Scotbeef Ltd v D&S Storage Ltd ((in Liquidation))
| Jurisdiction | England & Wales |
| Judge | Kelly |
| Judgment Date | 14 October 2022 |
| Neutral Citation | [2022] EWHC 2434 (TCC) |
| Docket Number | Case No: HT-2020-LDS-000008 |
| Court | Queen's Bench Division (Technology and Construction Court) |
| Year | 2022 |
[2022] EWHC 2434 (TCC)
Her Honour Judge Kelly sitting as a Judge of the High Court
Case No: HT-2020-LDS-000008
IN THE HIGH COURT OF JUSTICE
CHANCERY DIVISION
LEEDS DISTRICT REGISTRY
The Court House
Oxford Row
Leeds LS1 3BG
Mr Andrew Brown (instructed by Birketts LLP) for the Claimant
Mr Max Davidson (instructed by TKTL Solicitors) for the Defendant
Hearing date: 21 October 2021
Date draft circulated to the Parties 29 September 2022
Date handed down 14 October 2022
APPROVED JUDGMENT
This judgment was handed down by the Judge remotely by circulation to the parties' representatives by email and release to The National Archives. The date and time for hand-down is deemed to be 10:00am on Friday 14th October 2022.
Her Honour Judge Kelly
This judgment follows the trial of the preliminary issues ordered to be tried by order made on 22 March 2021. The preliminary issues are:
(1) Whether the Food Storage & Distribution Federation (‘FSDF’) terms and conditions were incorporated into a contract between the parties, as alleged by the Defendant;
(2) The effect of this (if any) upon the Defendant's liability.
The Claimant was represented by Mr Andrew Brown of counsel, and the Defendant was represented by Mr Max Davidson of counsel. I had the very great assistance of skeleton arguments from both counsel before the start of the hearing.
At the start of the hearing, the Defendant made an oral application to admit further documents. The documents which it sought to admit were three different sets of terms and conditions which the Defendant wished to rely upon to demonstrate industry standard terms and conditions. I gave reasons at the time of the decision for allowing the Defendant to refer to the terms of the United Kingdom Warehousing Association (“UKWA”) as those had been referred to in the pleadings, but refused permission to rely upon the other documents.
In addition, a late application had been made to admit the witness statement of Mr David Brian Straw (“Mr Straw”) dated 23 July 2021 as hearsay evidence as a result of Mr Straw's ill-health. I admitted Mr Straw's witness statement into evidence, and indicated during the course of my judgment on that issue that I would have to consider what weight could be given to the statement because Mr Straw could not be cross-examined.
Background
The Claimant claims £395,588 from the Defendant arising out of the alleged breach of contract by the Defendant in respect of storage of the Claimant's meat. A quantity of the Claimant's meat was found to be covered in mould and subsequently deemed unfit for human or animal consumption and had to be destroyed.
The Defendant admits that mould was found on meat products, but denies that the mould was caused by any failure of the refrigeration system at the storage facility nor by any breach of contractual duty by the Defendant. Further, the Defendant asserts that the contract incorporated the Food Storage & Distribution Federation (“FSDF”) terms and conditions which included time bar conditions, the effect of which was that the Claimant was time-barred from bringing any legal proceedings against the Defendant by, at the latest, 3 July 2020.
Further, if the claim was not time-barred, the Defendant asserted that the FSDF terms and conditions limited any damage found to have been caused by any breach to £250 per metric ton in any event. The Defendant's case is that there was a single contract, originally agreed in February 2017, which contract was subsequently amended to incorporate the FSDF terms and conditions.
The relevant FSDF terms and conditions were “Recommended Conditions For Storage Services” 2015 as follows:
“11.4 The Company shall have no liability for any claim unless;
a) the Company receives written notice of it within 10 days of the date upon which the Customer became aware of the event giving rise to such claim or would have become aware of the event had the Customer acted with reasonable diligence (“the Date”); and
b) a detailed claim giving sufficient details of the claim and alleged loss to allow the Company to investigate the claim including but not limited to the weight, value and date of delivery into store is submitted to the Company in writing within 21 days of the Date.
…
“11.7 In any event and subject to the rest of this Condition 11 and save where a higher limit is agreed pursuant to Condition 11.9, the Company's liability to the Customer, Owner or any other party with an interest in the Goods arising out of or in connection with the Services and / or the Goods whether based in contract, tort (including but not limited to negligence), bailment, restitution, equity, arising from statute or otherwise and including but not limited to in respect of loss (including theft), destruction, damage, unavailability, contamination, deterioration, delay, non-delivery, mis-delivery, unauthorised delivery, noncompliance with instructions or obligations, incorrect advice or information, loss or corruption of data, interference with or disruption of computer systems or any event giving rise to any liability of the Customer or Owner to any other person or authority shall never exceed:
(a) the Value of the Goods or the part thereof that is lost or damaged; or
(b) £250 per metric tonne of gross weight of that part of the Goods to which the claim relates;
whichever shall be the lesser.
“11.10 No legal proceedings may be brought against the Company whether by a claim, counterclaim, Part 20 claim or otherwise unless they are issued and/or served within nine months of the event giving rise to the claim.”
In addition, on the front page of the recommended conditions there were three introductory paragraphs set out in bold as follows:
“The Customer's attention is drawn specifically to conditions 4, 5, 7, 10, 11, 13, 14, 17, 19 and 21 which exclude or limit the Company's and the Company's subcontractors' liability or require the Customer to indemnify the Company and/or its sub-contractors in certain circumstances. There are also strict time limits within which claims for loss or damage must be notified and proceedings brought. Clause 15 entitles the Company to exercise a lien over goods consigned to it and provides for consequential rights.
To enable the Company to provide the Services to the Customer for the charges quoted the Company excludes and/or limits it's ( sic) liability for certain types of loss and damage and places a limit on any liability to the Customer.
The Company will not insure the Goods and the Customer and/or the Owner are advised to check their own insurance arrangements having regard to the limitations on the Company's liability and the indemnities being given by the Customer in the Conditions”.
The following chronology is of assistance:
| c. 2010 | The Claimant began its relationship with Woolley Bros. (Wholesale Meats) Limited (“Woolleys”). Woolleys began to store its own meat with the Defendant. |
| Early 2017 | The Claimant decided it needed a further depot and opened one in Wolverhampton. The Claimant asked Woolleys to make arrangements with the Defendant to store meat on behalf of the Claimant. The Claimant did not handle the meat before it went into storage with the Defendant. Woolleys processed the meat and then sent it to the Defendant and paid for it to be blast frozen. At that point, ownership of the meat transferred from Woolleys to the Claimant and the Claimant then paid the Defendant for the meat to be stored. The Claimant understood from discussions with Woolleys that the Defendant had appropriate insurance cover if anything should happen to the meat. Woolleys negotiated the price per pallet with the Defendant, acting as agent for the Claimant. Thereafter, weekly storage invoices were sent by the Defendant directly to the Claimant's head office by post. There was no written contract between the Claimant and the Defendant in respect of provision by the Defendant of cold storage services. |
| 27 February 2017 | First invoice from Defendant to Claimant – UKWA Terms are referred to on the invoice. The Defendant asserts in paragraph 7 of its Amended Defence that although the Defendant traded on UKWA terms and conditions, it is not alleged that those terms were in fact incorporated into any material contract with the Claimant. |
| c.1 May 2017 | The Defendant became a member of FSDF. |
| c.15 May 2017 | In its Amended Defence, the Defendant alleged that its employee, Clare Portsmouth, telephoned the Claimant and Woolleys to inform them that the Defendant was no longer trading on UKWA terms and conditions and from then on was trading on FSDF terms and conditions. In his witness statement, Mr Straw stated that he spoke to Gary Blockley of Woolleys by telephone and “mentioned to him” that the Claimant was switching from UKWA to FSDF terms and conditions and that the payment for claims was going up to £250 per tonne of meat damaged from £100 per tonne. Mr Straw also stated that he asked Clare Portsmouth to inform all customers about the change to the terms and conditions. |
| 15 May 2017 | First invoice from the Defendant to the Claimant which refers to FSDF terms and conditions. |
| 7 January 2019 | Woolleys and the Defendant enter into a written contract, the terms of which differ from the FSDF terms and conditions and FSDF terms and conditions are not mentioned in that contract. |
| 18 February 2019 | The invoices from the Defendant stop referring to FSDF terms and conditions (apart from a single invoice dated 16 September 2019). |
| 3 October 2019 | The Defendant transferred to the Claimant six pallets of beef which were discovered to contain mould. |
| 24 October 2019 | The Defendant provided the Claimant with a spreadsheet detailing the damage to the meat transferred to the Claimant on 3... |
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