Ans.
IMPLIED CONDITIONS
A stipulation (or term) in a contract of sale of goods
may be express or implied. Express terms are those which have been expressly
agreed upon by the parties. Implied terms are those which have been enacted in
the Sale of Goods Act. Sections 14 to 17 of the Act contain a list of
conditions and warranties which are implied in a contract for the sale of
goods, unless the circumstances of the contract are such as to show a different
intention. The implied conditions are stated below:
Implied conditions
1. Implied condition as
to title. - [Sec. 14]
There is an implied condition on the part of the seller
that, in the case of a sale he has the right to sell the goods, and in the case
of an agreement to sell, he will have the right to sell the goods at the time
when the property is to pass. If the seller’s title turns out to be defective,
the buyer is entitled to reject the goods and claim refund of the price plus
damages.
- A bought a motor car from B. He used it for 3 months
and thereafter the car was detected to have been stolen. A was compelled to
return it to the true owner. Could A recover the sale price from B? (Ans: Yes)
- A sells to B tins of condensed milk labelled “Nissly
Brand” and this is proved to be an infringement of Nestle Company's trade mark.
Is it a breach of implied condition as to title? (Ans: When a person sell the
goods by infringing a copyrights or trademark of the others, he is considered
as not having right to sell such goods.)
2. Implied condition in
a sale by description. - [Sec. 14]
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. “Correspond with the description” means that the buyer must
get the goods that he has asked for. The description may be given—
(a) by mentioning qualities or characteristics of the
goods e.g. Basmati rice.
(b) by mentioning the trademark or brand name e.g.
Videocon TV.
(c) by the type of packing e.g. 1 kg. packing of tea in
plastic jar.
If the buyer does not get the goods he has described he
can reject the goods. The rule is “If you contract to sell peas, you cannot
oblige a party to take beans. If the description of the article tendered is
different in any respect, it is not the article bargained for, and the other
party is not bound to take it’’. E.g. A car is sold as a "new maruti car".
The buyer finds it to be a used one. The buyer may reject the car or retain the
car and claim damages.
3. Implied condition in
a sale by sample as well as by description. - [Sec. 15]
When goods are sold by sample as well as by description,
the goods shall correspond both with the sample and with the description.
4. Implied condition as
to fitness or quality. - [Sec. 16(1)]
The general rule is, there is no implied condition as to
quality or fitness for the purpose of the buyer. This is based on the doctrine
of “caveat emptor” that is, let the buyer beware. It means that while 3 buying
the goods, it is the responsibility of the buyer to check that the goods he is
buying would suit his purpose or not. However, in the following situation, the
responsibility as to fitness of goods falls upon the seller:
a. where the buyer, expressly or by implication, makes
known to the seller the particular purpose for which the goods are required,
b. so as to show that the buyer relies on the seller's
skill, or judgment, and
c. the goods are of a description which it is in the
course of the seller's business to supply (whether he is the manufacturer or
not), there is an implied condition that the goods shall be reasonably fit for
such purpose.
- A contracts to make and deliver a set of false teeth to
B. The false teeth do not fit in the mouth of B. B is entitled to reject the
goods.
- X places order for lorries to be used for 'heavy
traffic in a hilly country’. The lorries were unfit for this purpose and broke
down. It was held that there was breach of condition as to fitness.
Sale under patent or
trade name. Proviso
to section 16(1) lays down that in the case of a contract for the sale of a
specified article under its patent or other trade name, there is no implied
condition as to its fitness for any particular purpose. It is so because in
such a case the buyer is not relying on the skill and judgment of the seller
but relies on the patent name. For example, a hotelier orders ‘Sujeet’ juicer
and mixer (patent product) for his business. The juicer and mixer supplied was
found to be unsuitable for commercial use. The buyer has no cause of action
against the seller, since he purchased the juicer by its patent name.
5. Implied condition as
to merchantability. - [Sec. 16(2)]
Where goods are brought by description from a seller who
deals in goods of that description, there is an implied condition that goods
shall be of merchantable quality. Merchantable means that the goods are
commercially saleable and that they are fit for the purpose for which they are
generally used.
Where the buyer examines the goods prior to sale, there
is no implied condition as to merchantability as regards defects which such
examination ought to have revealed. However, inspite of examination, if the
goods have certain latent defects which no examination could reveal, the
implied condition remains.
- X bought a colour TV from M/s Concord Electronics. The
TV was defective right from the beginning and it did not work inspite of
repairs by expert technicians. There is a breach of implied condition as to
merchantability and the dealer will have to take back the defective TV and
refund the amount.
- X orders motor horns from a manufacturer. The horns
supplied are defective. X is entitled to reject them as unmerchantable.
6. Implied condition in
a sale by sample. - [Sec. 17]
When goods are to be supplied according to a sample
agreed upon, the following conditions are implied:
(a) The bulk shall correspond with the sample in quality.
(b) The buyer shall have a reasonable opportunity of
comparing the goods with the sample.
(c) The goods shall be free from any latent defect
(hidden defect) rendering them unmerchantable. Latent defects are the defects
which would not be apparent on reasonable examination of the sample and they
can be discovered only when the goods are put to use. If the defect is easily
discoverable on inspection and the buyer takes delivery after inspection, he
has no remedy.
A sale is by sample where there is a term in contract,
express or implied to that effect. The effect of the section is that where
goods are sold by sample, there should not be any latent defect therein which
renders them unmerchantable.
7. Implied condition as
to wholesomeness
In case of food stuff and eatables, in addition to the
implied condition as to merchantability, there is another implied condition
that the goods shall be wholesome that is fit for human consumption.
X bought milk from Y, a dairy owner. The milk was
contaminated with germs of typhoid fever. X’s wife, on taking the milk, became
infected and died of it. Y was held liable in damages.
