The UKWA Conditions of Contract is one of the most prized of our range of member benefits, particularly amongst SMEs. This well-established legal document, developed by our legal specialists Aaron & Partners, has been tested and proven in Court, is widely recognised by insurance companies, and would come at a high price for any individual company looking to have such comprehensive terms drawn up for their own use. For UKWA members, it is a standard part of their exclusive membership package and is designed specifically to protect warehouse operators.
To ensure protection remains up to date, the Conditions are kept under review, in the light of the experience of members, UKWA’s own insights, our legal advisers Aaron & Partners, and, of course, by Court cases and legislation. Central to its provisions is the safeguarding of warehouse operators through the exclusion and limitation of liability for loss and damage, alongside the vital lien over goods held, preserving payment security.
The principle of limitation of liability is based on the understanding that the third-party warehouse operator’s contract is to provide storage and warehousing services for their customer – and that is the extent of their liability. 3PLs are not liable for the value of the goods which, for example, may vary from toilet rolls to gold watches. Consequently, the default limitation of liability stands at £100/tonne (unless the customer wishes to have a higher level of cover, in which case it is up to the customer to pay the additional premium). The £100/tonne benchmark has been upheld very recently in the High Court, while the lien rights (the right to retain lawfully received products belonging to another, so long as a debt remains unpaid) have been regularly and successfully relied upon to obtain payment from slow paying or insolvent customers.
From last month, several important changes were made to the Conditions, creating a new 2024 edition. These updates provide new clarification of the process for increasing the level of limitation of liability, and also the member’s right to change storage location. In addition, the force majeure condition now expressly includes pandemic or government directive; and member’s rights to deal with perishable, contaminating or hazardous goods have been enhanced.
Crucially, however, the Conditions of Contract can only be relied upon in Court if they are expressly part of members’ contracts with customers. A copy should be provided to customers and reference made to the Conditions on all subsequent documentation, so that customers understand what they are signing up to.
As the trade association for Warehousing, UKWA assumes many roles and responsibilities: protecting our members’ interests is one that remains paramount. For warehouse operators who are not yet members, peace of mind over your legal limitation of liability is a compelling reason to consider joining us now!
Clare Bottle
UKWA, CEO
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