Commercial Contracts Essay Example | Topics and Well Written Essays - 3500 words

Commercial Contracts - Essay Example Unless the seller can proof that all the goods were defective, the buyer is entitled to decline such a move and seek for legal redress. Watchtower vs. Classic Gift Ltd The two partners entered into a contract, where Watchtowers Ltd was supposed to supply Classic Gift Ltd with both the antique watches and the cleaning oil. The latter owns several shops that specialize in the sale of such watches. The managing director of Classic Gift Ltd agreed on a contract with Matthew Achbold, who was the sales director at Watchtower. It is this contract that was supposed to bund the two parties, in ensuring that everything happened according to the stipulations therein. The challenge After the delivery of the goods to Classic Gift, it was found that some of the oil provided had some defects. According to the letter addressed to the sales director of Watchtower, the oil led to malfunctioning of some watches, which were cleaned. It is because of this issue that Julie Fitz thought that they were enti tled to compensation because of the losses incurred. In their reply, the Watchtower indicated that indeed one of the batches of oil supplied may have been contaminated or had defects. The sales director however appeared to defend the fact that the rest batches were up to standard. However, according to the letter addressed to the supplier (seller), the buyer wanted full refund of the money used to make the purchased. In addition to that, the seller insisted that they need to be compensated due to the number of watches that had been affected. For that, reason, apart from refunding the total amount of purchase, there was need to further pay 2,000 pounds. Discussion Prior to the purchase of the materials, Watchtower provided Classic Gift Ltd with a document 1, which provided the terms and conditions that would make the contract legally binding. Some of the stipulations were that for the contract to remain binding, both parties had to address each other in writing, and within some stipu lated period of time1. Secondly, the seller was supposed to ensure that he supplied goods that were free of any defects to the buyer. However, to facilitate this provision, the buyer on the other hand was supposed to inspect the goods sent to ensure they were of the required standard and quality, upon detection of any anomalies, the buyer is obligated to address the buyer in writing, giving their dissatisfactions in the goods2. However, such a complaint was supposed to be done within the first 14 days. If these days elapse, the buyer was not entitled to any compensation. As part of ensuring that the seller was compensated, the terms and conditions stipulated that, the seller would either get partial or full refund. In addition to that, the seller may be provided with another butch of goods that meet the required standard. From the above explanation, it is clear that Classic Gift Ltd was entitled to compensation. The letter addressed to the supplier was made within 14 days. The lette r highlighted the losses that the company had suffered due to the contaminated oil. According to Unfair Contract Terms Act 1977, it is imperative to ensure that the buyer of the goods proof reasonably that there was actually a loss that was incurred. Such a loss must be linked to the mistake done by the seller. In the above issue, it is outright that the seller was entitled to remedies. Firstly, it appears that the buyer may have had the knowledge that some of the oil supplied was defective.