In these General Conditions of Sale, the "Company" means . . . . . . . , the "goods" means any item of whatsoever nature which is to be sold by the Company; the "Purchaser" means the person firm or body corporate which buys or has agreed to buy the goods.

These General Conditions of Sale shall apply to and form part of every contract of sale entered into by the Company. All orders are accepted and executed on the understanding that the Purchaser is bound by these General Conditions of Sale. Where there is any inconsistency between these General Conditions of Sale and any conditions which the Purchaser seeks to impose, these General Conditions of Sale shall prevail.

No contract of sale shall come into being unless and until the Purchaser has accepted these General Conditions of Sale either expressly or by implication.

1.2 A contract should begin with a definition of the parties, and any other terms requiring definition.

The remainder of this clause concerns the formation of the contract. One should note that although sellers and buyers may declare their intentions regarding formation of the contract, there is no guarantee that these clauses will be successful:
Butler Machine Tool Co Ltd v Ex-Cell-O-Ltd 1979 1. All. E.R. 965

The contract includes only such goods, accessories and work as are specified in the quotation or acknowledgement accompanying these General Conditions of Sale.

1.3 Clauses of this kind help to define the scope of the contract. For major contracts, a list of contract documents is desirable.

(a) The price payable for goods shall unless otherwise stated by the Company in writing be the list price of the Company current at the date of despatch and in the case of an order for delivery by instalments the price payable for each instalment shall be the list price of the Company current at the date of despatch of such instalment.

1.4 This clause must be tailored to the client's specific needs. The important points are to state how the price is to be ascertained, whether or not it is adjustable (see Butler Machine Tool Co. Ltd v Ex-Cell-O Ltd 1979), and what additions are to be made to the price.

(b) Unless otherwise expressly stated to be firm for a period the Company's prices are subject to variation to take account of variations in wages, materials and other costs. The Company accordingly reserves the right to adjust the invoice price without notice by the amount of any increase or decrease in such costs after the price is quoted.

In practice, the question of whether a price is fixed or variable, and if fixed, for how long, is one for negotiation.

(c) All prices are exclusive of Value Added Tax and this will be charged at the applicable rate and recoverable as part of the price by the Company.

(f) If the Purchaser fails to make any payment when due in accordance with these General Conditions of Sale, the Company reserves the right in its absolute discretion and without prejudice to any of its other rights or remedies to suspend all further deliveries until such payment has been made in full or, at the Company's option, to cancel the balance of the order. In either case the Company shall hold the Purchaser liable for costs incurred in respect of goods in course of manufacture or ready for despatch.

(g) The Company shall be entitled to bring an action for the price or part thereof whether or not the property in the goods has passed.

1.5(g) This is to counteract the effect of Sale of Goods Act 1979, Section 49 (1).

Any credit shall be subject to the Company being satisfied as to the Purchaser's credit references, and without prejudice to the generality of the foregoing, the Company may (in its absolute discretion), having informed the Purchaser that the goods are ready for despatch, refrain from delivering the goods until such time as the Purchaser tenders the purchase money to the Company together with any outstanding amounts which may be due to the Company on any account whatsoever.

1.6 If credit is not given, because the conditions upon which it is to be given are not satisfied, then the right of lien of the seller may be exercised.

(a) Where the value of any order exceeds £. . . the cost of delivery of the goods to the Purchaser's premises on the mainland of Great Britain shall be included in the contract price.

1.7 This clause is to clarify the position as to carriage and to permit additional charges.

(b) In all other cases the prices are exclusive of carriage and insurance to the Purchaser's premises.

Where it is necessary to despatch goods in crates, cases, pallets, stillages or skids or other such packing, a charge will be made for this. Unless otherwise specified this amount will be credited in full on the return, within one month, of such crates, skids, stillages and pallets etc. in good condition carriage paid. No charge is made for any other form of packaging and no credit will be allowed for its return.

1.8 This is an example of the kind of "practical" clause which can only be drafted as a result of careful consultation with the client, to find out where problems are likely to occur.

When the price quoted includes delivery, the Company shall repair or replace free of charge goods damaged in transit or not delivered in accordance with the Advice Note provided that the Company is given written notification of such damage or non delivery within such time (being not more than . . . days) as will enable the Company to comply with the carrier's conditions of carriage as affecting loss or damage in transit, or, where delivery is made by the Company's own transport, within . . . days after receipt of the Advice Note. Notwithstanding the above undertaking, the Company will only consider claims for alleged shortage if they are received within two working days of the receipt of the goods by the Purchaser together with sufficient information to enable the Company properly to identify the shortage including the Advice Note number, case number and condition of case.

1.9 This clause is about risk allocation and the details necessary to administer a claim for loss or damage in transit.

It is important to relate the seller's liability for loss or damage in transit to the seller's position regarding their acceptance of liability by the carrier.

Any samples submitted with the Company's quotation or at the Purchaser's request must be returned within ninety days of receipt and the Company shall be entitled to charge for them if they are not so returned.

1.10 Companies supplying goods or services do not usually charge for samples, but may find it inconvenient if expensive samples are not returned. This clause is therefore not needed in cases where samples are non-returnable, but may be a useful provision to enforce the prompt return of more costly, returnable samples.

(a) The Company shall be under no obligation to alter or vary any part of the contract or any work connected therewith. Any alteration to or addition to or amendment or other variation of the specification, including any increase or decrease in the quantity of the goods or any alteration to any drawings or to the quality, performance, weight or measurements of any goods or any alteration or variation of advised delivery schedules, shall, if requested by the Purchaser, be subject to the agreement of the Company, with such alteration or addition to the price and to delivery dates or schedules as may be required by the Company, and shall not be binding upon the Company unless and until accepted by the Company in writing.

1.12 There is no legal obligation to vary goods or work supplied under a contract. Contracts may provide for variations, subject to certain conditions. Sometimes purchasers expect to be able to vary goods and services as of right, and this clause makes it clear that mutual written agreement is required under this contract, with adjustments to price and delivery schedules where applicable.

If the Company does not receive forwarding instructions sufficient to enable it to despatch the goods within fourteen days after notification that the goods are ready for delivery or that they have been tested under Clause 14, the Purchaser shall thereupon take delivery or arrange for storage. If the Purchaser does not take delivery or arrange for storage as aforesaid, the Company shall be entitled to invoice and be paid for the goods as though the goods have been duly delivered in accordance with these General Conditions of Sale and the Company may arrange storage either at the Company's own works or elsewhere on the Purchaser's behalf and all charges for storage, insurance or demurrage shall be payable by the Purchaser.

1.13 This clause builds upon and extends the rights conferred on the seller by section 37 of the Sale of Goods Act 1979.

Any performance figures given by the Company are based on its experience and are such as the Company expects to obtain under the conditions of its standard tests at its works.

1.14 This is to avoid any doubt as to what any figures for performance of goods represent.

The Company's products are carefully inspected, and, where practicable submitted to its standard tests at the Company's works before despatch. If tests other than those specified or tests in the presence of the Purchaser or its representatives are required, these will be charged for. In the event of any delay on the Purchaser's part in attending tests after the Purchaser has received seven days notice that the Company is ready to perform the tests, the tests will proceed in the Purchaser's absence and the Purchaser accordingly agrees herein to accept and pay for such tests as if they had been performed in the Purchaser's presence.

1.15 This clause is to avoid any doubt about the nature of tests included in the price, and the seller's right in certain cases to perform tests in the absence of the purchaser.

An alternative is to allow for alteration of the date for tests, with corresponding changes to the price and delivery date.

All descriptions and illustrations and particulars of weights and dimensions issued by the Company in catalogues, price lists, advertising matter and forwarding specifications are by way of general descriptions and approximate only, and shall not form part of any contract or give rise to any liability on the part of the Company.

It is the policy of the Company to endeavour to develop and improve its products, and accordingly the Company reserves the right to change all specifications without prior notification or public announcement pursuant to such policy. Provided that nothing in this Clause shall oblige the Purchaser to accept goods which do not reasonably comply with the contract.

1.16 Statements made in brochure material, etc, may give rise to representations, or even be construed as terms of the contract. This clause aims, within reason, to lesson the chances of liability for misrepresentation or breach of conditions or warranties.

(a) The Company will make good by repair, or at the Company's option by the supply of a replacement, defects which, under proper storage and use appear in the goods within the period of twelve calendar months after the goods have been delivered and arise solely from faulty design (other than design made or furnished by the Purchaser), materials or workmanship.

1.17 This clause aims to be positive as to terms about quality given expressly by the seller, and subsequently goes on to impose certain requirements upon the purchaser, as conditions of liability. It is thought that these requirements are not unreasonable within the Unfair Contract Terms ACT 1977.

(ii) that in the case of defects which would have been reasonably apparent to the Purchaser on reasonable examination of the goods on delivery, the Purchaser shall notify the Company of the defects in writing within fourteen working days of delivery;

Time limits for reporting of defects by a purchaser to a seller must be fair.

R.W. Green Ltd v Cade Bros Farm (1978) 1 Lloyds Rep 602.

(iii) that in the case of any other defects, the Purchaser shall notify the Company of the defects in writing within seven working days of the date when the defect becomes apparent;

(iv) that where in discharge of its obligations under the Warranty given in this Clause the Company agrees that the Purchaser may undertake any repair or remedial work on its behalf, the cost of such work shall be agreed in writing between the Purchaser and the Company before the commencement of any such repair or remedial work.

Unless otherwise agreed in writing, and subject to Clause 16 hereof (WARRANTY), goods rejected as not complying with the contract must be rejected within fourteen working days of delivery to the Purchaser's premises or to such other place as the Purchaser shall have specified.

In no circumstances may goods supplied against a firm order be returned without the Purchaser having first applied for and obtained the written consent of the Company. A handling charge may be deducted from any credit allowed by the Company where it is established that the reason for the return of goods was not the subject of Clause 8 hereof or due to any error on the part of the Company.

Notes to clauses 1.17, 1.18, 1.19

There is no blanket limit upon or disclaimer of liability, but certain remedies of the purchaser for defective goods are restricted or made subject to conditions.

There is a limit on liability in the sense that "consequential loss", as defined in clause 19, is excluded. The expression as defined here means that liability for personal injury, death, damage to property and other physical losses is not excluded.

Save as may be expressly provided for herein the Company shall not be liable for any consequential loss suffered by the Purchaser, and in particular the Company shall not be liable for any costs claims or damages or expenses arising out of any tortious act or omission or any breach of contract or statutory duty calculated by reference to profits income production or accruals or by reference to accrual of such costs claims damages or expenses on a time basis.

An exemption from liability does not exempt a contractor from his common law liability in tort unless the words specifically preclude such liability.

Dorset County Council v Southern Felt Roofing Co (1989) F.T. November 24, 1989 CA

The Purchaser will indemnify the Company against all damages penalties costs losses and expenses suffered by the Company or for which it may become liable in respect of the infringement of any intellectual property including (but without limitation) any patent copyright design right trade mark trade name or know-how arising out of the Company's manufacture of goods in accordance with any specification design drawings or other data supplied by the Purchaser or its servants or agents.

1.21 Purchasers occasionally design items to be made by sellers, and this clause aims to protect sellers against possible infringement of intellectual property rights in such circumstances.

All drawings descriptions and other information submitted by the Company shall remain the property of the Company together with the copyright therein, and shall be treated as confidential and shall not be disclosed to any person except as permitted in writing by the Company.

1.22 This is to protect the seller's own property in drawings and other information.

The Company shall be entitled without liability on its part and without prejudice to its other rights, to terminate the contract or any unfulfilled part thereof, or at its option to suspend or make partial deliveries or extend the time or times for delivery, if the manufacture of the goods by the Company or the Company's suppliers, or the delivery of the goods or the performance by the Company of any of its obligations under the contract is hindered or delayed whether directly or indirectly by reason of the Purchaser failing to furnish necessary instructions or information, or by war or other hostilities, civil commotion, act of God, government action or legislation, interruption of transport, strike, lock out or other form of industrial action, accidents or stoppages to works, shortage of labour materials equipment fuel or power, breakdown of machinery or any other cause whatsoever beyond the reasonable control of the Company or its sub-contractors, whether or not such cause exists at the date of the order.

1.23 Sellers of goods and services should always protect themselves against circumstances beyond their control. The law of frustration is insufficient, and a properly drafted "force majeure" clause will protect the seller against circumstances falling short of frustration.

(b) The property in the goods shall remain with the Company, which reserves the right to dispose of the goods until payment in full for all goods which have been supplied at any time by the Company to the Purchaser has been received by the Company, or until such time as the Purchaser sells the goods to its customers by way of bona fide sale at full market value in the ordinary course of business. While the goods remain the property of the Company the Purchaser shall keep the goods identifiable and separate from all other goods in its possession.

1.24 Clause 23 is a retention of title clause, passing risk upon delivery to the Purchaser, while the property in the goods remains with the seller until the seller is paid or until the goods are sub-sold in good faith in the ordinary course of business.

(c) Until such payment as aforesaid has been received in full by the Company the Purchaser shall be under an obligation to redeliver the goods to the Company if the Company so requires and the Company shall be entitled at any time to retake possession of the goods and for that purpose to enter upon any land or premises of the Purchaser where the goods may be for the time being. The Company shall be entitled, where the goods have been fixed or attached to any other product, to detach the goods in order to recover possession of them. Such redelivery or retaking of possession shall be without prejudice to the obligation of the Purchaser to purchase the goods.

The clause attempts to confer upon the seller rights of repossession of the goods, rights of entry to do so, and the right to trace and recover the proceeds of sub-sales.

In the event of the Purchaser committing any breach of this contract, or if any distress or execution is levied upon the Purchaser, his goods or assets, or if the Purchaser enters into any negotiations for arrangement or composition with or for the benefit of his creditors or becomes bankrupt or if any petition in bankruptcy shall be presented against him, or if, being a corporate body, the Purchaser shall be wound up or if any resolution is proposed or petition presented to wind up the Purchaser (not being a members' voluntary winding up for the purpose of reconstruction or amalgamation without insolvency), or if a receiver of the Purchaser's assets or undertaking or any part thereof shall be appointed or if the Purchaser shall be deemed to be unable to pay its debts, or if an administration order shall be made against the Purchaser the Company shall be entitled, without prejudice to any other claim or right or remedy which it may have, forthwith to suspend any or all deliveries until the default has been made good or to determine the contract or any unfulfilled part thereof.

1.25 It is standard, in a contract such as this, to have a clause permitting the seller to take action to protect himself in the event of insolvency or breach of contract by the Purchaser. There are many different forms of these clauses, and some go less far than this example, while others go further, in attempting to provide against every possible circumstance affecting the purchaser's financial soundness.

Sellers may sometimes find it desirable to delete the words in brackets, although Purchasers will probably wish them to be retained.

If any time any question, dispute or difference whatsoever shall arise between the Purchaser and the Company upon or in relation to or in connection with the contract, either party may give the other notice in writing of the existence of such question, dispute or difference, and the same shall be referred to the arbitration of a person to be mutually agreed upon, or failing agreement within 30 days of receipt of such notice, of some person appointed by the President for the time being of the Institution of . . . . . in Great Britain. A submission to arbitration under this Clause shall be deemed to be a submission to a sole arbitrator pursuant to the Arbitration Act 1950 or any statutory modification or re-enactment thereof. Any such arbitration shall be held in London, England.

1.26 An arbitration clause is optional. Some clients may oppose the inclusion of such a clause.
In this particular clause, the name of the Institution referred to must be completed. There are various methods of appointing arbitrators, and the merits of different methods should be considered.
The last sentence of this clause is a matter of choice and convenience.

All contracts to which these General Conditions of Sale apply shall be governed by and construed in accordance with English Law.

The headings to the clauses of these General Conditions are inserted for convenience of reference only and shall not affect their interpretation.

1.27 It is normal to include a "choice of law" clause, and unless Scots Law, or the law of any other country, is specified by the client, the appropriate law is English Law.

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