Contract failure gives firm "useless" £300,000 plant

The pastry maker Filobake has been left with a £300,000 pastry machine that it said was useless, because of a failure in specifying the unit.

Enfield-based Filobake took Rondo to court last April after claiming that equipment which Rondo supplied to make pastry for samosas was not fit for purpose. However, Filobake lost its case on the grounds that the performance warranty in the contract was too vague and has now lost a subsequent appeal, said the law firm Ashurst.

Had the warranty obliged Rondo to produce something that was exactly fit for purpose able to produce pastry to a specific recipe in a specific way it would have raised the duty of care beyond reasonable skill (where liability depends on negligence) to an absolute obligation to ensure that the machine could make exactly what Filobake wanted, said Ashurst.

"The case serves as a reminder of the potential for argument where performance criteria are not accurately specified," said the law firm.

Vasos Pittalis, general manager at Filobake said: "We just couldn't understand the decision. The machine cost us £300,000 and it's still sitting in our factory. We can't use it."