Business contract

Explain the main characteristics of a consumer contract. Sale of Goods Act 1979 (SAGA 1979) is amended by Sale and Supply of Goods Act 1994 and the Sale and Supply of Goods to Consumers Regulations 2002 The Contract for Sale of Goods A contract for the sale of goods Is ‘a contract In which the seller transfers, or agrees to transfer, the property In goods to a buyer for a money consideration. Called the price’ This contract contains two conditions, Both ‘sale’ and ‘agreement to sell, the seller can transfer the goods immediately and is willing and able to do ,there is some sort f condition that must be fulfilled firstly.

Legal effect: In ‘sale, purchaser obtains a real right over the goods as property passing, In ‘agreement to sell’: purchaser only holds a personal right against the seller in respect of the contract. The ‘Goods “all corporeal movable except money; and In particular ‘goods’ Includes ennoblement, industrial growing crops and things attached to or forming part of the land which are agreed to be severed before sale or under a contract of sale. ” But there are two should be excluding: the first is incorporeal movables; the other one is heritable property, such as land and building. Consumer contract is that supplied for private use or consumption.

Implied Terms of SAGA 1979 which are automatically incorporated into a contract by SAGA 1979. There are four breaches of Section 12, 13, 14 and 15 section 12- Title It has two main points The first one is implied condition which means the seller has, or will have at the time when property in the goods is to be transferred, a right to sell the goods. The second one is implied warranty, it tell us the buyer shall have quiet possession of the goods and that the goods are free of any encumbrance or challenge by a third party (unless closed to the buyer when the contract is made) Section 12 cannot be excluded or restricted by agreement.

See cases 1. Nimblest Ltd v Confectioners Materials Co. 1921 2. McDonald proven Ltd 1960 Section 13 – Sale by Description An implied condition: The goods will correspond to the description. If a description is applied to the goods, it is a sale by description even though the buyer may have inspected the goods. Apply to all sales both by private individuals and by business. See the Case: Grant v Australian Knitting Mills 1936 Section 14 Section 14 – ‘Satisfactory Quality Only apply where goods are sold in the course of a business (the seller is in business). But it doesn’t cover private sales.

We need to know the goods are to be of a standard(SIS (AAA))that a reasonable person would regard as satisfactory, taking account of any description of the goods, the price (if relevant) and all other relevant circumstances. There are factors potentially relevant: SIS (b) Fitness for the purpose for which goods of the kind in question are commonly supplied Appearance and finish Freedom from minor defects Safety and Durability But the buyer should notice that the buyer’s attention is drawn to defects before the interact is made, or the buyer examines the goods before the contract is made, and the examination ought to reveal the defects.

Sale by sample, the matter would have been noticed on a reasonable examination of the sample. It is said the goods are reasonably fit for a particular purpose applies, and where the seller sells the goods in the course of business. The buyer expresses or by implication makes known to the seller the particular purpose for which the goods are bought. Unless the circumstances show that a) The buyer does not rely, or that b) It is unreasonable for him to rely, on the skill or Judgment of the seller.

Section 14 – Some others If a buyer has special needs, the buyer must make these known to the seller before the section will apply. (Griffith v Peter Conway Ltd 1939) Strict liability: a buyer does not have to prove negligence on the part of the seller. (Frost v Eyelashes Dairy Co Ltd 1905) Sale goods does not diminish the buyer’s rights unless they are classed as ‘seconds’ etc. It is unlawful to state ‘No refund on Sale Goods’ under Consumer Transactions Order 1976. The provisions only apply to the buyer, not to any other party.

Section 15 – Sale by Sample Two Implied conditions: The bulk corresponds in quality with the sample. The goods re free of any defect rendering them unsatisfactory, which would not be apparent on a reasonable examination of the sample See the case Goodly v Perry 1960 The buyer shall have a reasonable opportunity of comparing the bulk with the sample; the bulk must correspond to both the sample and the description. C) Explain the section in the Unfair Contract Terms Act relating to consumer contracts.

Any attempt to exclude or restrict liability for breach of Section 12 is void – Unfair Contract Terms Act 1977 (SIS) Consumer contract: Supplied for private use or consumption. Any attempt to exclude or restrict liability for breach of Section 13, 14 ND 15 is void. Commercial contract: Any attempt to exclude or limit liability for breach of Section 13, 14 and 15 shall have no effect unless it was fair and reasonable. A) In respect of Marry suit, advise her of her rights in relation to the following and where appropriate use case law to Justify your answer. 1.

In the case, the sale person said it was a leather suit, but when Marry suit was delivered, there was a hole in the back of the couch, and this violated the Satisfactory Quality in Section 14 of SAGA, it indicates only apply where goods are sold in the course of a business (the seller is in business). But it doesn’t cover private sales. We need to know the goods are to be of a standard(SIS (AAA))that a reasonable person would regard as satisfactory, taking account of any description of the goods, the price (if relevant) and all other relevant circumstances.

There are factors potentially relevant: SIS (b) 2. In the case, the salesperson told Mary that the suit was in sale, which she could not return it under any circumstances, it against the Section 14 – some others in SAGA. The Have-it-all has strict liability that a buyer does not have to prove negligence on the part of the seller. Even though the suit is sale goods but it does not monish the buyer’s rights unless they are classed as ‘seconds’ etc. It is unlawful to state ‘No refund on Sale Goods’ under Consumer Transactions Order 1976.

But the provisions only apply to the buyer, not to any other party. So it is voided for Have-it- All that Mary could not return it under any circumstances. Assonating Piggeries v Christopher Hill 1972 B gave S a recipe for mink food and requested that S should mix the food in accordance with the recipe and supply it to B. S told B that they had never supplied mink food before although they were manufacturers of animal foodstuffs. One of the ingredients was herring meal which had been stored in a chemical which created a poisonous substance damaging to all animals but particularly damaging to mink.

As a result many of the mink died. Mary can remedy for seller’s breach in Sale of Goods Contract The buyer’s remedies by SAGA: The seller has to return both the purchase price and compensate for any damage if breach of implied terms. Action for damages for non- delivery, which means the damages payable is the estimated loss arising from the seller’s breach. Order for specific implement, it indicates that seeking a court order that the seller deliver the goods. If only the buyer has sound reasons for preferring the remedy to an action for damages.

Where the goods do not conform to the contract at the time of delivery, the remedies in order of availability are: Repairing or replacement of goods Reduction in price or Rescission of the contract Any attempt to exclude or restrict liability for breach of Section 12 is void – Unfair Contract Terms Act 1977 (SIS). Consumer contract supplied for private use or and 15 is void. 4. In the case, it is said the suit is leather, but the suit was not leather but made of vinyl, this violated the Section 13 – Sale by Description which means an implied notation that The goods will correspond to the description.

Mary could require repairing or replacement of goods and reduction in price or Rescission of the contract. 5. Trade Descriptions Act 1968 protects consumers through the criminal law. It includes Powers of local trading standards officers: a) Make test purchase b) Enter premises at all reasonable hours c) If they have reasonable cause to be suspect that an offence has been committed, require production or books and documents and seize goods d) Enter premises (by force if necessary) after obtaining a Warrant from a Sheriff or Justice of the peace.

Trade description An indication, direct or indirect of any of the following to any goods: SO often 1968 a) The quantity, size or gauge of the goods b) The composition of the goods c) The method of manufacture of the goods d) The fitness for purpose, strength, performance, behavior or accuracy e) Any other physical characteristics of the goods f) Any testing by any person and the results of such testing g) Any approval by any person or conformity with a type of approval h) The date or place of manufacture, production, processing or reconditioning of the goods I) Other history of the goods including ownership or use sledding (to a material degree) description to goods, this trader can be prosecuted by the composition of the goods, beyond the Trade Descriptions Act 1968, it needs to pay fines.

Services, accommodation or facilities: Wings v Elites 1985 A holiday firm was convicted under Section 14 due to a statement in a brochure which incorrectly stated that a hotel had air-conditioning. When the error had been discovered the company had advised their staff, agents and customers who had already booked their holiday. Some months after the brochure had been published a customer read the description and was not informed of the mistake. ) Explain Margarita’s rights in relation to the washing machine and the damage caused by it. 1. Washing machine purchase in the form of a credit, the machine caught fire, and quality problems cause dangerous. This violated the safety of Satisfactory Quality in Section 14 of SAGA, Margaret can remedy for seller’s breach in Sale of Goods Contract. 2.

Consumer Credit Act 1974: Debtor-creditor-supplier agreement There is a pre- existing financing arrangement between Have-it-all and Loan-r-Us. The creditor and the supplier are Jointly and severally liable in respect of any breach of contract- connected lender liability. The consumer would choose to claim against any of them. There is existing arrangement between Have-it-all and Loan-r-Us, they have connected lender liability, Margaret would choose to claim against any of them, even if Margaret has no success as Have-it-all keep denying all responsibility, she can get the compensate from Loan-r-Us. 3. Consumer Protection Act 1987 delicates strict liability on a producer for damages caused by a defective product.

It may rule out claims that could still be made at common law but it does not cover some forms of loss (e. G. Pure economic loss) Margaret does not have to prove negligence on the part of the seller. 4. Amended by General Product Safety Regulations 1994 The General Product Safety Regulations 1994 (GAPS) amends the CPA and is a ‘safety net’ that addresses the safety of all consumer goods. The regulations place a general duty on all suppliers of consumer goods to supply products that safe in normal or reasonably foreseeable use. The washing machine caught fire, which beyond the safe in normal or reasonably foreseeable use, so it is not safety production. 5. CPA is also covered by criminal law.

Criminal side is enforced by public bodies such as the Trading Standards Department, which can punish the Have-it-all by criminal law. 6. Common law of delicate for breach of a duty of care: the buyer must show that the defender has failed to take reasonable care for the safety of the purchaser and to show negligence According to this, the washing machine caught fire, that because of the poor quality, Margaret can remedy for seller’s breach. Donahue v Stevenson 1932 Mrs. Donahue had gone to a cafe in Paisley with her friend who bought her an opaque bottle of ginger beer. The shopkeeper poured some ginger beer over ice cream in a glass from which Mrs. Donahue drank.