Investing in machinery: fit for purpose ?

A large investment for any business is the purchase of machinery and equipment.  With more sophisticated technology available every year, not only are there increased costs involved with purchasing the machinery, there is also a greater reliance on the manufacturer and dealer to ensure that the machinery being purchased is suitable for the buyer’s needs.

It is not always apparent whether machinery purchased is right for the job, or will do what is promised, until it has been delivered and put into operation.  Even then it may take some time to identify any problems or defects in the machinery.

We understand that the impact of machinery breaking down or not working correctly can be stressful, time consuming and expensive, especially at key times in the season, such as seeding, spraying and harvest.

Should you find yourself in this situation, there are a number of options that may be pursued to seek to recover some or all of the loss that you have suffered.

First, it is important to keep a full copy of the purchase agreement, user manuals and warranty documents.  These documents often provide key terms under which you purchased the machinery.  They may provide rights to repairs or a replacement machine.

If a solution cannot be found in the written terms of the agreement or warranty, there are also terms that are implied by Statute.  Such ‘implied’ terms may include that machinery:

  1. will be fit for the purchaser’s purpose (if this purpose was communicated to the seller); and
  2. will be of merchantable quality (meeting a level of quality and performance that could have been reasonably expected by the purchaser).

Where you have machinery that is broken down or not working as expected, it is important to maintain detailed records and to review the options as early as possible.  Sometimes dealers will enter into negotiations to assist you to keep your business moving along smoothly.  If you are not successful in finding a solution you may wish to consider a stronger approach, such as dispute resolution processes or initiating court proceedings, to recover your losses.

If you would like more information on these issues, please contact Philip Brunner at Bailiwick Legal or call (08) 9321 5451. 

The above information is a summary and overview of the matters discussed. This publication does not constitute legal advice and you should seek legal or other professional advice before acting or relying on any of the content.

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