George Mitchell (Chesterhall) Ltd v Finney Lock Seeds Ltd [1983] 2 AC 803

A farming business bought cabbage seed from a regular supplier under known conditions limiting liability to replacement or refund of the seed price. The supplier delivered seed of the wrong type which was commercially unsuitable. It was planted across a substantial area, producing a failed crop and loss far exceeding the small purchase price. The supplier relied on its standard limitation. The farmer challenged both its interpretation and the fairness of relying on it. Evidence addressed industry practice in settling justified claims and the availability of insurance against the relevant loss.

Did the standard limitation cover the defective seed, and was reliance on it reasonable under the statutory control applicable to the transaction?

The House of Lords held that the limitation covered the breach on its proper construction, but that reliance upon it failed the applicable statutory reasonableness control. The court did not need to avoid the clause by pretending that the wrong seeds fell wholly outside its wording.

Relevant considerations included the seed trade's practice of settling justified claims beyond the seed price, the supplier's ability to insure and the allocation of risks between the parties. Lord Bridge also emphasised that reasonableness involves an evaluative judgment on the circumstances, with appellate restraint appropriate unless the trial judge has gone wrong in principle. The result therefore distinguishes construction from statutory validity and does not rest solely on the disparity between the price of seed and the loss of the crop.

A limitation clause may cover a breach yet fail statutory reasonableness. Insurance, commercial practice, bargaining circumstances and risk allocation are relevant. Appellate courts should respect a properly directed trial judge's evaluative assessment rather than substituting their preferred balance without a principled basis.

George Mitchell is important both for reasonableness and for the method of reviewing exclusions. The court first construed the clause and then assessed whether it could properly be relied upon. It also considered how the supplier actually dealt with justified claims, rather than treating printed industry wording as conclusive. For current questions identify the applicable statute and transaction date; the sale preceded UCTA's operative regime, although the reasoning is influential in later UCTA assessments.