| Date | 13 June 1996 |
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| Judgment | Central Regional Council -v- Uponor Ltd; 14 February 1996 |
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| The Issue | Implied warranties as to merchantable quality and fitness for purpose. |
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| Implication |
Notwithstanding questions raised over the pleaded case, a defendant carries the burden of proof that warranties to be normally implied by law ought to be excluded as a consequence of an express requirement to meet British Standards. |
printReaders who have met me will know that I am as Scottish as the Heart of Midlothian or the famous Grouse. They will be entitled to ask therefore why it is that I so rarely report construction law cases from north of the border. This is a deficiency which I intend to correct from time to time. After all, some of the most important developments of the law south of the border started life in Scotland. For example, the modern law of the tort (delict in Scotland) of negligence might not stand as it does today were it not for two fine old Scottish ladies deciding to drink a glass of ginger beer on a rare hot summer's day. One of the bottles was alleged to contain the decomposed remains of a snail which, as we all know, led to the case of Donoghue and Stevenson decided eventually in the House of Lords in 1932. Of course the case also provided the origin of that phrase often heard in Scotland "Hey Jimmy, gie' s a slug oot yer bottle". The case of Central Regional Council -v- Uponor Ltd heard on 14 February 1996 in the Outer House of the Court of Session in Scotland (the equivalent of the High Court down south) concerned the pleading of implied terms for merchantable quality and fitness for purpose of goods supplied. Central Regional Council at the time of the contract in question were the water authority for the region. In 1981 they invited tenders for the supply of pipes which were required in connection with the laying of a trunk water main. Through acquisition Uponor became liable under the contract subsequently awarded for the manufacture and supply of the pipes. Since then, the Council has had nothing but trouble with the water main. They pleaded that since the main was brought into service there had been fifteen failures attributable to defects in the pipes. They stated that these failures were due to latent defects in the pipes which existed at the time of sale but which were not apparent on visual inspection when the pipes were delivered. They added that tests carried out subsequently on the pipes revealed the presence of a large number of voids and inclusions in the pipe material. These and other defects, which they alleged arose as a result of inadequate quality control during manufacturing, had rendered the pipes vulnerable to cracking, erosion and disintegration. Uponor said that the contract for the pipes required that they should be tested in accordance with BS 3503: and that these tests were at all times carried out. Not good enough, said the Council, stating that, quite apart from complying with the British Standard, Uponor had an obligation to provide pipes which were of merchantable quality and which were fit for their purpose. They argued that it was an implied condition of the contract that the pipes would be of merchantable quality and made reference to section 14(2) of the Sale of Goods Act 1979. In addition they said it was to be implied into the contract that the pipes should be reasonably fit for their purpose. They went on to state that Uponor had been made well aware that the pipes ordered were to be used as underground cold water service pipes and that they should have had a minimum life of about thirty years. Section 14 of the Sale of Goods Act 1979 provides that where a seller sells goods in the course of a business, there is an implied condition that the goods supplied under the contract are of merchantable quality, except as regards defects specifically drawn to the buyer's attention before the contract is made, or defects which an examination ought to reveal upon the buyer having examined the goods before the sale. The Act also provides that, where the buyer makes known to the seller any particular purpose for which the goods are being bought, there will be an implied condition that the goods supplied under the contract are reasonably fit for that purpose insofar as the buyer relies upon the skill and judgement of the seller. Uponor argued that the pleadings gave no notice of how or in what way it could be said that the implied conditions formed any part of the contract. They argued that by stipulating for compliance with the specified British Standard, the Council had taken upon itself the responsibility for selecting the standard for the pipes and so had negatived any implied warranty on the part of the suppliers both as to fitness for purpose and as to quality. Lord Cameron of Lochbroom held that it would be going too far and too fast at this stage to accede to Uponor's motion. He decided that the pleadings were firmly based on the proposition that the implied warranties formed part of the contract and that they were breached. He therefore rejected the application to have the action dismissed based upon the relevancy of the pleadings. The burden of proof therefore lay on Uponor to establish that, notwithstanding the condition of the pipes, not only did the pipes comply with the specified British Standard but that somehow the requirements of that standard overruled any other warranties which would otherwise be implied by law.
CJ-9622
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