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Australian Knitting Mills Ltd v Grant

Australian Knitting Mills Ltd v Grant

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Case Copied 18 August 1933 52 min read

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50 CLR 387

AUSTRALIAN KNITTING MILLS LIMITED

AND ANOTHER

APPELLANTS; DEFENDANTS, GRANT

RESPONDENT. PLAINTIFF,

ON APPEAL FROM THE SUPREME COURT OF Tort-Manufacturer of goods-Liability for damage caused by goods purchased through Sale of Goods-Reliance on seller's skill or judgment-Merchantable quality of goods-

Sale of underwear by retailer-Sale of Goods Act 1895 (No. 630) (S.A.), sec. 14*

The plaintiff purchased woollen underwear from a retail merchant whose business it was to supply goods of that description. The manufacturer, after completing his preparation of the underwear, folded each garment, wrapped them in paper parcels and then tied them in quantities of one half dozen per *The Sale of Goods Act 1895 (South

50 CLR 388

packet. To each garment there was a ticket attached upon which the manufae- turer printed its name, described the garment as "pure woollen underwear," gave directions as to washing, and concluded "We guarantee to replace this garment free of charge if it shrinks when washed in accordance with the directions printed above." The retailer purchased the goods direct from the manufacturer who manufactured the material from which the garments were made as well as the garments. After wearing the garments for a short time an irritation commenced in the plaintiff's skin which developed into an acute general dermatitis. The plaintiff alleged that the garments contained a chemical substance introduced during the course of the manufacture of the material which formed an irritant when coming into contact with the skin and which was the cause of the plaintiff's condition. The plaintiff brought an action against the manufacturer and the retailer alleging against the manufacturer negligence in the making of the garments and against the retailer breach of the implied warranties of reasonable fitness for the purpose for which they were bought and of merchantable quality.

Held, by Starke, Dixon and McTiernan JJ. (Evatt J. dissenting), that upon the evidence the plaintiff's claim failed against both defendants.

Per Starke J.: The evidence did not show that the plaintiff relied on the skill or judgment of the retailer SO as to imply a warranty of reasonable fitness under sec. 14 (1) of the Sale of Goods Act 1895 (South Australia) and assuming that the plaintiff "bought by description' from the retailer the evidence showed that the garments were of merchantable quality and, therefore, there was no breach of the implied condition in sec. 14 (2) of the Act.

Per Dixon and Evatt JJ. The goods were "bought by description so as to raise an implied condition of merchantable quality under sec. 14 (2) of the Sale of Goods Act.

Per Evatt J.: (1) The evidence established that there existed such a relationship between the defendant manufacturer and the plaintiff that the former was under a duty to the latter to take reasonable care in the preparation of the garments so as to avoid the retention in them of any chemical residuum likely to cause or set up injury or disease to the skin. (2) The plaintiff made known to…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

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Details

Case: [1933] HCA 35
Decision Date: 18 August 1933

CaseChat Overview and Summary

The case involved an appeal from the Supreme Court of South Australia to the High Court of Australia. The plaintiff, Dr. Grant, a medical practitioner, sued both the manufacturer, Australian Knitting Mills Ltd., and the retailer, John Martin & Co. Ltd., for damages. Dr. Grant alleged that woollen underwear purchased from the retailer contained an irritant chemical substance introduced during the manufacturing process, which caused him to develop severe dermatitis. His claim against the manufacturer was based on negligence, while his claim against the retailer was based on breach of implied warranties under the Sale of Goods Act 1895 (SA) regarding fitness for purpose and merchantable quality.

The legal issues before the High Court were whether the manufacturer was negligent in its production process, rendering the underwear inherently dangerous, and whether the retailer breached the implied conditions of reasonable fitness for purpose and merchantable quality under the Sale of Goods Act. Specifically, the court had to determine if the underwear contained a deleterious irritant substance, and if so, whether this established liability against either or both defendants based on the respective legal grounds.

A majority of the High Court, comprising Starke, Dixon, and McTiernan JJ., found that the plaintiff's claim failed against both defendants. Starke J. held that the evidence did not establish the plaintiff's reliance on the retailer's skill or judgment, thus no warranty of reasonable fitness was implied under section 14(1) of the Sale of Goods Act. He also found that the garments were of merchantable quality, meaning no breach of section 14(2) occurred. Dixon and McTiernan JJ. agreed that the goods were bought by description, raising an implied condition of merchantable quality under section 14(2), but ultimately concluded the evidence did not support the plaintiff's case. Evatt J., dissenting, found that the manufacturer owed a duty of care to the consumer and that the evidence established the garments contained a harmful chemical residue, leading to liability for both defendants.

The High Court reversed the decision of the Supreme Court of South Australia. The majority allowed the appeal, ordering that the plaintiff's claim be dismissed against both the manufacturer and the retailer.

Orders