week 8 class notes - sale of goods & consumer law Flashcards
What are the two elements of a contract under the Sale of Goods Act?
Promises by parties + transfer of goods
What are the two ways goods can be transferred?
Sale (immediate) or Agreement to Sell (future)
What is excluded from the definition of “goods”?
Land, money, cheques, negotiable instruments, wages, or labor
When is a contract considered a contract for work and materials instead of a sale of goods?
When payment is mostly for labor and only a small amount for materials
What must be exchanged for goods to be considered a “sale”?
Money (excludes barter and consignment)
When must a sale of goods contract be in writing?
If the value of goods is over $50.00
How can an agreement avoid being put in writing?
By accepting part of the goods, giving part payment, or giving something “in earnest”
What is “transfer of property” in the Sale of Goods Act?
The legal ownership (title) of goods
Does ownership always go with possession?
No, parties can retain ownership while giving up possession
What happens if goods are not in a deliverable state?
They remain at the seller’s risk until delivery
When does title pass in an unconditional contract for specific goods?
When the contract is made, regardless of payment or delivery time
When does title pass if goods need something done to be in a deliverable state?
When the action is completed and the buyer is notified
When does title pass if the price needs to be determined (e.g., weighing, measuring)?
When the action is completed and the buyer is notified
When does title pass for goods delivered on approval?
When the buyer accepts, adopts the contract, or retains the goods beyond the specified time
When does title pass for unascertained or future goods?
When goods are unconditionally appropriated to the contract with buyer/seller agreement
What happens if the seller delivers goods to a carrier without reserving the right of disposal?
Title is deemed to have passed to the buyer
What is the difference between a condition and a warranty?
A condition is essential to the contract, while a warranty is a minor term
What is the implied condition under the Act regarding the seller’s right to sell?
The seller must have the right to sell at the time of transfer of title
What is the implied warranty regarding goods being free from encumbrances?
Goods must be free of liens unless the seller has informed the buyer
What are the conditions for goods sold by description?
They must correspond to the description
What are the conditions for goods sold by sample?
They must match the sample and be free from defects rendering them unmerchantable
What does “Caveat Emptor” mean?
“Let the buyer beware” – the buyer must inspect goods before purchase
When does “Caveat Emptor” not apply?
When the buyer relies on the seller’s skill and knowledge for a specific good
What are the seller’s duties regarding delivery?
Deliver on time and at the specified place
What if no delivery time is specified?
Delivery must be within a reasonable time
What happens if the wrong quantity is delivered?
The buyer can reject less, reject excess, or accept the entire amount and pay accordingly
What are the buyer’s options for breach of contract by the seller?
Rescission, damages, or specific performance
When can a buyer repudiate the contract?
When there is a breach of condition
What remedy does a buyer have for breach of warranty?
Damages, but not rescission (unless contract allows it)
When is specific performance granted?
When the object is rare or unique
What is a lien?
The seller’s right to hold goods until payment is made
When can the seller claim a lien?
If payment is not made on a cash sale, credit expires, or buyer is insolvent
Can the seller sue for price if the title has passed?
Yes, if goods are delivered and title has passed
What happens if a buyer refuses goods after delivery?
The seller can resell and sue for loss
Can a seller retain a buyer’s deposit?
Yes, but only if it represents a reasonable estimate of damages
What is “Stoppage in Transitu”?
The seller’s right to stop delivery if the buyer becomes insolvent
What are the four types of consumer protection laws?
Product safety, quality/performance, credit granting/reporting, business practices
What are the five approaches to consumer protection?
Disclosure, expanded rights, safety/quality standards, licensing, and prohibition of unfair practices
What does the Consumer Packaging and Labeling Act regulate?
Prohibits misleading advertising and sets penalties for violations
What is the purpose of the Business Practices Act?
To regulate business practices and prevent unfair competition
What consumer rights are protected under door-to-door sales laws?
Mandatory cooling-off periods, written agreements, and itemized pricing
What are examples of unfair business practices?
False advertising, unconscionable contracts, undue pressure, and misleading statements
What does the Competition Act prohibit?
False advertising, bait-and-switch, price fixing, and monopolies
What restrictions exist for collection agencies?
No harassment, no misleading forms, and limited employer contact
What is required in credit reporting?
Accuracy, debtor consent, and right to dispute errors
What must lenders disclose under credit granting laws?
All costs of borrowing at the time of the transaction
