From: Gerard Sadlier <>
Date: 22/01/2015 00:47:29 UTC
Subject: Irish Supreme Court on Incorporation of Terms, Sale of Goods and EU Technical Standards Directive


In December last, the Irish Supreme Court gave judgment in James
Elliott Construction Limited -v- Irish Asphalt Limited [2014] IESC 74.

This case arose out of the construction of a youth centre by the
Plaintiff. The foundations of the youth centre were found to contain
excess pyrite and required extensive remediation, which the Plaintiff
carried out and for which the Plaintiff sought an indemnity from the
Defendant in these proceedings. (Despite the significance of the works
involved, one cannot help the feeling that costs in this case will
dwarf the actual expenses of remediation - perhaps the most troubling
and thought provoking aspect of the saga.)

The case is important, in what I think is descending order for members
of this list, because:
1. The Court discussed at length the ways in which standard terms of
business can be incorporated into commercial contracts, either by
signature, notice or course of dealing. Much English authority,
including the works of several academics was referred to in a lengthy
analysis. It must be said that relatively few Irish decisions were
referred to, for whatever reason. I found the discussion interesting
but think it may turn largely on the particular facts of the case, as
found in the High Court. (The lengthy discussion of this issue begins
at paragraph 80.)
2. The Court considered the meaning of "merchantability" in the Irish
Sale of Goods and Supply of Services Act 1980, which it held to be
identical to the UK's 1979 Act. The Court considered whether a product
was "merchantable" if it fulfilled any one of a number of purposes for
which it was sold, as held in Aswan Engineering Establishment Co. v.
Lupdine Ltd & Anor [1987] 1 W.L.R. 1. The Court considered the
slightly later English decision in Rogers v. Parish (Scarborough) Ltd.
[1987] Q.B. 933 and the Australian decision in Cavalier Marketing
(Australia) Pty Ltd v. Rasell & Anor (1990) 96 A.L.R. 375, where views
to the contrary were expressed and disapproved Aswan (obiter, see
paragraphs 63-74).
3. (The Court noted that since 1994, the UK legislation is different.)
The Court held that where a product was purchased by a construction
company on foot of its contract to build a property and the
requirements of its customer's professional advisers, there was no
reliance on the supplier's representation that the product purchased
was fit for a particular purpose - Rotherham Metropolitan Borough
Council v. Frank Haslam Milan & Co. Ltd & Anor [1996] C.L.C. 1378.
(See paragraph 80.)
4. The Court (with marked reluctance) made a preliminary reference to
the ECJ on the question whether the EC's Technical Standards Directive
in some way pre-empted Irish Sale of Goods legislation. (See from
paragraph 151.

Comments welcome.
Kind regards