Implied conditions for the law incorporates into a contract of sale of goods are given below:
1. Condition as to title [Sec. 14 (a)]:
In every contract of sale, the first implied condition on the part of the seller is that, in the case of a sale, he has the right to sell the goods and that, in the case of an agreement to sell; he will have a right to sell the goods at the time when the property is to pass.
ADVERTISEMENTS:
Ordinarily the seller has the right to sell the goods if either he is the owner of the goods or he is owner’s agent. As a result of this condition, if the seller’s title turns out to be defective the buyer is entitled to reject the goods and to recover his price.
Notice that in the case of breach of condition as to title the buyer has no option to treat the breach of condition as breach of warranty and accept the goods and sue the seller for damages. In this case he must return the goods to the true owner. He can of course recover the price from the seller because of a total failure of consideration.
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Illustration:
ADVERTISEMENTS:
R purchased a car from D and used the same for several months. D had no title to the car and, therefore, R was compelled to return the car to the true owner. R sued D to recover back the price which he had already paid. He was held entitled to recover the whole of the price paid by him despite the fact that he had used the car for some months (Rowland vs Dival).
It may be noted that the implied condition as to title makes it obligatory upon the seller that he must not only be the owner but also must be able to uphold the validity of the contract. Thus if the goods sold bear labels infringing the trade mark of another, the seller is guilty of breach of this condition although he had full ownership of the goods.
2. Condition in a sale by description:
“Where there is a contract of sale of goods by description, there is an implied condition that the goods shall correspond with the description” (Sec. 15). The description may be in terms of the qualities or characteristics of the goods, i.e., long staple cotton, Kalyan wheat, sugar C-30, basmati rice or may simply mention the trade mark, brand name or the type of packing, etc.
ADVERTISEMENTS:
Illustrations:
(a) Where there was a contract for the supply of ‘new singer cars’ and one of the cars supplied having already run a considerable mileage was not new, there was a breach of condition on the part of the seller and the buyer was held entitled to reject the car (Andrews Bros, vs Singer & Co).
(b) M agreed to supply to L 3,000 tons of canned fruit, to be packed in cases each containing 30 tins. M tendered a substantial portion in cases containing 24 tins. It was held that the mode of packing constituted a part of the description and, therefore, L was entitled to reject the whole consignment (Re Moore & Co., and Landaure & Co).
3. Condition in a sale by sample (Sec. 17):
When under a contract of sale, goods are to be supplied according to a sample agreed upon, the implied conditions are:
(i) That the bulk shall correspond with the sample in quality;
(ii) That the buyer shall have a reasonable opportunity of comparing the bulk with the sample;
(iii) That the goods shall be free from any defect, rendering them unmerchantable, which would not be apparent on reasonable examination of the sample. In other words, there should not be any latent defect in the goods.
If the defect is patent one, that is, easily discoverable by the exercise of ordinary care, and the buyer takes delivery after inspection, there is no breach of implied condition and the buyer has no remedy.
Illustrations:
(a) Two parcels of wheat were sold by sample. The buyer went to examine the bulk a week after. One parcel was shown to him but the seller refused to show the other parcel which was not there in the warehouse. Held, the buyer was entitled to rescind the contract (Lorymer vs Smith).
(b) Some mixed worsted coatings were sold by sample. The goods when supplied corresponded to the sample but it was found that owing to a latent defect in the cloth, coats made out of it would not stand ordinary wear and were therefore unsaleable.
The same defect existed in the sample also but could not be detected on a reasonable examination. Held, the buyer was entitled to reject the cloth (Drummond & Sons vs Van Ingen).
4. Condition in a sale by sample as well as by description (Sec. 15):
When goods are sold by sample as well as by description, there is an implied condition that the bulk of the goods shall correspond both with the sample and with the description. If the goods supplied correspond only with the sample and not with the description or vice versa, the buyer is entitled to reject the goods. The bulk of the goods must correspond with both.
Illustrations:
(a) There was a contract of sale by sample of seeds described as ‘common English sainfoin.’ The contract contained a term excluding all warranties express or implied.
The seed was sown and when the crop was ready it was discovered that the seed supplied and the sample shown was a different and inferior variety known as ‘giant sainfoin’. It was held that there was a breach of condition and the exemption clause did not protect the sellers. The buyer was, therefore, entitled to recover damages (Wallis vs Pratt),
(b) Nagreed to sell G some oil described as ‘foreign refined rapeseed oil,’ warranted only equal to sample. The oil supplied, though corresponded with the sample, was adulterated with hemp oil. Held, that since the oil supplied was not in accordance with the description the buyer was entitled to reject the same (Nichol vs Godts).
5. Condition as to fitness or quality [Sec. 16(1)]:
Ordinarily, in a contract of sale there is no implied condition or warranty as to quality or fitness for any particular purpose of goods supplied; the rule of law being ‘Caveat Emptor’™, that is, let the buyer beware. But an implied condition is deemed to exist on the part of the
The doctrine of Caveat Emptor has been discussed separately later in this Chapter
seller that the goods supplied shall be reasonably fit for the purpose for which the buyer wants them, if the following conditions are satisfied:
(i) The buyer, expressly or impliedly, should make known to the seller the particular purpose for which the goods are required;
(ii) The buyer should rely on the seller’s skill or judgement; and
(iii) The goods sold must be of a description which the seller deals in the ordinary course of his business, whether he is the manufacturer or not.
The purpose must be made known expressly if the goods to be supplied can be used for several purposes, otherwise the condition as to fitness will not be implied and the buyer will have no right to reject the goods merely because they are unfit for the specific purpose he had in mind.
Illustration:
A buyer ordered for the hessian cloth, which is generally used for packing purposes, without specifying the purpose for which he wanted the same. The cloth was supplied accordingly. On receiving the cloth the buyer found that it was not suitable for packing food products as it had an unusual smell.
Held, that the buyer had no right to reject the cloth as it was suitable for packing purposes alright. The buyer ought to have disclosed his particular purpose to the seller in order to make him liable for the breach of implied condition as to fitness (Re Andrew Yule & Co.).
The purpose need not be told expressly if the goods are fit for one particular purpose only or if the nature of the goods itself tells the purpose by implication. In such cases the purpose is deemed to be made known to the seller impliedly.
Illustrations:
(a) A, a draper, who had no special knowledge of hot water bottles, went to the shop of a chemist and asked for a hot water bottle. He was shown an American rubber bottle which the chemist said would not stand boiling water, but was meant for hot water. A bought the bottle.
After a few days, while being used, it burst and injured his wife. It was found that the bottle was not fit for use as a hot water bottle. It was held that since the bottle could be used only for one particular purpose, there was a breach of implied condition as to fitness and the seller was liable to pay damages (Priest vs Last),
(b) Where a buyer demands tinned fruit juice, it is implied from the nature of the product itself that he wants it for consumption and if later on it is found to contain poisonous matter, there is a breach of implied condition as to fitness and the seller is liable in damages.
Sale under patent or trade name:
Proviso to Section 16(1) lies 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 judgement of the seller but relies on the good reputation that the goods came to acquire and buys them on the strength of that reputation. The seller’s duty is to supply the goods of the same trade name as demanded by the buyer, whether they are fit for any particular purpose or not, is not his concern.
Illustration:
The buyer wrote to the seller: “Send me your patent smoke- consuming furnace for fitting up in my brewery.” The seller supplied the furnace according to the order but the same was found to be not fit for the purpose of the buyer’s brewery.
It was held that the seller had performed his part of the contract by supplying his patented furnace and so he was entitled to recover its price from the buyer (Chanter vs Hopkins).
6. Condition as to merchantability [Sec. 16(2)]:
This condition is implied only where the sale is by description. We have already seen that there is an implied condition in such cases, as per Section 15, that the goods should correspond with the description.
This sub-section lays down another implied condition in such cases, that is, that the goods should be of ‘merchantable quality.’ But for making this condition applicable, not only that the sale must be by description, but the following conditions must also be satisfied:
(i) The seller should be a dealer in goods of that description, whether he be the manufacturer or not; and
(ii) The buyer must not have any opportunity of examining the goods or there must be some latent defect in the goods which would not be apparent on reasonable examination of the same.
If the buyer had an opportunity of making the examination but he avoids examining, or if he has examined the goods, there is no implied condition as to merchantability as regards defects which such examination ought to have revealed [Proviso to Sec. 16(2)].
The phrase ‘merchantable quality’ means that the goods are of such quality and in such condition that a reasonable man, acting reasonably, would accept them under the circumstances of the case in performance of his offer to buy those goods, whether he buys them for his own use or to sell again (S.S. Mendse vs Balkrishna Chettiar).
Stated briefly, in order to be ‘merchantable’ the goods must be such as are reasonably saleable under the description by which they are known in the market.
Illustrations:
(a) Where the underwear’s supplied contained certain chemicals which could cause skin disease to a person wearing them next to skin, it was held that because of such a defect the underwear’s were not of merchantable quality and the buyer was entitled to reject the goods (Grant vs Australian Knitting Mills Ltd).
(b) Where A purchases a certain quantity of black yarn from B, a dealer in yarn, and finds it damaged by white ants, the condition as to merchantability has been broken and A is entitled to reject it as unmerchantable.
(c) R ordered for some 600 motor horns of varying description. Some of the horns were dented and badly polished and R rejected the whole of the consignment. Held, the defects in the horns had rendered them unmerchantable and therefore the buyer was justified in rejecting the whole consignment as the contract is indivisible (Jackson vs Rotax Motor & Cycle Co.)
7. Condition as to wholesomeness:
This condition is implied only in a contract of sale of eatables and provisions. In such cases the goods supplied must not only answer to description and be merchantable but must also be wholesome, i.e., free from any defect which render them unfit for human consumption.
Illustrations:
(a) The plaintiff bought a bun at a baker’s and confectioner’s shop. The bun contained a stone which broke one of the plaintiff’s teeth. Held, the seller was liable in damages because he violated the condition of wholesomeness (Chaproniere vs Mason).
(b) IF bought a bottle of beer from H, a dealer in wines. The beer was contaminated with arsenic. W, on taking the beer, fell ill. H was held liable to W for the consequent illness (Wren vs Halt).