England and Wales Court of Appeal (Civil Division) Decisions

Medivance Instruments Ltd. v Gaslane Pipework Services Ltd. & Anor [2002] EWCA Civ 500 (18th April, 2002)

IN THE SUPREME COURT OF JUDICATURE
IN THE COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM THE HIGH COURT OF JUSTICE
QUEEN’S BENCH DIVISION
(HIS HONOUR JUDGE PHILIP PRICE QC – Sitting as a High Court Judge)

		Royal Courts of Justice Strand, London, WC2A 2LL
		18th April 2002

NEUBERGER J:

1. This is an appeal brought by Medivance Instruments Limited with the permission of Clarke LJ, from a decision of His Honour Judge Philip Price QC. In a reserved judgment given on 10^th January 2001, he dismissed its claim for damages against Gaslane Pipework Services Limited (“Gaslane”) and Vulcana Gas Appliances Limited (“Vulcana”).

The Facts

2. The claim arose out of a fire which broke out shortly after 6 a.m. on 19^th December 1994 in the small parts and packing area (“the packing area”) in the appellant’s factory in Harlesden, NorthWest London. The appellant occupied the factory in connection with its business of manufacturing x-ray and other equipment, and supplying such equipment to medical, dental and veterinary practices. The fire, which caused substantial damage to the factory and its contents, resulted from the ignition of one or more cardboard boxes which the Judge found had been left very close to the front grill of a heater in the packing store. The heater, which was a Vulcana Temcana 20C Heater (“the Heater”) had been designed and manufactured by Vulcana, who had supplied it to Gaslane, who in turn had sold it to, and installed it for, the appellant.
3. The Judge described the Heater as:

“A room sealed fan-assisted heater with a balanced flue. It is fired by natural gas… It stands on the floor. …The ambient room air is drawn into the right side… by a fan and is blown over the heat exchanger surface before discharging into the room through the front grill…”

The Heater was 915mm wide, 834mm high and 372mm deep. The Judge explained that the Heater included:

“An overheat thermostat… which operates at about 95°C to cut off the power… to prevent appliance over-heat in the event of the failure of the fan. That shuts down the gas valves to the burner.”

4. If the outlet grill at the front of such a Heater is obstructed, it will lead to an increase from the temperature at which it usually operates, namely around 100°C, to a higher temperature, the precise level of which will depend upon the nature, size and proximity of the obstruction. Without an obstruction, the temperature at the front of the Heater is far too low to lead to the igniting of nearby cardboard. However, the rise in temperature resulting from an obstruction of the outlet grill at the front of the Heater can be sufficient to set fire to cardboard, at least where the obstruction itself is made of cardboard.
5. Vulcana had been manufacturing heaters since 1968, and each of their models, including the Heater, had been tested and certified by British Gas. Most, possibly all, of the heaters which the appellant had installed in the factory had been manufactured by Vulcana.
6. In August 1993, the appellant approached Vulcana about extending the heating in the factory. The following month, Mr Bold, Vulcana’s sales agent, inspected the factory and saw the existing heaters in place. He assessed what he thought was needed to heat the packing area, and recommended that the appellant purchase a Vulcana Kestrel 250 Heater for the packing area. Around the same time, Mr Wybrow, Gaslane’s contract manager, visited the factory and gave the appellant a quotation for carrying out Mr Bold’s recommendation.
7. Mr Buckland, the appellant’s production director, expressed a preference for a type of heater whose style was closer to that which the appellant had elsewhere in the factory. In light of this, on 13^th September 1993, Mr Whybrow produced a quotation for installing the Heater, which was essentially an updated version of Vulcana heaters which the appellant had elsewhere in the factory. This quotation was accepted by the appellant, and the Heater was installed by Gaslane on, or at any rate by, 13^th November 1993. There were no problems with the Heater until the fire which took place some 13 months later.
8. The instructions issued by Vulcana with the Heater, which were duly passed on by Gaslane to the appellant when the Heater was installed, included this warning:

“Do not cover or obstruct any parts of the heater with clothes or other materials. No article should be placed within 600mm of the front of the heater.”

The instructions also included this recommendation:

“While this appliance meets the required Safety Standards, additional guarding is recommended to give full protection to young children, the elderly or the infirm.”

9. Around the heaters which had already been installed in the factory, Mr Buckland’s predecessor had placed crosshatched markings on the floor for a distance of 300mm. Mr Buckland explained that this was to prevent items being placed within 300mm of those heaters, and, more specifically, within 300mm of the front. Mr Buckland did not arrange for such crosshatched markings around the Heater in the present case. This was because the Heater had been installed virtually abutting a walkway which was marked on the ground with tape. Mr Buckland took the view that the extent of this marked walkway would be enough, in light of the appellant’s standing instructions to all its staff not to place anything in the walkways for safety reasons, and of the knowledge of the staff of the need to keep the front of any heater clear of obstructions. Mr Buckland said that he had emphasised to the appellant’s supervisors and staff the warning in the instructions which accompanied the various heaters manufactured by Vulcana. The evidence established that the installation of the Heater was effected by Gaslane in accordance with Vulcana’s instructions, save possibly in one respect which had no bearing on the cause of the fire.
10. The day before the fire occurred, there had been what the Judge called “significant upheaval” in the packing area, involving a major reorganisation whereby a number of substantial racks and an inspection table were moved, and there was a large amount of re-stacking and removal of goods and containers. The disruption was exacerbated by deliveries and rubbish collection taking place on the same day. By the time the factory closed on 18^th December, the state of the packing area was, according to the Judge, “chaotic”, not least, it would appear, because the reorganisation work had not been finished. Unfortunately, one of the consequences of this upheaval was that the walkway markings on the floor of the packing area were no longer apparent or appropriate.
11. Having considered the factual and expert evidence, including photographs taken by the Fire Brigade and by the appellant’s loss adjusters, the Judge described the explanation of the fire put forward on behalf of the appellant. This involved expansion of the packaging material on a shelf, which in turn resulted in causing a container falling from the shelf and to land in front of the heater. The Judge rejected that explanation and concluded that, when the factory closed on 18^th December “one or more cardboard containers had been left on the floor hard up against or very close to” the front grill of the Heater. Accordingly, when the Heater started up at 6 a.m. on the morning of 19^th December 1994, the blockage of the front grill, caused by the cardboard containers, resulted in the temperature rising to such a level that the containers ignited, and this led to the fire.

Outline of the issues

12. The appellant argues that Gaslane was in breach of:

i) Its contractual duty to provide a heater of merchantable quality;

ii) Its contractual duty to provide a heater which was fit for the purpose for which it was known to be required, namely for use in the packing area of the appellant’s factory;

iii) Its contractual duty to provide a heater which was suitable and safe for such use;

iv) Its contractual and tortious duties to exercise reasonable skill and care in considering the appellant’s heating requirements in the packing area, and making proposals in relation thereto;

v) Its implied representation as to the suitability and safety of the Heater.

13. As to Vulcana, the appellant contends that it was in breach of its tortious duties to the appellant:

i) To ensure that the heater it recommended and supplied through Gaslane, was suitable and/or safe for installation and use in the appellant’s packing area;

ii) To ensure that Gaslane quoted for a suitable heater, and to give appropriate consideration to the suitability of the Heater;

iii) To ensure that any heater supplied by Gaslane would be safe and suitable for use in the appellant’s packing area;

iv) As designer and manufacturer of the Heater, to ensure that it was suitable and safe for use in buildings and conditions in which it could be expected to be installed.

14. The appellant’s case in contract against Gaslane relies in part on the provisions of section 14 of the Sale of Goods Act 1979 (“section 14”), which applies in this case in its original, unamended form. So far as relevant, section 14 provides as follows:

“…

(2) Where the seller sells goods in the course of a business, there is an implied condition that the goods supplied under the contract are of merchantable quality, except that there is no such condition –

(a) as regards defects specifically drawn to the buyer’s attention before the contract is made; or

(b) if the buyer examines the goods before the contract is made, as regards defects which that examination ought to reveal.

(3) Where the seller sells goods in the course of a business and the buyer, expressly or by implication, makes known… to the seller… any particular purpose for which the goods are being bought, there is an implied condition that the goods supplied under the contract are reasonably fit for that purpose, whether or not that is a purpose for which such goods are commonly supplied, except where the circumstances show that the buyer does not rely, or that it is unreasonable for him to rely, on the skill or judgment of the seller…

…

(6) Goods of any kind are of merchantable quality within the meaning of sub-section (2) above if they are as fit for the purpose or purposes for which the goods of that kind are commonly bought as it is reasonable to expect having regard to any description applied to them, the price (if relevant) and all the other relevant circumstances.

…”

15. In the absence of special factors, it seems to me that it would be inappropriate for the court to impose, through the medium of tort or of implied contractual terms, any obligation on a seller which involves a higher duty than that which the parties have expressly imposed in their contract, or which the legislature has imposed through section 14. No argument has been advanced in the present case which suggests to me that there is anything special about the facts of the present case. It is true that both the respondents knew in some detail the circumstances in which the Heater would be used: they knew of the layout of the factory, and in particular of the packing area, and the nature of the appellant’s business, and the way in which it was run. However, as I see it, such factors are effectively catered for in section 14(3).
16. I turn to the difference between the test of merchantable quality in sub-section (2) and the test of fitness for purpose in sub-section (3) of section 14. The test of merchantable quality is comparatively general: merchantability is to be assessed by reference to the nature of the article and the likely sort of uses to which it would be put. Fitness for purpose, on the other hand, is directed to the specific purpose for which the purchaser is acquiring the article, at least to the extent that that purpose is known to the seller. In this connection, it is to be noted that section 14(6) only applies to the merchantable quality test. To have regard to “the purpose or purposes for which goods of [the relevant] kind are commonly bought” will always be appropriate to the more general question as to whether the article concerned is of merchantable quality. However, that is not to say that such a consideration will always be relevant to the issue of fitness for purpose. In some cases where that issue is in play, the test in sub-section (6) may well be relevant.
17. The provisions of section 14 apply as between the appellant and Gaslane, because there was a contract under which the appellant was “the buyer” and Gaslane was “the seller”, and under which the Heater was supplied. However, there was no contract or buyer/seller relationship between the appellant and Vulcana. Any liability it may have to the appellant would lie in tort, not in contract. Accordingly, the basis of the appellant’s claim against Vulcana is juridically very different from that of its claim against Gaslane. However, on the facts of this case, the appellant contends that Vulcana’s obligations in tort to the appellant included duties which in practice were effectively identical to the contractual duties of Gaslane to the appellant pursuant to the provisions of section 14. That is because, if the Heater was not fit for its purpose or not of merchantable quality, the appellant says that Vulcana, as manufacturer and supplier, would have been negligent. For the purpose of this appeal, I am prepared to proceed on the assumption that this contention is correct in principle.
18. As already mentioned, the appellant puts its case against each of the respondents in a number of other ways over and above those formulated under, or by reference to, section 14(2) and (3). However, Mr Geoffrey Brown, in the course of his admirable submissions for the appellant, rightly accepted that, if the claims against Gaslane and Vulcana, on the basis that the Heater was not fit for its purpose or of merchantable quality, fail, its other claims cannot succeed. We can therefore limit our consideration on this appeal to the claims under section 14 (in the case of Gaslane) or their tortious equivalent (in the case of Vulcana).
19. Having identified the nature of the duties which the appellant alleges against each of the respondents, it is necessary to identify the nature of the breach or breaches of those duties as alleged by the appellant. In this connection, the central point made by the appellant is that the Heater was not of merchantable quality and/or fit for its purpose, in that it was not supplied with sufficient protection in the event of overheating due to the front grill being blocked. More particularly, the appellant argues that such protection could easily have been provided in one of two ways. First, in addition to the thermostat which prevented overheating in the event of fan failure, the Heater should have included a thermostat device which shut down the Heater in the event of its overheating for any other reason, in particular because of blockage of the front grill. Alternatively, the appellant contends that the Heater should have been supplied with a guard of the type described in the second extract I have quoted from the instructions accompanying the Heater. In other words, without the thermostat device or the guard, the Heater was, in the appellant’s contention, neither of merchantable quality nor fit for its purpose.
20. The Judge rejected this contention and therefore dismissed the claim. In summary terms, he reached his conclusion bearing in mind four factors, namely:

i) The Heater complied with the relevant British Standard;

ii) The appellant was warned not to permit the very thing which led to the incident complained of; indeed, even without the warning, it is clear that the appellant and all its staff were very well aware of the risk and knew how to avoid it;

iii) The appellant had ordered the Heater not merely knowing of the risk and how to avoid it, but in the context of having used similar heaters for the previous eight years or so, and being satisfied that all necessary precautions could be taken to avoid the problem;

iv) Expert evidence on behalf of the respondents, which was to the effect that the Heater was of merchantable quality and fit for its purpose, was preferred by the Judge over other expert evidence which, at least to some extent, assisted the appellant’s case.

21. The Judge accordingly rejected the argument of the appellant which effectively relied on three contentions. First, that the Heater would undeniably have been safer if it had had a thermostat, which shut down in the event of overheating, caused by blockage of the front grill, or a guard. Secondly, that there were good reasons why the Heater should have had such a thermostat device or guard. Thirdly, that there were various indications that it had such a thermostat device.

The Appellant’s Case

22. The fact that the Heater would undoubtedly have been safer if it had been supplied with such a thermostat device or a guard cannot of itself mean that the Heater was not of merchantable quality or that it was not fit for its purpose. First, the requirements of section 14 do not involve imposing such a high standard, as a matter of ordinary language. Secondly, it would place an intolerable burden on suppliers of goods, and therefore would represent a serious interference with normal commerce, if a claim brought under section 14 succeeded every time it could be shown that the article concerned could have been safer, more merchantable or more fit for its purpose than it actually was. On the other hand, if it can be shown that a desirable improvement to the article was common practice, easy and cheap to achieve, and had obvious benefits, then a buyer’s prospect of establishing lack of merchantable quality or of suitability for purpose obviously would be enhanced.
23. Equally, I should add for the avoidance of doubt, it appears to me that the test of merchantability or of fitness for purpose is not, at any rate in all cases, satisfied by reference by a test of reasonable necessity: in this context, I would refer to the observations of Mustill LJ in Rogers –v- Parish [1987] 1 QB 933 at 944C-E.
24. The appellant does not merely rely on the fact that the Heater did not have a thermostat which effected a shut down in the event of overheating due to a blockage of the front grill, or a guard. It also makes the following points. First, other convector heaters on the market at the time were supplied with a thermostat device which was described as functioning in a way advocated by the appellant. Secondly, the installation of such a device would not have been an expensive or difficult exercise. Thirdly, such a device would have been particularly appropriate bearing in mind that the Heater was to be used in the packing area, where there was a risk of obstruction by inflammable material, because, however well run a factory may be, there is obviously always room for human error. Fourthly, it is scarcely significant that the appellant did not request the inclusion of such a device, and did the best it could without it, because the appellant did not know that such a thermostat could be supplied relatively easily and cheaply.
25. Although it may very well have been possible to attach an effective thermostat device, of the type contended for by the appellant, to the Heater at relatively small expense, the evidence was by no means as favourable to the appellant as might appear from this summary of its case. First, although there were some convector heaters on the market which included a device described in the terms relied on by the appellant, it is equally clear that there were a number of other convector heaters on the market which, like the Heater, did not. Further, there was no evidence as to the effectiveness or reliability of such a device in preventing incidents like that which occurred in the instant case. In that connection, the location, rating, and operation of any such devices could be very material. Secondly, the inclusion of a device in a heater is not quite as simple an exercise as the appellant suggests. The Judge described it as “not a straightforward matter”, and referred to the difficulty in establishing the number of thermostat controls which would have to be included in order for the device to be reliable, and the uncertainty as to where those controls should be placed. Thirdly, the Judge did not consider that the danger or risk in the packing area was unusually great, a factor I shall discuss a little further below.
26. Fourthly, the Judge considered whether the appellant would have been attracted by another heater which had the additional feature of a device. In that connection, Mr Buckland of the appellant said that, if he had been aware that there were on the market heaters with devices included, he would have bought one, but the Judge described that testimony as “not convincing in the totality of his evidence”, albeit “understandable now in the light of his experience”. He thought that Mr Buckland “had a very high degree of confidence in the protective systems in terms of management and of gangways etc.” and “took pride in such physical arrangements and the system of work”. For the same reasons, the Judge rejected the notion that Mr Buckland would have been interested in acquiring a guard.
27. Both Mr Bold, Vulcana’s sales agent who initially recommended the Kestrel Heater, which also had no thermostat device of the type suggested by the appellant, and Mr Collis, the employee of Gaslane who installed the Heater in the packing area, told the Judge that they thought that it had such a device. This gives one pause for thought. However, it seems to me that, at least on its own, such evidence takes matters very little further forward so far as this appeal is concerned. It is possible that one or both of the witnesses could have been under this impression for a number of reasons. They may have believed that all convector heaters had such a device, or that all convector heaters were required to have such a device, or that the thermostat which cut off the power if the fan failed also worked in other situations as well, such as overheating caused by blocking of the grill. Another possibility is that a third party wrongly informed either or both of them that the Heater included a device; or perhaps they took the view that, because the Heater was a relatively modern model it would have such a device. Unless one knows the reason why these two witnesses believed that the Heater had a device, whether the reason is relevant to the issues in this case, and what weight should be given to their belief in light of their experience and knowledge, it seems to me that their actual, erroneous belief is of little value to the appellant’s case.
28. There is also the fact that Vulcana’s brochure described the Heater as having an “overheat switch [which is] fail safe on overheating” and “Full safety protection provided electronically”. Again, this is not a negligible point, but in relation to the present issues, it seems to me that that takes matters little further. There is no suggestion that the appellant saw the brochure, and the mere fact that this brochure would have at least arguably have been understood to indicate that the Heater had a device, is not of itself of much assistance on the issue of whether, without the device, the Heater was of merchantable quality or fit for its purpose.

The Respondent’s Arguments

29. I turn, then to the arguments which carried the day with the Judge. The first point, which the Judge described as “very important”, is that the Heater complied with the British Standard and had been certified by British Gas.
30. Heaters, like many other appliances, are the subject of standards issued by the British Standards Institution (“the Institution”), an independent and non-profit-making body, incorporated by Charter to undertake the preparation and promulgation of standards for the production of goods and the provision of certification and testing (as explained in Halsbury’s Laws, 4^th Edition, Vol. 41 at paragraph 437). The relevant British Standard in this case is BS5258 “Safety of Domestic Gas Appliances”, Part 13 “Specification for Convector Heaters”. This Standard, as Mr Andrew Bartlett QC (who appears with Mr Andrew Burns for Gaslane) pointed out, was prepared under the direction of a committee which included representation from British Gas Corporation, Consumers Association, Health and Safety Executive, Royal Society of Prevention of Accidents, and four government departments. Although the Standard relates to domestic heaters, it was common ground between the experts who gave evidence that it would be regarded as the appropriate Standard in relation to heaters in a commercial environment. The Standard, which runs to over 30 pages of fairly close print, contains no requirement, or even recommendation, about the inclusion of a device or a guard, although it does contain this:

“18.10.1 In the event of the fan failing to produce the necessary airflow for any reason… no hazard shall arise and the gas supply to the main burner shall be shut within 60s.”

31. On 2^nd April 1992, British Gas issued a “Test Certificate – Commercial Appliance” in relation to the Heater. In that Certificate, British Gas stated that they “tested and examined” the Heater “during the period 13.2.92 to 18.3.92” and went on to certify that it complied with the requirements of BS5258 Part 13.
32. It is not as if the British Standard is silent on the question of some sort of automatic cut off mechanism in the event of a convector heater overheating: it specifically requires a control of the sort which the Heater had, namely an automatic switch-off mechanism if the fan failed. The significance of the British Standard in the present case is reinforced by a “Gas Installer Manual” issued by CORGI, the Council of Registered Gas Installers in April 1997, which “acknowledges the use… of reference material published by the … Institute” and specifically directs its members to refer to the British Standards. It is also relevant, when considering the weight to give to the British Standard, that, at least in the present case, it is in the context of what the appellant’s expert, Dr Foster, accepted was a “fairly heavily regulated and standard-related industry”.
33. The appellant referred the Judge to other publications. “The Planning Guide to Space Heating”, issued by the Fire Protection Association, warned against the risk of combustible material being ignited if it was near the part of the Heater from which hot air emerged, particularly if such air became very hot. “Loss Prevention Council Guide for Warehouses and Other Storage Places” advised the provision of guard rails which “entirely surround gas fired space heaters allowing a clear space of at least one metre”. However, in agreement with the Judge, it seems to me that these recommendations are more concerned with the care to be taken in relation to the use of convector heaters than with the manufacture or supply of convector heaters. In other words, they are really directed more to a person such as the appellant, using a convector heater in its premises, rather than to persons such as the respondents, the manufacturers, suppliers and installers of convector heaters.
34. What are the consequences, in terms of merchantability and fitness for purpose in a contractual context, of the article concerned complying with standards laid down by an organisation such as the Institution? Two decisions of this Court appear to me to establish that, if the article complies with the standards laid down by the Institution, then that is certainly an important factor which should be taken into account, but it is by no means necessarily a conclusive factor. In my judgment, it would be a particularly important factor in favour of the seller on the issue of merchantability, because neither the British Standard nor merchantability is directed towards the specific purpose for which a particular seller intends to put the article. However, even when considering fitness for purpose, it seems to me that the fact that the article complies with the British Standard is unlikely to be irrelevant, albeit that the more unusual and exceptional circumstances of the particular use, the less may be the force of the argument that the article complies with the British Standard.
35. In Ward –v- The Ritz Hotel (London) Limited [1992] PIQR 315, the majority of the Court of Appeal reversed the first instance finding of no liability in a case where the plaintiff had fallen over a balustrade which was significantly lower than the height recommended by the Institution. Nourse LJ said at [1992] PIQR 331 that:

“In the light of [various] considerations…, particularly in the defendants’ failure, in 1976 or thereabouts, to raise the level of the balustrade in accordance with the British Standards then in force,... liability is established in this case.”

36. In Green –v- Building Scene Limited [1994] PIQR 259, the Court of Appeal upheld the dismissal of a claim based on the allegation that the plaintiff would not have been injured if there had been a central handrail in accordance with the requirements both of the Building Regulations 1976 and in the Code of Practice issued by the Institute. Staughton LJ said this at [1994] PIQR 269:

“[The] fact that the stairs did not comply with the Building Regulations or the relevant British Standard… is evidence which we must certainly take into account. It represents current professional opinion as to what is desirable in order that accidents should be avoided. But it is one thing to lay down regulations and standards with that objective, and another to define what is reasonably safe in the circumstances of the particular case.”

37. We were not referred to any case where an article was held to be not of merchantable quality or not fit for the purpose where it complied with the British Standard. Clearly, there could be circumstances where an article would not be of merchantable quality even though it complied with the British Standard. Thus, it may be shown that the British Standard was prepared at a time when a specific defect or problem was not known. Or the court may conclude that, for one reason or another, the British Standard was not concerned with the particular problem or defect which arises in the case before it. Further, in an appropriate case, the court could conclude that the British Standard was too low or deficient in a certain respect. After all, I believe, every British Standard Specification (and BS 5258 is no exception) contains the statement that compliance with the Standard does not of itself necessarily absolve the manufacturer or supplier of the relevant article from legal liability. In the present case, as I have already mentioned, the British Standard does deal with the question of a cut-off mechanism in the event of overheating, and effectively limits it to a case where the overheating is attributable to the fan not working. It is, I think, fanciful to imagine that those responsible for compiling the Specification in question cannot have been aware of the risk of a convector overheating by blockage of the outward grill.
38. The fact that the Heater complied with the British Standard is, therefore, of strong assistance to the respondents so far as merchantability is concerned. However, the fact that the Heater complied with the British Standard is potentially of less significance in relation to the argument as to fitness of purpose. That is because the appellant’s case is that the respondents knew that the Heater was to be used in the packing area, and that this would involve the risk of combustible material being near the Heater, and the consequent risk of fire, even if only due to oversight on the part of the appellant’s staff in failing to ensure that combustible material was kept away from the front of the Heater.
39. As to the relevance of compliance with the British Standard to the issue of fitness for purpose, the Judge accepted expert evidence on behalf of the respondents to the effect that the use of the Heater “in a well-run storeroom poses no significantly greater degree of risk compared to its use in other well-run commercial environments”. He went on to say that, while the packing area contained combustible materials, it was not large, there was no mechanical handling, and “the quality of management of the store was generally high”. He expressed himself “satisfied the degree of risk does not require the installation of a different sort of heater than that provided”. Mr Brown makes the point that the evidence on this topic was pretty slender, and that the Judge’s observations did not condescend to particulars. While I see some force in that point, it seems to me that the Judge was entitled to start with the finding that the Heater was of merchantable quality, in light of its compliance with the British Standard and other factors, and then to proceed, in effect, to conclude that it was fit for its purpose for essentially the same reasons, given that, in light of the expert evidence, he did not consider that the circumstances in which the Heater was to be used made the specific “purpose” different from the general run of purposes which would be covered by merchantability. Further, if the evidence on the issue was unsatisfactory, it appears to me that that is more a problem for the appellant than for the respondents, given the onus of proof was on the appellant to show that section 14(3) was not satisfied.
40. The second point which weighed strongly with the Judge was the warning in the Instructions, to the effect that the front of the Heater should be left unobstructed because of the risk of fire. That warning was clear and unambiguous, and, as I have mentioned, it was clearly drawn to the attention of the appellant, through Mr Buckland. Not only was the warning of the risk in the present case expressly communicated in clear and unequivocal terms, but there is no doubt that the appellant was well aware of the risk in any event. Indeed it had, to the knowledge of each of the respondents (whose representatives had visited the factory), taken sensible precautions to deal with the risk, namely the warnings to staff and cross-hatching on the floor in front of all the other heaters manufactured by Vulcana.
41. As pointed out by Mr Graham Eklund, in his skeleton argument on behalf of Vulcana, Mr Buckland was well aware of the risk, which he considered to be obvious, of placing articles, particularly of an inflammatory nature, so as to obstruct the air being blown out of a convector heater, and he said that instructions had been given to all the management and supervisory staff of the appellant to ensure that no problem occurred. Indeed, the two principal employees of the appellant in the packing area, Mr Burtenshaw and Mrs Grimes, were well aware of the risk of leaving cardboard boxes in front of the Heater. They also accepted that, if the appellant had put a box directly in front of the Heater, and this had resulted in a fire, the fire would be the appellant’s own fault. Of course, it cannot be suggested that such concessions by witnesses in cross-examination can conceivably bind the court, but they are of assistance to the respondents in the present case.
42. The extent to which a clear and unambiguous warning about a problem, or knowledge on the part of the buyer of a problem, which could arise as a result of the use of the article, will exonerate the supplier for any liability for damage caused by that problem as a result of the buyer’s non-compliance with the warning, must depend on the circumstances. In many cases, it seems to me that, provided the warning of the risk is given in clear and unambiguous terms, or it is plain that the seller was fully aware of the risk, then that would be a sufficient answer of itself to the claim. However, although there are judicial dicta which, if read on their own, could be taken as suggesting that in every case a warning (and therefore knowledge) will suffice, I do not think that that can be a defence to a claim of breach of section 14(2) or (3) in every case.
43. Indirect support for that conclusion is to be found in Wright –v- Dunlop (1973) 7 KIR 255, which involved a claim by employees who had contracted cancer as a result of working with a product called Nonox S, which had been supplied to their employer, Dunlops by ICI. At 7 KIR 272, the Court of Appeal said this:

“ICI, then, owed a duty to Dunlops’ employees in respect of Nonox S. What was the extent of the duty? It was a duty to take all reasonable steps to satisfy themselves that Nonox S was safe… in the sense that there was no substantial risk of any substantial injury to health on the part of persons who were likely to use it or to be brought into contact with its use…

It is obvious that the answer to the question: “What are reasonable steps?” must depend upon the particular facts. …

If the manufacturer discovers that the product is unsafe, or has reason to believe that it may be unsafe, his duty may be to cease … to … supply the product in its unsafe form. It may be that in some circumstances the duty would be fulfilled by less drastic action: by, for example, giving proper warning to persons to whom the product is supplied of the relevant facts, as known or suspected, giving rise to the actual or potential risk….”

44. Of course, the Court of Appeal in that case was not concerned with the precise question which arises in the present instance, particularly as between the appellant and Gaslane, involving the construction and effect of section 14. However, it appears to me that those observations tend to support the view that whether a defect prevents an article being of “merchantable quality” or “reasonably fit for [a particular] purpose” cannot automatically be answered in the negative, merely because the specific defect complained of by the purchaser was the subject of a clear and unambiguous warning supplied to him by the seller at the time of the sale of the article.
45. So far as section 14(2) is concerned, I consider that it is clear from paragraph (a) that it cannot be denied that an article is of “merchantable quality”, because of a defect from which it suffers, if that defect has been clearly and unambiguously drawn to the attention of the purchaser at the time of sale. However, so far as fitness for purpose in section 14(3) is concerned, there is no provision equivalent to section 14(2)(a). Therefore, a warning of the defect, however clear and unambiguous, is not necessarily decisive. Accordingly, I consider that it sets a standard that must be judged by considering the article concerned, the purpose for which it was, and was known to the seller, to be used, and all other relevant circumstances, including any warning about any particular defect in the article concerned.
46. As Mr Brown said, if a seller can always avoid liability for a defect, whatever its nature, by providing a clear warning of the defect, then the seller would be effectively being permitted to define the scope of his contractual duty in every case, irrespective of the circumstances. There is obvious force in the point that, because manufacturers and suppliers such as Vulcana and Gaslane are far more knowledgeable as to the state of the art with regard to heaters, they should not automatically be able to satisfy the requirements of section 14 by issuing an appropriately worded and highlighted warning of the defect, if there is a simple, commonly used, and inexpensive way of avoiding the defect.
47. Having said that, it is right to say that in many cases the existence of a clear and unambiguous warning of a particular defect or risk when the product is sold, will, on its own, be enough to defeat a claim based on section 14, when, in the absence of such a warning, the claim would have succeeded. A relatively recent example may be found in Wormell –v- RHM Agriculture (East) Limited [1987] 1 WLR 1091. The case was concerned only with a claim under section 14(3), because it was accepted that if the claim failed under that sub-section, it could not succeed under section 14(2) – see at [1987] 1 WLR 1094A-B. Dillon LJ said this at [1987] 1 WLR 1094H to 1095A:

“These are goods which both [the defendant’s representative] and the plaintiff knew would be supplied with detailed instructions, and both of them expected that the plaintiff would read the instructions. Plainly the instructions have to be taken into account in considering whether the goods were fit for the purpose. The plaintiff cannot simply say that the weed killer was not reasonably fit for its purpose of killing wild oats if it would have been fit for that purpose if used in accordance with the instructions.”

48. The second sentence of that observation could be said to suggest that an appropriately worded warning is not necessarily conclusive in favour of the seller. Although the balance of the passage could be said to point the other way, it seems to me that it must be taken to be a conclusion based on the effect of the instructions and the risk or defect in that case.
49. In any event, the issue in that case did not concern a defect in the sense of a problem with the product which could lead to damage; it was concerned with a defect in the sense of a problem with the product which meant that it would not perform its intended function in certain circumstances. Rather more similar to the present case on the facts is Holmes –v- Ashford [1950] 2 All ER 76. In that case, the manufacturer of a hair dye was held not liable to a client of a hairdresser who contracted dermatitis as a result of being treated with the dye, because the dye was supplied with a clear warning of such a possible danger and a recommendation to test the effect of the dye first. The Court of Appeal applied the reasoning of an earlier Court of Appeal judgment in Hodge & Sons –v- Anglo-American Oil Co. (1922) LC.L.Rep 183, where at 188 Scrutton LJ said this:

“[I]f the barge… is an article of danger in itself, it is the duty of the owners to take proper and reasonable precautions to prevent its doing damage to people likely to come into contact with it. These precautions may be fulfilled by entrusting it to a competent person with reasonable warning of its dangerous character if the danger is not obvious.”

These two cases are not precisely in point as they were not concerned with section 14 or its statutory predecessor, but with negligence. However, they illustrate the great significance of warnings to (or indeed knowledge of) the buyer of a defect or risk. Nonetheless, they do not appear to compel the conclusion that such knowledge or warning of the defect or risk is enough to exonerate the seller of any liability for damage caused by the defect or risk, in every case.

50. In my judgment, the warning in this case was plainly an important factor in favour of the respondents, as the Judge said. He observed that “installers [of a heater] can… reasonably expect ordinary precautions to be taken to guard against the known risk”. He then found on the evidence, plainly rightly, that the risk in the present case was both properly warned against, and anyway well known to the appellant. He also said that it “depends on the circumstances whether such warnings will be sufficient to discharge the duties that rest upon [the seller]”. On the facts of the present case, he held that the circumstances were such that the respondents had discharged their duties under section 14 by giving the warning (if that was necessary in light of the appellant’s knowledge of the risk and experience in dealing with it in relation to other heaters).
51. Particularly in connection with the appellant’s case under section 14(3), the Judge thought, in any event, that the Heater was fit for the purpose for which it was supplied, in light of the fact that the appellant had specifically asked for the particular Heater, having knowingly used heaters of the same sort in the factory, with precisely the same risk. By 1993, when the Heater was supplied to the appellant, some of these earlier heaters had been used in the factory for about eight years. Accordingly, not only was the appellant well aware of the risk in question, but it had taken satisfactory steps to avoid it, in terms of marking the relevant area on the ground, and ensuring that members of its staff were properly instructed of the risk. The evidence suggests, and so far as the respondents were aware at the time, there was no reason to think that this state of affairs had proved anything other than entirely satisfactory. It would be quite unrealistic, particularly in a case involving a commercial buyer, to disregard the past experience and attitude of that buyer in relation to the use and care of articles of a very similar nature, when considering whether the article in question can fairly be said to have been fit for the purpose.
52. Fourthly, the Judge had the benefit of expert evidence. In this connection, there was clear evidence from a properly instructed and qualified expert, Mr Christie, called on behalf of Gaslane, to the effect that, essentially in light of the various factors to which I have referred, but also based on his experience, the Heater was of merchantable quality and fit for the purpose for which it was supplied. In particular, as I have mentioned, he did not consider that the use of the packing area, and the nature of the articles therein, posed an unusual risk, such that, even if the Heater was of merchantable quality generally for commercial purposes, it was not fit for the purpose of being used in the packing area, at least without a device or a guard.
53. Although the appellant’s expert, Dr Foster, expressed some views critical of the selection of the particular Heater for use in the packing area, it is hard to see why the Judge was not entitled to prefer the evidence of Mr Christie, particularly in light of some of the answers which Dr Foster gave in cross examination. Thus, in light of the fact that the Heater was “officially approved”, Dr Foster accepted that he “would not criticise Gaslane for picking [it]”. Further, Dr Foster was not experienced in the requirements of the design of heaters, other than through having consulted appropriate standards.
54. Expert evidence is not, of course, conclusive, especially when it is directed to the very issue which the Judge has to determine. However, unless the case is one where the Judge can get clear guidance from his own experience (as in some professional negligence cases), the factual evidence, common general knowledge or common sense, it can obviously be of value. That is particularly true in a case with a technical dimension, or where the case involves a practical dimension outside the skill and expertise of the Judge. Although not particularly technical, the present case was one in which expert evidence could reasonably have been regarded by the Court to be of assistance.

Conclusion

55. In my judgment, bearing in mind his findings of primary fact, Judge Price QC was plainly entitled to reach the conclusion that the Heater was merchantable and fit for its purpose in light of the four factors which he identified, despite the points made by the appellant. Indeed, in light of the cumulative effect of the four factors he relied on, I do not consider that he could properly have reached a different conclusion from that which he did. In these circumstances, I am of the view that the Heater was of merchantable quality and fit for the purpose for which it was supplied. As the appellant admittedly cannot succeed on any other basis alleged against either respondent, this appeal should accordingly be dismissed.

MANCE LJ:

56. I agree.

THORPE LJ:

57. I also agree.
Order: appeal allowed in part with no order as to costs; in respect of costs below, father's liability to run from the date of issue, namely 18th July; application for substantial payment on account to be determined by the money constitution of the court next week. (Order does not form part of the approved judgment)