Product Liability – Sellers liable for contaminated ground nut extractions
Contaminated ground nut extractions (the byproduct remaining after the extraction of ground nut oil) from Brazil poisoned domesticated pheasants and partridges.
Defending suppliers joined intermediate parties who joined the primary importers.
Suppliers settled with buyers who had initiated the action.
The facts and multiple issues of law were tried before Havers J who found liability all the way down the line.
The issues were mainly: the interpretation of the Fertilizers and Feeding Stuffs Act, 1926 including the effect of the passing of ownership in CIF sales, the application of sections 14(1) and 14(2) of the Sale of Goods Act, 1893, a battle of the forms issue and fundamental breach versus exemption clauses.
Each of Sellers, Davies and Diplock LJJ, differed from Havers J in divers respects, but upheld the effect of the judgment.
This trend continued in the House of Lords (Lords Reid, Morris, Guest, Pearce and Wilberforce).
Once the issues of fact had been solved, the outcome was fairly obvious.
The Sale of Goods Act, as in Ashington Piggeries, proved to be a fertile source of controversy.
The most interesting points were:
The exclusion of pheasants and partridges from the definition of “poultry” in the Fertilizers and Feeding Stuffs Act;
The rejection of the artificial, and overly narrow, definition of sale in the same Act with regard to CIF sales, favoured by Lord Denning MR in Draper & Diplock LJ in the Court of Appeal in this case;
The battle of the forms point;
The consistent refusal to allow exemption clauses to defeat fundamental breaches of contract.
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