J & H Ritchie Ltd v Lloyd Ltd
Encyclopedia
J & H Ritchie Ltd v Lloyd Ltd [2007] UKHL 9 is an English contract law
case, concerning the measure of damages for breach.
. He bought an all in one seed drill
and harrow
from Lloyd Ltd, based at Hunters Hall, Kelso. It was advertised at a reduced price because it had been repossessed from the previous owner. It did not work. Lloyd Ltd agreed to take it back, investigate, and repair it. Lloyd Ltd returned it, but refused to say what the problem had been, and just said it had been repaired to "factory gate" standard. Mr Ritchie found out informally that two bearings for the rotors of the harrow had been missing. This was a serious defect. Mr Ritchie was concerned that when he had used it, further damage may have been caused, and he would not find out, because he would only start using it the next Spring. He was worried that by this time the manufacturer's guarantee would be affected. So Mr Ritchie rejected the machine.
The question was whether rejecting the equipment was permissible under s 35(6)(a) of the Sale of Goods Act 1979
. This provides,
Lord Hope's opinion went as follows,
English contract law
English contract law is a body of law regulating contracts in England and Wales. With its roots in the lex mercatoria and the activism of the judiciary during the industrial revolution, it shares a heritage with countries across the Commonwealth , and the United States...
case, concerning the measure of damages for breach.
Facts
Mr Ritchie has a business (J&H Ritchie Ltd) on North Arkleston Farm, PaisleyPaisley
Paisley is the largest town in the historic county of Renfrewshire in the west central Lowlands of Scotland and serves as the administrative centre for the Renfrewshire council area...
. He bought an all in one seed drill
Seed drill
A seed drill is a sowing device that precisely positions seeds in the soil and then covers them. Before the introduction of the seed drill, the common practice was to plant seeds by hand. Besides being wasteful, planting was very imprecise and led to a poor distribution of seeds, leading to low...
and harrow
Harrow (tool)
In agriculture, a harrow is an implement for breaking up and smoothing out the surface of the soil. In this way it is distinct in its effect from the plough, which is used for deeper tillage. Harrowing is often carried out on fields to follow the rough finish left by ploughing operations...
from Lloyd Ltd, based at Hunters Hall, Kelso. It was advertised at a reduced price because it had been repossessed from the previous owner. It did not work. Lloyd Ltd agreed to take it back, investigate, and repair it. Lloyd Ltd returned it, but refused to say what the problem had been, and just said it had been repaired to "factory gate" standard. Mr Ritchie found out informally that two bearings for the rotors of the harrow had been missing. This was a serious defect. Mr Ritchie was concerned that when he had used it, further damage may have been caused, and he would not find out, because he would only start using it the next Spring. He was worried that by this time the manufacturer's guarantee would be affected. So Mr Ritchie rejected the machine.
The question was whether rejecting the equipment was permissible under s 35(6)(a) of the Sale of Goods Act 1979
Sale of Goods Act 1979
The Sale of Goods Act 1979 is an Act of the Parliament of the United Kingdom which regulates English contract law and UK commercial law in respect of goods that are sold and bought. The Act consolidates the original Sale of Goods Act 1893 and subsequent legislation, which in turn had codified and...
. This provides,
Judgment
The House of Lords all agreed that Mr Ritchie was entitled to reject the equipment, even though it had in fact been repaired. Furthermore Lloyd Ltd were in breach of a separate "inspection and repair agreement" by refusing to say what had been wrong with it. This had arisen when the machinery was taken away. It had to have been an implied term of that agreement that, so long as Lloyd Ltd were performing its duties, Mr Ritchie would not rescind the contract. Mr Ritchie would lose his right to reject the goods. But he could only make that choice when he was fully informed. The law has shown that this is correct.Lord Hope's opinion went as follows,