Credit note binds company to pay out over faulty goods
Published: 20 February 2018
A company that gave a credit note to compensate for faulty goods had effectively entered into a contract and was obliged to pay up to settle the dispute.
That was the decision of the Court of Appeal in a case involving a paper merchant and a firm of printers.
The issue arose when the printer was unhappy with the quality of a batch of paper.
merchant accepted the batch was substandard, and a manager issued a credit note
dispute was whether the merchant was bound by the credit note and therefore
liable to pay the sum promised.
merchant claimed the credit note was “unauthorised and illegitimate”.
the Judge ruled that the manager did have the authority to issue the credit
note on the merchant’s behalf.
The Court of Appeal has upheld that decision.
Please contact Matthew Sigsworth in our Dispute Resolution Team if you would like more information about the issues raised in this article or any aspect of contract law.