Sellers and suppliers are under a duty to supply goods which conform to the contractual provisions agreed upon and which are safe and free from defects. A product may be considered defective where it is unsafe, damaged, or faulty, or if its design or specifications do not conform to what was decided between the parties. It is possible for a claim to be brought based on a breach of contract where any defective product supplied under a contract subsequently causes loss or harm to the contracting party.
Who can sue and be sued?
It is the usual position that only the parties in a direct contractual relationship have the right to sue and be sued. This would ordinarily be a purchaser and a seller/supplier.
There are limited rights to sue third parties under a contract and therefore usually, the buyer will not be at liberty to sue the manufacturer for any losses unless there is a contract between the parties.
Liability
The claimant to any action may be able to rely on express terms of the contract if the contract specifically describes the type and quality of the product to be supplied, and the end product does not match that description.
In addition to any express terms as to the quality, where both parties are acting in the course of their respective business (i.e. B2B contracts), the Sales of Goods Act 1979 implies terms into contracts for the sale of goods that any goods supplied will be:
- Compliant with their description;
- Of satisfactory quality; and
- Fit for purpose.
This means that, in addition to any written contractual provisions, if a buyer has purchased a product from a supplier which is unfit for purpose (and such purpose was communicated to the supplier prior to entering into the contract) or of unsatisfactory quality then the buyer may have a claim against the supplier for any losses caused in defective products being supplied.
Remedies
Where a breach of contract is established, there are two remedies available for the buyer which includes:
- The contract can be repudiated and the goods rejected; or
- If the goods have already been accepted, damages should be claimed. This will be compensation for any loss or harm caused by the defective product.
How can Nelsons help?
At Nelsons, we understand the complex issues surrounding product liability that bring businesses such as those centred in the manufacturing and engineering sectors into problems surrounding who may be liable when something goes wrong.
Our expert Dispute Resolution team in Derby, Leicester or Nottingham are able to assist with advising on the law, how to protect your business and how to resolve problems if and when they arise. If you require legal advice, please contact Jade or another member of the team on 0800 024 1976 or via our online form.
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