Sale of Goods Act, 1930 Q. Define ‘Condition’ and
‘Warranty’. Distinguish between Condition and Warranty.
Ans: - Section
12(2) states that a condition is a stipulation which is essential to the
main purpose of the contract. The breach of a condition gives rise to a right
to treat the contract as repudiated or broken.
Example – A buys
from B hair oil advertised as pure coconut oil. The oil turns out to be mixed
with herbs. A can return the oil and claim the refund of price.
Section
12(3) states that a warranty is a stipulation which is collateral to the
main purpose of the contract. The breach of a warranty gives rise to a claim
for damages but not a right to reject the goods and treat the contract as
repudiated.
Example – A while
selling his car to B, stated the car gives a mileage of 12 kms per litre of
petrol. The car gives only 10 kms per litre. B cannot reject the car. It is
breach of warranty. He can only claim damages for the loss due to extra
consumption of petrol.
Difference
between Condition and warranty:
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Basis of
Difference
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Condition
|
Warranty
|
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Definition
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A
stipulation which is essential to the main purpose of the contract.
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A
stipulation which is collateral to the main purpose of the contract.
|
|
Remedy
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The
aggrieved party can terminate the contract, claim damages or treat it as
breach of warranty | The aggrieved
party cannot terminate the contract but can only claim damages
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Treatment
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A breach
of condition can be treated as a breach of warranty
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A breach
of warranty cannot be treated as breach of condition. |
Q.
Enumerate implied warranties and implied conditions.
Ans: - Implied
conditions
1. Condition
as to title – In a contract of sale, unless the circumstances of the
contract are such as to show a different intention, there is an implied
condition on the part of the seller that –
(a) In the
case of a sale, he has a right to sell the goods and
(b) In the
case of an agreement to sell, he will have a right to sell the goods at the
time when the property is to pass.
2. Sale
by description – Where there is a contract for the sale of goods by
description, there is an implied condition that the goods shall correspond with
the description (Section 15). If you contract to sell peas, you cannot
oblige a party to take beans.
3. Sale
by sample – In a case of a contract for sale by sample, there is an implied
condition –
(a) That
the bulk shall correspond with the sample in quality
(b) That
the buyer shall have a reasonable opportunity of comparing the bulk with the
sample.
(c) That
the goods shall be free from any defect, rendering them unmerchantable.
4. Sale
by description as well as sample – Section 15 further provides that if the
sale is by sample as well as by description, the goods must correspond both
with the sample and with the description.
5. Condition
as to quality or fitness – Normally, in a contract of sale there is no
implied condition as to quality or fitness of goods for a particular purpose.
The buyer must examine the goods thoroughly before he buys them in order to
satisfy himself that the goods will be suitable for the purpose for which he is
buying them. However, in the following instances, the condition as to quality
or fitness applied –
(a) Where
the buyer, expressly or by implication makes known to the seller the particular
purpose for which he needs the goods and depends upon the skill and judgement
of the seller whose business it is to supply goods of that description, there
is an implied condition that the goods are reasonable fit for that purpose. [Section
16(1)]. For e.g. an order was placed for some Lorries to be used "for heavy
traffic in a hilly area”. The Lorries supplied were unfit and broke down. Held,
there is a breach of condition as to fitness.
(b) An
implied condition as to quality or fitness for a particular purpose may also be
annexed by the usage of trade. [Section 16(3)]
6. Condition
as to merchantability – Where goods are bought by description from a seller
who deals in goods of that description, here is an implied condition that the goods
are of merchantable quality. This means that the goods should be such as are
commercially saleable under the description by which they are known in the
market at their full value.
7. Condition
as to wholesomeness – In the case of eatable and provisions, in addition to
the implied condition as to merchantability, there is another implied condition
that the goods shall be wholesome. For e.g. C bought a bun containing a stone
which broke one of C’s teeth. Held, he could recover damages.
8. Condition
implied by custom – An implied condition as to quality or fitness for a
particular purpose may also be annexed by the usage of trade in the locality
concerned.
Implied
warranties
1. Warranty
of quiet possession – In a contract of sale, unless there is a contrary
intention, there is an implied warranty that the buyer shall have and enjoy
quiet possession of the goods. If buyer’s possession is disturbed because of
some defect in seller’s title, he can claim damages from the seller.
2. Warranty
of freedom from encumbrances – The buyer is entitled to a further warranty
that the goods are not subject to any charge or right in favour of a third
party.
3. Warranty
to disclose dangerous nature of goods – Where a person sells goods, knowing
that the goods are inherently dangerous or they are likely to be dangerous to
the buyer and that the buyer is ignorant of the danger, he must warn the buyer
of the probable danger, otherwise he will be liable for damages.
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