This post covers the short notes to contract of sale of good as well as the end notes to business law embedded from scribd. You can view it from first chapter to the last on the document attached below at last. This is created because of many users request and we analyze that it will be more easier and flexible to have a pdf version.
Contract of sale of goods:
When a seller transfer or agree to transfer his movable goods to buyer then there is the contract of sale of goods taken place on which the ownership of the good is transferred from seller to buyer for a certain price.
NCA 2056 states “where a seller agrees to transfer any good immediately or in future against the price of that goods, there is a contract of sale of goods.
Essential element of contract of sale of good
i) Movable Goods/ property : Goods are fundamental factor of a contract of sale , which means every kind of movable goods or property except an actionable claim and money. The act does not apply to immovable property like building , land etc.
ii) Two parties
iii) Price : Price is the value (measured in terms of money), which is the medium of the exchange of goods. If goods are exchanged with goods not with price then there will be the barter system and there is no any contract of sale of goods.
iv) Transfer of ownership : It is the transfer of legal rights over the good of owner.
v) Terms of contract :Relevant conditions about the price, goods, mode of payment , place , time and mode of performance should be mentioned in a contract of sale of goods.
vi) Essential element of valid contract : All the essential element of valid contract like offer and acceptance , legality of object and consideration , free consent must be fulfilled to be a contract of sale of goods. It may be written or implied.
The condition are the factors or stipulation of the contract of sale, which are essential for the main purpose of the contract of sale. In case of breach of the conditions, the aggrieved party has the right to repudiate(refuse to accept). He/ She can demand the damage for the loss or price of goods on the ground of repudiation the whole contract.
Kinds of Condition
1) Expressed condition: The condition which have been expressly (by using words in written form or oral) agreed upon by the contracting parties are called expressed conditions.
2) Implied condition: The condition that have not been expressly agreed but are implied or acted at the time of making the contract of sale of goods are the implied conditions , which are given below:
i) Conditions as to title: The seller has the right to sell the goods to other and must transfer the pure title. But in case of defective title of the good sold , the buyer has the right to refund the price of those goods. That’s why the seller is impliedly liable to prove the legality of goods to be sold.
ii) 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 must be as per the description in quantity and quality.
iii) Condition as to fitness or quality: Generally, the buyer must be aware of the fitness or quality of the selling goods. However, when the buyer is told by the seller about the fitness and quality of the goods for the particular purpose, there is the implied condition that the good shall be reasonably fit and qualitative for the purpose. Otherwise the seller will be responsible.
iv) Conditions as to merchantability: The general rule is that the seller should have authority to sell the goods and they must be usable too. For example: the sold foods must be hygienic, medicine must not cross the expiry date etc.
v) Condition as to wholesomeness: In case of eatable and provisions, in addition to the implied condition that the good shall be wholesome i.e they must be free from defects and must not be harmful for human health.
vi) Condition as to price : the price of the sold goods also must be reasonable or comparable in price transected in the market currently. Because high price is also one of the essential elements of black marketing.
Warranty is the stipulation which is collateral/auxiliary or relating factor for the main purpose of the contract. But it is not such a vital factor as a condition. In case of breach of warranty, the aggrieved party can only claim damage and cannot be treated as repudiated contract.
Caveat emptor is one of the fundamental principles of the law of sale of goods which means ‘let the buyer beware’. It deals with the matter that a buyer must be aware and caution, whether the goods is fit for his/her purpose or not. It is no part of the seller’s duty to point out the defects of his own goods. It’s always the buyer’s responsibility to see such caution and other things. Therefore, when a person buys some goods, he must examine them thoroughly. If the goods turn out to be defective or do not suit buyer’s purpose, or if buyer’s depends upon his/her own skill or judgement and makes a bad selection, he /she cannot blame anybody. Thus the doctrine is applicable, whenever the buyer voluntarily chooses the goods he want to buy, but it is not applicable when the seller undertakes or the buyer has left the responsibility on the seller.
Exception of doctrine of caveat emptor]
The doctrine of caveat emptor has certain exceptions, these are follows:
i) Mispresentation by the seller: When the seller makes any misrepresentation and the buyer realize on it at the time of contract of sale, that the contract is voidable and the buyer can rescind the contract. The doctrine of caveat emptor does not apply in such cases.
ii) Fraud by the seller: Where the seller, makes a misrepresentation with the intention to deceive the buyer amount to a fraud. If the sale is made on such types of fraud, this is voidable.
iii) Fitness for buyer’s purpose : Where the buyer’s expressly or by implication , makes known to the seller the particular purpose for which he requires the goods and relies on the seller’s skill or judgement and the goods are as of description, the seller must supply the goods which shall be fit for the buyer’s purpose.
iv) Sale by description: Where the selling and buying act is performed on the basis of a description of the goods sold and they do not correspond with the description, such a contract is also voidable.
v) Sale by the sample: When goods are sold by sample, the doctrine of caveat emptor does not apply if the goods supplied does not match with sample, the buyer is not given a chance to compare, there is any hidden defect in the goods.
vi) Sale by trade uses: Where a trade usage is attached with an implied condition or a warranty as to the quality and fitness and the seller benefits from it, the doctrine is not applied. The seller is liable.
The full notes to business law can be viewed in reading format presented below. Keep in mind that this work is copyrighted. Nobody can republish it. This is only for educational purpose.
Business law , the subject notes for management student by www.howtoearth.com by abbohorance_yuckky77