BDW Trading Limited v Lantoom Limited

Contractual terms may be incorporated by reference where the document gives reasonable notice of them, including a reference to standard terms available on a website. A supplier who represents goods as suitable for a particular use may be liable where the goods are not fit for that use. If suitability depends on specific construction methods that are not a matter of general knowledge, the supplier must qualify the representation and identify those limitations.

Fitness for purpose and satisfactory quality are assessed by reference to the goods supplied and the notified purpose. Evidence of poor durability, testing results, and early failure may establish breach, even where other possible causes are advanced.

BDW Trading Limited supplied stone from Lantoom Limited for the external walls of houses at a housing development in Cornwall. The stone later cracked, spalled and fell away. BDW claimed damages for breach of contract and misrepresentation.

The court determined whether BDW’s standard purchase terms were incorporated, what specification and purpose had been agreed or notified, whether the stone was of satisfactory quality and fit for use as the external leaf of cavity walls, and whether the failures were caused by the stone or by design and workmanship issues.

1. Contract formation. BDW’s Purchase Order incorporated its standard terms by reference. The reference was sufficiently prominent and the terms were available on the identified website. Lantoom accepted the offer by commencing delivery. Its delivery notes did not operate as counter-offers because they concerned individual deliveries, were not communicated to the relevant contracting personnel, and were signed by persons without authority to contract.
2. Specification and notified purpose. The agreed specification included suitability for external walling and, in particular, the external leaf of a cavity wall at the development. The parties used “slate” in its regional sense and did not agree that the stone would be true slate. BDW nevertheless notified Lantoom of the intended use.
3. Fitness and satisfactory quality. The stone supplied was not of satisfactory quality and was not fit for external walling or use as the external leaf of a cavity wall. Its high water absorption, variability, failure in durability testing, and widespread cracking and delamination supported that conclusion. The testing was relevant as evidence of durability and did not need to replicate site conditions exactly.
4. Lantoom’s proposed qualification that the stone was fit only if used according to particular local construction practices was not part of the contract. If such methods were necessary, Lantoom had to identify and communicate that limitation. The evidence did not establish that recessed joints, mortar, absence of backing, movement joints, or other alleged workmanship matters caused the failures.
5. Lantoom breached clauses 6.1.1, 6.1.2, 6.1.3 and 6.1.5 of BDW’s terms. BDW was entitled to damages and to the indemnity in clause 10.5. It was not entitled under clause 10.2. There was also an alternative misrepresentation claim based on suitability for external walling. The question whether replacing all the stone was reasonable and proportionate was left for the quantum stage.

First-instance decision. The court determined liability and deferred the issue of the reasonableness and proportionality of replacing all the stonework to the quantum stage.