Claiming poor welding on steel fabrication at a Bupa retirement village under construction in Hamilton cost it some $320,000, engineering firm George Grant Engineering sued Fabrication & Pipe Services, without success. Fabrication’s standard terms excluded all liability and were enforceable despite the contract being signed after work started.
The High Court was told South Auckland engineers George Grant Engineering Ltd contracted to supply and erect steel framework for a Bupa village at Te Rapa. Its original welding contractor pulled out at the last minute. Hamilton welder Fabrication & Pipe Services Ltd was called in as a late replacement.
It took time for paper work to catch up with the job. On 17 January, Grant Engineering offered by email to pay $65 per hour for a Fabrication welder. One day later, Fabrication agreed, sending by email a ‘credit application’ for completion. Included in the email was Fabrication’s terms of trade, including an extensive exclusion clause excluding all liability by Fabrication for any losses. The email narrative made no mention of these terms of trade.
By 21 January, a Fabrication welder was on the job. Only after follow-up by Fabrication office staff did Grant Engineering return a signed credit account application on 31 January with the terms of trade attached. The signed credit application included a statement confirming Grant Engineering had read and agreed to the terms of trade. When suing for remediation costs of some $320,000 Grant Engineering said the exclusion clause had never been brought to its attention and it did not form part of their contract.
Fabrication disputed whether its welder’s work was not up to agreed specifications, but said the exclusion clause blocked legal action by Grant Engineering in any event.
The exclusion clause was part of the contract, Associate judge Andrew ruled. Grant Engineering did have notice of the exclusion clause when receiving the emailed request to complete a credit application. This was confirmed when the signed credit application was later returned to Fabrication.
George Grant Engineering Ltd v. Fabrication & Pipe Services Ltd – High Court (2.06.21)
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