Duty to supply goods of the right quality
- The position of the law is caveat venditor, let the seller beware.
Due to the presence of ss. 13, 14(2)-(3), they give buyers a substantial degree of protection against
the risk of the goods proving to have defects of quality or fitness for purpose.
- The quality of the goods must comply the requirements of the terms of contract when the property
in the goods is passed to the buyer.
The time to determine the compliance with the requirements is the time when property in the goods
is passed to the buyer.
o In cases where the property in goods passes before actual delivery, it takes form of constructive
delivery.
Conformity of the goods with the contract is judged at this time.
The three provisions provide a graduated protection to the buyers.
Express terms
- The use of express terms in relation to description, quality and fitness of goods is common.
- Deviation from an express term is a breach of contract which entitles the buyer to some remedy.
Exception: application of the de minimis rule.
The nature of the express term is important in determining the nature of remedy.
If there are no terms providing the remedy for breach of the express term, the express term is
often being treated as an innominate term.
o An innominate term is a term neither condition nor warranty.
The availability of right to repudiate the contract depends on the nature and consequences of
the breach of the innominate term.
o A party can repudiate the contract only if the nature and the consequences of breach is
serious enough.
Regardless the nature of the express term, the breach of such term will entitle the party to his
right to damages.
Implied terms
- Implied terms are all conditions.
- S. 13 – sale of goods by description, the goods must correspond with the description.
Note the effect of s. 13 on the common law distinction between mere representation and terms of
contract.
Does the statement made by the seller automatically become the terms of the contract? No.
o Taylor v Combined Buyer Ltd [1924] NZLR 627 held that the traditional distinction has
not been affected by s. 13.
o T & J Harrison v Knowles and Foster [1918] 1 KB 608 – the capacity of the ships
represented before entering the contract is only a representation not a term.
o Harlingdon & Leinster Enterprises Ltd v Christopher Hull Fine Art Ltd [1991] 1 QB 564
S. 13 does not automatically convert all descriptive words into terms.
a. Descriptive words falling outside the scope of s. 13 will be dealt with by the law
regarding misrepresentation.
Description of goods made in negotiations or in the contract as a term did not
necessarily lead to a sale by description.
a. But a description in a sale by description must always be a term of the
contract.
The description must be influential, so the description is a condition of the contract.
Scope of application of s. 13
- The position of the law is caveat venditor, let the seller beware.
Due to the presence of ss. 13, 14(2)-(3), they give buyers a substantial degree of protection against
the risk of the goods proving to have defects of quality or fitness for purpose.
- The quality of the goods must comply the requirements of the terms of contract when the property
in the goods is passed to the buyer.
The time to determine the compliance with the requirements is the time when property in the goods
is passed to the buyer.
o In cases where the property in goods passes before actual delivery, it takes form of constructive
delivery.
Conformity of the goods with the contract is judged at this time.
The three provisions provide a graduated protection to the buyers.
Express terms
- The use of express terms in relation to description, quality and fitness of goods is common.
- Deviation from an express term is a breach of contract which entitles the buyer to some remedy.
Exception: application of the de minimis rule.
The nature of the express term is important in determining the nature of remedy.
If there are no terms providing the remedy for breach of the express term, the express term is
often being treated as an innominate term.
o An innominate term is a term neither condition nor warranty.
The availability of right to repudiate the contract depends on the nature and consequences of
the breach of the innominate term.
o A party can repudiate the contract only if the nature and the consequences of breach is
serious enough.
Regardless the nature of the express term, the breach of such term will entitle the party to his
right to damages.
Implied terms
- Implied terms are all conditions.
- S. 13 – sale of goods by description, the goods must correspond with the description.
Note the effect of s. 13 on the common law distinction between mere representation and terms of
contract.
Does the statement made by the seller automatically become the terms of the contract? No.
o Taylor v Combined Buyer Ltd [1924] NZLR 627 held that the traditional distinction has
not been affected by s. 13.
o T & J Harrison v Knowles and Foster [1918] 1 KB 608 – the capacity of the ships
represented before entering the contract is only a representation not a term.
o Harlingdon & Leinster Enterprises Ltd v Christopher Hull Fine Art Ltd [1991] 1 QB 564
S. 13 does not automatically convert all descriptive words into terms.
a. Descriptive words falling outside the scope of s. 13 will be dealt with by the law
regarding misrepresentation.
Description of goods made in negotiations or in the contract as a term did not
necessarily lead to a sale by description.
a. But a description in a sale by description must always be a term of the
contract.
The description must be influential, so the description is a condition of the contract.
Scope of application of s. 13
