In the case between George Mitchell v Finney Lock Seeds the fundamental issues to the case is the limitation of liability to the cost of the goods (seeds) by replacing defective goods (seeds) or alternatively refunding the customers for the total invoice value of the goods purchased. Essentially any further liability that the farmers (respondents) may suffer from the defective goods (loss of crop, which includes profits) they will have no claim on the Merchants (Appellants). History is made in this case as the House of Lords had to consider a modern statutory provision which gives the court the power to override contractual terms based on the merchant (Appellants) limited liability. Of additional importance is that this ruling set precedence for future interference by the courts.
The further importance of this case is that it over –ruled the doctrine of law whereby parties are free to contract without interference of the courts. It is also interesting to note that the contract was entered into prior to the introduction of the Sale of Goods Act but the argument is that the contract between the parties was in essence against the guidelines of the Unfair Contract Terms Act . It is further argued that the wording of s 5 is essentially a replica of the wording of schedule 2 of the Unfair Contract Terms Act (UCTA) , therefor a case by the Merchants (Appellants) that the contracts between the parties were made prior to the introduction of the Sale of Goods Act is irrelevant and as Lord Bridge mentions it will soon outlive its usefulness.
In conclusion the main importance of the George Mitchell v Finney Lock Seeds is that the courts intervened and override contractual terms between parties.
Relation between Section 55 of the Sale of Goods Act and Schedule 2 of UCTA.
Schedule 2 of the Unfair Contract Terms Act and Section 55 of the Sale of Goods Act is so similar that one can argue it to be a replica of Schedule 2 of UCTA. The Sale of Goods Act expands in that it governs that parties may give up their rights under legislation as long as it is deemed to be fair and reasonable on parties. This fair and reasonableness test is according to s 55 (5), which as indicated above are similar to the UCTA .
Subsection 4 deals with the exemptions from ss 13, 14, 15 however notes that any contract, whether it is a consumer sale or sale of goods it has to be fair and reasonable. Subsection 9 covers exemption from a wide range of circumstances. This exemption as discussed in Figure 4.16 states that any reference to a term exempting from all or any provisions of the Act, has the right to confer any provision of that section of any liability of the seller for breach in contract .