The in In Beale v Taylor - Case Study Example

The Sale of Goods Act 1979 imposes certain conditions on goods that are to be sold. Section 14(2) (B) of this Act s that the goods should be fitfor the purpose for which they are manufactured and sold. Further, section 13 of the Sale of Goods Act 1979 states that in the event of a contract for sale of goods by description, there is an implied term that the goods have to correspond with their description. In addition, this section states that incorrectly described goods can be rejected if the buyer had relied upon such description. In Beale v Taylor, the buyer bought a vehicle on the basis of its description by the seller. The court held that this was a sale by description (Beale v Taylor, 1967). However, in Harlingdon & Leinster Enterprises Ltd v Christopher Hull Fine Art Ltd, the court did not consider a transaction between two art dealers to be a sale by description, as the buyer was competent to rely on his own expertise to assess the value of the painting (Harlingdon & Leinster Enterprises Ltd v Christopher Hull Fine Art Ltd, 1991). In some situations the goods bought may be free of defects but may fail to serve the purpose for which they had been purchased. However, in Slater v Finning Ltd the court held that if the buyer desired to utilize the product for an abnormal purpose and if this had not been revealed to the seller, then a claim under section 14(3) of the Sale of Goods Act would fail (Slater v Finning Ltd, 1997). The reason for which goods are bought can be either implied or expressed. If the customer knows that the goods are made for a specific purpose or the goods can be used for only one specific purpose then there is no need for the customer to make enquiries about the product’s appropriateness for that purpose (Priest v Last, 1903). Implied terms are enforced by statute, therefore their breach is deemed to be a violation of the legislation and the buyer can reject such goods and claim a full refund of the price without any concession for having used the goods. The court in Godley v Perry held that a defect in the goods is a violation of an implied term under the Sale of Goods Act and renders a product unsafe and unsatisfactory (Godley v Perry, 1960). The Sale of Goods Act states that the buyer’s acceptance of goods are evidenced by the buyer’s acts, which may include intimating his acceptance to the seller, the buyer’s acts after delivery and if the buyer retains the goods without rejecting them for a reasonable period of time (Section 35, of the Sale of Goods Act , 1979). If the buyer had retained the goods for a reasonable period of time, then rejection is not possible and the only remedy that will be allowed by the court will be the claiming of damages (Bernstein v. Pamson Motors (Golden Green) Ltd). Moreover, this act states that if goods are purchased for some specific purpose, then the seller is duty bound to inform the buyer about the suitability of the goods for the intended use (Section 16(a), of the Sale of Goods Act , 1979). A false statement of fact made by a party to another, while forming a contract is defined to be a misrepresentation. If a party suffers loss due to a misrepresentation made by the other party to the contract, then the former can either seek damages or rescission of the contract. In Derry v. Peek, the House of Lords held that mens rea need not be established in an action that was trying to establish deceit and the only thing needed was for the plaintiff to show that the defendant either knew or believed that the statement was false. While establishing deceit, the court held that it was sufficient if it could shown that the defendant did not believe in the veracity of the statement or that the defendant had made that statement without considering its truth or falsity (Derry v Peek, 1889). Molly bought a mobile phone on the basis of an advertisement that held that these phones were shockproof, waterproof and ideal for an active lifestyle. Molly informed the salesman that she would be subjecting the cell phone to very rough treatment. The salesman stated that these mobile phones were virtually indestructible. However, the mobile phone stopped working after Molly sat on it. The advertisement depicted the mobile phone as being capable of withstanding considerable amount of shock and immersion in water. Moreover, the salesman had emphasized that these mobile phones had not suffered any damage even after trucks had run over them, they had been dropped from great heights and that in sum these phones were virtually indestructible. Neither the manufacturer nor the seller can evade liability on the basis of exclusion clauses by stating that such statements were common in advertising and that they were not necessarily true. The validity of the exclusion clauses, are to be tested under the UCTA (Unfair Contract Terms Act, 1977) and the UTCCR (Unfair Terms in Consumer Contracts Regulations , 1999). The Director General of Fair Trading is duty bound to investigate the complaints in respect of unfair terms in contracts. In Carlill v Smokeball, the defendant argued that his advertisement in a newspaper was for the general public and therefore it could not be considered to be an offer. However, the court held that a contract had been formed as the plaintiff had complied with the terms of the offer (Carlill v Smokeball Co, 1892). Therefore, this contention of the manufacturer of the mobile phone will not hold good and therefore Molly can claim damages for the loss suffered by her due to having relied on the manufacturer’s advertisement. In respect of the seller, Molly had clearly specified that she would be subjecting the mobile phone to rough use and this had been made amply clear to the salesman. This salesman had understood the purpose for which Molly wanted the mobile phone and he had also understood the manner in which she would be using it. Nevertheless, he had recommended the phone as being ideally suited to her active life style. Further this sale can be construed to be a sale by description. In Harlingdon & Leinster v. Christopher Hull Fine Art Ltd, it was held that the sale is by description if the buyer could reasonably be expected to rely on the words in question while buying the goods. Under Section 13 of the Sale of Goods Act 1979, goods that have not been correctly described can be rejected in the event of the buyer relying on such description. In contracts specifying sale of goods by description, a condition that these goods have to correspond to the description is inherent by implication. The mobile phone which suffered damage due to rough handling had been described by the seller as indestructible. As such he had misrepresented the facts by stating that the mobile phone had not suffered damage even after being run over by trucks, etc. Section 14(2) of the Sale of Goods Act implies a term in contracts that goods purchased will be of satisfactory quality. This is applicable only if the goods were sold in the due course of business. Moreover, the statutory implied terms that goods supplied under a contract must be of satisfactory quality, reasonably fit for the buyers purpose and must conform to the description by which they are supplied offer a number of advantages to a potential plaintiff. They make the supplier liable for the goods supplied. The central requirement is that the goods supplied must be of satisfactory quality and this arises automatically wherever goods are sold in the normal course of business (Section 14(2), Sale of Goods Act, 1979). Since the seller had infringed the implied terms that have been deemed to be essential conditions by the statute under the provisions of section 14(2) of the Sale of Goods Act 1979, he is liable for a claim of full refund of the cost of the mobile phone subsequent to its rejection by Molly. Moreover, the seller cannot evade liability by stating that the salesman was solely responsible for the information and advice that had been given to Molly and for the sale by misrepresentation. In Canadian Pacific Railway Co v. Lockhart, Lord Thankerton of the Privy Council held that an employer was liable for the acts done by his employees in the course of business (Canadian Pacific Railway Co v Lockhart, 1942). On the basis of this decision the seller is responsible for the statements made by his salesman during the course of business. The Statute sets out that no contract term can exclude or limit liability in any way for negligently causing death or injury (Section 2, Unfair Contract Terms Act, 1977). In Stevenson v. Rogers the court gave wider interpretation to the term in the course of a business (Stevenson v. Rogers , 1999). The remedies available for breach of contract of sale are repair; replacement; partial refund; rejection and full refund. Moreover, if a defect occurs within six months of sale then such defect is deemed to have been present at the time of sale (Section 48 A (3), Sale of Goods Act , 1979). Hence Molly can either reject the contract or claim a full refund in addition to a claim for damages, against both the seller as well as the manufacturer. References Beale v Taylor, 1 WLR 1193 (1967). Bernstein v. Pamson Motors (Golden Green) Ltd, 2 All ER 220 (1987). Canadian Pacific Railway Co v Lockhart, AC 591 (Privy Council 1942). Carlill v Smokeball Co, 2 QB 484 (1892). Derry v Peek, 14 App Cas 337, All ER Rep 1 (House of Lords 1889). Godley v Perry, 1 All ER 36 QB (1960). Harlingdon & Leinster Enterprises Ltd v Christopher Hull Fine Art Ltd, 1 QB 564; (1989) 3 WLR 13; (1990) 1 All ER 737 (1991). Priest v Last, 2 KB 148 (1903). Section 14(2), Sale of Goods Act. (1979). Section 16(a), of the Sale of Goods Act . (1979). Section 2, Unfair Contract Terms Act. (1977). Crown Copy Right . Section 35, of the Sale of Goods Act . (1979). Section 48 A (3), Sale of Goods Act . (1979). Slater v Finning Ltd, AC 473 (1997). Stevenson v. Rogers , 1 All ER 613 (Court of Appeal 1999). Unfair Contract Terms Act. (1977). Unfair Terms in Consumer Contracts Regulations . (1999). Read More