Conditions and Warranties
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Conditions and Warranties Condition A condition is a fundamental term of the contract which goes to the very root of the contract. A failure to perform a condition will render the contract significantly different from that contracted for. Breach of a condition entitles the innocent party to treat the contract as repudiated and itself as discharged from performance of all outstanding obligations under the contract. [1 ] Poussard v Spiers and Pond [1876] 1 QBD 410 is an example of a case were a breach of a condition took place. In this case an actress was hired to sing in the opera, but she got ill and could not perform until a couple of weeks after the premiere. It was held at the court that this breach went to the root of the contract, and therefore the opera could repudiate the contract and hire a new actress. Warranty An assurance, promise, or guaranty by one party that a particular statement of fact is true and may be relied upon by the other party. A warranty is considered as ancillary to the main terms of a contract. A breach of a warranty would only amount to damages, and the innocent party does not have the right to repudiate the contract. [3 ] In the case of Wills v Amber [1954] 1 Lloyd's Rep 253, a four-berth motor boat had been sold. An innocent statement by the seller that the hull was sound was held to be a warranty, which the buyer had entered into the contract in reliance upon it, when in fact the hull was rotten. But the contract was not substantially different to that which the parties originally intended. He was awarded damages. When condition to be treated as warranty? 1. Voluntary waiver of a condition: The buyer may elect to treat a breach of condition as a breach of warranty, i.e., instead of repudiating the contract he may accept performance and sue for damages, if he has suffered any.—Sec. 13(1). Where a contract of sale is subject to a condition to be fulfilled by the seller, the buyer may waive the condition. 2. Compulsory waiver of a condition: Where a contract of sale is not severable and the buyer has accepted the goods or a part thereof, he cannot repudiate the contract but can only sue for damages. In such a case, the breach of condition can only be treated as a breach of warranty, unless there is a contract to the contrary.—Sec. 13(2).
Transcript of Conditions and Warranties
Conditions and WarrantiesConditionA condition is a fundamental term of the contract which goes to the very root of the contract. A failure to perform a condition will render the contract significantly different from that contracted for. Breach of a condition entitles the innocent party to treat the contract as repudiated and itself as discharged from performance of all outstanding obligations under the contract.[1]Poussard v Spiers and Pond [1876] 1 QBD 410 is an example of a case were a breach of a condition took place. In this case an actress was hired to sing in the opera, but she got ill and could not perform until a couple of weeks after the premiere. It was held at the court that this breach went to the root of the contract, and therefore the opera could repudiate the contract and hire a new actress.Warranty An assurance, promise, or guaranty by one party that a particular statement of fact is true and may be relied upon by the other party.A warranty is considered as ancillary to the main terms of a contract. A breach of a warranty would only amount to damages, and the innocent party does not have the right to repudiate the contract.[3]In the case of Wills v Amber [1954] 1 Lloyd's Rep 253, a four-berth motor boat had been sold. An innocent statement by the seller that the hull was sound was held to be a warranty, which the buyer had entered into the contract in reliance upon it, when in fact the hull was rotten. But the contract was not substantially different to that which the parties originally intended. He was awarded damages.When condition to be treated as warranty?1. Voluntary waiver of a condition: The buyer may elect to treat a breach of condition as a breach of warranty, i.e., instead of repudiating the contract he may accept performance and sue for damages, if he has suffered any.Sec. 13(1). Where a contract of sale is subject to a condition to be fulfilled by the seller, the buyer may waive the condition.2. Compulsory waiver of a condition: Where a contract of sale is not severable and the buyer has accepted the goods or a part thereof, he cannot repudiate the contract but can only sue for damages. In such a case, the breach of condition can only be treated as a breach of warranty, unless there is a contract to the contrary.Sec. 13(2). If a buyer prevents the fulfilment of a condition contained in the contract, the condition becomes invalid. Example: Certain goods were promised to be delivered on 1st June, time being made the essence of the contract. The goods were delivered on the 2nd June. The buyer may accept the goods.Express Conditions & Warranties :-Conditions and warranties are those which are included in clear words and all parties are agree at the time of contract.
IMPLIED CONDITIONS :-Those conditions are not included in the contract but the law presumes their existence in the contract are called implied conditions.Following conditions are included by law in to a contract of sale of goods.
1. Right To Sell :-This right is considered as an implied conditions in every sale contract. It is presumed that he can sell the goods and he can enter in sale agreement.
2. Sale By Description :-In this case implied condition is that goods shall the correspond with the description. A buyer can reject if the goods if these are not according the description.
3. Sale By Sample :-In this case goods must be supplied according the sample agreed upon condition.
i. The buyer may be able to compare the sample with the bulk.ii. The goods should be free from any defect.iii. The bulk should match with the quality of the sample.4. Sale By Sample & Description :-In this case goods supplied must correspond with sample and description both. So there is implied condition in it that if bulk does not match with one even then buyer may reject the goods.
5. Condition of Merchantable Quality :-Merchantable quality means that the goods must be sale able in the market as goods of that description are sold. In case of any defect a seller must inform the buyer. It is implied condition.
6. Conditions As Quality To Fitness :-Sometimes buyer informs the seller that he wants to purchase the goods for particular purpose. It is implied condition that goods shall serve the purpose of buyer. As the buyer relays on the sellers skill then seller should provide the goods according the description.
7. Wholesomeness Condition :-It means conductive to health. When someone makes a sale of contract about the eatable goods this condition is applied. If some one supply the goods and it damages to health then supplier will be liable for damages.Example :- Sams Food Company supplied food on the marriage party of Mr. Vicky. After eating the food people were infected and died. The company was held liable in damages.
IMPLIED WARRANTIES
1. Possession Of Goods :-It is an implied warranty on the part of the seller that buyer shall enjoy the quiet possession of goods sold to him without any disturbance. In case of any disturbance a buyer can claim the damages from the seller.
2. Dangerous Nature Must Be Disclosed :-It is necessary that seller should disclose the dangerous nature of the good sold to the buyer. If he does not disclose then any type of loss suffered by the buyer will be compensated by the seller.Example :- Mr. Noor sold the camel to Mr. naveed which is very dangerous. But he did not told about the nature of the camel. The camel killed to Mr. Baqir son of Mr. Naveed due to the ignorance of the nature of camel Mr. Noor will be liable to compensate Mr. Naveed.
3. Burden on Property :-Before selling the goods, it is necessary that these should be free from any charge or encumbrance from any third party. If a sellers does not tell about such burden on the goods to the buyer and later on the buyer suffers a loss. The buyer can claim such damages from seller.Example :- Mr. Khaliq the owner of a horse, pledges it with Mr. Karim. After a month, Mr. Khaliq obtains possession of the horse from Mr. Karim for some purpose and sells it to the Mr. Jawad. Mr. Karim goes to Jwad and tells him the pledge story. Mr. Jawad has to make the payment of pledged amount to Mr. Karim. In this case of breach of warranty and Mr. Jawad is entitled to claim compensation from Mr. Khaliq.
