Summary

Kingsway Hall Hotel Ltd, based in busy central London, procured a premises management system from Red Sky IT (Hounslow) Ltd.  Needless to say problems arose with the new system, which the Hotel eventually rejected claiming around £330k in damages.

Red Sky sought to limit its liability as per the contract, which was set at four times the total price or some £70k.
The crux of the case was whether or not the contractual warranties fell foul of the reasonableness test under s11 of the Unfair Contract Terms Act.

On 28 December 2009 The Provision of Services Regulation 2009 came into force, enacted under the European Framework Services Directive (2006/123/EC).

The effect of this is to introduce various “client care” requirements for all businesses providing services, which includes information about the supplier itself and its services.  For most UK businesses the Regulations will not be too burdensome, as most of the information requirements have existed for some time in other legislation.

Nonetheless it is worth noting that the Regulations appear to impose a fairly high standard in dealing with complaints, both in terms of the time taken to deal with a complaint and the redress offered.

For more information, please read this Briefing Note.