Seed Suppliers Can Contract Out Of Their Duty to Farmers

A recent case in the Queensland Supreme Court (Mallonland Pty Ltd v Advanta Seeds Pty Ltd[2023] QCA 24) found that Advanta Seeds, a supplier of sorghum seeds did not have a duty of care to farmers who planted sorghum contaminated with shatter cane seed. This largely came about as a result of a disclaimer of liability printed on the seed bags.

On appeal, JA Bond stated the case "does not provide support for recognition of a duty of care where the claim is by an ultimate purchaser against a manufacturer of defective goods for pure economic loss, unless the case can be characterised as a case in which the manufacturer has assumed direct responsibility to the ultimate purchaser". He went on to say "the findings that Advanta sold seeds to the distributors in bags marked with a specific disclaimer of responsibility for loss suffered by the ultimate consumer, Advanta most assuredly had not assumed direct responsibility to the farmers". The effect of the terms and conditions on the bags is that they operated as a clear and prominent disclaimer of liability.

In addition, the Court made it clear that legislative protections under the Australian Consumer Law did not extend to farmers in commercial circumstances.

Takeaway: Farmers need to be mindful that they may not be protected against contaminated seed products where a disclaimer of liability is provided on the product or in a contract. In this situation, Farmers need to ensure that the product is right for them before using it - they may not have an automatic consumer warranty. Moreover, you should always read the terms of any contract or disclaimer in respect of any seed purchased, and where appropriate have it reviewed, particularly if purchasing large quantities or entering into multi-year contracts.