Advise Aneel on the following Commercial Law problem.
Commercial Law Problem Question.
Aneel Computers Ltd manufactures desktop computers. They supply a variety of national retailers with high specification computers. They also supply ‘Tachilles 2.0’, a computer operating system. In January 2021, Vick PC Ltd, a national retailer, contracted with Aneel for a delivery of 30,000 ‘Horsey 1200’ computers. All the computers are to be delivered to Vick’s warehouse. Half of the computers are to be loaded with Tachilles 2.0. The first shipment (half pre- loaded with Tachilles 2.0, half without operating systems) is to be delivered in March 2021; the second shipment of the remaining devices is to be delivered in July 2021. Aneel also agrees to allow Vick to have the right between March and September, to sell to its customers a ‘pin code’ which allows Vick’s customers to download Tachilles 2.0 from the internet. The contract between Aneel and Vick also contains the following terms:
‘It is a condition of this agreement that Aneel undertakes to provide ‘Horsey 1200’ computers ready for retail distribution and that 15,000 of these computers will have the Tachilles 2.0 operating system pre- installed.’
‘Aneel’s terms and conditions of business, as delivered to Vick, shall prevail. These terms and conditions of business are subject to change without notice’.
Vick receives its first shipment in March 2021. The delivery to its warehouse is accompanied by a shipment invoice, which includes the following term on the reverse:
‘No terms are implied as to the condition, fitness or operating quality of Aneel’s ‘Horsey 1200’ computers… Any loss arising from the use or re- sale of any ‘Horsey 1200’ computer is limited to £10’
A fault in the Tachilles 2.0 operating system means that some of the computers delivered to Vick do not work properly. Similarly, some of Vick’s customers, who downloaded the Tachilles 2.0 operating system using a pin code have problems with their computers due to the fault in Tachilles 2.0. Vick has been compelled to reimburse its customers for the losses arising from this defect. In addition, 75 of the computers delivered in July 2021 were not installed with Tachilles 2.0 but an older version, Tachilles 1.0.
Vick rejects the entire shipment, informing Aneel that this is within their rights. Vick also seeks to recover compensation for amounts that they have had to pay to customers who had suffered because of the faulty Tachilles 2.0 systems sold to them by Vick.
Advise Aneel.
