|In December 2019, Alpha Ltd, the UK’s leading distributor of fruit and vegetables, supplied five hundred cases of tomatoes to Beta Ltd, a regional wholesaler, at a cost of £50,000. The contract between Alpha Ltd and Beta Ltd specified the tomatoes were to be ‘Grade A’ and ‘French in origin’.
On delivery at the Port of Liverpool, Beta Ltd discovered that the tomatoes were Dutch and Grade B in type. As a consequence, Beta Ltd spent £75,000 on finding replacement, French grown, Grade A tomatoes, in order to complete a contract with Delta Ltd, who own a chain of supermarkets within the M25. Beta Ltd rejected the consignment and the Grade B tomatoes were stored by Beta Ltd at a continuing, weekly expense of £5,000.
In response to Beta Ltd.’s claim for recovery of the purchase price and/or damages, Alpha Ltd is insisting that (i) it is not liable and (ii) the parties are bound by the following clause contained in the contract:
‘In respect of any breach of any term of the contract, express or implied, Alpha Ltd limits its liability to no more than fifty percent of the contract price.’
Advise Beta Ltd as to its legal position.
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