IMPLIED CONDITION AND WARRANTIES

by • 24/06/2013 • GeneralComments (0)367

Q.3      What is meant by implied condition and warranties in a contract of sale of goods?

Ans:    IMPLIED CONDITION AND WARRANTIES

There are number of stipulations in a contract of sale. Some of them are conditions and other may be warranty. Moreover these conditions or warranties may be expressed or implied under Section 14 to 17 of the Sale of Goods, Act deals with the implied condition and warranties. According to these sections, the following are implied conditions and warranties.

IMPLIED CONDITIONS

Implied conditions are condition, which are not expressed by the parties but are incorporated by law and they are as follows.

1.         RIGHT TO SELL

In every contract of sale, there is an implied condition on the part of the seller then in case of a sale, he has right to sell the goods and that in the case of an agreement to sell, and he will have a right to sell the goods at the time when the property is to pass. {Section 14(a)}

EXAMPLE

X purchased a car from V. after 6 months Z, the true owner of. car, demanded it from X. X had to return it to its true owner. X was entitled to recover the full price even though several months had passed.

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 description. [Section 15]

EXAMPLE

X bought a reaping machine from Y who described it to be one year old and used only to cut 50 to 60 acres but X found that the machine extremely old. X was entitled to reject the machine because machine did not correspond with the description give up by the seller.

3.         SALE BY SAMPLE

In the case of sale by sample, there are implied condition under Section 17 that

(a)        The bulk should correspond with the sample in quality

(b)        That the buyer shall have reasonable opportunity of comparing of bulk with the sample.

(c)        That the goods shall be free from any defect rendering the merchantable, which would not be appearing on reasonable examination of the sample,

EXAMPLE

X bought from Y certain quantity of worsted coating equal to sample. The coating was equal to sample but due to a latent defect, the cloth was found to be unfit for making coats. The buyer was entitled to reject the goods because the defect contained in the sample was not apparent on reasonable examination of the sample.

4.         SALE BY DESCRIPTION AND SAMPLE

If the sale is by sample as well as by description it is an implied condition that goods should correspond both with sample and description [Section 15]

EXAMPLE

X bought from Y foreign refined rapeseed oil which was warranted to be equal to sample. The oil supplied was equal to the sample. The sample was actually a mixture of rapeseed oil and hemp oil. X was entitled to reject the goods because the goods supplied did not correspond with .the description.

5.         PURPOSE OF GOODS

When the buyer expressly or by implication tells the purpose of purchase of goods to the seller and relies on the seller’s skill and judgement, then it is an implied condition that the goods shall be reasonably fit for such purpose.

EXAMPLE

X purchased a hot water bottle from Y, retail chemist. X asked Y if it would stand boiling water. The Chemist told him that the bottle was meant to hold hot water. The bottle burst when water was poured into it and injured his wife. The Chemist is liable to refund the price and pay damages because bottle was unfit for the purpose for which if was purchased.

6.         IMPLIED CONDITION AS TO QUALITY

Where goods are bought by description from a seller who deals in goods of that description whether he is manufacturer or producer or not, there is an implied condition that the goods shall be of merchantable quality [Section 16(2)]

EXAMPLE

X bought from a dealer a bottle of wine. While opening its cor)<: in the normal manner, the bottle broke off and injured X’s hands. X was entitled to claim damages because the bottle was not of merchantable quality.

7.         USAGE OF TRADE

An implies warranty or condition as to quality or fitness for a particular purpose may be annexed by the usage of trade [Section 16(3)]

 

IMPLIED WARANTIES

The following are implied warranties under the contract of sale.

1.         POSSESSION OF GOODS

There is an implied warranty that the buyer shall has and enjoy quite possession of the goods [Section 14(b)]

EXAMPLE

X sold a second hand Radio to Y who spent Rs.100 on the repairs of this radio. The police seized this radio, as it was a stolen one. Y filed a suit against X for the recovery of damages for breach of warranty of quite possession including the cost of repairs. It was held that Y was entitled to recover the same.

2.         FREE FROM CHANCES

There is an implied warranty that the buyer shall be free from any charge or encumbrance in favour of any party not declared or knows to the buyer before or at the time when the contract is made. [Section 14(c)]

EXAMPLE

X borrowed Rs.500/= from Y and hypothecated his radio with Y as security. Later on X sold this radio to Z who bought in good faith. Here, X can claim damages from X because Y having a charge disturbs his possession.

3.         USAGE OF TRADE

There is an implied warranty or condition as to quality or fitness for a party’s purpose may be annexed by the usage of trade.

EXAMPLE

X purchased a tin of disinfectant powder, which required to be opened with special care. X*s wife while opening the tin was injured as the powder flew into her eyes. Held, the seller was liable for the injury sustained by Xls wife because of breach of warranty.

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