Leah Tierney X00128761 Advertising Law Continuous Assessment
Outline in detail the implied terms that protect consumers and that are contained in the 1893/1980 Sales of Goods and Supply of Services Act.
The most popular type of commercial law is the sale of goods, and additionally, the supply of services. This type of transaction is regulated by principles of contact law, more particularly the Sale of Goods Act (1893) and the later amended version, the Sale of Goods and Supply of Services Act (1980). These acts are in place to protect consumers in a variety of ways.
A statement becomes a contractual term in a sale of goods contract when the maker of it, expressly or by implication, declares it to be true. In this way, terms can either be…
In this instance, the involved parties will agree their terms either in writing and/or orally. In other words, they are expressly agreed upon. For example, these terms could include the price of the goods, the quantity and method of delivery.
Both acts imply certain terms in the form of conditions and/or warranties. A condition has been interpreted by the court to mean a term vital to the contract. Breach of a condition generally entitles the innocent party to claim damages and reject the contract. A warranty, which is of less importance than a condition, is a subsidiary term. Breach of a warranty entitles the innocent party to damages only.
The terms implied into a contract for sale of goods are…
i) Good title – Sellers duty to pass good title to the goods
There is an implied condition that the seller has the right to sell the goods. If a buyer purchases goods from a seller that has no good title to the goods, the buyer must return the goods to the true owner. The buyer can then claim there has been total lack of consideration and recover the entire price paid to the seller for the goods, excluding any allowance for use of the goods.
Rowland vs Divall 1923: The defendant sold a car to the plaintiff, unknown to the defendant that it has been stolen. The true owner later recovered the car from a third party the plaintiff had sold the car to, who was fully reimbursed by the plaintiff. The plaintiff sued the defendant to recover full refund, but the defendant argued that an allowance should be made for the use of the car before it was returned to true owner.
Held: The plaintiff was entitled to full refund as the contract had been for the transfer of ownership and not just the right to use the car, meaning there had been total lack of consideration.
There is also an implied warranty that the buyer is to have quiet enjoyment of the goods and that the goods are free from any third-party charges unless made known to the buyer before or at the time of making the contract.
ii) Description – Goods as described
There is an implied condition that when goods are sold by description (for example, on the packaging or orally by a salesperson), then the goods must correspond with that...