Customer Protection Laws, Law of Torts and the Contract Act - Essay Example

Customer Protection Laws, Law of Torts and the Contract Act Facts of the case: Rahim bought a laptop computer from Asia Tech Limited upon express warranty that it would be repaired free of charge in the event it stopped functioning within six months of its purchase. During this warranty period, it stopped working. Hence, the company needs to perform their part of the contract to avoid being sued. In this case, it is seen that contract has been established between Rahim and the Company, AsiaTech, in that there is valid consideration flowing from both the parties. The consideration for Rahim is obtaining the laptop computer, subject to enforceable warranty. On the part of the Company, it would be the purchase price consideration. Consideration, according to Jill Poole, in her book, Text Book on Contract Law, could be described as action, inaction or promise thereof by one party, which stimulates action, inaction, or promise of another. (Poole 1996-2008, P. 3). The following case illustration would drive home the aspects regarding the law applicable in this case. A arranges with a lorry transport Company, B, to transfer his chattels and also paid advance towards this arrangement. However, during the actual movement of goods, the cases fall into the river. B is under contract with A and therefore, a breach of contract has resulted. Again, in this case, if A could prove negligence, B may be held negligible under Tort. There fore, under such circumstances, the transport company could be held liable for actions under Contract, and also under Tort law, or both. In the Henderson v. Merritt Syndicate Limited case, the learned jury, Lord Goff observed “Approached as a matter or principle, therefore, it is right to attribute to that assumption of responsibility, together with its concomitant reliance, a tortuous liability and then to enquire whether or not that liability is excluded by the contract because the latter is inconsistent with it.” (Poole 1996-2008, P. 6). Issues in this case: In this case study, it is seen that the product stopped functioning during the warranty period. This warranty is termed as “warranty of fitness” whereby the buyer agrees to purchase the laptop upon the express condition that, in the event of non-functioning within a period of six months, it would be repaired free of cost Answer.com: Consumer protection : Warranties. (Consumer protection. 2008). In this case it could be said that there is an Express warranty that assure the quality, description, or performance of the product… These warranties may be less apparent than are product advertisements. Express warranties can also be oral, such as promises made by salespeople. In this case study it could be in terms of warranting performance for 6 months. The law states that for a breach-of-implied-warranty claim to be victorious, the consumer must establish the following aspects: 1. That actually an implied warranty was present but was violated by the seller 2. That the breach harmed the consumer, 3. That the consumer dealt with the party responsible for the implied warranty, 4. That the consumer notified the seller within a reasonable time. 5. The seller is aware of the losses suffered by the buyer. (Consumer protection. 2008). An implied warranty was present but was violated by the seller: In this case, it is seen that there was an express warranty of fitness of the product, in that it could be serviced, free of charge, for a period of six months within purchase. The breach harmed the consumer: The purchaser, Rahim could not use the product after it sustained a fall since it began to stop functioning. The consumer dealt with the party responsible for the implied warranty: The buyer, Rahim had contact with the Company, Asia Tech from whom he had purchased the laptop. The consumer notified the seller within a reasonable time: It is necessary that Rahim forthwith inform the sellers regarding the fault in the laptop. L’Estrange v F Graucob Ltd (1934) 2 KB 394: There is an interesting case regarding implied condition of fitness which is known as the case relating to L’Estrange v F Graucob Ltd (1934) 2 KB 394. The facts of this case is that the plaintiff purchased a cigarette vending machine from the defendant who got her to sign a sales agreement, which she did not read or care to understand, but signed, nevertheless. The terms of the agreement contained an exclusion clause which disclaimed any responsibility of the seller after the product changed hands. The machine did not work despite several attempts by the parties to bring it into effective condition. Finally the buyer got exasperated and claimed termination of the contract and refund of consideration. The defendant refused to comply. The buyer filed a suit in the lower Court. The plaintiff, claiming break of implied warranty sought restitution as follows: 1. Getting back the money for total collapse of consideration paid 2. Return of money for breach of implied contract of warranty 3. Claiming damages for apparent breach of warranty of fitness for purpose. Although the Lower Courts verdict was in favour of the plaintiff, the higher court dropped proceedings on the ground that the plaintiff was held by the exclusion clause in the agreement. The fact that the plaintiff was not aware, or did not read the finer prints, does not release her from being bound by it. “Accordingly the plaintiff's case failed and judgment for the defendant on the counterclaim was entered.” (L’Estrange v F Graucob Ltd (1934) 2 KB 394. 2003). However the present issue differs from L’Estragne case, in that Rahim, the buyer had placed reliance on the skill and judgment of the seller. The sale was contingent to the meeting of the specific requirement of the buyer in that the laptop could be carried in bicycle without damage as made out in their advertisement that their laptops were “reliable, safe and tough". But apparently this was not so, and the laptop stopped after the fall. Hence, a breach in contractual obligation had resulted, due to non-performance of the laptop as desired by the buyer. Sections 14 (3) (amended) of the Sale of Goods Act 1979: In this instance it is necessary to refer to Sections 14 (3) (amended) of the Sale of Goods Act 1979 with regard to implied warranties in contract of sales. Under it, the quality or fitness of the product states: “Where the buyer, categorically or otherwise, informs the seller the particular objective or need for which the goods are being requisitioned , so as to show that the buyer places trust and faith on seller’s skill or judgment, and the goods are of a description which it is in the course of the seller’s business to supply (whether he is the manufacturer or not), there is an implied condition that the supplied product will serve this purpose, except that in the case of a contract for the sale of a specified article under its patent, or other trade name there is no implied condition as to its fitness for any particular purpose. (Sale of Goods Act 1979 (c. 54) Schedules: Section 14: Quality or Fitness). Remedies: Thus it could be argued that if the product purchased by Rahim was a patented or trade marked one, he would lose the benefit of implied condition as to its fitness. Assuming that the implied conditions are present, the accruing remedies could be said to be as follows: 1. He could proceed against Asia Tech for breach of contractual agreement and arranged to have the laptop services free of cost, or in case this is not possible, a free replacement. He could even litigate for the repayment of consideration. 2. He could initiate action under law of Tort. Under it, he could argue that an aspect of negligence on the part of the sellers was present in that the product could not function even during the warranty period of 6 months, even though the contract provides that the product would meet Warranty limits within this period. 3. Rahim could bring action for claiming damages on grounds of breach of warranty of fitness of the product in that it did not meet the specific needs which he had demanded upon initial purchase. Conclusion: It could be seen that there are several aspects to this case, especially in the light of the fact that the product may either be patented or not. If the patent laws do not apply, the applicant could seek the provisions of Customer protection laws, Law of Torts and the Contract Act to remedy his claim. However, it is often found that parties need not always need to seek help of expensive and long drawn court cases, where the final litigation costs would not be justified. He could approach a Small Courts Court in the event of an unsatisfactory decision from the company, or resort to ADR who are neutral parties who help in settlement of commercial and other disputes. The main advantages are in terms of speedy efficient and low cost dispute resolution. This could be used in co-ordination with arbitration and other dispute settlement processes. Bibliography POOLE, Jill. (1996-2008). Text Book on Contract Law: 8th Edition. [online]. Amazon.co.uk. P. 3. Last accessed 27 July 2008 at: http://www.amazon.co.uk/gp/reader/019928248X/ref=sib_dp_pt#reader-page Consumer protection. (2008). [online]. Answers.com. Last accessed 27 July 2008 at: http://www.answers.com/topic/consumer-protection L’Estrange v F Graucob Ltd (1934) 2 KB 394. (2003). [online]. Law Essay UK Last accessed 27 July 2008 at: http://www.law-essays-uk.com/contract-law-cases-81.php Sale of Goods Act 1979 (c. 54) Schedules: Section 14: Quality or Fitness. [online]. Ministry of Justice: The UK statute law database. Last accessed 27 July 2008 at: http://www.statutelaw.gov.uk/content.aspx?LegType=All+Primary&PageNumber=47&NavFrom=2&parentActiveTextDocId=1837068&activetextdocid=1837173 Read More