Consumer transactions - How does the law help?

By Najma Ahmad

 

Every consumer transaction is governed by the law of contract. The consumer agrees to purchase goods and the seller in turn provides the services.

Common problems faced by a consumer are that goods purchased turn out to be defective or not up to standard. For example, your washing machine breaks down after one month, the TV blows up or the cooker burns out..

The Law

Section 14 of the Sale of Goods Act 1979 (as amended) applies to goods that are sold in the course of a business. It does not cover goods sold in a private sale; however it does apply to business and private buyers. Goods sold in the course of a business include sales by stores, garages and mail order.

Under section 14 (2A) of the 1979 Act, all goods must be of satisfactory quality.

So what does this mean?

Goods are of “satisfactory quality” if they meet the standard that a reasonable person would regard as satisfactory. Therefore a washing machine that breaks down two days after purchase would, by a reasonable person, mean that the goods supplied were unsatisfactory. Section 14 (3) of the Sale of Goods Act 1979 (as amended) takes this a step further and states that the quality of goods includes their state and condition, i.e. must be “fit for the purposes in which it was intended”. Aspects of quality of goods are appearance and finish, safety, durability and the goods must be free from minor defects. This however varies according to the goods that are supplied, whether they are new or old and the price that consumers pay for them.

New goods – how long should they last?

The 1979 Act as amended does not deal with this; therefore each case is decided upon its own merits.

For example:

Mr A buys a brand new car from Company B who is a seller for Manufacturer C. If after two days of driving the engine seizes up, the car clearly would not be of satisfactory quality.

Case law suggests that appearance defects for all goods must be taken into account when deciding whether or not the goods are of satisfactory quality. Consumers tend to purchase goods to look good and not just to perform a function.

 

 

 

 

 

Second hand goods

The condition of satisfactory quality as under the 1979 Act applies to second hand goods. However factors such as price, age and the buyer’s expectation are taken into account.

For example:

Mr A purchases an old car from Garage B for £600. Mr A drives the car for 400 miles and it suddenly breaks down. Mr A is required to repair the clutch at a cost of £75. Mr A can not argue that the goods were not of satisfactory quality because a clutch defect would be anticipated at some point on an old car.

Defects specifically drawn to the consumer’s attention

Section 14 (2c) (a) states that the goods must be of satisfactory quality unless the defect was brought to the buyer’s attention before the contract is made. Section 14 (2c b) takes this a step further and says “where the buyer examined goods there is no condition of satisfactory quality as regards to defects which that examination ought to have revealed”. Thus a consumer who purchases a second hand purse and misses an obvious hole can fall foul of this section if the purse was examined thoroughly before purchase.

Strict Liability

Section 14 of the Sale of Goods Act 1979 (as amended) creates strict liability. It therefore does not matter how careful the seller is in checking the goods, they are liable if goods are defective. However it must be stressed each case is decided upon its own merits.

Remedies for breach of contracts

If there is a breach of the conditions under section 14(2) and (3), i.e. goods purchased are not of satisfactory quality or are not fit for their intended purpose, consumers are entitled to reject the goods, recover monies paid for them and further damages resulting from the breach.

The law of contract is such that any breach can give the consumer a right to reject the goods and obtain a full refund if he / she has not accepted the goods.

In a case where the consumer has accepted goods, i.e. accepts a washing machine which breaks down after one year, if under warranty the remedy for this would be damages whereby a replacement or repair can be requested. It would appear however the more expensive the goods, the more rights you would have to replace, refund or repair. Ultimately no case is the same and is decided on its own merits.

 

 

 

 

 

 

Practical points:

  • when entering in to a contract, if possible, always check the terms and conditions - always read the back of the forms;

 

  • check the refund policy;
  • check for guarantees;

 

  • if you don’t understand anything in the contract, always ask;
  • if dissatisfied with the goods, consult the seller immediately to rectify the fault or problem.