The Sale of Goods Act 1979 (c 54) is an Act of the Parliament of the United Kingdom which regulated English contract law and UK commercial law in respect of goods that are sold and bought. The Act consolidated the original Sale of Goods Act 1893 and subsequent legislation, which in turn had codified and consolidated the law. Since 1979, there have been numerous minor statutory amendments and additions to the 1979 Act. It was replaced for consumer contracts from 1 October 2015 by the Consumer Rights Act 2015(c 15) but remains the primary legislation underpinning B2B transactions for selling / buying goods.
The Act applied to contracts where property in 'goods' were transferred or agreed to be transferred for a monetary consideration, in other words: where property (ownership) in personal chattels was sold.
Maps, Directions, and Place Reviews
Part II, contract formation
Sections 2 to 15B concern how a contract is formed and, in particular, contains standardised implied terms in all contracts for sale.
Section 3(2) provides that if goods are sold and delivered to minors or those mentally incapacitated the minor will be liable to pay a reasonable price if the goods are necessaries. Necessaries are goods suitable to the persons' condition of life and actual requirements at the time of contracting. Under sections 6 and 7, concerning specific goods that perish, a contract is void where they perish before and avoided where they perish after contract formation. (See Mistake (contract law)). Under section 8(2) the price is a money consideration given in exchange for property in goods. If the price, or means to ascertain a price, is not agreed, the buyer will be required to pay a reasonable price.
Breach of these terms by the seller may give rise to an action for damages, and in the case of those terms which are also conditions, termination of the contract. Where the slightness of the breach renders it unreasonable for a non-consumer buyer to reject the goods, for breach of the implied terms as to description, quality or fitness or sample, then the buyer can only claim damages for a breach of warranty. This amendment moderates the traditionally strict approach of English Law to contractual breach in a commercial context.
Section 12 incorporates into the contract a term that the seller either has legal title to the property to be sold or that he will have title at the time when property is to pass. Section 13(1) provides that where the buyer is sold goods by description, the goods must correspond with this description. Harlingdon v Christopher Hull held that this implied term may only be breached if the buyer relied upon the description. Therefore, if the buyer is an expert, reliance may not be established.
Section 14 states that terms are implicitly about quality and title and are only relevant where the seller is acting in the course of a business. There is no requirement as to the status of the buyer. The phrase "in the course of a business" has received much judicial consideration. Some judges have applied definitions found in other acts, but the recent case of Stevenson v Rogers gives a wide definition to this requirement. It will encompass activity which is ancillary or loosely related to the business of a company. To use Richards' example, a bank that sells a company car will be acting in the course of a business.
Under section 15, when goods are bought by bulk and the buyer has tested or examined a small number of those goods, the seller is obliged to make sure that every item in the bulk corresponds with the quality of the sample tested or examined.
Fitness Business For Sale Video
Part III, effects of the contract
Sections 16 to 26 concern a contract's effects, and in particular the transfer of property and title. Under section 16, property (ownership) cannot pass unless the goods are ascertained (the actual goods to be sold are identified). Section 18 provides presumptions to determine when property will pass, both for specific goods (ascertained at the time of the contract) and goods unascertained at the time of contracting. These 'rules' can be excluded by contrary implication or express agreement.
Part IV, contract performance
Sections 27 to 39 concern performance of the contract. Under section 29, concerning the place of transfer, where location is not stipulated, the buyer must collect the goods at the sellers' place of business. The seller must be prepared to deliver them to the entrance of his place of business. If the contract was concluded by a means of communication at a distance and the buyer is a consumer, this provision is disapplied and the Consumer Protection (Distance Selling) Regulations 2000 apply instead. However, it is changed today and what applies is The Consumer Contracts (Information, Cancellation and Additional Charges) Regulations 2013.
- J & H Ritchie Ltd v Lloyd Ltd [2007] UKHL 9
Part V, rights of unpaid seller
Within six months, beginning at the time at which the goods were delivered, the buyer can require the seller to repair the goods, reduce the price, or rescind (revesting property and requiring the return of any payment) the contract where the buyer successfully claims that the goods were not in accordance with the contract at the time of delivery. The seller can defeat this claim if (a) "it is established that the goods did so conform" at the time of delivery, or (b) the measure is "incompatible with the nature of the goods or the nature of the lack of conformity.
Part VI, Actions for contract breach
Sections 49 to 54 concern actions for breach of contract.
Part VII, supplementary
Terms from the Sale of Goods Act will not be incorporated into the contract where they have been expressly excluded, or express terms conflict with them. These exclusions may be invalid under common law, the Unfair Contract Terms Act 1977, or in consumer cases the Unfair Terms in Consumer Contracts Regulations 1999. If the term excluding these implied terms is struck out, the implied term will be effective.
Under the Unfair Contract Terms Act 1977, section 12 may never be excluded, and sections 13 to 15 may never be excluded where the buyer is a consumer.
Future prospects
The 1979 Act was preceded by the original Sale of Goods Act 1893, a statute drafted by Sir Mackenzie Chalmers, (who also wrote the Marine Insurance Act 1906). The success of both the 1893 and 1979 statutes was largely down to their conciseness and to Sir Mackenzie's clarity of expression. In the 1990s, a number of short statutes were passed to amend the 1979 Act, and a new updated and consolidated Act is considered to be overdue.
Source of the article : Wikipedia
EmoticonEmoticon