Statutory Implied Terms: s14 s15 Flashcards
The important terms implied into the SGA
1) S’s right to sell goods s12(1)
2) Goods free from encumberance and B will enjoy quiet possession s12(2)
3) Quality s14(2)
4) Fitness for purpose s14(3)
5) Discriptionn s13 (1)
6) Sale by sample s15
which sections only apply when S is dealing in their course of business
s14(2) s14(3)
What kind of terms are implied by the SGA
COnditions
Warranties
s12
IMPLIED TERMS TO TITLE
12(1) - right to sell the goods
12(2)a - goods free from charge/encumbrance
12(2) b - B will enjoy quiet possession
Why is s12(1) so important?
Imposes a legal DUTY for S to pass on good title to B
KARLSHAMMS v EASTPORT NAVIGATION 1982
- s12(1) doesn’t require S to have title on transferring goods to B, only that they have it at time of sale
- Also S need not own the goods only have right to sell
Most common doubt of title
When S has found the goods
What kind of title is aquired on finding goods?
POSSESSORY
- strictly subject to owners title, can reclaim at anytime
S must disclose they only have possesory title or?
breach of s12(1) = breach of condition -> contract is over
How can S sell found goods
- Declare they only have possessory title-> gain protection of s12(3) and (5)
- Can sell to B only as good a title as he has
s12(3) and (5)
- If it appears/inferred from contract that S only intends to transfer as much title as he is able
- Implied warranty that S wont disturb B’s quiet possession, B only distrubed by those with charge/encumbrence to the goods as was made aware to B before contract
s11(4)
If B still accepts goods after breach of condition, loses right to rescind contract. Only sue for damages
ROWLAND v DIVALL 1923
- S was unaware car was stolen and that he no right to sell it
- Whole purpose of contract is to transfer ownership to B - here theres no consideration so B could never get a title that S doesnt have
- B used car for a substantial time but was not acceptance by extensive use because you cant accept something ithout consideration
- B still has right to rescind
Why has Rowland v Divall been critisised
- B got to use the car for several months for nothing -> car decreased in value
- Paticularly problematic if goods are perishable/finite
- Seems to give B something for nothing
NIBLETT v CONFECTIONERS MATERIALS 1921
- S sold condensed milk, some labeled nissly
- Bs informed by nestle this was infrinement of trademark
- B sues S for breach of s12(1)
- Held YES, as even though S had owned goods, infringement on trademark meant that they had no right to sell
s12(2)a and s12(2)b
Warranties goods free from charge/encumberence and B will enjoy quiet possession
key case for s12(2)a and b
MICROBEADS v UINHURST ROAD MARKINGS 1975
MICROBEADS v UINHUSRT ROAD MARKINGS 1975
- S sold B some road marking machinery
- shortly after, unconected company bought patent over machinery of that type and brought action against B to enforce it
- B then brought action against S breach of condition 12(1) and 12(2) b
- NOT breach of 12(1) -> at time of sale S had perfectly good title, copany bought rights after
- WAS breach of 12(2) b, as ‘will enjoy’ quiet possession related to future use = damages
difference between warrantt and condition
breach of condition -> rescind contract
breach of warranty -> damages only
s13?
Sales by discription
s13(1)
Goods by discription will correspod with that doscription
Is there a definition for by desription?
NO -> oridinary meaning of words and is easy to apply to unascertained//future goods as they can only be sold by discription
Can specific goods come under s13(1)
YES
But only if it is a very very specific discription
s13(3)?
NO prevention of goods on display and then being chosen by B from the shelf being a sale by description
BEALE v TAYLOR (triumph car)
- S advertised ‘herald convertiable, white, 1961’ for sale
- B bought it and soon found it was half a 1961 model but the front half was an earlier model
HELD: could be sale by description of specific chattel, even when B had inspected it
-> Only if it was being sold not as the specific thing B inspected, but also as the specific thing advertised and B relied on the advert in anyway - could sue for damages
case that contrasts BEALE v TAYLOR 1991
BREWER v MANN 2012
BREWER v MANN 2012
- S advertised ‘1930 bentley speed 6’ and B obtained it on HP
- Later argued car didnt confom to discription as engine not original and later that bodywork had been altred
HELD: advert did not say original, so any alterations to make it meet specs of a 1930 bentley speed 6 were not a breach
-> identity of goods to be decided by normal customs of trade and 2 experts said it was up to spec
NO BREACH
To breach s13 how important must description be
it must ammount to a term of the contract, not just a description at any point
Court must be able to hold the parties to a common intention that it was a term that goods matched description
CHRISTOPHER HILL FINE ART 1991
1921 case that showed how easy it used to be to reject goods under s13 -> not meeting description
Re MOORE AND LAUDAUER 1921
- S contracted to sell tinned fruit in cases of 30
- Consignment arrived, was correct quantity but some were in cases of 24
HELD: cases of 30 was indeed part of description, some goods did not correspond -> B could send back the lot
Who critisised the decision in Re Moore and Landauer 1921
Lord Wilberforce in HANSEN-TANGEN 1976
called it ‘exessively technical’
HANSEN-TANGEN 1976
- Commissioned a vessel, stated it would be built in shipyard Osaka 354, actually built in Oshima 004 due to size
- When vessel finally finished, market had totally collapsed and B sought to escape payment relying on s13 and decision of Re Moore and Landauer 1921
HELD: had to be a ‘substantial ingredient of the thing sold’ and hull number from yard built in was not NO BREACH
When is there not a sale under s13 even when it was described?
- If B does not rely on desscription in any way
Has to be within reasonable contemplation of both parties that description was relied on
CHRISTOPHER HILL FINE ART 1991
s14(2)
Satisfactory quality
What happened to wording o s14(2) in 1994
Sale and Supply of Goods Act 1994
- Changed merchantile quality to satisfactory
When does s14(2) apply
In course of businesss
STRICT LIABILITY
What does in the course of business mean?
According to UNITED DOMINIONS TRUST 1977
- Is an integeral part of S’s business
- Was from UCTA 1977
According to STEVENSON v ROGERS 1999:
- For purpose of s 14 any sale BY a business is in course of business, reagardless of whether it was their usual business
s14(2A)
Defines satisfactory quality
What is the defintion of satisfactory quality
‘meet the standard a reasonable person would regard as satisfactoy, accounting for discription, price and other relevent circustances’
What sort of test is the one for s14(2A)
Objective -> to standard of reasonable person
What is included in other relevent circumstance?
Usually purpose of goods? Is it for scrap? Are they second hand?
difference between s14(2A) and s14(2B)
14(2A) - general definition of satisfactory quality
14(2B) - 5 matter that are aspects of quality (if appropriate)
5 aspects of quality of goods under s14(2B) (ONLY IS APPROPRIATE)
a) Fittness for all normal purposes of goods supplied
b) Appearance and finish
c) Free from minor defects
d) Safety
e) Durablility
Case for high qualit/expensive goods?
NORDIC MARINE 2003
NORDIC MARINE 2003
‘high priced quality product, B may be entitled to expect free from even minor defect, in other words perfect’ LJ HALE
Case that confirmed in the course of business has a dual meaning
FELDORAL FOUNDRY v HERMES LEASING 2004
What are the dual meanings confirmed in Feldoral Foundry v Hermes Leasing 2004
1) s12(1) UCTA 1977
‘integeral part of business, bought with some degree pf regularity’ -> UNITED DOMINIONS TRUST 1988
2) s14 SGA 1979
‘ sale by a business is in the course of business’ -> STEVENON v ROGERS 1999
When is s14 not applied even when in the course of business?
s14(2C)
s14(2C) exceptions even if in course of business?
a) defect specifically drawn to B’s attention -> general statement not enough to protect S
b) If B eexamined goods and that ought to have revealed defect, no oblgation to inspect so only applies if they do
c) If sale by sample, sample ought to have revealed defect to B
Why is s14(2C)b strange?
It puts B who doesn’t examine in his goods in a better position than B who does
Advise B not to examine the or if they do, to do so very very thoroughly
s14(3)
Fitness for purpose
What is meant by s14(3) fitness for purpose
B has expressly/impliedly made known to S the specific purpose for the goods
Is s14(3) strict liability
YES
Unless would be unreasonable/unnecessary for B to rely on S’s judgement
Normally application of s14(3)
Where B is buying goods for usual/only purpose
GRANT v AUSTRALIA KNITTING MILLS 1936
GRANT v AUSTRALIA KNITTING MILLS 1936
By the very fact of buying the goods, B is making known to S their purpose -> requirement of knowledge of purpose by S is met
What about where B has a paticular use for goods or a peculiar idiosyncrasy?
Essential for B to make this known to S
- GRIFFITHS v PETER CONWAY 1939
- JEWSON v KELY 2003
when else does s14(3) not apply
If B does not rely on skill/judgement of S, or it would be unreasonable to do so
ASHINGTON PIGGERUES 1972
LORD WILBERFORCE:
1. B’s responsibility to make any idiosyncrasy known to S
- If idiosyncrasy not known, B had to prove ‘some general unsuitability through contamination’.
- Only necessary for B to prove that the goods supplied had ‘some generally toxic quality’.
- Evidential burden then shifted to S who, had to prove that the damage caused was due to some factor within the responsibility of the buyer
HERE S FAILED = LIABLE
What is meant by ‘reasonably fit’ for purpose
Need not be o very highest quality
Circumstances can be relevant, second hand goods wont be as high a quality
Who has burden to prove goods weren’t satisfactory quality
B must prove unsatisfactory on balance of proababilities
LEICESTER CIRCUITS v COATES BROS 2003
Do goods only need to be fit for purpose at time of sale?
NO -> continuning obligation for reasonable time
LAMBERT v LEWIS 1982
Realtionship between 14(2) and 14(3)?
Overlap of implied conditions of satisfactory quality and fit for purpose
Different purposes defined in JENSON v KELLY 2003
JENSON v KELLY 2003
different purposes of s14(2) and (3)
- 14(2) directed principly at sale of substandard goods
- courts main concern is their intrinsic qualities -> issue is te goods themselves
- 14(3) focuses on the purpose to B individually
s15?
Sales by sample definition in s15(1)
Written contracts is easy to see if is expressed/implied into contract
DRUMMOND AND SONS v VAN INGEN 1887
DRUMMOND AND SONS v VAN INGEN 1887
- Sample’s purpose -> to present to the eye the real meaning an in tention of the parties with regard to the subject matter of contract, which could be difficult to discribe in words’
- Sale by sample saves hassle of trying to verbly describe very specific goods
s15(2) a
s15(2) c
15(2) a - bulk will correspond with a sample -> even if easily made to correspond S has no defence
15(2) c - goods free from any defect that would make them unsatisfactory quality that wasnt shown on sample
Case for s15(2) a
E AND S RUBEN v FAIRE BROS 1949
E AND S RUBEN v FAIRE BROS 1949
- S liable even though the crinkled material provide could be made smooth like sample by simple process fo heating
- Doesnt matter how easy to make it like sample, doesn’t correspond on delivery no defence
s15(2)c
- B can’t claim if defect apparent on inspection of sample
- Unlike section 14(2) B has to inspect sample as thats whole point of sale by sample
GODLEY v PERRY 1960
GODLEY v PERRY 1960
breach of s15(2)c
breach of s14
- Chlid bought catapault form retailer, seriously injured on first use
- R had tested sample from wholesaler, who had tested sample from importer
- Boy claimed against R, who claimed against W, who claimed against I
- Defect not apparent on inspection of sample so both W and I were liable under s15(2)c
- R still liable under s14 -> goods not mechantable quality (now satifactory)
