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Dick Bentley Productions Ltd v Harold Smith (Motors) Ltd [1965] 1 WLR 623

By Oxbridge Law TeamUpdated 04/01/2024 07:17

Judgement for the case Dick Bentley Productions Ltd v Harold Smith (Motors) Ltd

 KEY POINTS

  • If a statement is provided during negotiations for a contract with the specific aim of influencing the other party to take certain actions, and it successfully leads them to enter into the contract, there is a strong basis to consider that the statement was meant to serve as a warranty.

FACTS

  • Mr. Charles Walter Bentley, also known as Dick Bentley, brings a legal action against Harold Smith (Motors) Limited for breach of warranty on the sale of a car. Mr. Smith informed Mr. Bentley that he had purchased a Park Ward convertible car with a replacement engine and gearbox, which had done only 20,000 miles since the refit.

  • Relying on this information, Mr. Bentley bought the car for £1,850. However, the car turned out to be a considerable disappointment and required extensive repairs during the first 12 months. After the guarantee period, a knocking noise in the engine led to further repairs, and it was discovered that the cylinder had been scored by broken piston rings.

  • Mr. Bentley claims damages for breach of warranty based on the car's condition and the information provided by Mr. Smith at the time of sale.

COMMENTARY

  • This case highlights the need for parties engaged in contract negotiations to be cautious and accurate in their statements, as their words can carry legal implications beyond the initial negotiations. It also reinforces the idea that contractual relationships are built on trust and good faith, and parties should be held accountable for the statements they make to induce the other party to enter into a contract.

ORIGINAL ANALYSIS

  • Defendant sold Plaintiff a car but made false claims as to the mileage of the car and Plaintiff sued for the difference between the value he paid and the actual value.

  • CA allowed his claim. 

Denning LJ

  • If a representation is made so that Plaintiff will act on it, and Plaintiff does in fact act on it, there is prima facie ground for saying that it was a warranty.

  • This presumption can be rebutted by Defendant if he can show that

    • (1) it was made innocently i.e. he had no fault in a false representation being made, and

    • (2) that it would not, in the circumstances, be reasonable for him to be bound by it.

  • In this case the prima facie warranty is not rebutted since Defendant was in a position to, and ought to, have found out the truth about the car. The statement as to mileage was made without justification.

  • This is contrasted with Defendant in Oscar Chess who could not have discovered the truth about the car.

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Contract Law Notes
1,511 total pages
744 purchased

Contract law notes fully updated for recent exams at Oxford and Cambrid...