AIR TRANSWORLD LTD V BOMBARDIER INC

[2012] EWHC 243 (Comm), Queen's Bench Division, Commercial Court, Mr Justice Cooke, 20 February 2012

Sale of goods - Aircraft - Whether parties had ousted statutory implied terms - Whether exclusion valid - International supply contract - Applicable law - Dealing as a consumer - Sale of Goods Act 1979, sections 13 and 14 - Unfair Contract Terms Act 1977, sections 6, 12, 26, 27 and schedule 2

ASA, an Angola company controlled by M, agreed to buy a Challenger 605 private jet aircraft from BI, a Canadian manufacturer. The contract was stated to be governed by English law. ASA subsequently assigned its rights under a tripartite assignment agreement to AT, a Gibraltar company also controlled by M. The assignment agreement incorporated the terms of the sale. It was asserted that the jet was brought for his private use. The jet was delivered in March 2009 and was rejected in July 2010 on the basis of various alleged mechanical problems. AT asserted that the jet did not correspond to its description, was not of satisfactory quality and was unfit for purpose, within sections 13 and 14 of the Sale of Goods Act 1979. The preliminary questions for the court were whether the relevant contract (the assignment contract) ousted the implied terms and, if they did, whether the exclusion clauses fell within the Unfair Contract Terms Act 1977. A contract of sale was an international supply contract and outside the 1977 Act if it was a contract for the passing of property by parties whose places of business were within different states (section 26(3)) and it met any of the three requirements in section 26(4)).