Predominant Factor/Predominant Purpose definition
Predominant Factor/Predominant Purpose. Test – looks at the transaction as a whole to determine whether its predominant purpose was the sale of goods or the provision of a service. Takes into account the following factors:
a. Language of the parties’ contract,
b. The nature of the business of the supplier of the goods and services,
c. The reason the parties entered into the contract (i.e. what each bargained to receive), and
d. The respective amounts charged under the contract for goods and services. Note: Even where the cost of goods exceeds the cost of the services, the predominant purpose of the contract may still be deemed the provision of service where the other factors support such a finding.