General Conditions of Purchasing and Supply
General Conditions of Purchasing and Supply; last updated October 2018
In these Conditions and all other documents the following words and phrases shall, save where the context otherwise requires, have the following meanings: Order means the Company’s purchase order; Company means the company placing the Order; Seller means the person, firm or company on whom the Order is placed; Goods means the goods and/or services which form the subject matter of the Order.
2. ORDER AND ACCEPTANCE
2.1If there is a procurement agreement in force between the Seller and the Company, the Seller shall be bound to supply any Goods which are the subject of an Order placed by the Company under it and these Conditions shall apply to such Order save in so far as expressly varied by special conditions or any other terms included in the procurement agreement which apply to such Order.
2.2 The Company shall not be bound by the terms of any Order unless placed by the Company on its standard order form and acknowledged by the Seller on the form provided by the Company provided that the Company may confirm by issue of an order form an Order previously placed informally in which case these terms shall be deemed to have applied from the outset.
2.3 Notwithstanding any stipulations to the contrary by the Seller, any Order shall be deemed to have been placed and accepted subject to these Conditions, subject only to agreed alterations under clause 26 of these Conditions.
2.4 These Conditions (save as stated in clause 2.1 of these Conditions) contain all the terms and conditions of the Order and subject to clause 23.5 of these Conditions, supersede any and all prior correspondence, proposal, agreements (written or oral) or any trade customs and practices not directly set forth in the Order. Any terms and conditions sought to be imposed by the Seller are excluded.
3. SCOPE OF SUPPLY
The Seller’s obligation to supply Goods shall be deemed (save as may be expressly provided to the contrary in the Order) to include an obligation to procure at its own expense all necessary insurance, raw materials, designs, tools, labour, setting up or packaging and transport and to deliver the Goods in finished state suitably wrapped and protected to the address specified in the Order.
4. CLARIFICATION OF ORDER
Where there is any uncertainty or ambiguity upon any point arising under an Order, the Seller shall seek the instructions of the Company on the point and act in accordance with the Company’s direction. For this purpose the Company’s Purchasing Manager or his/her authorised representative are the only personnel authorised to give instructions on behalf of the Company.
The Company shall not be obliged to accept Goods in variance with the terms of the Order (whether by quantity or by time and place of delivery or by substitution of materials or in any way whatsoever) unless such variation has previously been agreed in the manner provided in clause 26 of these Conditions below.
6.1 Delivery shall be made at the place, to the person and in the manner specified in the Order or (if none) as directed by the Company.
6.2 At the time of delivery, the Seller shall obtain from the Company’s representative (nominated to accept delivery) a detailed quantified signed receipt for Goods delivered. Any qualifications noted thereon by the Company’s said representative shall be conclusive evidence of the facts noted, except in so far as challenged by a note made thereon at the same time and signed by the Seller’s representative. In the absence of such receipt, the Company’s representative’s evidence as to the Goods which were delivered and their state and other circumstances on delivery shall be conclusive.
6.3 Physical delivery of the Goods and the acknowledgement of receipt thereof by the Company whether or not in the prescribed form shall not constitute acceptance of the Goods by the Company nor agreement to a variation in the Order which has not been agreed in the prescribed manner nor a waiver of any defects in the Goods or packing thereof or completion of the Order generally.
6.4 Where a receipt is issued, subject to qualification, the Company reserves its rights with regard to the subject matter of the qualification.
6.5 Subject to clause 6.6 of these Conditions below, time for delivery shall be of the essence of the Order.
6.6 Upon material or repeated breach by the Seller of any of the terms relating to place, manner and time of delivery the Company shall have the right without liability or penalty and without waiving any of its other rights and remedies by notice to the Seller to cancel the Order in whole or in part and purchase replacement Goods elsewhere and recover from the Seller any proven direct loss or damage incurred. For the avoidance of doubt, direct losses for the purposes of these Conditions shall exclude loss of contracts, loss of profits and any consequential loss or damage, howsoever arising.
6.7 If delivery is made ahead of schedule, the Company may at the Seller’s risk return the Goods to the Seller or retain them or place them in the hands of a third party for storage (at the Seller’s risk) and charge for or pass on the cost of such storage.
6.8 If the Order includes or refers to a delivery schedule, the Company shall have the right at any time to vary or extend the delivery schedule without prejudice to any rights it may have to cancel outstanding parts of the Order.
6.9 If at any time the Seller anticipates that he will be unable to meet a required delivery schedule he shall immediately so inform the Company and put forward a detailed recovery programme with timings for due corrective action to be achieved. The Company shall thereupon have the following rights (such rights to be without prejudice to each other and without prejudice to the Company’s other rights):
a) to agree a new delivery schedule with the Seller in accordance with the Seller’s recovery programme or otherwise which once agreed in writing between the parties shall become binding subject to 6.5 to 6.8; and/or
b) to cancel the order in whole or in part with the same consequences as are provided in 6.6 above.
7.1 The Seller shall provide transport by the route and means specified (if any) in the Order. Subject to the particular requirements of the Order, such transport shall be of a type and quality suitable to the nature and value of the Goods, taking account where appropriate of the perishable, fragile or other special qualities of the Goods. In any event Goods in transit shall be at the risk of the Seller.
7.2 The Seller shall have adequate and suitable insurance to cover all Goods in transit. In any case, where the Seller fails to promptly demonstrate upon request to the satisfaction of the Company that the Seller holds such insurance policy, the Company shall be entitled to arrange such insurance and debit the cost thereof to the Seller.
8. RISK AND TITLE
Risk in the Goods shall pass to the Company on delivery. Ownership of the Goods shall pass to the Company when all monies owed in relation to such Goods are paid to the Seller.
It shall be a condition of any Order that the Seller will implement in full any quality control procedures stipulated by the Company. The Company shall be entitled to take any reasonable steps to satisfy itself that the Seller is observing this clause. If the Company on reasonable grounds is not satisfied that this Condition is being observed the Company may (without prejudice to its other rights including the right to reject the Goods altogether) at the expense of the Seller institute quality controls and the Goods shall not be deemed to have been accepted nor shall the Company be liable to take delivery or pay for them until such controls are completed to the satisfaction of the Company. The Seller shall, if required by the Company, provide certificates of conformity with each and every delivery.
10.1 Irrespective of delivery having taken place the Company may reject any Goods within a reasonable time of discovery of any defect in them or becoming aware of any breach of these conditions or the terms of the Order in the course of production or handling of Goods by the Seller its servants or agents or where the Goods are defective in material, workmanship, design or otherwise fail to meet the requirements of the Order or the warranties contained in clause 23 of these Conditions.
10.2 The right of rejection shall not be prejudiced by the Company handling the Goods in good faith and without knowledge of the circumstances giving rise to the rejection.
10.3 In any case where the Goods are so rejected the Company may without prejudice to its other rights invite or require the Seller to collect the Goods at the expense of the Seller and the Company undertakes to make the Goods available for collection at reasonable times upon reasonable notice.
10.4 The Company may reject some of the Goods while accepting others.
10.5 In any case where Goods are rejected, the Company may take such steps as it thinks fit to replace such Goods and the Seller shall indemnify the Company for all direct losses thereby caused.
10.6 Negotiations between the parties with a view to remedying defects in Goods shall not prejudice the Company’s right to rejection unless and until some alternative course has been agreed between the parties.
10.7 Any Goods rejected shall thereafter be at the risk of the Seller who shall be responsible for all costs of the handling or storage of such Goods.
10.8 Payment for any or all of the Goods shall not constitute a waiver by the Company of any rights including (without prejudice to the generality of the foregoing) its rights to reject the Goods.
11. PRICE AND COSTS
The price payable for the Goods as stated in the Order shall be fixed against increase and fully inclusive. Save where expressly agreed in the Order no further charge shall be made in respect of surcharges, customs duties, sales, import and export taxes, impositions and duties (or any other costs and expenses) and the prices shall be inclusive of all items within the scope of supply (as detailed in clause 3 of these Conditions).
12.1 Payment (unless terms are stated in the Order) shall be made 60 (sixty) days after the end of the month from the invoice date.
12.2 All invoices, statements and other correspondence relating to the Goods must state the Company’s official Order number and other material codes or part numbers stated on the Order. Payment shall not become due and will not be paid unless correctly completed invoices are received by the Company.
Any credit properly claimed by the Company in respect of short deliveries, incorrect pricing, returns of excess or defective Goods or in respect of storage or rectification or other charges which under the provisions hereof may be passed on to the Seller shall constitute a debt due and payable by the Seller to the Company within 7 (seven) days of the Company’s invoice or other notification thereof to the Seller (without prejudice to the right of set-off contained in the previous Condition). The Seller shall not return Goods after rectification or by way of re-supply without first crediting and re-invoicing such Goods.
14. PACKING MATERIALS
All packing materials and accessories (such as cylinders, drums, pallets) delivered with the Goods shall be deemed to be included in the price of the Goods and ownership of them shall pass to the Company at the same time as ownership in the rest of the Goods. In any case where contrary to the above it is specifically agreed that any such item remain the property of the Seller, it shall be the Seller’s responsibility at its own expense promptly to arrange the uplift of such items in default of which the Company shall have the right to return them to the Seller or to store them both at the Seller’s expense.
15. COMPANY’S ISSUES TO SELLER
15.1 The Seller shall insure all Company property from time to time in its possession.
15.2 Any tools, dies, gauges, fixtures or other design or manufacturing aids (including software) supplied by the Company to the Seller or paid for by the Company in whole or in part shall be and remain the property of the Company. They shall be used exclusively for work done for the Company and shall be surrendered up to the Company at any time upon demand.
15.3 All materials, specifications, blueprints, documentary technical know-how instructions, moulds, models, casts, formulae, sketches, drawings, designs, customer lists, promotional copy, mailing labels, manufacturing procedures and processes and employee lists supplied to the Seller or prepared by the Seller (with or without the assistance of the Company) in connection with the Order (including the copyright in the same) shall be and remain the sole property of the Company.
15.4 The Seller undertakes to take all due care of all property of the Company from time to time in its possession and/or under its control. It shall keep all such items maintained, safely stored and in good condition and separately identifiable as the property of the Company without charge and shall take every precaution to prevent loss, damage, destruction, theft, appropriation or wrongful use or copying of the same.
16. ACCESS TO SELLER’S PREMISES
The Company by its authorised representatives shall have the right at all reasonable times to enter any premises owned or occupied by the Seller (and the Seller shall afford access accordingly):
a) to inspect and test Goods in the process of manufacture and materials which it is proposed to incorporate in the same;
b) to take possession of any property, documents or other items belonging to the Company on such premises; and/or
c) to make inventories of such items for purposes of stocktaking or otherwise.
The Company may so enter with vehicles and lifting gear where necessary.
The Seller shall not, without the prior written consent of the Company, disclose to any third party for the purposes of advertising or promotion or for any other purpose the existence of any details of the Order.
The Seller hereby acknowledges that all or any information given to it by the Company in the course of negotiating and executing the Order relating to the trade, business, customers and marketing strategies of the Company or to the Company’s products or the design, composition, manufacture and specification thereof has been so given on a confidential basis and solely for the purposes of the Order. The Seller hereby warrants that it has not disclosed such information to any third party and undertakes that it will not hereafter disclose or use the same. The Seller further undertakes, if the Company reasonably so requires, to obtain and deliver to the Company a confidentiality undertakings from individual employees in a form previously agreed by the Company.
19. PATENTS, TRADE MARKS AND COPYRIGHT
Save in respect of Company Intellectual Property, for which the Company makes equivalent warranties and undertakings as made by Seller below, the Seller warrants and agrees that the Goods and the sale or use by the Company or its customers thereof do not and will not infringe any patent, copyright or trade mark right or any other third party right whatsoever. The Seller shall forever defend, indemnify and hold harmless the Company, its successors and assigns and any of its customers and all persons claiming under the Company from and against any and all liability, claims, actions, losses, damages and expenses of any kind including without limitation legal expenses by reason of actual alleged infringements or contributory infringement of any domestic or foreign letters patent or any copyright, trade mark or trade name or other third party rights arising in any way out of or connected with the Goods (“Claims”) save to the extent that such claims relate to Company Intellectual Property. This provision shall apply notwithstanding any of the said claims, actions or suits shall ultimately be determined to be unjustified or to have been unfounded.
20. PRODUCT IMPROVEMENT
The Seller warrants that in the course of dealings leading to the Order it has disclosed and made available to the Company all technical and other knowledge and expertise available to it specific to the scope of the procurement agreement and undertakes that so long as the Order remains in force it will continue to do so including any innovations or improvements of which it or any of its employees become aware (the Company having the right to alter the Order or to take account of such matters).
21. WORK ON COMPANY’S PREMISES
If fulfilment of the Order requires operations by the Seller, its employees, agents or contractors at the premises of the Company or any third party:
a) it shall be the Seller’s responsibility to arrange such operations to take place at a time and in a manner convenient to the occupier(s) of the premises;
b) the Seller shall ensure that the individuals carrying out such operations comply with site rules and reasonable requirements of the Company and are competent, courteous and presentable;
c) without prejudice to the foregoing, the Seller shall be entirely liable for the correct and proper discharge by such persons of the tasks which are required to be done and for the conduct and acts and omissions of those persons while on the said premises generally; and
d) the Seller shall be responsible to the extent that any loss, damage or injury is caused or suffered by the negligent act or wilful default of such person so long as he is on any such premises or in transit to or from such premises and shall indemnify or save the Company and occupier harmless against such losses, claims, damages or expenses by reason of any such matter.
The Seller shall produce to the Company upon request copies of the relevant certificates of insurance currently in force.
The Seller shall insure and at all times maintain insurance with an insurance company approved by the Company against all usual and other risks including inter alia insurance for public liability, third party liability, employers liability and product liability and against all liabilities (whether liabilities arising under contract tort or otherwise) it may have to the Company under the Order including cover for loss or damage to the Company’s property from time to time in the custody of the Seller, and will:
a) insure in the joint names of the Seller and Company; and
b) produce to the Company a copy of any appropriate policy together with a current premium receipt.
23.1 The Seller warrants that the Goods supplied to the Company by the Seller under the procurement agreement shall:
a) conform in every respect to any relevant sample, pattern, specification or description;
b) be of satisfactory quality (within the meaning of the Sale of Goods Act 1979, as amended) and fit for any purpose held out by the Seller or made known to the Seller by the Company;
c) free from defects in workmanship, material and design; and
d) comply with all applicable statutory and regulatory requirements.
23.2 For all purposes connected with these conditions the Seller shall be under an onus to ascertain from the Company the purpose for which the Company is acquiring the Goods and insofar as it fails so to do shall be deemed to know that purpose and these conditions shall be construed upon the basis that the Seller does have such knowledge.
23.3 Upon receiving notice from the Company at any time within eighteen months of delivery of any Goods of any breach of any applicable warranty or any other defects in the Goods, the Seller shall repair or replace the Goods free of charge (whether the Goods are situated in the UK or elsewhere) so as to remedy the defect and/or indemnify the Company for all costs of and incidental to such breach including wasted operational and manufacturing costs and fresh warranties in the terms of this condition shall attach to such Goods as replaced or repaired. Furthermore, the Seller shall provide free of charge for the said period of eighteen months any services or parts required (excluding items designated consumables in the Order) to maintain rectify repair or service such Goods servicing being provided at the normal intervals whether or not there has been any breakdown or problem.
23.4 Costs and expenses of any remedial action or services as described above shall be the sole responsibility of the Seller and in particular but without prejudice to the generality of the foregoing the Seller shall bear and pay for all expenses arising from the provision of skilled engineers and personnel aforesaid including all fares and other travel expenses travelling time and labour costs and time accommodation and food and other ancillary expenses.
23.5 Insofar as the Seller (or its servants or agents) may have given the Company advice or information or have provided services in connection with the Order or the Goods (whether before or after delivery and including pre-contract negotiations), the Seller hereby warrants that it supplied such advice, information or services as an expert in the relevant field.
23.6 The warranties and remedies above provided are in addition to and without prejudice to the Company’s other rights and remedies under the Order or under general law and shall survive acceptance of and payment for the Goods and shall endure for the benefit of and be directly enforceable against the Seller by the successor owners to the Company of the Goods including, without prejudice to the generality of this clause, the Company’s customers and users of the Company’s products and services. In particular but without limitation:
a) in relation to the said advice, information and services, the Seller acknowledges that it has a duty of care enforceable independent of the contractual warranty referred to in clause 23.5 of these Conditions; and
b) the above provisions do not prejudice the Company’s right to reject Goods and in any case where that arises, the Company may reject the Goods or seek redress under this clause and may deal differently with different parts of the Goods.
The Seller shall fully indemnify the Company and its successors and assigns against all loss, damages, costs, claims and expenses which may be suffered or incurred whether direct or indirectly by reason of any and all breaches by the Seller and its obligations under the Order including in particular (but without prejudice to the generality of the foregoing) clause 23 of these Conditions above, provided that neither party shall be liable to the other for loss of profits, loss of contracts or for any other consequential losses, except direct losses, or damage howsoever arising. The Seller shall likewise indemnify the Company, its successors and assigns against any tortuous claim arising out of possession or use of the Goods (except use contrary to the Seller’s express instructions) including (without limitation) consumer claims, employee claims and environmental claims.
25. TERMINATION AND CANCELLATION
25.1 The Company may by notice in writing to the Seller terminate any outstanding Order or part thereof without liability to the Seller save to meet the purchase price for Goods delivered to and accepted by the Company prior to such notice if:
a) owing to warfare, acts of God, industrial dispute or other cause beyond the control of the Company, the Company no longer has need for all or any of the Goods;
b) the Seller shall be in material or repeated breach of any of its obligations towards the Company and fails to remedy such a breach within a reasonable time;
c) an Order shall be made or resolution passed for the winding up or other dissolution of the Seller or if the Seller (being an individual) shall commit an act of bankruptcy; or
d) the Seller makes any voluntary arrangements with its creditors or becomes subject to an administration order or (being an individual or firm) becomes bankrupt or (being a company) the Seller goes into liquidation (otherwise than for the purpose of amalgamation or reconstruction) or a receiver, an administrative receiver, a manager or administrator be appointed over any part of the undertaking or assets of the Seller or other procedure whether voluntary or involuntary be involved by or against the Seller under the Insolvency Act 1986 (as the same may be from time to time amended or re-enacted).
25.2 The rights to the Company under this clause are in addition to and without prejudice to all other rights and remedies of the Company under the Order or otherwise.
26.1 The Company and the Seller shall have the right at any time by notice in writing to the other party to alter the terms of the Order or any of them subject to the written agreement of the other party. The Seller shall thereafter carry out the Order as so altered but otherwise in accordance with the original terms thereof insofar as the same are still applicable provided that if within 30 (thirty) days of receipt of any such notice the Seller by notice to the Company claims that the alteration has rendered performance of the Order materially more onerous than was contemplated when the Order was placed, the Company shall make such further adjustment as the Company considers reasonable and confirm by notice in writing. If the Seller does not serve any notice as aforesaid, it shall be deemed to have waived any claim for any such adjustment. Nothing herein shall exclude the Seller from proceeding with the Order as altered in accordance with its terms. The Company shall not be bound to make any such adjustment on variation of a delivery schedule under Condition 6.8 nor when any alteration has been made at the request of the Seller.
26.2 No purported variation (whether or not under the above terms) shall be effective unless the Company has agreed to the variation in writing.
The Seller shall not without the Company’s prior written consent assign or sub-contract the Order or any part thereof. In any event, and notwithstanding having obtained such consent:
a) any such sub-contractors shall be on terms matching and where appropriate the same as these conditions; and
b) the Seller shall be directly liable to the Company for all acts and omissions of any sub-contractor or assignee.
The Company shall not without the Buyer’s prior written consent assign the Order or any part thereof.
Without prejudice to clause 23.5 of these Conditions, for provision of services hereunder (as of goods) shall be of the essence and the Seller shall be deemed to have given warranties relating to any services, information or advice given hereunder in the same terms (mutatis mutandis) as are contained in clause 23.1 of these Conditions relating to Goods.
29. GOVERNING LAW
This Order and all other dealings between the Company and the Seller shall be governed by and interpreted according to the laws of England and, subject only to provisions below relating to arbitration, the Seller hereby submits to the non-exclusive jurisdiction of the Courts of England.
Any dispute or difference arising between the Company and the Seller and which concerns the question whether or not the Goods have been manufactured or supplied to specification shall be referred if either party by notice to the other before commencement of any proceedings elects to a single arbitrator to be appointed (in default of agreement) by the President of the Law Society of England & Wales.
All notices by either party hereunder to the other shall be in writing signed by or on behalf of the party giving the notice and may be served by delivering the same or sending it by first class pre-paid post, email or facsimile to the address of the party to be served stated in the Order (or such other address as that party may in the meantime have notified to the other party). A properly addressed notice sent by pre-paid first class post shall be deemed in the absence of evidence of non-arrival to have been served forty-eight hours after posting to an address in the United Kingdom (disregarding days on which there are no postal deliveries) or 5 (five) days after posting by first class airmail (if to an address abroad) and notices shall be deemed served on the first business day (at the place of receipt) following the date of despatch if sent by telex or facsimile.
32.1 The procurement agreement constitutes the entire agreement between the parties and supersedes and extinguishes all previous agreements, promises, assurances, understandings, statements, warranties or representations between them (in particular but without prejudice to the generality of the foregoing those relating to its potential requirements over any future period for Goods or the nature of the Goods), whether written or oral, except insofar as it is clear from the nature and context of any document that the parties intended to be bound thereby.
32.2 The rights contained in these Conditions are in addition and without prejudice to any other rights and remedies under or for breach of the contract or any other of these Conditions and the exercise or failure to exercise any such rights shall not prejudice affect or be deemed to satisfy or waive any other right or remedy which may then have accrued or which may accrue thereafter.
32.3 The headings to these Conditions shall not affect the interpretation thereof.
32.4 Where anything in these Conditions conflicts or is inconsistent with any specific agreement evidenced in writing in the Order such specific agreement shall prevail over these Conditions.
32.5 Any provisions of these Conditions held by a court of law to be invalid shall be severable and shall to the extent necessary to prevent such invalidity be deemed to be omitted from these Conditions and any liability which would otherwise have been excluded or limited shall nevertheless be subject to the remaining provisions of these Conditions.