This report considers the legal implications of Fillitup's dealings with Babyburp, advises on any possible legal liability and how to avoid liability in the future. Legal implications arising from dealings with Babyburp Ltd will be covered by the Sale of Goods Act 1979 (SoGA 1979) and the Supply of Goods and Services Act 1982 (SoGSA 1982).
2.0Formation of the Contract
2.1A contract of sale of goods is defined by SoGA 1979 Section 2(1) as a 'contract by which the seller transfers or agrees to transfer the property in goods to the buyer for a money consideration called the price'.
2.2As Fillitup Ltd supplied a machine to Babyburp there must have been some form of contract entered in to. The first issue therefore is to identify on what terms (both express and implied) the contract to supply the machine were made.
2.3Following negotiations and discussions with Babyburp, a specification and order were sent to the company that included information on delivery and price (express terms).
However, as delivery and price are not disputed, these issues are irrelevant. At this point an offer was made to Babyburp Ltd for them to consider.
2.4To complete the contract on this offer would require Babyburp to accept the offer as it stands, with any terms that may be attached. Such acceptance may be in the form of words, spoken or written and the telephone call received from their Managing Director 10 days later appeared to agree with the specification and the impression is that Fillitup Ltd. deemed this to be absolute agreement.
2.5However, while verbal acceptance is considered by statute to provide suitable means of communicating acceptance, the problem of using such communication for this type of business dealing is that there are no witnesses to the act and either party could interpret the...