Originally published in June 2003
Courts are often required to perform a balancing act when interpreting contracts. One example is where the rights of the customer collide with the limits of what is fair to expect a supplier to do. So courts accept that new software may contain some bugs but also recognise that it is not fair to require a customer to pay for a system that does not work. The balance can be tipped by the claims the supplier makes for the software. If it is sold 'warts and all' then the customer must accept that there could be problems. But where software is sold as 'fully tried and tested' then even minor bugs could mean it is simply not good enough.
In SAM Business Systems v Hedley SAM, a software company, contracted with Hedley to provide a ready-made software package. They claimed the new software was superior to Hedley's existing system, fully tried and tested and capable of use by untrained staff. The contract contained SAM's standard written terms of business
