Module #7 - Sale of Goods and Consumer Protection Flashcards
Foundation of Commerce
Sale of Goods
Parties in a SOGA transaction
buyers and sellers
think about promoting trade and commerce
What was wrong with original common law?
- risk was all on the buyer
- when one side bears all risk, they don’t want to participate
- no more venture into marketplace
Sale of Goods Act
-codified laws
- every province has one
- has been the same since 1893
rules, what it protects
SOGS - details
- protects only tangible personal property
- specific rules between the buyer and selller
details about transaction
SOGS
- goods have to be sold
-property must be transferred and must be paid for - money must exchange hands
Does leasing fall under SOGS?
NO!
When can you modify SOGS conditions?
only in business transactions, parties can modify or exclude the act
Test for consumer transaction - what the goods will be used for
if the buyer uses it for domestic/household purposes vs business purposes
Conditions
fundamental to the contract
breaching=breach of contract
Warranties
minor term breach/ just have to pay damages
Implied conditions of SOGS
-seller has right to sell
-goods must match description,
-goods must match sample
-merchantable quality, reasonably
-suitable for intended purpose
-recommending a customer to use a product that is not for its purpose
Implied Warranties
-no encumbrances
-delivery within a reasonable time
-payment on time
SOGS - passing risk
- helps determine when title passes from seller to buyer
- risk follows title
- title=bears risk of loss
- INTENTION of parties govern pass to buyer
remedy for breach
Repudiation
breach of condition –> get your money back
remedy for breach
Damages
breach of warranty
Consumer Protection Act
-every province has one
-allows consumer to sue in contract instead of tort (regardless of privity)
What does consumer protection act apply to?
services and goods
Duties regarding CPA
- duty to warn of product hazards
- prohibits false/misleading claims
- make terms visible
politicians get a lot of complaints
Controlled business practices
-door to door sales
-timeshares
-fitness clubs
-used cars
-multi level marketing
-debt collection
CPA affect on contract law
-modifies freedom to contract
-puts limitationns on contracts to protect consumers
-determine consumer with purpose based test
Favors of CPA
-consumers are weaker and less informed
-for consumers to be enthusiastic, we have to protect them
Not in favor of CPA
-increases transaction costs
-long term: business are less competetive because too many rules
-annoying when government gets involved in contracts
Competition Act - primary goal
reducing behaviour that is anti-competetive
Why do we want more competetion?
-better for economy and consumers
-restricts mergers and acquisitions
Quasi-Criminal Acts
-bid rigging
-price fixing
Reviewable acts
-predatory pricing
-not illegal automatically, can only do them if they don’t lessen competetion
Price fixing
an agreement (written, verbal, or inferred from conduct) among competitors to raise, lower, maintain, or stabilize prices or price levels
Bid rigging
occurs when businesses, that would otherwise be expected to compete, secretly conspire to raise prices or lower the quality of goods or services for purchasers who wish to acquire products or services through a bidding process.
Abuse of dominant Position
when a dominant firm or a dominant group of firms engages in a practice of anti-competitive acts, with the result that competition has been, is, or is likely to be prevented or lessened substantially in a market.
Refusal to supply/tied selling
refuse to supply someone with a product if you sell a competitor’s product
Restrictions on contests and prizes
these are governed by the competition act
