Classification of Terms

 Conditions: a stipulation going to the root of the contract;

breach: right to treat the contract as repudiated. (May be express or
implied.)

 Warranties: part of the agreement, but collateral to its main

purpose; breach gives rise to a claim for damages but not a right to
reject the goods and treat the contract as repudiated.

 Innominate Terms: either a condition or a warranty; breach –

the remedy can only be determined afterwards; serious
consequences = as condition; less serious = as warranty.

The Statutory Implied Terms

Introduction
SoGA 1962, ss. 9-14 prescribe a set of 9 implied terms in favour of
the Buyer:
1. Existence of specific goods s.9
2. Title s. 10(1)
3. Freedom from charges and encumbrances s. 10(2)
4. Quiet possession s. 10(2)
5. Correspondence with description s.11
6. Correspondence with sample s.12
7. Quality of Goods s. 13(1) (a)
8. Fitness for purpose s. 13(1) (b)
9. Quantity of goods s.14

Numbers 2, 3 and 4 are warranties, the rest are conditions: ss. 11,
12, 13 and 14– but see below for exceptions.

Buyer’s Rights on Breach of Implied Terms

Normally, the Buyer can insist on perfect tender, and can reject for
any non-conformity (unless microscopic, see Goode p 317).

The duty on the Seller is strict: exercising reasonable care is not a

defence to goods, which do not conform (Goode p 308).

Where the implied term is a condition, on breach the buyer may

either:

 Treat the contract as repudiated: The Buyer has to decide

whether to accept the breach, which generally requires a
positive act. Mere silence or inactivity is not enough: State
Trading Corp of India v M Golodetz Ltd [1989] 2 Lloyd’s Rep
277, 286; or
  Reject the goods tendered, in which case the situation
becomes one of non-delivery, giving the Seller a chance (if
unascertained goods) to retender, although there may be a
liability in damages. However, the Seller can only retender if:
There is still time within the contract terms to do so;
and
The contract was not for specific goods, or
Waive the condition, and treat the breach as a breach
of warranty, i.e. sue for damages.

Correspondence with Description (s 11)

Section 11: Where there is a contract for the sale of goods by

description, there is an implied term that the goods will correspond
with the description.

What Is a Sale by Description?

There is a contract for the sale of goods by description where:
Descriptive words are used for the purpose of describing and
identifying the goods;

Those words form a term of the contract, not merely a

representation inducing the contract.

Meaning of ‘sale by description’

Varley v Whipp (1900) 1 QB 513
per Lord Channel J
This phrase ‘must apply to all cases where the purchaser has not
seen the goods but is relying on the description alone’
 A sale must be by description is it is of future or unascertained
goods
 The term applies in many cases even where the buyer has
seen the goods

DOUBTS AS TO WHETHER AN ORDINARY SALE IN A SHOP

COULD BE A SALE BY DESCRIPTION WERE SET TO REST BY
LORD WRIGHT IN GRANT V AUSTRALIAN KNITTING MILLS LTD
(1993) 50 CLR 387
‘It may also be pointed out that there is a sale by description even
though the buyer is buying something displayed before him on the
counter: a thing is sold by description, though it is specific, so long
as it is sold not merely as the specific thing but as a thing
corresponding to a description, e.g., woolen under-garments, a hot-
 water bottle, a second-hand reaping machine, to select a few
obvious illustrations’
Application of s 11
Section 11 applies even though the goods are not sold by a person
who sells ‘in the course of a business’
In Varley v Whipp
 D agreed to buy from the plaintiff a second hand reaping
machine, which was stated to have been new the previous
year and hardly used at all. This was a gross mis-description
and the defendant declined to accept or pay for it. The D
could not rely on s 14 (which imposes requirements as to
quality and fitness for purpose) because the plaintiff was not a
dealer in agricultural machinery but as the goods did not
correspond with the description it was held there was a
breach of s 11.

Description and Total Non-performance

Although s. 11 appears to be a term implied by law, it is also a
factual and express undertaking where the breach is not merely
a breach of part of the contract but a total non-performance of it.
(Goode p 308 & 317).

Description and Unascertained and Specific Goods

i. Unascertained Goods
Sales of unascertained goods are always sales by description:
Wallis, Son and Wells v Pratt and Haynes [1911] AC 394

ii. Specific Goods

There may be a sale by description of specific goods provided the
item is not sold merely as a specific thing, but also as a thing
corresponding to a description, in See Grant v Australian Knitting
Mills.

Breach of the Implied Term as to Description

The Seller must deliver goods of the same “kind” as those set out in
the contractual description. Each case turns on its facts, e.g. the
exact contract description, commercial setting and what traders in
that line of business will tolerate.

SOME IMPORTANT CASES ON THE SALE OF GOODS BY

DESCRIPTION
In Oscar Chess v Williams [1956] EWCA Civ 5
Facts: Mrs Williams purchased a second hand Morris car on the
basis that it was a 1948 model. The registration document stated it
was first registered in 1948. The following year her son used the car
as a trade in for a brand new Hillman Minx, which he was purchasing
from Oscar Chess. The son stated the car was a 1948 model and on
that basis the Oscar Chess offered £290 off the purchase price of
the Hillman. Without this discount Williams would not have been
able to go through with the purchase. 8 months later Oscar Chess
ltd found out that the car was in fact a 1939 model and worth much
less than thought. They brought an action for breach of contract
arguing that the date of the vehicle was a fundamental term of the
contract thus giving grounds to repudiate the contract and claim
damages.

‘One final word… [the motor dealers only checked the log book]
eight months later. They are experts, and, not having made that
check at the time, I do not think they should now be allowed to
recover against the innocent seller who produced to them all the
evidence he had, namely, the registration book... If the rogue can be
traced, he can be sued by whomsoever has suffered the loss: but if
he cannot be traced, the loss must lie where it falls. It should not be
inflicted on innocent sellers, who sold the car many months,
perhaps many years before…’Per Denning LJ.
One of the judges dissented on grounds that the year in the logbook
was meant to be relied on by the parties as a warranty.

Ratio: The statement relating to the age of the car was not a term
but a representation. The representee, Oscar Chess ltd as a car
dealer, had the greater knowledge and would be in a better position
to know the age of the manufacture than the defendant.
For the sale to be by description, the description had to be
influential in the sale so as to become an essential term or condition
of the contract and had to be relied on by the buyer as the common
intention of the parties.

Harlingdon & Leinster Ltd v. Christopher Hull Fine Art Ltd

[1991] 1 QB 564:
Facts: The claimant purchased a painting from the defendant for
£6,000. The painting was described in an auction catalogue as being
by German impressionist artist Gabrielle Munter. Both the buyers
(claimants) and the sellers (Defendants) were London art dealers.
The sellers were not experts on German paintings whilst the buyers
specialised in German paintings. The purchasers sent their experts
to inspect the painting before agreeing to purchase. After the sale
the buyers discovered that the painting was a fake and worth less
than £100. They brought an action based on s.13 English Sale of
Goods Act in that the painting was not as described.

Ratio: By sending their experts to inspect the painting this meant

the sale was no longer by description. S.13 only applies to goods
sold by description and therefore the buyers had no protection.

From the ration in the preceding case, and for practical purposes,
that there cannot be a contract for the sale of goods by description
where it is not within the reasonable contemplation of the parties
that the buyer is relying on the description.

Beale v Taylor [1967] 3 All ER 253

Taylor published an advertisement to sell a car describing it as
“white, 1961, herald convertible….” Relying on that description
Beale came to see the car. Since he did not have a licence, he did
not actually take a test drive, but just sat on the passenger side.
After the test run he also saw a metallic disc on the rear of the car
with the figure 1200 on it. He bought the car believing it to be the
1961 model. When he got the license he found the car
unsatisfactory. On examination, the mechanic told him that the car
was made up of two cars welded together, the front portion was one
948 model while the rear portion was the 1200 model. Further the
car was found to be in unroadworthy and unsafe. Beale filed a suit
claiming damages.

The issue before the court was whether the transaction was sale by
description? Plaintiff contended that it was entitled to damages (1)
for breach of the condition as implied by sec. 13[1](Car should
correspond with its description) (2) as money was paid on a
consideration which had wholly failed (3) for breach of an implied
condition of roadworthiness.

Defendant on the other hand defended the claim that the

transaction was not a sale by description but sale of a particular car
as seen, tried and approved, which the buyer had ample opportunity
to inspect and test the car.

The Trial Court held that the sale was not a sale by description as
B had seen, tried and approved the said car. However, this was over
turned by the Court of Appeal and held the following:

1. Both the parties are innocent because no one could see from
an ordinary examination that it was made of two cars welded
together;
2. There is a sale by description even though the buyer saw the
car before purchasing it. A thing is sold by description as long
as it is not sold merely as a specific thing but as something
corresponding to a particular description. The buyer relied in
part on that particular description in buying the car.
 3. Ideally the buyer should have returned the car to the seller,
but since this is not the case, B is only entitled to the price
difference (actual price-scrap value).

Beale v Taylor is the test for description when the buyer sees and
examines the goods): There is a sale by description even though
the buyer sees the car before purchasing it. A thing is sold by
description as long as it is not sold merely as a specific thing but as
something corresponding to a particular description. The buyer
relied in part on that particular description in buying the goods.

Commodities and Descriptions

Ashington Piggeries Ltd v Christopher Hill Ltd [1972] AC 441,
per Lord Wilberforce at 489:

The test of description, at least where commodities are concerned,

is intended to be a broader, more commonsense, test of mercantile
character. The question whether [the goods supplied are] what the
buyer bargained for has to be answered according to such tests as
men in the market would apply, leaving delicate questions of
condition, or quality, to be determined under other clauses of the
contract or sections of the Act. In this case, herring-meal was
contaminated with an ingredient rendering it toxic was still herring-
meal, so not a breach of this implied term.

The Supreme Court in Andreas Bschor Gmbh & Co. Kg v Birim

Wood Complex Ltd & Birim Timbers Ltd (2016) unreported by
Pwamang JSC referred to Lord Wilberforce statement in Ashington
Piggeries to explain section 11 Act 137 and the issue of course of
business. At page 494 of the report, the following statements were
made:
‘I would hold that (as to subsection (1)) it is in the
course of the seller’s business to supply goods if he
agrees, either generally or in a particular case, to
supply the goods when ordered…… But, moreover,
consideration with the preceding common law shows
that what the Act had in mind was something quite
simple and rational: to limit the implied conditions of
fitness or quality to persons in the way of business, as
distinct from private persons……I would have no
difficulty in holding that a seller deals in goods ‘of that
description’ if he accepts orders to supply them in the
way of business and this whether or not he has
previously accepted orders for goods of that
description.’

It is instructive to note that Ashington Piggeries followed by Andreas

Bschor, in Ghana moved away from the non-application of sale of
goods by description by a seller either a one off seller or one who
did not sell in the course of his ordinary business and for that matter
could be concluded that Varley v Whipp is no longer good law.

The following have been held to breach the implied term:

Azemar v Casella (1867) 13 CBNS 447

Contract specified Long Staple Salem cotton, seller tendered
Western Madras cotton.

Robert A. Munro & Co Ltd v Meyer [1930] 2 KB 312

Contract specified meat and bone meal, seller tendered meat and
bone meal with 5% cocoa husks.

Goode points out at p 324 that the fundamental nature of the

contract description of the goods sold means that, other than in
extreme circumstances, exclusion of s.11 will also negate the whole
contract.

Quality and Fitness for Purpose (s.13)

Section 13 (1): Subject to the provisions of this Act and subject to

any other enactment, there is no implied warranty or condition
about the quality or fitness for any particular purpose of goods
supplied under a contract of sale except…where defects which
are not declared or known to the buyer before or at the time
when the contract is made.

According to Continental Plastics Engineering v IMC Industries

Technik [2009] SCGLR 298, section 13 (1) of the Sales of Goods Act
can only avail a buyer who has succeeded in establishing the
existence of defects in goods bought at the time the contract was
concluded.

Quality of goods

Section 13(1) (a) Where the seller sells goods in the course of a
business, there is an implied term that the goods supplied are free
from defects which are not declared or known to the buyer before or
at the time when the contract is made:

The term implied by subsection 13(1) above does not extend to any
matter making the quality of goods defective:
(a) which is specifically drawn to the buyer’s attention before the
contract is made,
(b) where the buyer examines the goods before the contract is made,
which that examination ought to reveal, or
(c) in the case of a contract for sale by sample, which would have been
apparent on a reasonable examination of the sample;
(d) Where the goods are not sold by the seller in the ordinary course
of his business, in respect of defects of which the seller was not, and
could not reasonably have been aware.

Elements of s. 13(1)
 Seller must sell in the course of a business
 Applies also if a business seller operates through an agent
 The goods must be of satisfactory quality
o Applies to the goods sold
o And also to any goods with which they are supplied, i.e., includes
containers and articles mixed with the goods sold; even by accident:
e.g.

Does not extend to disclosed defects, or to defects, which the buyer

ought to have discovered See Goode pp 302-304.

In Wren v Holt [1903] 1 KB 610 the court laid down the principle
that goods must be of merchantable quality and that goods which
are not of such quality if in the state they were sold have defects
which makes them unfit for the ordinary use or their condition such
that no one with knowledge of their true condition would have
accepted them.

Bramhill v Edwards [2004] 2 Lloyd’s Rep 653

Buyer bought a mobile home from the Seller, which was 102 inches
wide, whereas the maximum legal width in England was 100 inches.
Seller told Buyer it had an internal width of 100 inches.

Held: Buyer should have been alerted to the fact it exceeded the
legal maximum width and for that matter seller had breached the
implied term under section 13 SGA 1979.

Meaning of Defects

If a buyer inspects goods and becomes aware of the defects in the

goods then that buyer may reject the goods, but if that buyer
(knowing of the defect or ought to have known of the defect),
proceeds to buy the goods nonetheless then that buyer can not
later say goods are not of satisfactory quality due to the defective
character of the goods.

There is no implied condition under section 13 as regards defects,

which are visible. If you see a defect and still purchase the goods,
then you cannot complain about it.

Latent and/or hidden defects are an exception to this rule.

The protection of the buyer from the defects that are not known at
the time of the sale does not apply under the following
circumstances:

Where the buyer examines goods that he/she is buying, the implied
conditions and warranties of quality and fitness do not apply in
respect of defects, which could have been seen from reasonable
examination. Thus, a buyer must always beware of the inspection
conducted on the goods in any contract of sale transaction
(CAVEAT EMPTOR).

It must be pointed out that caveat emptor rule applied in

England and Wales is totally different from the Ghanaian
position. In England, it is a buyer’s duty to inspect and
examine the goods regardless of whether defects are
declared or made known to that buyer whereas in Ghana the
true and proper meaning of caveat emptor with regard to
the Sale of Goods Act, 1962 is to the effect that when a
buyer examines goods and fails to detect defects which
were obvious from a reasonable examination thereof then a
seller of goods shall not be liable under section 13(1)(a) SGA
1962.

However, it is a seller’s duty to ensure that the goods sold

are not defective and that seller must either make it known
to the buyer by declaring same at the time the contract is
made. In other words, in Ghana, the rule is caveat venditor,
which means seller must beware of the goods he sells either
to be consumed or to be sold in a string sale.

Thornett v Beers, [1919] 1 KB 486

Facts:
P sued D for the balance of veg glue that was sold to D. D said it
was sale by sample and that the glue was not equal to the sample.
In alternative D claims they were not merchantable. Determined not
sale by sample. D had a chance to see the goods, but only looked at
the outside container not the inside of the containers to look at the
glue.
The issue was whether the glue of merchantable quality? What is
meant by inspection?

Ratio: If you have plenty of time to inspect and you don’t, you will
be held to have done a reasonable inspection and to have
discovered the defects that would have been discovered of a
reasonable inspection.
If the buyer has examined the goods, there is no implied condition
as regards to defects. The buyer who conducts only a cursory
inspection does so at his own risk.

The principle in section 13 applies when a seller sells in the ordinary

course of business. The principle was first applied in mercantile
transactions. Sec 13 (a) (3) states that the principle applies to
ordinary sale of goods; i.e. sale by merchants.

In Burnby v Bollet [1847] 11 JP 790, a farmer went to an open

market to sell his product. While looking for a store, he passed by a
butcher who had hanged a pig for sale. He bought the pig and left it
in the care of the butcher to pick it later. A second farmer saw the
pig and expressed the interest to buy it to the butcher, who
subsequently directed him to the first farmer. The second farmer
bought it from the first farmer and when he took it home, he
detected that the pig was rotten. He sued and claimed that:

“The Defendant publicly offered for the sale the carcass of a

pig for the food of man and thereby he falsely and
fraudulently undertook and warranted that the said carcass
was in a sound and wholesome condition and fit for human
consumption whereby the plaintiff was induced to buy the
said carcass at the sum of £6.86 whereas in truth and in fact
the said carcass was not fit for human consumption but on
the contrary thereof was unsound, unwholesome and unfit
for human consumption”.

The court held that the seller was a farmer but not a butcher and
therefore the sale was not in the ordinary sense of business. The
law on quality and fitness cannot be applied under the
circumstances. The law under the principle applies to a sale under
ordinary course of business.

Section 13 (2) protects buyers from exclusion clauses. It states that,

exclusion clauses are only effective if they were brought to the
attention of the buyer at the time of the sale. If the buyer agrees
when it is brought to his attention, then it is binding on him. If that
is not done, the buyer will not be bound by such clause. In other
words, section 13 (2) frowns on any provision, which seeks to
negate the conditions thereof under section 13 (1) (a) & (b) unless
the buyer is made aware of such a provision(s).

Section 13 (3) says an implied warranty or condition on quality or

fitness may be a further addition to the contract by usage of the
trade (custom of parties).

Section 13 (4) states that, an express warranty does not negate any
of the warranties under the act. Thus, if there is an express
warranty for a sale transaction and there is an inconsistency
between the implied and the express warranty, the implied
warranty/condition imposed by statute prevails over the express
warranty.

Sec 13 (5) states that, implied condition of quality and fitness

applies not only to the goods themselves but also to the packaging
and the materials, which come with the goods.
If buyer inspects goods and becomes aware of defect in the goods
then they may reject the goods, but if buyer (knowing of defect or
ought to have known of defect), proceeds to buy the goods
nonetheless then they can’t later say goods are unmerchantable
due to the defect.

Gredding v Marsh [1920] 1 KB 668

In this case, it was held that packaging, which was in this case
bottling, was part of the product (water), which exploded and
injured the buyer when the buyer opened the bottle containing the
water.

'In this action the plaintiff claimed damages for injuries caused to
her by the bursting of a bottle in which mineral water was supplied
to her by the defendant. Her case is based upon a breach of the
condition dealt with by s. 14 of the Sale of Goods Act, 1893. The
plaintiff kept a small shop in which she sold, among other articles,
mineral waters. The defendant supplied her with the mineral water
in the usual way - namely, in bottles. The bottles were delivered in
cases and the course of business was that she was charged three
pence for the mineral water in each bottle and one penny in
respect of the bottle itself. If the plaintiff returned the bottle she
got the penny back; if she did not return it owing to its being lost or
broken she did not receive back the penny; and on the county
court judge's findings we must take it that there was no sale of the
bottles to the plaintiff.

The judge found that the accident may have arisen from one or
more of a number of causes, one of these being either the
improper manufacture of the bottle or some flaw in it. I think we
must take it - and it is consistent with the judge's findings - that the
accident arose not from any defect in the liquid contained in the
particular bottle but from some defect in the bottle itself. As I have
said the judge found that there was no sale of the bottle to the
plaintiff, but he considered that to be immaterial for this purpose,
and the question is, was he right in taking that view?

For the plaintiff it is said that it is immaterial whether in fact the

property in the bottle passed to the plaintiff or not, because,
whether there was a sale or merely a bailment of the bottle, the
case falls within s. 14 of the Sale of Goods Act, 1893. [His Lordship
read the section and continued:] In this case there was only one
contract - namely, a contract between the plaintiff and the
defendant that the plaintiff should be supplied with mineral waters.
Mineral waters could not be supplied except in bottles, and
therefore the plaintiff was asking to be supplied with mineral
waters in bottles.

That undoubtedly is a contract of sale, and I will assume that in

that contract there might be a condition that the bottles should not
be bought by the plaintiff but should be hired; but the question the
county court judge had to consider was whether the bottles were
not "supplied under a contract of sale." This was a contract of sale
none the less because there was a special provision with regard to
the bottles. The section, in my opinion, extends not only to the
goods actually bought under the contract but to goods "supplied
under the contract of sale." This particular bottle was thus
"supplied under a contract of sale," and it follows that it should be
reasonably fit for the purpose for which it was supplied. In fact it
was not reasonably fit and in consequence of that unfitness the
plaintiff was injured.'
What is a latent manufacturer’s defect? (Georgia Hotel v
Silver Star Auto, J4/34/2012), unreported, 4 th December,
2012 and Grant v Australian Knitting Mills (see above)

According to Black’s Law Dictionary 8 th Edition relied on by the trial

judge, a hidden or latent or inherent defect is defined as ‘a product
imperfection that is not discoverable by reasonable inspection” A
manufacturing defect is defined as an “imperfection in a product
that departs from its intended design.” According to the High Court
judgment, the imperfection must thus exist at the delivery of the
product. The Court took into account the implied fitness for which
the vehicle was intended as well. Thus, a new vehicle should be
free from defects at the time it is delivered from seller to buyer.

In order words, it means a defect is a manufacturing defect, which

must exist at the time of production and delivery of the product.
Reasonable inspection of goods and the acceptable time
period for claiming that a latent defect exists are also
factors to be weighed in determining the outcome of a case.

In the case of Continental Plastics Engineering Co Ltd v IMC

Industries-Technik GMBH [2009] SCGLR 298 supra, Georgina
Wood, CJ, said:

The legal position can therefore be summed up as follows: a seller

of either first or second hand goods is by an implied condition, liable
for all defects in them. Based on what we believe is pure common
sense the seller is however not liable for defects which he fully
discloses or declares to the buyer at the time of the contract of sale.
When the buyer has examined the goods the seller cannot be held
liable for defects, which ought to have been discovered on
examination, as for example, patent defects. It does follow that if
there were defects particularly latent defects which are not
discoverable on examination, and which are not disclosed to
the buyer before the conclusion of the contract, the seller
cannot escape liability for the breach of an essential
condition of the contract”

Under the English legal system it was held that if goods are of
unsatisfactory quality, the consumer is entitled, within a reasonable
time, to a repair or replacement (s 11M, SGSA 1982), unless this
would be disproportionate. This right stems from the 1999
Consumer Sales Directive (1999/44/EC) and the choice is the
consumer's.
However, the position in Ghana requires that an affected party be
required to make the defects known to the defaulting party within a
reasonable time to have the defects repaired and/or maintained.
However, failure to inform the latter, may lead to a loss of right to
 reject the goods by unreasonable delay. Reasonable time is a
question of fact and might vary with the circumstances of a case
(Rockson v Armah [1975] 2 GLR 116

This court held in Social Security Bank Ltd v. CBAM Services

Inc. [2007 -2008] 2 SCGLR 894 that a breach of a fundamental or
essential term is one of the grounds upon which a contract may be
terminated. Where an allegation that a term is essential or
fundamental is disputed, a court is bound to determine the issue as
a primary fact. A breach of an obligation that would of necessity call
for an election on the part of an innocent party to exercise his right
of determination in the contract must fit into one of the following: (i)
that which goes to the whole root of the contract and not merely
part of it; or (ii) that which makes further performance impossible;
or (iii) that which affects the very substance of the contract.

Under Ghana law, as opposed to the English law under the Sale of
Goods Act1979, the issue for consideration is whether the
appellant could repudiate the contract on the ground of
latent defects. The relevant portion of section 13 of the Sale of
Goods Act 1962 is the entire section 13.

What Is Meant by Satisfactory Quality? (Section 13 SGA 1979

and not in Act 137 but inferences can be drawn from same
to fill in the gaps of Act 137)

For the purposes of this Act, goods are of free from defects
(satisfactory quality) if they meet the standard that a reasonable
person would regard as satisfactory, taking account of any
description of the goods, the price (if relevant) and all the other
relevant circumstances.

For the purposes of this Act, the quality of goods includes their state
and condition and the following (among others) are in appropriate
cases aspects of the quality of goods—
(a) fitness for all the purposes for which goods of the kind in question
are commonly supplied,
(b) appearance and finish,
(c) freedom from minor defects,
(d) safety, and
(e) durability.

When the Terms of Quality and Fitness Must Be Satisfied

At the time of delivery (also applies to section 13(1)(a)&(b). See
Goode pp 339-340.

Standard a Reasonable Person Would Regard As Satisfactory

 The test to be applied under the Act is partly objective and partly
subjective in that the reasonable person must be attributed with
knowledge of all of the background facts. So the test is really
whether a reasonable person with the knowledge of the
Buyer “would” regard the goods as being of unsatisfactory
quality.

E.g. Bramhill v Edwards, above: on the facts this was evenly

balanced, so the Buyer lost.

Egan v Motor Services (Bath) Ltd [2008] 1 WLR 1589: Buyer bought
a new Audi TT 3.2 litre V6 car for £32,300.

The buyer rejected the car because he said it veered to the left. The
expert evidence was that it did have a tendency to veer to the left,
but its handling was normal for this type of car. While the car was
sensitive to the camber of the road, it was not defective. The car
was accordingly of satisfactory quality, and the buyer had not been
entitled to reject it.

Description and Price

In deciding whether goods are of quality, the court must consider all
relevant circumstances. However, the two key factors are:

1. Contract Description: e.g.

 “Premium Quality Raw Cotton Fibre”; or
 “Industrial cotton”

2. Price: e.g.
 car sold for £25,000, or
 an older example of the same type sold for £4,000

The test requires an objective comparison of the state of the goods

with the standard, which a reasonable person would find acceptable.
 For a high-priced article, the buyer may be entitled to expect it to be
free from even minor defects (i.e. perfect, or nearly so). Clegg v Olle
Andersson [2003] 1 All ER (Comm) 721

Condition of the Goods: Robust Enough for Sea Transit

Mash & Murrell Ltd v Joseph I Emmanuel Ltd [1962] 1 WLR 16
Where goods (here potatoes) are sent to the buyer by sea, they
must be in such condition when they leave that they are likely to
arrive in a sound condition.

KG Bominflot Bunkergesellschaft fur Mineralole mbh & Co KG v

Petroplus Marketing AG [2009] 2 Lloyd’s Rep 679

 The implied term extends to being of satisfactory quality for a

reasonable time after delivery. Whether this period covers the whole
of any sea voyage depends on the circumstances of the contract,
including whether the seller knew the goods were to be transported
by sea, and what the seller knew about what the buyer intended to
do with the goods.

 There is a related common law implied term that the goods will
remain in accordance with the contractual description for a
reasonable time after delivery. This is also a condition.

Packing for Goods to Be Carried (See Gredding v Marsh

above)
It must be suitable for the contemplated carriage. This in part
depends on the nature of the goods.

Non-application of s. 13(1) (a) Factors

The particular features apply only “in appropriate cases”. The terms
of the contract may make this clear, one way or the other.

Balmoral Group Ltd v Borealis (UK) Ltd [2006] 2 Lloyd’s Rep

629

B bought borecene (a type of plastic) from S for use by B in

manufacturing oil tanks. The tanks suffered a high failure rate. B
claimed £50m claiming the borecene was not satisfactory (and not
fit for purpose, see below).

Held: The goods were of satisfactory quality. Function of s 13(1)

(a) was to establish a general standard, which the goods in
question are required to reach, not to ensure they obtained
some higher standard of fitness for a particular purpose
made known to S. For a commodity with a wide range of uses,
and which was used by a manufacturer for its particular purposes, it
was not “appropriate” to ask whether the goods were fit for all the
 purposes for which goods of the kind were commonly
supplied. Borecene comes in different grades. The actual
borecene supplied was not defective or incorrectly manufactured,
and was suitable for moulding purposes generally. So no breach of
s.13 (1) (a)

REASONABLY FIT FOR THEIR PURPOSE, SOGA 1962, S. 13(1)

(B)
Where the seller sells goods in the course of a business and the
buyer, expressly or by implication, makes known to the seller...any
particular purpose for which the goods are being bought, there is an
implied term that the goods supplied under the contract are
reasonably fit for that purpose, whether or not that is a purpose for
which such goods are commonly supplied, except where the
circumstances show that the buyer does not rely, or that it is
unreasonable for him to rely, on the skill or judgment of the seller....

Requirements
 Seller acting in the course of a business
 Buyer must make known the particular purpose
 Goods must be “reasonably fit” for that purpose
 Buyer relied on seller’s skill and judgment

See the Ghanaian cases of Bartholomew v Adu Gyamfi [1962] 2

GLR 62 and Andreas Bschor.

Henry Kendall & Sons v William Lillico & Sons Ltd [1969] 2
AC 31
The required purpose must be expressed with sufficient particularity
to show that the buyer reasonably relied on the seller’s skill and
judgment, per Lord Reid.

Where seller is a manufacturer, it may be nigh on impossible to

rebut reliance on the seller’s skill and judgment

Grant v Australian Knitting Mills above holds the view that

some goods may have only one purpose and that a buyer
might not require making known its particular purpose to a
seller.

Ashington Piggeries Ltd v Christopher Hill Ltd [1972] AC 441

Herring-meal was bought and made up into a compound for feeding

to mink. Sellers knew the herring-meal was required for animal
food, but not that it was to be fed to mink. Herring-meal was
commonly fed to mink. Unfortunately, this particular compounding
resulted in food, which was toxic to mink.
Held: the Section was engaged by stating the herring-meal was to
be used as animal food. There was no need to go further and state
it was to be used as mink food. See Goode pp 346-347.

Hazlewood Grocery Ltd v Lion Foods Ltd [2007] EWHC 1887

(QB)
The sale of chilli powder contaminated with dye.

Held: Seller was also in breach of both s. 13(1)(a) and s.13 (1)(b)

Balmoral Group Ltd v Borealis (UK) Ltd [2006] 2 Lloyd’s Rep

629
See above.

The borecene was also fit for its purpose under s. 13(1)(b). Expert
evidence showed the tanks failed because of a design failure. A
competent manufacturer (here B) could have used the borecene to
make tanks if the right thickness has been used to avoid splitting
(as B’s competitors had managed to do).

Exclusion of Quality or Fitness for Purpose

KG Bominflot Bunkergesellschaft fur Mineralole mbh & Co KG v

Petroplus Marketing AG [2009] 2 Lloyd’s Rep 679

Sale of gasoil, clause 18 of the contract provided:

There are no guarantees, warranties or representations, express or

implied [of] merchantability, fitness or suitability of the oil for any
particular purpose or otherwise, which extend beyond the
description of the oil set forth in this agreement.

Held: There is a great reluctance in finding a contract clause has

excluded the statutory implied terms. Clause 18 failed to exclude
the s. 13 implied terms, which are conditions whereas clause 18
referred to “warranties”.

Conclusive Inspection Clauses & Satisfactory Quality

When goods conform to specification on loading, but no longer
conform on discharge, is the seller in breach of its implied duty
under the Sale of Goods Act 1962?

Not if the parties agreed to a conclusive inspection clause and that

inspection took place and showed that the goods were – at that time
– conforming ones.
 KG Bominflot Bunkergesellschaft für Mineraloele mbH & Co v
Petroplus Marketing AG (The “Mercini Lady”) [2010] EWCA Civ 1145

Title, Freedom from Encumbrances & Quiet Possession (s.

10)

Section 10(1) In a contract of sale, there is an implied term on the

part of the seller that in the case of a sale he has a right to sell the
goods, and in the case of an agreement to sell, he will have such a
right at the time when the property is to pass.

In s. 10(1) SoGA 1962 the term is that the seller “has a right to sell
the goods”. Surprisingly, the seller may have title to the goods, but
still be in breach:

Niblett v Confectioners’ Materials Co Ltd [1921] 3 KB 387 [Goode p

284]

Sale of 1,000 cases of condensed milk with “Nissly Brand” labels.

This infringed the Nestlé trade mark. Although the sellers had title
to the goods, there was a breach of s. 10(1) because the goods
could only be re-sold after stripping off the offending labels. Atkin
and Bankes LJJ also felt that the circumstances amounted to breach
of the implied terms as to Quiet possession and Merchantable (now
satisfactory) quality, i.e. s. 14(2) and Ghana section 13(1) (a)

Correspondence with Sample (s. 12)

SoGA 1962, s. 12(1): Where there is a sale by sample… where there

is an express or implied term to that effect.

In the case of a contract for sale by sample there is an

implied term
(a) that the bulk will correspond with the sample in quality;
(b)that the goods will be free from any defect making their quality
unsatisfactory which would not be apparent on reasonable
examination of the sample.
See Sackey v Fattal [1959] GLR 169

Breach of Correspondence with Sample

There will be a breach where the goods supplied differ from the
sample in ways which would be apparent from the usual sort of
examination conducted by traders in that line of business: James
Drummond & Sons v EH Van Ingen & Co (1887) 12 App Cas 284
[Goode p 325]
Note that in some commercial trades there are agreed rules for
taking samples. An example is the Grain and Feed Trade
Association rules (GAFTA 100) and FCC.