Provisions of Domestic and International Sales Legislation
Referred to in the Report
A. Sale of Goods Act 1979 (as amended)
12. Implied terms about title, etc
(1) In a contract of sale, other than one to which subsection
(3) below applies, there is an implied term on the part of the
seller that in the case of a sale he has a right to sell the goods,
and in the case of an agreement to sell he will have such a right
at the time when the property is to pass.
(2) In a contract of sale, other than one to which subsection
(3) below applies, there is also an implied term that-
(a) the goods are free, and will remain free until the time
when the property is to pass, from any charge or encumbrance not
disclosed or known to the buyer before the contract is made, and
(b) the buyer will enjoy quiet possession of the goods except
so far as it may be disturbed by the owner or other person entitled
to the benefit of any charge or encumbrance so disclosed or known.
(3) This subsection applies to a contract of sale in the case
of which there appears from the contract or is to be inferred
from its circumstances an intention that the seller should transfer
only such title as he or a third person may have.
(4) In a contract to which subsection (3) above applies there
is an implied term that all charges or encumbrances known to the
seller and not known to the buyer have been disclosed to the buyer
before the contract is made.
(5) In a contract to which subsection (3) above applies there
is also an implied term that none of the following will disturb
the buyer's quiet possession of the goods, namely-
(a) the seller;
(b) in a case where the parties to the contract intended that
the seller should transfer only such title as a third person may
have, that person;
(c) anyone claiming through or under the seller or that third
person otherwise than under a charge or encumbrance disclosed
or known to the buyer before the contract is made.
(5A) As regards England and Wales and Northern Ireland, the term
implied by subsection (1) above is a condition and the terms implied
by subsection (2), (4) and
(5) above are warranties.
13. Sale by description
(1) Where there is a contract for the sale of goods by description,
there is an implied term that the goods will correspond with the
description.
(1A) As regards England and Wales and Northern Ireland, the term
implied by subsection (1) above is a condition.
(2) If the sale is by sample as well as by description it is not
sufficient that the bulk of the goods corresponds with the sample
if the goods do not also correspond with the description.
(3) A sale of goods is not prevented from being a sale by description
by reason only that, being exposed for sale or hire, they are
selected by the buyer.
14. Implied terms about quality or fitness
(1) Except as provided by this section and section 15 below and
subject to any other enactment, there is no implied term about
the quality or fitness for any particular purpose of goods supplied
under a contract of sale.
(2) Where the seller sells goods in the course of a business,
there is an implied term that the goods supplied under the contract
are of satisfactory quality.
(2A) For the purposes of this Act, goods are of satisfactory quality
if they meet the standard that a reasonable person would regard
as satisfactory, taking account of any description of the goods,
the price (if relevant) and all the other relevant circumstances.
(2B) For the purposes of this Act, the quality of goods includes
their state and condition and the following (among others) are
in appropriate cases aspects of the quality of goods-
(a) fitness for all the purposes for which goods of the kind
in question are commonly supplied,
(b) appearance and finish,
(c) freedom from minor defects,
(d) safety, and
(e) durability.
(2C) The term implied by subsection (2) above does not extent
to any matter making the quality of goods unsatisfactory-
(a) which is specifically drawn to the buyer's attention before
the contract is made,
(b) where the buyer examines the goods before the contract
is made, which that examination ought to reveal, or
(c) in the case of a contract for sale by sample, which would
have been apparent on a reasonable examination of the sample.
(3) Where the seller sells goods in the course of a business and
the buyer, expressly or by implication, makes known-
(a) to the seller, or
(b) where the purchase price or part of it is payable by instalments
and the goods were previously sold by a credit-broker to the seller,
to that credit-broker,
any particular purpose for which the goods are being bought, there
is an implied term that the goods supplied under the contract
are reasonably fit for that purpose, whether or not that is a
purpose for which such goods are commonly supplied, except where
the circumstances show that the buyer does not rely, or that it
is unreasonable for him to rely, on the skill or judgment of the
seller or credit-broker.
(4) An implied term about quality or fitness for a particular
purpose may be annexed to a contract of sale by usage.
(5) The preceding provisions of this section apply to a sale by
a person who in the course of a business is acting as agent for
another as they apply to a sale by a principal in the course of
a business, except where that other is not selling in the course
of a business and either the buyer knows that fact or reasonable
steps are taken to bring it to the notice of the buyer before
the contract is made.
(6) As regards England and Wales and Northern Ireland, the terms
implied by subsections (2) and (3) above are conditions.
15. Sale of sample
(1) A contract of sale is a contract for sale by sample where
there is an express or implied term to that effect in the contract.
(2) In the case of a contract for sale by sample there is an implied
term-
(a) that the bulk will correspond with the sample in quality;
(b) . . .
(c) that the goods will be free from any defect, making their
quality unsatisfactory, which would not be apparent on reasonable
examination of the sample.
(3) As regards England and Wales and Northern Ireland, the term
implied by subsection (2) above is a condition.
15A. Modification of remedies for breach of condition in non-consumer
cases
(1) Where in the case of a contract of sale-
(a) the buyer would, apart from this subsection, have the
right to reject goods by reason of a breach on the part of the
seller of a term implied by section 13, 14 or 15 above, but
(b) the breach is so slight that it would be unreasonable
for him to reject them,
then, if the buyer does not deal as consumer, the breach is not
to be treated as a breach of condition but may be treated as a
breach of warranty.
(2) This section applies unless a contrary intention appears in,
or is to be implied from, the contract.
(3) It is for the seller to show that a breach fell within subsection
(1)(b) above.
(4) This section does not apply to Scotland.
34. Buyer's right of examining the goods
Unless otherwise agreed, when the seller tenders delivery of goods
to the buyer, he is bound on request to afford the buyer a reasonable
opportunity of examining the goods for the purpose of ascertaining
whether they are in conformity with the contract and, in the case
of a contract for sale by sample, of comparing the bulk with the
sample.
35. Acceptance
(1) The buyer is deemed to have accepted the goods subject to
subsection (2) below-
(a) when he intimates to the seller that he has accepted them,
or
(b) when the goods have been delivered to him and he does
any act in relation to them which is inconsistent with the ownership
of the seller.
(2) Where goods are delivered to the buyer, and he has not previously
examined them, he is not deemed to have accepted them under subsection
(1) above until he has had a reasonable opportunity of examining
them for the purpose-
(a) of ascertaining whether they are in conformity with the
contract, and
(b) in the case of a contract for sale by sample, of comparing
the bulk with the sample.
(3) Where the buyer deals as consumer or (in Scotland) the contract
of sale is a consumer contract, the buyer cannot lose his right
to rely on subsection (2) above by agreement, waiver or otherwise.
(4) The buyer is also deemed to have accepted the goods when after
the lapse of a reasonable time he retains the goods without intimating
to the seller that he has rejected them.
(5) The questions that are material in determining for the purposes
of subsection (4) above whether a reasonable time has elapsed
include whether the buyer has had a reasonable opportunity of
examining the goods for the purpose mentioned in subsection (2)
above.
(6) The buyer is not by virtue of this section deemed to have
accepted the goods merely because-
(7) Where the contract is for the sale of goods making one or
more commercial units, a buyer accepting any goods included in
a unit is deemed to have accepted all the goods making the unit;
and in this subsection "commercial unit" means a unit
division of which would materially impair the value of the goods
or the character of the unit.
52. Specific performance
(1) In any action for breach of contract to deliver specific or
ascertained goods the court may, if it thinks fit, on the plaintiff's
application, by its judgment or decree direct that the contract
shall be performed specifically, without giving the defendant
the option of retaining the goods on payment of damages.
(2) The plaintiff's application may be made at any time before
judgment or decree.
(3) The judgment or decree may be unconditional, or on such terms
and conditions as to damages, payment of the price and otherwise
as seem just to the court.
(4) The provisions of this section shall be deemed to be supplementary
to, and not in derogation of, the right of specific implement
in Scotland.
B. The Unfair Contract Terms Act 1977
B.1 Sections applicable to England, Wales and Northern
Ireland
5. "Guarantee" of consumer goods
(1) In the case of goods of a type ordinarily supplied for private
use or consumption, where loss or damage-
(a) arises from the goods proving defective while in consumer
use; and
(b) results from the negligence of a person concerned in the
manufacture or distribution of the goods,
liability for the loss or damage cannot be excluded or restricted
by reference to any contract term or notice contained in or operating
by reference to a guarantee of the goods.
(2) For these purposes-
(a) goods are to be regarded as "in consumer use"
when a person is using them, or has them in his possession for
use, otherwise than exclusively for the purposes of a business;
and
(b) anything in writing is a guarantee if it contains or purports
to contain some promise or assurance (however worded or presented)
that defects will be made good by complete or partial replacement,
or by repair, monetary compensation or otherwise.
(3) This section does not apply as between the parties to a contract
under or in pursuance of which possession or ownership of the
goods passed.
7. Miscellaneous contracts under which goods pass
(1) Where the possession or ownership of goods passes under or
in pursuance of a contract not governed by the law of sale of
goods or hire-purchase, subsections (2) to (4) below apply as
regards the effect (if any) to be given to contract terms excluding
or restricting liability for breach of obligation arising by implication
of law from the nature of the contract.
(2) As against a person dealing as consumer, liability in respect
of the goods' correspondence with description or sample, or their
quality or fitness for any particular purpose, cannot be excluded
or restricted by reference to any such term.
(3) As against a person dealing otherwise than as consumer, that
liability can be excluded or restricted by reference to such a
term, but only in so far as the term satisfies the requirement
of reasonableness.
(3A) Liability for breach of the obligations arising under section
2 of the Supply of Goods and Services Act 1982 (implied terms
about title etc in certain contracts for the transfer of the property
in goods) cannot be excluded or restricted by references to any
such term.
(4) Liability in respect of-
cannot (in a case to which subsection (3A) above does not apply)
be excluded or restricted by reference to any such term except
in so far as the term satisfies the requirement of reasonableness.
(5) This section does not apply in the case of goods passing on
a redemption of trading stamps within the Trading Stamps Act 1964
or the Trading Stamps Act (Northern Ireland) 1965.
12. "Dealing as consumer"
(1) A party to a contract "deals as consumer" in relation
to another party if-
(a) he neither makes the contract in the course of a business
nor holds himself out as doing so; and
(b) the other party does make the contract in the course of
a business; and
(c) in the case of a contract governed by the law of sale
of goods or hire-purchase, or by section 7 of this Act, the goods
passing under or in pursuance of the contract are of a type ordinarily
supplied for private use or consumption.
(2) But on a sale by auction or by competitive tender the buyer
is not in any circumstances to be regarded as dealing as consumer.
(3) Subject to this, it is for those claiming that a party does
not deal as consumer to show that he does not.
B.2 Sections applicable to Scotland only
19. "Guarantee" of consumer goods
(1) This section applies to a guarantee-
(a) in relation to goods which are of a type ordinarily supplied
for private use or consumption; and
(b) which is not a guarantee given by one party to the other
party to a contract under or in pursuance of which the ownership
or possession of the goods to which the guarantee relates is transferred.
(2) A term of a guarantee to which this section applies shall
be void in so far as it purports to exclude or restrict liability
for loss or damage (including death or personal injury)-
(a) arising from the goods proving defective while-
(b) resulting from the breach of duty of a person concerned
in the manufacture or distribution of the goods.
(3) For the purposes of this section, any document is a guarantee
if it contains or purports to contain some promise or assurance
(however worded or presented) that defects will be made good by
complete or partial replacement, or by repair, monetary compensation
or otherwise.
25. Definitions
(1) In this Part of this Act-
"consumer" has the meaning assigned to that expression
in the definition in this section of "consumer contract";
"consumer contract" means a contract (not being a contract
of sale by auction or competitive tender) in which-
(a) one party to the contract deals, and the other party to
the contract ("the consumer") does not deal or hold
himself out as dealing, in the course of a business, and
(b) in the case of a contract such as is mentioned in section
15(2)(a) of this Act, the goods are of a type ordinarily supplied
for private use or consumption;
and for the purposes of this Part of this Act the onus of proving
that a contract is not to be regarded as a consumer contract shall
lie on the party so contending;
"goods" has the same meaning as in the Sale of Goods
Act 1979.
C. The United Nations Convention on Contracts for Sale
of Goods 1980
("Vienna Sales Convention")
Article 2
This Convention does not apply to sales-
(a) of goods bought for personal, family or household use,
unless the seller, at any time before or at the conclusion of
the contract, neither knew nor ought to have known that the goods
were bought for any such use;
(b) by auction;
(c) on execution or otherwise by authority of law;
(d) of stocks, shares, investment securities, negotiable instruments
or money;
(e) of ships, vessels, hovercraft or aircraft;
(f) of electricity.
Article 25
A breach of contract committed by one of the parties is fundamental
if it results in such detriment to the other party as substantially
to deprive him of what he is entitled to expect under the contract,
unless the party in breach did not foresee and a reasonable person
of the same kind in the same circumstances would not have foreseen
such a result.
Article 28
If, in accordance with the provisions of this Convention, one
party is entitled to require performance of any obligation by
the other party, a court is not bound to enter a judgement for
specific performance unless the court would do so under its own
law in respect of similar contracts of sale not governed by this
Convention.
Article 35
(1) The seller must deliver goods which are of the quantity, quality
and description required by the contract and which are contained
or packaged in the manner required by the contract.
(2) Except where the parties have agreed otherwise, the goods
do not conform with the contract unless they-
(a) are fit for the purposes for which goods of the same description
would ordinarily be used;
(b) are fit for any particular purpose expressly or impliedly
made known to the seller at the time of the conclusion of the
contract, except where the circumstances show that the buyer did
not rely, or that it was unreasonable for him to rely, on the
seller's skill and judgment;
(c) possess the qualities of goods which the seller has held
out to the buyer as a sample or model;
(d) are contained or packaged in the manner usual for such
goods or, where there is no such manner, in a manner adequate
to preserve and protect the goods.
(3) The seller is not liable under subparagraphs (a) to (d) of
the preceding paragraph for any lack of conformity of the goods
if at the time of the conclusion of the contract the buyer knew
or could not have been unaware of such lack of conformity.
Article 36
(1) The seller is liable in accordance with the contract and this
Convention for any lack of conformity which exists at the time
when the risk passes to the buyer, even through the lack of conformity
becomes apparent only after that time.
(2) The seller is also liable for any lack of conformity which
occurs after the time indicated in the preceding paragraph and
which is due to a breach of any of his obligations, including
a breach of any guarantee that for a period of time the goods
will remain fit for their ordinary purpose or for some particular
purpose or will retain specified qualities or characteristics.
Article 39
(1) The buyer loses the right to rely on a lack of conformity
of the goods if he does not give notice to the seller specifying
the nature of the lack of conformity within a reasonable time
after he has discovered it or ought to have discovered it.
(2) In any event, the buyer loses the right to rely on a lack
of conformity of the goods if he does not give the seller notice
thereof at the latest within a period of two years from the date
on which the goods were actually handed over to the buyer, unless
this time-limit is inconsistent with a contractual period of guarantee.
Article 40
The seller is not entitled to rely on the provisions of articles
38 and 39 if the lack of conformity relates to facts of which
he knew or could not have been unaware and which he did not disclose
to the buyer.
Article 46
(1) The buyer may require performance by the seller of his obligations
unless the buyer has resorted to a remedy which is inconsistent
with this requirement.
(2) If the goods do not conform with the contract, the buyer may
require delivery of substitute goods only if the lack of conformity
constitutes a fundamental breach of contract and a request for
substitute goods is made either in conjunction with notice given
under article 39 or within a reasonable time thereafter.
(3) If the goods do not conform with the contract, the buyer may
require the seller to remedy the lack of conformity by repair,
unless this is unreasonable having regard to all the circumstances.
A request for repair must be made either in conjunction with notice
given under article 39 or within a reasonable time thereafter.
Article 49
(1) The buyer may declare the contract avoided-
(a) if the failure by the seller to perform any of his obligations
under the contract or this Convention amounts to a fundamental
breach of contract; or
(b) in case of non-delivery, if the seller does not deliver
the goods within the additional period of time fixed by the buyer
in accordance with paragraph (1) of article 47 or declares that
he will not deliver within the period so fixed.
(2) However, in cases where the seller has delivered the goods,
the buyer loses the right to declare the contract avoided unless
he does so-
(a) in respect of late delivery, within a reasonable time
after he has become aware that delivery has been made;
(b) in respect of any breach other than late delivery, within
a reasonable time-
(i) after he knew or ought to have known of the breach;
(ii) after the expiration of any additional period of time
fixed by the buyer in accordance with paragraph (1) of article
47, or after the seller has declared that he will not perform
his obligations within such an additional period; or
(iii) after the expiration of any additional period of time
indicated by the seller in accordance with paragraph (2) of article
48, or after the buyer has declared that he will not accept performance.
D. The Convention on jurisdiction and the enforcement
of judgments in civil
and commercial matters 1968 ("Brussels Convention")
Article 13 - Jurisdiction over consumer contracts
In proceedings concerning a contract concluded by a person for
a purpose which can be regarded as being outside his trade or
profession, hereinafter called the "consumer", jurisdiction
shall be determined by this Section, without prejudice to the
provisions of point 5 of Articles 4 and 5, if it is:
(1) a contract for the sale of goods on instalment credit terms,
or
(2) a contract for a loan repayable by instalments, or for any
other form of credit, made to finance the sale of goods, or
(3) any other contract for the supply of goods or a contract for
the supply of services, and
Where a consumer enters into a contract with a party who is not
domiciled in a Contracting State but has a branch, agency or other
establishment in one of the Contracting States, that party shall,
in disputes arising out of the operations of the branch, agency
or establishment, be deemed to be domiciled in that State.
This Section shall not apply to contracts of transport.
E. The Convention on the law applicable to contractual
obligations 1980
("Rome Convention")
Article 5: Certain consumer contracts
1. This article applies to a contract the object of which is the
supply of goods or services to a person ("the consumer")
for a purpose which can be regarded as being outside his trade
or profession, or a contract for the provision of credit for that
object.
2. Notwithstanding the provisions of Article 3, a choice of law
made by the parties shall not have the result of depriving the
consumer of the protection afforded to him by the mandatory rules
of the law of the country in which he has his habitual residence:
-- if in that country the conclusion of the contract was preceded
by a specific invitation addressed to him or by advertising, and
he had taken in that country all the steps necessary on his part
for the conclusion of the contract, or
-- if the other party or his agency received the consumer's
order in that country, or
-- if the contract is for the sale of goods and the consumer
travelled from that country to another country and there gave
his order, provided that the consumer's journey was arranged by
the seller for the purpose of inducing the consumer to buy.
3. Notwithstanding the provisions of Article 4, a contract to
which this Article applies shall, in the absence of choice in
accordance with Article 3, be governed by the law of the country
in which the consumer has his habitual residence if it is entered
into in the circumstances described in paragraph 2 of this Article.
4. This Article shall not apply to:
(a) a contract of carriage;
(b) a contract for the supply of services where the services
are to be supplied to the consumer exclusively in a country other
than that in which he has his habitual residence.
5. Notwithstanding the provisions of paragraph 4, this Article
shall apply to a contract which, for an inclusive price, provides
for a combination of travel and accommodation.
