Medivance Instruments Ltd V Gaslane Pipework Services Ltd Essay: Trade Union And Labour Relations Act 1992 Analysis.

Part 1 – Case Analysis

Read the case of Medivance Instruments Ltd v Gaslane Pipework Services Ltd and another [2002] All ER (D) 111 (Apr) and using this case only answer the questions below.

1. What judges heard this case in the Court of Appeal?

2. Who was the appellant and who were the two respondents in the Court of Appeal?

3. What is the difference between the test of merchantable quality in s.14(2) Sale of Goods Act and the test of fitness for purpose in s.14(3)

4. Did s.14 of the Sale of Goods Act apply to Vulcana? Give reasons for your answer.

5. Why did Neuberger J limit the appeal to the issues around s.14 and the tortious equivalent?

6. According to the appellant, why was the heater not of merchantable quality and/or fit for purpose?

7. What effect would it have on business if a claim under s.14 was won every time it was shown that the product in question could have been made safer?

8. Did the judges believe that a different heater should have been supplied to the appellant? Give reasons for your answer.

9. Why did Neuberger J rely on the case of Wright v Dunlop (1973) 7 KIR 255?

10. According to Mr Brown, why might it be dangerous to always allow a seller to avoid liability through warning the buyer of the defect?

11. Why did Neuberger J refer to the cases of Holmes v Ashford and Hodge & Sons v Anglo American Oil Co.?

12. Which of the following were material facts in the case?

a. If the appellant had known that there were heaters with thermostat devices included, he would have bought one.

b. The appellant had told the respondents that the heater would be used in a packing area.

c. There were a mixture of heaters on the market including those that contained a thermostat and those that did not.

d. Vulcana's brochure described the heater as having an "overheat switch [which is] fail safe on overheating" and "Full safety protection provided electronically".

e. The heater complied with the British Standard and had been certified by British Gas.

f. The instructions for the heater contained a clear warning that it should be left unobstructed. This warning was brought to the attention of the appellant.

13. Which of the following was the ratio decidendi of the case? If you think a statement is part of the ratio decidendi explain why. If you think a statement is not part of the ratio decidendi explain why.

a. It would be inappropriate for a 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.

b. The heater was of merchantable quality and fit for the purpose for which it was supplied.

c. Where a commercial buyer has previous experience buying a similar product and is aware of the risks in using that product, then the product is likely to be fit for purpose under section 14.

d. 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.

e. The fire was caused by a blockage on the front grill of the heater which resulted in the temperature rising to such a level that the containers ignited.

14. Mr Matthews owns a shoe shop. The shoe shop has a shop floor and a small, narrow, stock room which contains hundreds of cardboard boxes. The cardboard boxes contain shoes. Mr Matthews wished to purchase a heater for the stock room to use during winter so that his two stock room staff would be kept warm. Mr Matthews asked JTL, a heating company, to visit the store room and recommend a heater to purchase. The JTL representative recommended their standard heater which did not include a safety guard or thermostat. JTL installed the heater and explained to Mr Matthews that nothing should be placed within a metre radius of the heater. Mr Matthews signed a document confirming that he understood this. A few weeks later, Mr Matthews left an empty cardboard shoe box directly in front of the heater and within an hour the stockroom had caught fire. Mr Matthews is now claiming that the heater was not of merchantable quality and not fit for purpose. He had never purchased a heater before and had trusted JTL. JTL believes that the heater conformed to British Safety Standards and they adequately warned Mr Matthews not to put anything within a metre radius of the heater. Using only the case of Medivance Instruments Ltd v Gaslane Pipework Services Ltd and another, advise JTL on these claims.

Part 2 – Statute Analysis

Read the Trade Union and Labour Relations (Consolidation) Act 1992 (“the Act”) and using this statute only answer the following questions.

1. What is the short title of the Act?

2. What is the long title of the Act?

3. On what date did the Act come into force?

4. What linguistic presumption would the courts use to determine whether something is included in s.137(5)? Give reasons for your answer.

5. How would courts determine what ‘advertisement’ means in s.137(3)?

6. Sophie is looking for a job as a teacher. She has recently applied for a teaching position at Hansroad Secondary School. The Head Teacher of this school is a strong believer in supporting a national teaching trade union
called ‘Teach Excel Union’. This union helps to compile a short-list for interviews held at the school. The union is aware that Sophie is not a member of any trade union and refuses to offer her an interview for this
position. Advise Sophie.

7. Marlon is a builder. He attended an interview to become a full-time builder at a construction company called Zeon Limited. In the interview the manager, Henry, asked Marlon whether he was a member of any builders’
trade unions. Marlon replied that he was not a member. Henry told Marlon that he would be offered the job if he did not become a member of a trade union. Marlon felt uncomfortable with this request and explained that he
could not guarantee that he would never become a trade union member. Henry refused to offer the job to Marlon. Marlon experienced severe stress
and anxiety after this refusal and he was unable to work for one month. Advise Marlon.

8. IT World Ltd is an IT retailer that sells computers. Most staff members are members of an IT trade union. IT World Ltd started a redundancy process and proposes to dismiss 150 employees. IT World Ltd started consulting 35
days before it dismissed an employee for redundancy reasons. As part of the consultation, IT World Ltd consulted with senior staff members. One of these senior staff members is a trade union representative. There are five trade union representatives in total at IT World Ltd. IT World Ltd orally told the senior staff members how many people would be made redundant and the reasons for the redundancy. They also asked some other staff members how IT World Ltd could reduce the number of employees to be dismissed. However, when one staff member made a suggestion, IT World Ltd refused to listen. Advise IT World Ltd on their liability under the Act.

1. Short title, 2. Long title, 3. Date of Act's enforcement, 4. Linguistic presumption of s.137(5), 5. Determination of 'advertisement' in s.137(3), 6. Teach Excel Union, 7. Marlon's case, 8. Liability of IT World Ltd., 9. Consultation rule, 10. Simon's request

9. A catering company has suggested that they need to dismiss 25 employees. Under what rule of statutory interpretation would the company be required to start a consultation under s.188(1) and why?

10. Marketing Solutions’ accountant, Simon, is a member of an independent trade union which is recognised by Marketing Solutions. Simon has requested time off to represent the union at a trade union conference.
Marketing Solutions has told Simon that as it is near the end of the financial year, they need him to work. They have denied Simon’s request to attend the conference. Advise Simon.

1  This case was heard in an appeal by Lord Justice Thorpe, Lord Justice Mance and Mr. Justice Neuberger.

2  In the given case, Medivance Instruments Ltd was the appellant and Gaslane Pipework Services Limited along with Vulcana Gas Appliances Limited were the two respondents.

3  The following may be stated to be the differences between the test of merchantable quality and the test of fitness for purpose;

Goods or services are deemed to be of merchantable quality when they are fit to be used for the purpose or purposes for which they are offered for sale and are brought. Whereas, a product or service is deemed to be fit for purpose the consumers are capable of using the said product or services for the purpose for which they have been designed.

For example, a cameraman may use a piece of iron as a chisel by flattening one of its ends. Even though this product does not fit the definition of merchantable quality it is fit for purpose as the cameraman is being able to use it in place of the chisel.

4  Section 14 of the Sale of Goods Act, 1979 is very much applicable to Vulcana Gas Applications Limited. The provisions of section 14 would be applicable if the parties have a relationship of buyer and seller and there is a contract between the parties. In this case, the relationship between Vulcana and the appellant is not that of buyer and seller. The appellant has imposed tortuous liability against Vulcana. In spite of the above-stated fact, the provisions of Section 14 are applicable to Vulcana because the tortuous claim is based on the contractual relationship that exists between Gaslane Pipeworks Limited and the appellant. If the impugned heater is found to be lacking merchantable quality or it appears to be not fit for purpose, then Vulcana would be held liable for negligence because the said heater has been manufactured as well as supplied by Vulcana.

5  The issues in the given case have been restricted to Section 14 of the Act and its tortuous equivalent by Neuberger J. on the basis of the submission of Mr. Geofrey Brown, on behalf of the appellant. He stated that if the case of the appellant does not fall within the provisions of Section 14 of the Act, then the other claims of the appellant would not be able to survive. Thus, if the respondents can prove that their actions do not attract the provisions of Section 14 of the Act, then they will not be held liable.

6 The appellant claimed that the impugned heater was neither fit for purpose nor of merchantable quality. The basis of such claim of the appellant is based on the fact that the heater was not well equipped with safeguards in case of overheating. The appellant has also described that ways by the adoption of which the said heater could have been made safer. The appellant stated that if a thermostat device would have been installed in the heater then the device could have shut down in the event of overheating or if a guard was installed it would have protected against overheating. In the absence of these safeguards, the appellant considered the heater to be lacking in merchantable quality and not being fit for purpose.

7 In the instant case, the judges were not satisfied with the argument put forward by the appellants that the impugned heater could have been made safer by adopting the ways suggested. The judges stated that in case a claim under Section 14 of the Act would have succeeded every time the claimant could show that the product in question could have been made safer then it would be impossible to conduct business in the normal course. The manufacturers and suppliers in such a case would be imposed with unreasonable burned as per the judges.

8 The judges did not feel that the appellants should have been provided with a different heater. As per the judges, the degree of risk associated did not require for the supply of any other heater to the appellants.

9 The decision in the case of Wright v. Dunlop was relied on by Neuberger J. to establish the fact that when the supplier issues warning then in case of breach of duty the supplier's liability would be reduced. In Wright v. Dunlop, the employees contracted cancer as a consequence of working with a certain drug. The court held that, if the company would have issued warning regarding the risk associated then in liability of the employer for the breach would have been reduced considerably. But Neuberger J. was not agreeable with the decision.

10 Mr. Brown states that if, by way of providing warning, a seller may always escape liability then the seller, in each and every case, would acquire the right to define the scope of his/ her liability. This would make it easier for the seller to escape liability in case of breach of duty.

11 In order to illustrate the importance of providing warning of the associated risk by the seller to the buyer, Neuberger J. has referred to the cases of Holmes v. Ashford and Hodge & Sons v. Anglo-American Oil Co. However, Neuberger J. cautioned that a seller would not be able to escape liability for breach only by providing warning.

12 The material facts of the given case are the following;

The facts stated under points (d), (e) and (f) are material facts of the instant case.

13 Ratio decidendi of a case is the principle of law established in a case which would be applicable to future cases based on similar facts. The impugned statement may be said to be the ratio of this case. It establishes the legal principle that sellers cannot be subjected to such obligations that have not been laid down in the statutes and the parties have not stated in their contract.

The impugned statement is only a fact of the case and is not the ratio as it does not lay down any legal principle for future observance by courts while making decisions in cases with similar facts.

The impugned statement is a ratio of the instant case. It lays down that in case a buyer has prior experience of buying similar product or is well aware of the associated risks then the said product would be deemed to be fit for purpose within the meaning of Section 14 of the Act.

The impugned statement is a ratio. This statement provides the circumstances under which a buyer can prove that a product or service lacks merchantable quality or is not fit for purpose.

The impugned statement is a fact of the case in hand.

14 Facts

Mr., Mathew, the owner of a shoe store that has a narrow stock room purchased a heater for the stock room.

The heater was purchased from JTL.

JTL warned Mr. Mathew that the heater should be placed in such a way that at least an area of a meter is kept clear around the radius of the heater.

A thermostat device was not installed in the heater.

In the stock room, cardboard boxes were kept in direct contact with the heater.

The heater caused the fire that effected the entire stock room.

Whether the heater satisfies the criterion of fitness for purpose and merchantable quality as laid down under Section 14 of the Act.

This case would be decided on the basis of the principles laid down in the case of Medivance Instruments Ltd. v. Gaslane Pipeworks Services Ltd and another. In this case, the court has provided a four-step test to determine the fitness for purpose and merchantable quality of the goods and services. The steps may be summarized as follows;

The heater must comply with the relevant British Standards.

The claimant ought to have warned the defendant regarding the risk associated with the use of the heater.

Usage by the claimant of similar heaters in past would ascertain the fact that the claimants were aware of the steps to be taken to mitigate the associated risk.

In case expert evidence proves that the product in question is fit for purpose and is of merchantable quality and experts certify the contrary as well then the courts would go by the evidence in favor of merchantability and fitness for purpose.

Now, we would apply the above-stated tests to the impugned case.

JTL must prove that the heater in question conforms to the standard laid down by the relevant British standard.

JTL had warned Mr. Mathew regarding the risk associated and also stated the steps required to be taken to avoid the risk.

Mr. Mathew had never used a similar heater in the past had no way of knowing the precautions to be adhered to.

JTL had proved to the court by way of expert evidence that the heater is fit for purpose and is of merchantable quality.

Conclusion

JTL has a chance of succeeding the case brought by Mr. Mathew only if he can prove that the heater conforms to the relevant British standards because all the other requirements have already been met.

1 Trade Union and Labour Relations (Consolidation) Act, 1992 is the short title of the Act. By the term, short title, we mean the name by which legislation is known.

2 An Act to consolidate the enactments relating to collective labour relations inclusive of industrial action, employer's association and industrial relations.

3 The Trade Union and Labour Relations Consolidation Act, 1992 came into force on 16th of July 1992.

4 ‘Expresio unius est exclusion alterius' is the linguistic presumption that the courts would use for determining if something g is included within the meaning of section 137(5) of the Act. There are three linguistic presumptions that the courts use for the interpretation of statutes. This is a Latin expression which means that when one thing is expressly mentioned, it means the exclusion of all other things that have not been mentioned. When the legislation clearly provides an exhaustive list, then the courts must not interpret words as being covered by the terms of the provision that have not been expressly included. If a statute specifically refers to lions and tigers only, then they courts must not presume that cheetahs are also covered by such reference. 

5 Under section 143 of the Act, interpretational provisions have been laid down. The courts would look into the provisions of Section 143(1) so as to determine the meaning of advertisement as provided under Sections 137-143 of the Act.

6 Facts

Sophie who inspires to become a teacher had applied for a teaching position at Hansroad Secondary School.

The head teacher of the instant school supports the Teach Excel Union which used to prepare short-list for interviews for the school.

The Union, being aware that Sophie is not a member of any union, decides to cancel her candidature.

In the above stated factual situation, what legal remedies are available to Sophie?

Section 137(1) of the Act lays down that in case, an individual is denied an opportunity of employment only because he/ she is not a member of any trade union or that he/ she refuses to become a member of any such union then such action of denial would be considered to unlawful. Section 137(2) lays down the remedies available to an individual who has been denied an opportunity of employment on the aforementioned grounds. Such an individual is entitled to register a complaint against the said organization with an employment tribunal. Section 137(5) lays down that an individual would be deemed to have been denied an opportunity for employment if the application of such an individual has not been processed intentionally. Section 140 of the Act provides the remedies that the courts would grant to an individual in such a situation. The court might require the respondent to mitigate the adverse effect complained of or may also require the respondent to pay compensation to the complainant.

The above stated legal principles would be applied to the facts of the given case. In the instant case, the job application of Sophie was not proceeded with only because she was not a member of any trade union. Sophie is thus, entitled to register a complaint with an employment tribunal against the school Authorities and Teach Excel Trade Union. The court would provide her the remedies laid down under Section 140 of the Act.

Conclusion:

Sophie is entitled to bring an action against the school authorities and the trade union. The court would grant her the remedies specified under Section 140 of the Act.

7 Facts

Marlon, who is a builder, in order to become a full-time builder, appeared for an interview at Zeon Limited, a construction company.

At the interview, Marlon was asked if he is a member of any trade union.

The manager put a condition before Marlon that he would be offered the job only if he agreed to never become the member of any trade union.

Marlon did not accept the offer and his candidature for the position was refused.

As a con sequence, Marlon underwent stress and anxiety and could not work for a month.

What remedies are available to Marlon in the above factual situation?

Section 137 prohibits the denial of employment opportunity to an individual only because he/ she denies to accept a condition that he/ she would never ever become a member of any trade union. Such an individual who has been denied an opportunity owing to this reason may file a complaint with an employment tribunal. The remedies that the courts may grant to the innocent party in such a case have been laid down under Section 140 of the Act. The court may either require such an individual to mitigate the adverse effect within a specified time period or pay compensation to the innocent party. If the complainant has suffered damage due to the actions of the respondent, the court would take into consideration the said fact while granting compensation to the innocent party.

Applying the above stated legal principles to the given case, we may state that the provisions of Section 137 are applicable to this case. Marlon was denied employment with Zeon Limited only because he refused to accept the condition that he would never ever become a member of any trade union. Marlon is entitled to file a complaint with an employment tribunal against Zeon Limited. The fact that Marlon suffered stress and anxiety and also could not work for a month as a result of the refusal would be taken into consideration by the court while granting compensation to Marlon.

8 Facts:

IT World Ltd. is into the business of selling computers.

Majority of the employees are members of an IT Trade Union.

As a result of a redundancy process the company decided to make 150 employees redundant.

It started the consultation process thirty five days before dismissing an employee.

It consulted with senior members of the staff and one of them was a representative of the trade union.

The company discussed about the redundancy process orally.

What is the liability of IT World Ltd under the given factual framework?

Section 188 of the Act contains provisions with respect to the duty of an employer to consult with the trade union representatives in case the company decides on redundancy. If an employer plans to dismiss more than 20 employees within the duration of 90 days or less then it is mandatory for such employer to undergo such consultation. If an employer intends to dismiss more than 100 employees then the said employer must begin the process of consultation at least forty five days before making the first employee redundant. The consultation must be in respect to ways of reducing the number of employees to be dismissed, the process of redundancy etc. The reason for which the employer is dismissing the employees must be disclosed by the employer in writing.

Applying the above legal principles to the given facts, it can be said that IT World Ltd. has committed violation of the provisions of Section 188 of the Act. The company had made a decision of making one fifty employees redundant; consultation process should have begun at least forty days before maki8ng the first employee redundant. However, the company started the process of consultation only thirty-five days before making the first employee redundant. The employer also did not provide the reasons for redundancy in writing.

Conclusion:

Thus, we may arrive at the conclusion that the company has violated the provisions of the Act.

9 Consultation with the representatives of the trade union as laid down under Section 188(1) of the Act by interpreting the provisions of the Section literally. By literal interpretation, we mean interpreting the provisions of the Section in the manner it has been laid down in the statute.

10 Facts:

Simon, accountant with Marketing Solutions is a member of a Trade Union recognized by Marketing Solutions.

Simon requests for time off in order to represent the Union at a conference.

The company refused to grant the time off on the ground that it was the end of the year and they required him to work.

Whether the company has violated the provisions of the Act by disallowing Simon the leave?

In this connection the provisions of Section 170 of the Act is relevant which deals with granting of time off to representatives of the union for activities concerning the trade union. The section makes it compulsory for the employers to grant time off to the representatives of the trade union during the working hours of the organization for doing work concerning the trade union. However, this is subjected to the condition that the occasion and purpose for which time off is granted is reasonable enough.

Applying the above-stated legal principles to the case in hand we may say that the reason owing to which the company denied time off to Simon seems reasonable enough.

Conclusion

We may conclude our discussion by stating that Marketing Solutions has not violated any provision of the Act by not allowing Simon the time off, he requested for.

References

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