The Identification of Harry's Rights - Essay Example

?Scenario The identification of Harry’s rights in regard to the particular transaction requires the examination of the events involved. At the nextlevel, it would be necessary to examine whether Harry has taken all initiatives mentioned in the law (the Sale of goods Act 1979) and whether alternatives were available. The responses of the seller would be also examined focusing especially on the fact whether the seller met all the requirements set by the Sale of goods Act of 1979. Harry has declared to the seller his intention to buy a particular table, along with a chair, which should also have specific characteristics, in accordance with the purchase order that Harry gave to the seller (Sivesand 2005). At this point, it should be noted that there is no problem as of the capacity of Harry to proceed to the purchase since he is not minor nor he suffers from a mental illness (s.3 Sales of Goods Act of 1979, MacLeod 2002). When ordering the table, Harry mentions to the sales assistant that he wants a table similar to that of the poster in the shop’s window; it is implied that the bed ordered should be of the same size, technical characteristics and colour as the bed illustrated in the specific poster (s.13(1) SOGA, Curtis v Ghemical Cleaning and Dyeing Co Ltd [1951], Andrews v Hopkinson [1957]); otherwise an issue of misrepresentation about quality would exist (Cranston 2000, p.148) In accordance with the case study, that bed was grey; therefore, Harry expected to receive a similar bed when making the order (s.13 (1) SOGA). At the same time, Harry picked a chair from the shop’s catalogue and made the relevant order. Again, the item ordered, the chair is defined through a photo of the item presented to the customer. This means that Harry did not have the chance to examine, closely, the size or the other qualities of the items ordered (Law Commission, 2009, p.9). He was only able to define their required characteristics through photographs. It should be noted that Harry did not explain to the seller the purpose of the goods, so the court could decide that the seller is not liable for the fact that the products are not fit for purpose (Reddy & Johnson 2011, p.22, Jewson Ltd v Leanne Teresa Boyhan [2004], BSS Group Plc v Makers (UK) Ltd (t/a Allied Services) [2011]). At this point, the following issues should be discussed: a) whether the items were accepted (s32 SOGA), and b) whether the items met the requirements of the law in regard to not fit for purpose products. The time framework available to Harry in order to make his claims should be also examined. In accordance with the Sales of goods Act 1979, the time framework for the buyer to develop claims against the seller in regard to the items sold is 28 days from the date of the sale (as such term is commonly added in contracts in order to define the ‘reasonable’ time during which the right of the buyer to reject the goods sold is retained, s35(4) SOGA). Harry’s rights, as derived from the specific sale, are active. Harry can approach the seller with a claim for faulty products within the period of 28 days from the date of the sale, meaning the date when the sale was completed, i.e. when the buyer accepted the goods (Chen-Wishart 2007, p.595). The period of 28 days had not passed; it begins from the day that Harry checked the goods, in the context that the seller has to give to the buyer a reasonable time for checking the goods and Harry was absent which means he could not check the goods (s.35 SOGA, Law Commission, 2009, p.10). Also, the English courts have held that the silence of the buyer cannot be considered as acceptance of the goods sold (Felthouse v Bindley [1862], Hannah Blumenthal [1983]). However, in order for the above claims to be valid, it needs to be proved that the products sold are not fit for purpose. The law, the Sales of goods Act 1979 (SOGA), sets the criteria under which a product is considered as not fit for purpose: ‘a) it does not match the description (s.13, SOGA), b) is not of satisfactory quality (s14.2 SOGA) and c) is not fit for purpose’ (14.2, 14.3 SOGA, Jewson Ltd v Leanne Teresa Boyhan [2004], Curtis v Ghemical Cleaning and Dyeing Co Ltd [1951] 1 KB 805). If one of the above requirements does not exist, then the buyer cannot set a claim against the seller in regard to the product purchased. In addition, there are certain cases, in which the buyer loses his right to set a claim for not fit for purpose products. Reference could be made indicatively to the following cases: a) it the customer damaged the item, even by accident, b) if the customer tried to repair the faulty item himself causing damages to the item, c) if the buyer was aware of the item’s faults at the time that he bought it, d) if the buyer decides that the item, after being delivered to him, does not respond to his expectations (s.13). In the above cases, the right of the buyer to set a claim against the seller is diminished (Air Transworld Ltd v Bombardier Inc [2012] EWHC 243, Habton Farms v Nimmo [2003] EWCA Civ 68). There are also cases, in which the above right of the buyer is limited. For example, in case that the buyer accepted the item delivered to him, then he has no claim for full refund (Fleming & Wendeln GmbH & Co v Sanofi Sa/ag [2003] EWHC 561); he can ask, however, for the item’s repair or replacement, in case that the rest terms of the law are met. At this point, of critical importance is the issue of acceptance. The law sets a period of time, usually short, available to the buyer so that the latter can check the item sold and can decide whether this item is of the quality/ characteristics required (J Murphy & Sons Ltd v Johnston Precast Ltd (Formerly Johnston Pipes Ltd) [2008] EWHC 3024). During that period the customer keeps his right to ask for the full refund of the item. However, if the buyer accepts the item, the right for full refund is lost; the buyer can only ask for the repair or the replacement of the item. Harry signed the receipt of the delivery (s32, s35 SOGA), since it was arranged between Harry and the seller that the products were delivered by a carrier but he didn’t accept them as he didn’t have time to check them (s 35, Law Commission 2009, p.10), but this is an issue that will be judged by the court, since it is not clear whether Harry accepted the goods or not. If it is decided that Harry did not accept the goods, then he keeps his right to a full refund (s 35 SOGA, see also Jewson Ltd. v Boyhan [2003], Brewer v Mann & Ors (Rev 1) [2010]). Otherwise, Harry keeps just his right to ask the replacement or the repair of these items (F40, 48B SOGA). In regard to the above rights of Harry, the following issues should be highlighted: a) the table that Harry ordered should be of specific colour. The table delivered to Harry is pink. Although there is no technical fault, still the item delivered is different from that ordered. Harry can set a claim using the s 13 of SOGA, which sets the terms for sale by description, b) in addition, the table has a technical fault, one of the table’s safety screws is missing; this problem gives to Harry another potential; the right to set a claim based on the satisfactory quality term of s14.2 of SOGA (Kulkarni v Manor Credit (Davenham) Ltd [2010], Watford Electronics Ltd v Sanderson CFL Ltd [2001]), c) problem seems to exist in regard to the chair; Harry had ordered a chair, as was described in one of the photos included in the shop’s list. Harry picked the chair he preferred being aware of its size; Harry saw the chain in a photo. Even if he didn’t have the chance to examine it closely, still he was aware of its size. The claim of Harry that the chair is not appropriate for being used in combination with the table cannot be justified; the repair and the replacement of goods are allowed only under the terms of goods that are not fit for purpose or those that are faulty (Geraint & Reiner 2009, p.15). The chair does not have a ‘functional problem’, in terms of its potentials to be used for its role. It is not important for the law whether Harry had in his mind specific plans in regard to the particular chair. Since the item is not faulty, as the term was described above, no claim for repair or replacement can be made. In this context, Harry would have no claim against the seller in regard to the chair. However, he would ask for the replacement of the table, since two different faults have been identified, its colour is different from the table ordered (misrepresentation) and a safety screw is missing (non satisfactory quality). Repairing the table would not be possible, as it would have to be painted again, a cost that would be quite high making the table disproportionately costing. In accordance with the above, Harry would have the following remedies: a) he could reject the goods, in the context of the articles 34-36 SOGA, b) he would also sets his right for recession based on the non-delivery section of s 51 of SOGA. The first of the above remedies would be rejected on the basis that Harry did not act quickly, i.e. he did not reject the items, but he accepted them, a problem related to the lack of time available for the items to be checked (Howells & Weatherill 2005), as analysed above. These remedies would be related with the following two facts: the goods delivered were different from those ordered, meaning especially the table which was of different colour compared to that of the table actually ordered (Cooke 2007). In this context, the seller breached his obligations, as derived from the particular contract. On the other hand, Harry would ask for compensation based on the breach of contract; such right would exist even if Harry had accepted the goods (Law Commission 2009, p.8). Another option in regard to the rights of Harry can be derived through the study of Geraint and Reiner (2009); the above researchers note that the period for rejecting goods can be extended up to 30 days. Moreover, they explain that the will of the buyer to accept the goods must be clearly proved. In case that the buyer had no time to check the goods and if the circumstances that prevent him from checking the goods have been expanded up to 30 days, then the buyer would, still, have the right to reject the goods, even if they were delivered to them (Jewson Ltd. v Boyhan [2003], Gold Coast Ltd. v Naval Gijon SA [2006]). The term acceptance in this case is judged by the court, which will set into examination the fact whether Harry had the time that a reasonable man would consider for checking the goods. If no such time existed, then there was no acceptance. At the same time, the period of 30 days would start to count from the day that the events that stopped the buyer from checking the goods had stopped. In this way, it is possible for the court to consider that the 30-day period for the acceptance of goods has started from the 2nd of February, when all such barriers eliminated, i.e. when Harry was allowed to check the items delivered to him. Regarding the above, the following issues should be made clear: Harry did not show negligence in accepting/ checking the products; as explained in the scenario, Harry was leaving the house when the items were delivered; in other words, he had not time to check the items, but he showed no negligence on this (Keenan & Smith 2007, p.825). In fact, he checked the items immediately, as possible, after returning from the trip and resolving emergent problems since his return; due to the above facts, Harry could possibly claim that he didn’t accept the goods (Cooke 2007, p.82); the Court would examine the facts of the case and decide whether there was acceptance of goods or not; for example in the case Manifatture Tessile Laniera Wooltex v J B Ashley Limited [1979] the Court held that for about 3 and half months after the delivery of goods no acceptance existed; also, in Truk (UK) Limited v Tokmakidis GmbH [2000] the Court held that goods would be rejected even after a year from their delivery. On the other hand, the seller has showed negligence in responding to the description of the products, as written in the order (Keenan & Smith 2007). Even if the courts would not recognize the existence of negligence by the seller’s side, still, Harry would use the provisions of the Consumer Protection Act of 1987, which offer to consumers to the right to state their claims against the sellers even if no negligence by the seller’s side exists (Keenan and Smith 2007). Misrepresentation (s75) is a common problem in sale contracts. Due to the expansion of the phenomenon, the law sets important consequences for those traders who developed the particular activity. In accordance with Cranston (2000) misrepresentation in regard to the quality of the products/ services ordered can lead to the civil and criminal liability of the retailer involved (Atari Corp (UK) Ltd v Electronics Boutique Stores (UK) [1997], Bence Graphics International Ltd v Fasson UK Ltd [1996]). The relevant provision is included in the Trade Descriptions Act 1968 (Cranston 2000, p.148). Courts tend to accept the claims of buyers based on misrepresentation (Reddy and Johnson 2011), as for instance in the case Fortright Finance v Ingate and the Lockett v A & M Charles Ltd (1938); in the last case, the existence of negligence in the sale contracts has been reviewed. Scenario 2 The key question of the second case seems to be the following one: who is, currently, the legal owner of the car? In order to identify the most appropriate response to that problem it would be necessary to check the sale process, as took place during the absence of Harry. Harry has been the owner of the car. During his absence, he left, intentionally, his car to another person, the owner of the garage. At this point of time, the owner of the garage acquires the legal possession of the car, which is, in practice, out of the control of its owner, in terms of the ownership (Chen-Wishart 2007). While Harry is away, the owner of the garage negotiates the sale of the car informing Harry for the process. Furthermore he finally sells the car to a price near to that Harry said he would probably accept, if he would want to proceed to such initiative. Up to now, two problems have appeared: had the owner of the garage the right to sell the car? Also, did the buyer acquire the ownership of the car or not? The above issues would be made clear by checking the provisions of the Factors Act 1889. The article 21(1) of the Sales of Goods Act 1979, which defines that a person who buys goods from a person who is not the owner, then he cannot obtain better title than the owner. The above rule, which is often described as ‘Nemo dat quod non habet’, i.e. No-one can acquire something from someone who is not the owner (Atari Corporation (UK) Ltd v Electronics Boutique Stores (UK) Ltd [1998], Finance Ltd v Hudson [2003]). This issue is critical for this case. If the garage owner is not considered as the owner of the car, then no sale of the car has taken place. In accordance with the above Act, ‘a person is in possession of goods… when these goods are in his custody’ (s1.2). This means that the owner of the garage was in legal possession of the car of Harry. However, his right to sell it would be examined separately, meaning that the fact, solely, that the owner was in legal possession of the car does not mean that he has the power to sell the car. Without such power, the sale of the care would be declared as non-valid, meaning that the buyer would have to return it to Harry. However, at this point, the court would probably require that the buyer of the car is aware of the particular fault of the sale. The owner of the garage can be characterized as a ‘mercantile agent’ in the sense of the article 1.1 of the Factors Act 1989. In accordance with the above article, a person is considered as being a mercantile agent if he has, as ‘a customary course of his business’ (article 1.1 FA 1989), the right to sell goods. The owner of the garage could be considered as a mercantile agent, especially in regard to cars and their components. However, doubts many existed in regard to the above claim, on the basis that the owner of a garage does not normally, sells cars; however, since it is expected that used cars are often abandoned to garages by their owners, after having suffered damages, then the role of the owner of the garage as a mercantile agent could be possibly reconsidered (Shaw and Another v Metropolitan Police Commissioner [1987]). On the other hand, the following issue needs to be analysed: in order for the sale of the car to be valid, it is necessary for the terms of the article 2(1) of the Factors Act 1889 to be met. The specific article sets a series of limitations in order for the sale developed by a mercantile agent to be considered as valid. More specifically, it is required that: a) the person who is considered to be a mercantile agent needs to have in his possessions goods which he can sell, in the context of his power as a mercantile agent; the above term is met in the specific case (MacLeod 2002, Moorgate Mercantile Co Ltd v Twitchings [ 1977]); the owner of the garage is in the possession of the car of Harry; the owner of the garage has been characterized as a mercantile agent, so he can proceed to the sale of the car, if the second term of this article is met; b) it is necessary that the mercantile agent is in the possession of the goods of another person with the consent of their owner (Geraint & Reiner 2009); again, such term is met in the particular case. Harry has given his car to the owner of the garage; the exact reason for which the car was given to the above person is not important; just the fact that the car is there with the consent of its owner is necessary in order for the second condition of the article 2(1) to be considered as fulfilled, c) the person that buys goods from the mercantile agent needs to act in good faith; such term can be considered as existing, due to the following facts: the owner of the garage is expected by any reasonable person that can have used cars for sale, i.e. the particular activity is not out of the general commercial practices (article 2(1) Factors Act 1889, Goldring 1998). Moreover, the owner of the garage has the car’s registration document, which Harry left in the glove box before leaving, not thinking of the potential consequences of such action. In this way, the third term for a sale to be valid under the section 2(1) of the Factors Act 1889 exists; d) furthermore, as already noted before the mercantile agent has the car’s registration document, another requirement of the Factors Act 1889 in order for a sale developed by a mercantile agent to be considered as valid. Therefore, the sale of the car could be considered as valid (2.1 Factors Act 1889). However, using the article 2(1) of the Sales of Goods Act 1979, i.e. the rule ‘‘Nemo dat quod non habet’, the sale could be considered as void since the garage owner is not actually the owner of the car (Stadium Finance v. Robbins [1962], Finance Ltd v Hudson [2003]). In this case, Harris could possibly ask for compensation. As for Barry, he could ask for the return of the money paid and compensation. Cases with similar characteristics lead to important conflicts in regard to the law applicable; the principle of ‘Nemo dat quod non habet’ aims to protect the ownership, as a concept. On the other hand, the Factors Act of 1889 aims to secure the validity of commercial transactions (Bishopsgate Motor Finance Corpn. v Transport Brakes Ltd [1949], Rowland v Divall [1923]). References A. Statutory Law Consumer Protection Act 1987 Factors Act 1889 Sale of goods Act 1979 Sale and Supply of goods Act 1994 B. Case law Andrews v Hopkinson [1957] 1 QB 229 Air Transworld Ltd v Bombardier Inc [2012] EWHC 243 Atari Corp (UK) Ltd v Electronics Boutique Stores (UK) [1997] EWCA Civ 2098 Bence Graphics International Ltd v Fasson UK Ltd [1996] EWCA Civ 748 Bishopsgate Motor Finance Corpn. v Transport Brakes Ltd [1949] Brewer v Mann & Ors (Rev 1) [2010] EWHC 2444 (QB) BSS Group Plc v Makers (UK) Ltd (t/a Allied Services) [2011] EWCA Civ 809 Curtis v Ghemical Cleaning and Dyeing Co Ltd [1951] 1 KB 805 Felthouse v Bindley [1862] EWHC CP J 35 Finance Ltd v Hudson [2003] UKHL 62 Fleming & Wendeln GmbH & Co v Sanofi Sa/ag [2003] EWHC 561 Forthright Finance Limited v Ingate and Carlyle Finance Limited. Court of Appeal [1997] Gold Coast Ltd. v Naval Gijon SA [2006] EWHC 1044 Habton Farms v Nimmo [2003] EWCA Civ 68 Hannah Blumenthal [1983] 1 All ER 34 HHR Pascal BV v W2005 Puppet II BV [2009] EWHC 2771 J Murphy & Sons Ltd v Johnston Precast Ltd (Formerly Johnston Pipes Ltd) [2008] EWHC 3024 Jewson Ltd v Leanne Teresa Boyhan [2004] I Lloyd's Rep 505 Jewson Ltd. v Boyhan [2003] EWCA Civ 1030 Kulkarni v Manor Credit (Davenham) Ltd [2010] EWCA Civ 69 Lockett v. A & M Charles Ltd., 3 AL ER 170, Kings Bench Div. [1938] Manifatture Tessile Laniera Wooltex v J B Ashley Limited [1979] Lloyd’s Rep 28 Moorgate Mercantile Co Ltd v Twitchings [ 1977] AC 89 Rowland v Divall [1923] 2 KB 500 Shaw and Another v Metropolitan Police Commissioner [1987] 3 ALL ER 405 Stadium Finance v. Robbins [1962] 2 Q.B. 664 Truk (UK) Limited v Tokmakidis GmbH [2000] All ER (Comm) 721 [63] Rowland v Divall [1923] Watford Electronics Ltd v Sanderson CFL Ltd [2001] EWCA Civ 317 C. Bibliography Chen – Wishart, M. (2007) Contract Law. Oxford: Oxford University Press. Cooke, J. (2007) Law of Tort. Essex: Pearson Education. Cranston, R. (2000) Cranston's Consumers and the Law. Cambridge: Cambridge University Press. Geraint, H., Reiner, S. (2009) Modernising and Harmonising Consumer Contract Law. Munich: Sellier. European law publishers. Goldring, J. (1998) Consumer protection law. Leichhardt: Federation Press. Keenan, D., Smith, K. (2007) Smith and Keenan's English law. Essex: Pearson Education. Law Commission, UK (2009) Consumer remedies for faulty goods. London: The Stationery Office. MacLeod, J. (2002) Consumer Sales Law: The Law Relating to Consumer Sales and Financing of Goods. London: Routledge. Reddy, J., Johnson, H. (2011) Q&A Commercial Law 2011-2012. Oxon: Taylor & Francis. Sivesand, H. (2005) The Buyer's Remedies for Non-Conforming Goods: Should There Be Free Choice Or Are Restrictions Necessary? Munich: Sellier. European law publishers. Read More