Commercial law - SGSA 1982

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  1. S. 12 SGSA 1982
    • (1) In this Act a "contract for the supply of a service" means, subject to subsection (2) below, a contract under which a person (the"supplier") agrees to carry out service 
    • (2) for the purpose of this act, a contract of service or  apprenticeship is not contract for the supply of a service.

    Robinson v Graves
  2. Types of contracts
    • (1) Goods - SGA 1979 
    • (2) Non sale of goods contracts SGSA Part 1 
    • - Collateral contracts 
    • - Barter or exchange
    • (3) Services SGSA Part 2
    • (4) Mixed Goods and services contracts - SGSA Part 1
  3. SGSA Questions
    • Often relate to 
    • - was the service/work carried out badly or with faulty materials?
    • - did it take too long? 
    • - how much did they charge?
  4. SGSA - part 1 and part 2
    Part 1 contains terms about title, description, quality and fitness for purpose for goods that pass under a service contract 

    Part 2 contains terms about standard of work carried out by supplier, timeframe and price charged.
  5. Implied terms
    • Title 
    • s. 2 (mirror of s. 12 of SGA) - in a contract for the transfer of property there is an implied condition that the transferor has a right to transfer the property 
    • Transfer is by description 
    • s. 3 (mirror of s. 13 of SGA) - where there is a contract to transfer goods there is an implied term that the goods will correspond to that description
    • Quality or fitness
    • s. 4 Where the transferor transfers the property in goods in the course of a business there is an implied condition that the goods supplies under the contract are of satisfactory quality (i.e. they meet the standard that a reasonable person would regard as satisfactory, taking account of any description of the goods, the price (if relevant) and all the other relevant circumstances). - (the only difference from s. 14 SGA is that breach of this condition may be either of faulty quality of goods or work or goods and work)
  6. Exempting liability for implied terms
    • s. 7 of UCTA provides:
    • (1) Against a consumer you cannot exempt liability for description, quality, fitness for purpose
    • (2) As against non-consumer such liability can be excluded in so far as it satisfies the requirement of reasonableness.
  7. SGSA - Part 2
    • (1) (s. 13) Services to be performed with reasonable care and skill
    • (2) (s. 14) Where no time for performance is fixed, it will be carried out within a reasonable time 
    • (3) (s. 15) Where no price is fixed a reasonable charge will be paid 
    • Implied terms 
    • - (s. 13) - innominate term (if consequences of breach are serious  i.e. deprive substantially benefit of the contract - can reject and sue for damages, if consequences are minor - cannot reject, only sue for damages) in a contract of supply of service where the supplier is acting in the course of business, there is an implied term that the supplier will carry out the service withe a reasonable care and skill
  8. Standard of care
    • Must exercise reasonable care and skill of a reasonably competent member of that profession, calling or trade - Bolam v Friern Hospital Management - doctor caused harm to patient. Court held that doctor had to behave as reasonable member of profession. In case it is so, he will not be negligent. 
    • Grieves v Baynham Miekle - if you held yourself like an expert that different standard has to apply. 
    • Matrix Securities v Theodore Goddard - tax advisor was considered as leading specialist in the field and the standard had to be as of the ordinary specialist in the particular field.
    • Nettleship v Weston - new driver will be judged at the standard of the experienced driver
  9. Guarantee an outcome?
    Usually you do not guarantee a particular result or outcome - Thake v Maurice 

    But it is possible for parties to contractually guarantee success or outcome - Platform Funding Ltd v Bank of Scotland 
  10. Time for performance of the contract
    • (1) Starting point - Look first to see what stated in the contract 
    • (2) Was time of the essence? Generally time is not of the essence unless
    • (a) the parties agreed so, or
    • (b) surrounding circumstances  suggested so 
    • United Scientific Holding v Burnley Council - time is not of the essence unless it is stated in the contract 

    • If there is nothing in the contract then s. 14:
    • (1)Where, under a contract for the supply of a service by a supplier acting in the course of a business, the time for the service to be carried out is not fixed by the contract, left to be fixed in a manner agreed by the contract or determined by the course of dealing between the parties, there is an implied term that the supplier will carry out the service within a reasonable time.
    • (2)What is a reasonable time is a question of fact
  11. When must the parties perform? (cases)
    Charnock v Liverpool Corporation - 6 weeks took garage to get the work done. However there was an evidence than normally such work had to be done within 2 weeks. Court held that there was a breach because of the garage. 

    Charles Rickards v Oppenheim - car had to be built to order. Due date passed. The buyer said - "deliver to me by this particular day or I will walk away". Court allowed the buyer to walk away.
  12. Price of the contract
    Normally the contract set out the date. 

    May and Butcher v R - parties agreed to agree the price later. Court held that agreement to agree is not enforceble

    Foley v Classique Coaches - parties provided mechanism how the price will be determined in the future
  13. What if price is not stated?
    • than apply s. 15: 
    • (1)Where, under a contract for the supply of a service, the consideration for the service is not determined by the contract, left to be determined in a manner agreed by the contract or determined by the course of dealing between the parties, there is an implied term that the party contracting with the supplier will pay a reasonable charge.
    • (2)What is a reasonable charge is a question of fact.
  14. Estimates and quotes
    • In determining a reasonable charge the court may have regard to estimates or quote provided, but the general rule is that the estimate is not a fixed price.
    • (a) Quote is an offer, once accepted, agreement is made
    • (b) Estimates
    • Croshaw v Pritchard - estimate provided very detailed estimate to the buyer. Court held that as soon as it was very detailed it could be considered as fixed price 
    • If the estimate is much lower than the final bill, the court may consider it in deciding of the final price for the work. The court may also have a reference to expert evidence
  15. Remedies
    s. 11M Goods failing within first 6 months will be presumed not to have conformed at at he date of contract. 

    s. 11N - Repair and replacement of the goods (should be considered in light of s. 11Q) 

    s. 11P Reduction of purchase price or rescission of the contract
  16. Exclusion of liability for breach of ss. 13 and 14
    This may be covered by ss 2-3 of UCTA -if negligence liability for death/pi then cannot exclude (s. 2(1) UCTA) - for other loss would be subject to requirement of reasonableness (s. 2(2) UCTA)
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Commercial law - SGSA 1982
Commercial law - SGSA 1982
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