had traced the contamination to one of its blending …show more content…
For breach of condition, Ellis is entitled to reject the goods as it intended although is not obliged to do so. Ellis is also entitled to claim damages if it has suffered further loss as it claimed because "damages might reasonably be within the contemplation of the parties at the time the contract was made" Hadley v Baxendale (1854).
• Floidex's attempt to exclude liability for the claim under its standard conditions of sale:
Floidex Standard Terms and Conditions (sale of Goods) which both parties agreed has a 'Limitation of Liability'. In clause 8.2.1 of the Terms, it exonerates Floidex of any loss of profit as a result of breach of contract. Clause 8.2.2 of the Terms also limits Floidex total liability to the cost price of the goods only. Floidex may rely on these exclusion clauses as they have been incorporated into the Terms when both parties expressly agreed to its implementation.
Floidex exclusion clause will cover the breach of the statutory duty that would have implied and the express terms of the agreement. The exclusion will cover remedy for loss of profit as both parties contemplated at the beginning of their