Consumer Protection Law in the UK - Essay Example

Consumer Protection Law in the UK Consumer Protection Law in the UK Upon reviewing the information presented byJim in regard to the three cases specified, I would advise him as follows: Superslammer Tennis Racquet The Sales of Goods Act 1979 s13 and 14 states that in order to conform to the terms of the contract the goods should: match the description given; be in satisfactory condition1; have satisfactory quality2; and be reasonably fit for any specific purpose the consumer makes known to the seller.3 Additionally any statement, in writing or verbally, made by the manufacturer, his agents or the retailer regarding the characteristics of the goods, with special regard to labelling or advertisement, must be factually correct and become a part of the contract of sale. An exception to this clause is when the retailer can show: for good reasons he was not aware of the advertisement; the statement had been corrected prior to the conclusion of the sale; or the statement could not have had an influence on the consumer.4 OSL in this case was bound by the contract of sale which included the warranty advertisement unless OSL, in this case Patrick the manager, could show he had no knowledge of the advertisement.5 In SOGA 1979 14(2) as to quality the court found in Rogers v Parish ( Scarborough) Ltd [1987] QB 933 found that goods must be fit for the purposes for which supplied and failure to do so leaves them unmerchantable.6 In Jim's case he purchased the racquet at 250, a considerable amount for a tennis racquet. Further, because the severe surface damage to finish of the racquet and the fact its handle came off all within the first few weeks of normal use, the racquet as well was unmerchantable. In Stevenson v Rogers [1999] 1 All ER 613 the Court of Appeal had to consider the meaning of 'in the course of a business' in the context of the Sale of Goods Act 1979, s14(2), "where it limits the statutory implication of a term as to the quality of the goods to sales where sellers are acting 'in the course of a business'. The court rejected the meaning given to that phrase in the context of the Trade Descriptions Act 1968 and the Unfair Contract Terms Act 1977 and took a broader approach.7 It will be contended that the broader meaning would also be more appropriate than that currently adopted in relation to the definition of 'deals as consumer' under the Unfair Contract Terms Act 1977." Further the guarantee, from the manufacturer, which came with the racquet stated that "We, Slammer Racquets plc, undertake that if, within twelve months of the date of the purchase, this racquet proves defective by reason only of faulty workmanship or materials, we will, at our option, repair or replace the same FREE OF ANY CHARGE for labour, materials or carriage on condition that the racquet has not been subjected to abnormal use. Exclusions: This guarantee does not cover damage resulting from improper use or neglect." As it was shown the racquet was in breach of implied terms of the contract as outline above, the next step was to ascertain if in fact the breach was a condition or a warranty of the sale or the goods did not conform to the contract. Jim purchased the Superslammer tennis racquet from Oldcastle Sports and Leisure (OSL) for 200 cash for the express purpose of learning to play tennis. He purchased the racquet based on the advertisement from the local newspaper. The advertisement read: "Slammer Racquets PLC announce the arrival of the Superslammer Tennis Racquet This is a fantastic new tennis racquet specially designed for beginners. Its unique anti-scratch finish means that however many times you knock it, scratch it, drop it, the scratches will not show. Your racquet will look as good as a new after many years of use. Buy one now from your Slammer Stockist." The statement coming from the manufacturer in the form of the advertisement was pre-contractual in nature; therefore, it is necessary to determine if it has contractual effect. To determine this one must look at intent.8 In Dick Bentley Productions Ltd v Harold Smith (Motors) Ltd [1965] 1 WLR 623 CA Lord Denning stated that "If seems to me that if a representation is made for the purpose ofinducing the other party to act on it, and the other party is so induced by entering the contract, that is prima facie grounds for inferring a warranty. The representor can rebut this by showing it is not reasonable for him or her to be bound."9 Having joined the racquet club and paid 200 for his annual membership, paid an additional 120 for six weeks of lessons and knowing he was a novice it would be reasonable to assume that upon seeing the advertisement for the Superslammer the inducement was there to buy a racquet as described in the ad. The next area to consider is when the statement was made. As stated in Routledge v McKay [1954] 1 WLR 615 the court found that a lapse in time mitigated the statement from being contractual.10 In Jim's case he saw the advertisement and proceeded from OSL to OSR to purchase the racquet. A reasonable person would infer that time, in this case, did not nullify the statement (i.e. the advertisement). The next area to examine is whether a misrepresentation occurred. In Smith v Chadwick (1884) 9 App Cas 187 the court held if a person made a statement "of such a nature as would be likely to induce a person to enter into a contract, and it is proved that the plaintiff did enter into the contract, it is a fair inference of fact that he was induced to do so by the statement it's weight as evidence must greatly depend upon the degree to which the action of the plaintiff was likely; and on the absence of all other grounds on which the plaintiff might act."11 In Jim's case as stated it is reasonable to assume that upon seeing the advertisement and proceeding to the OSL to purchase the racquet he was induced by the advertisement to do so. If the misrepresentation was innocent in nature, in that there was no fraudulent misrepresentation, per s2(2) of the Misrepresentation Act 1967, Jim would not be entitled to damages, however the court may award them instead of rescission. Having determined that the advertisement was a term of the contract for sale per SOGA 1979 it becomes necessary to decide if this term (the advertisement) was a condition or warranty of the contract of sale. There are two criteria to be met: The intention of the parties and the consequences of the breach. In Poussard v Spiers and Pond (1876) 1 QBD 410 the court found that the term was an intrinsic part of the contract that failure of the plaintiff to honour the term was a breach of contract.12 In the case of the racquet, the advertisement was sufficient to cause Jim to purchase the racquet as the advertisement averred it would sustain its appearance and not have the handle come off under the normal use by a novice. Therefore, in this case the advertisement is a warranty of the contract of sale and a breach of the contract of sale has occurred and s 53 and 54 of SOGA 1979 apply. The remedies set out in s53 are as follows: (a) "set up against the seller the breach of warranty in diminution or extinction of the price, or (b) maintain an action against the seller for damages for the breach of warranty. (2) The measure of damages for breach of warranty is the estimated loss directly and naturally resulting, in the ordinary course of events, from the breach of warranty. (3) In the case of breach of warranty of quality such loss is prima facie the difference between the value of the goods at the time of delivery to the buyer and the value they would have had if they had fulfilled the warranty. (4) The fact that the buyer has set up the breach of warranty in diminution or extinction of the price does not prevent him from maintaining an action for the same breach of warranty if he has suffered further damage." S54 reads that no interest is payable. In the case of Jim and the tennis racquet the remedy afforded him per SOGA 1979 s53 include the cost of the tennis racquet, 250 and as the loss of use of the remaining 50% of his tennis lessons, 60 was a direct result of the breach of warranty is he entitled to be awarded those damages as well. Additionally, the court may award damages for the partial loss suffered due to his not having the racquet and partial reimbursement for his annual membership at OSL of 200 could be awarded at the court's discretion. Valueview and TV1 In this case the main question is did Valueview have the right to sell TV1, an implied term as to the sale. Per SOGA s12(1) "in every contract of sale there is an implied term on the part of the seller that in the case of a sale he has the right to sell the goods. Further, this implied term is a condition of the sale. In Jim's case Valueview did not have title on TV1 at the time of the sale. In Bishopsgate Motor Finance Corp. Ltd v Transport Brakes Ltd [1949] 1 KB 322 Lord Denning said: "In the development of our law two principles have striven for mastery. The first is for the protection of property; no one can give a better title than he himself possesses. The second is for the protection of commercial transactions; the person who takes in good faith and for value without notice should get a good title." Nemo dat quod non habet: "Meaning: no one can give something he has not got. Someone who has not got good title to goods and is not authorised by the owner to sell them cannot pass on good title to them" Per s12(1) when the seller does not have title and sell to the buyer, the buyer acquires not better title than did the seller unless the owner by his own actions is precluded from denying the seller to sell the goods. S12(2) states "In a contract of sale, other than one to which subsection (3) below applies13, 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." In this case there was a breach of condition. In the court held that seller was in breach of s12 which implies conditions and warranties into the sale of goods. The court further found that there was "total failure of consideration in spite of the fact that C had had the use of the car. Restitution of the purchase price was allowed, with no deduction for the period of use, on the basis that C had contracted for the ownership of the car and not merely the ability to use it."14 When Jim purchased TV1 from Valueview he did so in good faith. However, he may per s11(4) reject the goods "even though in other circumstances he would be deemed to have 'accepted'- eg where he has had the use of the goods for several months." Per this instance Jim is in non-acceptance of TV1 even though he in fact had used the TV1. His remedy in this case per s51 is to recover the price of the TV1 from Valueview in the amount of 1,000, the price he had paid for TV1. Pricecutter and TV2 In this case Jim had purchased TV2 for 800 cash from Priceutter. Several days later when the TV was delivered in a box, Jim signed the following delivery note. "Pricecutters 2 High Street Oldcastle I, J Fenton of 2 Willow Way hereby agree that he TV delivered to me on June 25th 2005 has been delivered in satisfactory condition. Signed J Fenton" Jim did not inspect the TV before signing the delivery slip. As he was closing the door and turn he tripped over his cat. Hurting himself, he went to the hospital and was admitted for a three month period. Upon returning home, Jim unpacked TV2 and when he attempted to turn on TV2 he found that it did not work. As in any contract of sale there are four considerations that must be met in order to conform to the terms of the contract. The goods should: match the description given; be in satisfactory condition Satisfactory condition refers to what a reasonable person would perceive as satisfactory based on price, description and any other pertinent information; have satisfactory quality. Per SOGA 1979 five elements further define quality: fitness for the purpose being purchased i.e. buying it for the use it was intended; the good's finish and appearance; no observable minor defects; safety; and durability.; and be reasonably fit for any specific purpose the consumer makes known to the seller. This does not apply if the seller informs the buyer that it is not appropriate to use the goods for the purpose the buyer stated. In the case of TV2 at the time of sale, all the terms and conditions had been met and were not in dispute by Jim. However, upon returning from the hospital after a three month stay and not having used TV2 Jim had discovered a latent flaw in TV2. The Sale and Supply of Goods to Consumers Regulations 2002 48(3) states "For the purposes of subsection (1)(b) above goods which do not conform to the contract of sale at any time within the period of six months starting with the date on which the goods were delivered to the buyer must be taken not to have so conformed at that date." As Jim was in the hospital for a period of 3 months he was well within the timeframe to require the seller to replace or repair the TV. Per 48 (2). If this section applies, the buyer has the right- (a) under and in accordance with section 48B below, to require the seller to repair or replace the goods, or (b) under and in accordance with section 48C below- (i) to require the seller to reduce the purchase price of the goods to the buyer by an appropriate amount, or (ii) to rescind the contract with regard to the goods in question. Therefore in this case the remedy is to have Pricecutters repair or replace the televison as during the initial six month period it is assumed there is a latent fault with the TV. Further as Jim was hospitalized during the period in question. What is a reasonable time period should be ascertained between the two parties. OSL and the SuperSlammer The law is more lenient with regard to the consumer if they are not acting as buyer in a personal sense. If a purchase is made on a professional level the laws applied are somewhat different. In the case of the Super Slammer given the same circumstances where there was a warranty breach of contract, s53 reads: "(1) Where there is a breach of warranty by the seller, or where the buyer elects (or is compelled) to treat any breach of a condition on the part of the seller as a breach of warranty, the buyer is not by reason only of such breach of warranty entitled to reject the goods; but he may- (a) set up against the seller the breach of warranty in diminution or extinction of the price, or (b) maintain an action against the seller for damages for the breach of warranty. (2) The measure of damages for breach of warranty is the estimated loss directly and naturally resulting, in the ordinary course of events, from the breach of warranty." (3) In the case of breach of warranty of quality such loss is prima facie the difference between the value of the goods at the time of delivery to the buyer and the value they would have had if they had fulfilled the warranty. (4) The fact that the buyer has set up the breach of warranty in diminution or extinction of the price does not prevent him from maintaining an action for the same breach of warranty if he has suffered further damage. [(5) This section does not apply to Scotland.] The main difference between the consumer and a business in this case is that the business must repudiate the contract and reject the goods and seek damages if he can show loss. References Bishopsgate Motor Finance Corp. Ltd v Transport Brakes Ltd [1949] 1 KB 322 Dick Bentley Productions Ltd v Harold Smith (Motors) Ltd [1965] 1 WLR 623 CA Misrepresentation Act 1967 Poussard v Spiers and Pond (1876) 1 QBD 410 Rogers v Parish ( Scarborough) Ltd [1987] QB 933 Rowland v Divall [1923] 2 KB 500 Routledge v McKay [1954] 1 WLR 615 The Sales of Goods Act 1979 Sale and Supply of Goods Act 1994 Sale and Supply of Goods to Consumers Regulations 2002 Sale of Goods to Consumers Regulation 2004 Smith v Chadwick (1884) 9 App Cas 187 Stevenson v Rogers [1999] 1 All ER 613 Trade Descriptions Act 1968 Unfair Contract Terms Act 1977 Read More