MEANING OF THE DOCTRINE OF CAVEAT EMPTOR

by • 24/06/2013 • GeneralComments (0)567

Q.4      Describe the meaning and exceptions of the doctrine of caveat emptor?

Ans:    MEANING OF THE DOCTRINE OF CAVEAT EMPTOR [SECTION 16]

The expression Caveat Emptor  means “let the buyer beware.” The doctrine of caveat emptor has been given in the first Para of Section 16, which reads as under:

“Subject to the provisions of this Act and any other law for the time being in force, there is no implied warranty or condition as to the quality or fitness for any particular purpose of goods supplied under a contract of sale.”

In other words, it is not part of the seller’s duty to point out defects of the goods, which he offers for sale, rather it is the duty of the buyer to satisfy himself about the quality as well as the suitability of the goods.

EXAMPLE

Pigs were sold subject to all faults and the seller knew that the pigs were suffering from swine-fever but he did not inform the buyer about this defect. The seller was not liable for damages because there was no implied warranty.

 

EXCEPTIONS TO THE DOCTRINE OF CAVEAT EMPTOR

The doctrine of caveat emptor is subject to the following exceptions shown in fig.

 

(a)        In Case of Misrepresentation by the seller

Where the seller makes a misrepresentation and the buyer relies on that representation.

(b)        In Case of concealment of Latent Defect

Where the seller knowingly conceals a defect, which would not be discovered on a reasonable examination.

 (c)       In case of sale by Description [Section 15]

Where the goods are sold by description and the goods supplied by the seller do not correspond to the description.

(d)        In Case of Sale by sample [Section 17]

Where the goods are sold by sample and the goods supplied by the seller so not correspond with the sample.

(e)        In case of Sale by sample as well as Description [Section 17]

Where the goods are sold by sample as well as description and the goods supplied do not correspond with sample as well as description.

(f)         Fitness for Particular Purpose [Section 16(1)]

Where the seller or a manufacturer is a dealer of the type of goods sole by him and the buyer has disclosed the purpose for which goods are required and relied upon the seller’s skill or judgment.

(g)        Merchantable Quality [Section 16(2)]

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

 

RELEVANCE OF CAVEAT EMPTOR

The Role of Caveat Emptor appeared to play an important role in the past when trade was conducted on local scale and the buyer had every opportunity to examine the goods before buying. However, in the modern context, the rigours of the rule have been mitigated because of global dimensions of trade, government legislations on consumer protection, professional management, intense competition and consumer awareness. In fact, the rule of caveat emptor should be replaced by the rule of ‘Caveat Vendor’ (Let the seller beware).

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