Consumer Protection Act 1987 - Case Study Example

Car case The car was sold to Martha by representation that it was in A1 condition and it had only one previous owner. Both turned out to be untrue since the car was found to have been involved in multiple collisions and had several owners. This is violation of the prescribed A1 condition for the car. Besides, the poor condition of the vehicle led to swerving to the side of the road only to hit against a stationary lorry. The sales man did not wash the car before delivery contrary to his promise. His liability arises on three counts. One, for having sold a defective car fraudulently. Second, liable for the damages arising out of the accident occurred after delivery. Third, for not having delivered the car in washed condition. Consumer Protection Act 1987 as amended by General Protection Act 2004 covers sale of second hand goods also. Since passing of this legislation, buyers of the second hand goods have the rights as are applicable to new goods. Under Sales of Goods Act 1979, buyer of second hand cars or for that matter new car, Martha as a consumer can expect the quality to be satisfactory as per prescribed standards applicable to that good. In the instant case the car should be fit for the purpose and safe and durable as claimed by the seller at the time of sale. Here the car was claimed to be of A1 condition which was false. Hence Martha who bought the car is entitled to full refund of the value paid provided she makes an immediate complaint and lodges a claim. The time taken to return should be reasonable so that the seller will not have an excuse to say that it might have been mishandled by the buyer. Fortunately there is a witness of the driver who drove the car for delivery to Martha and it was by his expert opinion, the true status of the car came to be known. If Martha chooses to return the car within a maximum allowed period f six months either for repair, replacement or partial refund, she need not prove that car was faulty at the time of sale. If the seller does not agree, the onus to prove that it was not defective is on him. Any legal proceeding to make a claim should be made within six years. Even after repair, if it is not in sound condition, Martha can claim full refund. If the seller refuses to any of Martha’s proposals, she can take an advice from local Citizens’ Advice Bureau for legal action in small claims court and for further recovery action after the claim is allowed by the court. Alternatively she can approach Retail Motor Industry Federation, The Vehicle Builders and Repairers Federation or MVRA Ltd in which the seller maybe a member especially since he has claimed A1 condition for the car which is a standard set by the trade as description for immaculate condition. Further as per Trade Descriptions Act 1968, it is an offence to make false statement of condition of the goods sold by the trader. Martha can approach the local authority of trading standards department to lodge her complaint for necessary criminal action against the seller. As the Car has been apparently sold with serious defects, Martha is entitled make a complaint that the seller has committed offence under section 75 of the Road Traffic Act 1988 also. (BERR) Earlier ‘merchantable quality’ was the norm rather than ‘satisfactory quality’ as at present. Thus in Bartlett v Sidney Marcus (1952), Lord Denning had stated that in case of second hand cars, the buyer should be prepared for the defects to surface sooner or later and hence if there had been no express warranty, the buyer had no redress. The most he could expect was that it should be fit for the purpose that is to ride along the road. Hence usability test to establish merchantable quality was being applied for second cars for their road worthiness rather than being wholly perfect for their use. In the present case, ‘A1’ condition is a condition wider than even warranty. The car is not road worthy. It fails even the usability test. In a subsequent ruling in Shine v General Corporation Ltd (1988), the one year old FIAT X19 car which was claimed to be ‘superb’ in advertisement and orally also as a ‘nice car, good runner, no problem’ and sold for £4,400 turned out to be a written-off car by the insurance company due to an accident of submerging in water which however was not known to the seller. Question arose as to the merchantable quality of the car. It was held by the appeal court, it was not of merchantable quality at the time of sale based on the facts; that plaintiff was potentially buying a rogue car; that no body would knowingly touch it even with a barge pole; and that any buyer would buy it as a form of investment for future sale if need be. In yet another case Burnley Engineering Products ltd v Cambridge Vacuum Engineering Ltd (1997) QBD, the timing of rejection of goods was considered. Thus the plaintiffs, who had purchased an electron beam welding machine in August/October 1991, sought to return it in September 1992 by a public notice to the defendants and asked them to collect it back and refund the price. Since it was declined by the defendants, the plaintiff caused a writ for ordering rejection and refund. The court decided in favour of the defendants for the reason, the plaintiff had no right to reject the goods beyond September 1992 by which time the bedding down and commissioning of the machine would have extended. Hence it is crucial for the buyer to return the goods within a reasonable time. In the present case therefore Martha should not delay even a single day for further action as in the above case though the plaintiff gave pubic notice rejection in September 1992, their remedial action was taken only in September 1993. Even though many second hand goods are sold ‘as are seen’, buyers’ rights are limited because they rely on implied terms of contract. Food poisoning case The caterer’s employee Sarah forgot to keep the sausage rolls in the refrigerator due to which it developed bacteria resulting in mild food poisoning to the guests of Jim and Martha. It is a clear case of negligence. The question arises whether an employer can exclude liability for his employees’ negligence or any other reason whatsover. It cannot be called a product defect to attract the provisions of Consumer Protection Act 1987. Otherwise, for strict liability under the said Act, negligence need not be proved. Catering is a contract for supply of food at a party which includes caterer serving the food also to the guests at the party. Hence the caterer’s responsibility lies till the end of the party. In the instant case, the caterer’s employees arrive late and not in sufficient number. Sara forgot to keep the sausage in the refrigerator. Late arrival and insufficient staff could have resulted in work pressure which led her to not keeping the sausage in the refrigerator. But there can be no excuse for such negligence. The terms of contract excluding caterer’s liability, can be questioned under the Unfair Terms of Contract Act 1977 and Unfair Terms in Consumer Contracts Regulations 1999 as per which a consumer is not bound by a standard term in contract stipulated by the service provider if it is unfair. Standard terms are those that are printed in advance and not written at the time of contract. These terms are usually found on the invoice or contract in small print at the back. This does not mean an unfair term written while entering into contract is binding. A standard term is considered unfair if it creates imbalance in the rights of parties to the contract. Jim and his guests who suffered food poisoning should send a complaint of the deficiency in service and resultant loss and personal injury against caterer to the Office of the Fair Trading (OFT) which has a duty to consider the complaint of the unfairness of the contract terms. Section 5 of Unfair Contract Terms Act 1977 as amended upto 1/10/2003, where loss or damage occurs after supply of goods for private consumption while in use by the consumer either due to the defect in the product or the negligence by the person distributing the goods, the person responsible for the supply is liable for loss or damage regardless the same being excluded by express terms in the contract. By causing an injunction through the Office of Fair Trading against the unfair terms of the caterer, Jim and the guests can sue the caterer for damages due to the negligence of his employees under torts. Provisions Food Safety Act 1990 need to be mentioned here. Section 7 of Food Safety Act 1990 makes ‘intent’ to be present for implicating some one food poisoning. It may be remembered that during 1996 cold meat at the butcher’s shop was contaminated by E.Coli resulting in death of 21 people in Scotland. Food poisoning is caused by contamination of food by bacteria, virus or toxins, knows as “pathogenic organisms” In order for some one to be liable under section 7 of Food Safety Act 1990, intent to cause food poisoning must be established. On the other hand, section 8 of the said Act makes it an offence for rendering food injurious to health, making it unfit for human consumption penalty for which is not exceeding £ 20,000 as fine and /or sentence of not exceeding six months in the Magistrate’s court. If before the Queen’s court, penalty is unlimited and sentence is maximum two years. The supplier can take defence of due diligence under the Food Safety Act. In the current case, the customer’s guests have suffered food poisoning due to the negligence of the caterer for which the affected parties can bring civil action for negligence. (Caterersearch) Leading case law on the subject of negligence is Donoghue v. Stevenson (1932) in which case the bottle of Ginger Beer was found containing remnants of dead snail due to the manufacturer’s negligence; certain principles were established to invoke case for negligence. They are existence of duty of care, violating that duty of care and damage must have occurred as a result. In the case on hand, the caterer had a duty of care as otherwise he would have not attempted to exclude it by printing unfair terms on the contract forms. Supplying product with fitness for the purpose was the duty of care he had to Jim and vicariously to his guests as his consumers. By so making the product, the caterer makes it available for being used by any one and not necessarily Jim. And the third condition of damage arising out of the negligence. In the case on hand, the damage was food poisoning by contamination to the food consumed by the guests of Jim and Martha. Hence as laid down by Donoghue case, one is liable for negligence. The guests of Jim are eligible to claim damages for hospital and medical costs incurred and loss of earning for the number of days they might have been out of work. Jim is also entitled to claim damages from the caterer for not being able to conduct the party as planned. Summer house Jim ordered All Seasons for Summer house and garden furniture costing £ 15,000 and £1,200 respectively. In addition service charge of £ 800 was sought to be charged for erecting the summer house. Due to faulty concrete floor which was not drying, the summer house was at the risk of falling down any time. For the entire relaying of the floor, it would cost Jim another £ 2,000 but the summer house will be damaged in the process as advised by another company. Though All Seasons offered to relay the floor, there was no guarantee it would be of standard construction since their staff proved inefficient and lacked necessary skill contrary what All Seasons claimed in the notice board. The company All Seasons being the supplier of construction materials, their supply and service would be attracted by the provisions of Consumer Protection Act 1987 as it expressly included construction materials. The products they have supplied being defective as in the case of Garden future which also has hurt Jim’s finger rendering it to become out of use. All seasons have violated the provisions of the said Act. Negligence on the part of the company All Seasons does not have to be present since strict liability has been prescribed for supplying defective products. Under the Consumer Protection Act, liability under this Act is to be treated as under Tort. The summer house supplied has no apparent defect but it has been made unsafe and likely to cause injury due to faulty flooring on which it is rested. Hence as the manufacturer or supplier by putting their labels on the products, All Seasons is liable under section 2 of the Act for product defects. The company All Seasons is justified in refusing a refund because the summer house is not defective. By installing the notice board that their staffs are qualified enough to undertake expert construction, they have a made warranty and for violation of warranty, they are liable for damages. In attempting to set right the garden furniture nails, Jim has contributed to the negligence and hence Jim will be proportionately ineligible for the treatment of injury caused to his finger. The Garden furniture being defective without the required workmanship, All Seasons is not justified in refusing refund for the furniture. To sum up, Jim can proceed against All Seasons for award of damages for causing personal injury through the defective furniture by the jutting out nails, cost of relaying the floors for the summer house since in all would exceed £ 275 in claim as allowed under the Act. As building is excluded from the Consumer Protection Act, it depends upon the interpretation whether summer house is a building or not. It is brought as a component and installed and hence can be taken a building material. It is probably to claim it as a building to escape from liability, All Seasons is refusing to take back the summer house though it is not apparently defective but for the defective concrete flooring. Treated as a building, Jim can claim under Construction Act if not under Consumer laws. Hence All Seasons can not escape liability. References BERR, Car Sales and Servicing Quick Facts, Accessed 24 April 2008 http://www.berr.gov.uk/consumers/fact-sheets/page38071.html Bartlett v Sidney Marcus (1952) quoted in Mothersole Brenda, Ridley Ann 1999 p 428 Thomson Learning EMEA Burnley Engineering Products ltd v Cambridge Vacuum Engineering Ltd (1997) QBD, quoted in Mothersole Brenda, Ridley Ann 1999 p 428 Thomson Learning EMEA Caterersearch 28 April 2005 Food Poisoning accessed 28 April 2008 < http://www.caterersearch.com> Donoghue v Stevenson 1932 Donoghue (or M’Alister) v Stevenson ([1932] A.C. 562, 1932 S.C. (H.L.) 31, [1932] All ER Shine v General Corp Ltd [1988] 1 All ER 911, quoted in Mothersole Brenda, Ridley Ann 1999 p 428 Thomson Learning EMEA Read More