BUSINESS LAW

Chapter 6
Sale of Goods & Consumer
Protection Act 1999
Sale of Goods Act 1957
Introduction
• The Sale of Goods Act 1957 (Act 382) (hereinafter
referred to as SOGA) governs the law with respect to the
sale of goods
• It deals with such matters as contracts for the sale of
goods, the passing of ownership and the risk of goods
sold, and remedies of the buyers and sellers for breaches
by the other party
 SOGA is only applicable if

The GOODS you buy falls S4(1) SOGA 1957 applies

within the s2 SOGA 1957
definition of goods

Title / Ownership / The goods were

Property is purchased CASH
transferred to the
BUYER
Definition of Goods in the SOGA
• The SOGA applies to ‘goods’
• S2 SOGA defines goods as: -
“every kind of moveable property (động sản) other than
actionable claims and money; and includes stocks and
shares, growing crops, grass, and things attached to or
forming part of the land which are agreed to be severed
before sale or under the contract of sale”
Contracts for the Sale of Goods
under the SOGA
 S4(1) SOGA defines a contract of sale of goods as follows: -
“A contract of sale of goods is a contract whereby the seller
transfers or agrees to transfer the property in goods to the
buyer for a price. There may be a contract of sale between
one part-owner and another”
 The purpose of a contract of the sale of goods is to transfer
the property in the goods from the seller to the buyer for a
price
 The word ‘property’ in s4(1) refers to ownership of the goods
 S4(1) specifically provides that the transfer of property in the
goods must be ‘for a price’
 ‘Price’ is defined in s2 as meaning ‘the money consideration
for a sale of goods’
Contracts for the Sale of Goods
under the SOGA
• The exchange of goods is barter and does not involve a
‘money’ consideration
• Accordingly, barter is NOT covered by the SOGA
Contracts for the Sale of Goods
under the SOGA
• Under s4(3), a contract of sale may be:
• a sale or
• an agreement to sell
 Types of Goods

Existing Future
Owned or possessed by goods to be manufactured
the seller (s6(1) SOGA or acquired by the seller
1957) after the making of the
contract of sale (s2(1) SOGA
1957

Unascertained Ascertained/Specific Unascertained

Conditions and Warranties
 s12(1) states that a term in a contract may be a condition or a
warranty
 A condition is defined as a stipulation essential to the main purpose
of the contract, the breach of which gives rise to a right to treat the
contract as repudiated (s12(2))
 A warranty is a collateral term, the breach of which gives rise to an
action for damages without the right to either reject the goods or to
treat the contract as repudiated (s12(3))
 S12(4) – whether a term in a contract is a condition or warranty is to
be determined by construing the contract
 S12(4) – a term may be a condition though labeled as a warranty in
the contract
Conditions and Warranties
• S13 deals with one situation in which the buyer may elect
to treat a breach of a condition as a breach of a warranty
and another, in which the buyer must treat the breach of a
condition as the breach of a warranty
 Terms Implied into a Sale of Goods Contract by the SOGA

S14 SOGA 1957 S15 SOGA 1957 S16(1) SOGA 1957 S17 SOGA 1957

Right Free from (a) Sale by sample

to sell charge or Fit for purpose
encumbrances

Enjoy quiet (b)

possession Merchantable quality

Sale by Description
description + Sample
S14 SOGA
 S14 implies into all contracts for the sale of goods a
condition that the seller has a right to sell the goods
 The condition relating to the right to sell means that
the seller must have the right to sell the goods by
the time the contract is to be performed
 This is necessary because the performance of the
contract must make the buyer the true owner of the
goods (Lian Lee Motor Sdn Bhd v Azizuddin bin
Khairuddin (2001))
S15 SOGA
 S15 implies into every contract for the sale of
goods, a condition that the goods supplied shall
correspond with the description
 Where the buyer has not seen the goods, but relies
on the description, it will be a sale by description
 Where the sale is by description and sample, it is
not enough if the goods supplied corresponds with
the sample only
 Harrisons & Crossfield (NZ) Ltd. V Lian Aik Hang
(1987) – the goods supplied did not correspond to
the description or sample
 Lau Yaw Seng v Cooperative Ceramica D’ Imola
(1991)
S16 SOGA
 S16(1)
◦ …There is no implied warranty or condition as to the quality or
fitness for any particular purpose of goods supplied under a
contract of sale, except as follows:
 (a) Where the buyer, expressly or by implication makes known to the
seller the particular purpose for which the goods are required, so as to
show that the buyer relies on the skills or judgement, and the goods
are of a description which it is in the course of the seller’s business to
supply there is an implied condition that the goods shall be reasonably
fit for such purpose
 (b) Where goods are bought by description from a seller who deals in
goods of that description there is an implied condition that the goods
shall be of merchantable quality: provided that if the buyer has
examined the goods, there shall be no implied condition as regards
defects which such examination ought to have revealed
EXPRESSLY MAKES KNOWN: WALLIS v RUSSELL VL-22.23

FACTS: P went to a fishmonger and asked for

"two nice fresh crabs for tea". He was given
some boiled crabs that weren’t fresh and became
ill after eating them.

HELD: Seller liable as buyer had expressly made known

the particular purpose for which the goods were required
and the goods were of a description which it was in the
course of the seller's business to supply - there was
therefore an implied condition that the goods would be
reasonably fit for that purpose
IMPLIEDLY MAKES KNOWN:

GRANT v AUSTRALIAN KNITTING MILLS LTD VL-22.23

FACTS: G purchased underwear from AKML

whose business it was to deal in such articles &
contracted dermatitis because of excessive
sulphite in the material.

HELD: There was an implied reliance upon the

skill & judgment of the seller as to the general
fitness of the article for the known purpose
S16 SOGA
• S16(1)(b) implies into every contract for the sale
of goods a condition that the goods are of
merchantable quality if the seller normally deals
with such goods
• There is no statutory definition of ‘merchantable
quality’ in the SOGA
S16 SOGA
• Lord Reid in Henry Kendall v Lillico (1969) defined
merchantable quality as:
• If the description in the contract was so limited that goods
sold under it would normally be used for only one purpose,
then the goods would be un merchantable under that
description if they were of no use for that purpose. But if the
description was so general that goods sold under it are
normally used for several purposes, then the goods are
merchantable under that description if they fit for any one of
these purposes
• ‘Merchantable’ has also been treated as meaning
something like ‘acceptable’ or ‘satisfactory’, or in
other cases ‘saleable’
S16 SOGA
• S16(1)(b) goes beyond requiring the seller to take
reasonable care that the goods he sells are merchantable
• It imposes an absolute liability on the seller whether or not
he is at fault and also holds him absolutely liable for the
manufacturer’s or producer’s defects
S17 SOGA
 S17 provides that if a sale is by sample certain conditions will be
implied
 However, by s17(1), sale is not a sale by sample merely because the
buyer has seen only a part of the bulk
 There must be a term, express or implied, that the sale is by sample
 It is through s17(2) that a specific terms are implied into a sale by
sample
 By s17(2)(a) there is an implied condition in a sale by sample that the
bulk shall correspond with the sample quality (E&S Ruben Ltd v Faire
Bros (1949))
 By s17(2)(b) there is an implied condition in a sale by sample that the
buyer shall have a reasonable opportunity of comparing the bulk with
the sample (Polenghi Brothers v Dried Milk Co. Ltd (1904)
 By s17(2)(c) there is an implied condition in a sale by sample that the
goods shall be free from any defect rendering them unmerchantable
which would not be apparent on reasonable examination of the sample
Exclusion of implied terms &
conditions
• Unfortunately, under s62 of SOGA, these implied
terms (ss14-17) can be avoided by express
agreement of the parties
• A contract may contain an exclusion clause that
safeguards the seller from liability in the event
that he breaches any of the implied terms
Transfer of Property between
Buyer and Seller
• The basic rules for ascertaining when property is
transferred from the seller to the buyer: -
1. When the subject-matter of the contract consists of
unascertained goods, property in them is transferred to
the buyer only when the goods are ascertained (s18 and
24) (ReWait (1927))
2. When the subject-matter of the contract consists of
specific goods, the property in them is transferred to the
buyer at such time as the parties intended it to be
transferred and the intention is to be determined by terms
of the contract, the conduct of the parties, and the
circumstances of the case (s19) (Tractors Malaysia Bhd v
Kumpulan Pembinaan Malaysia Sdn Bhd (1979))
Transfer of Property between
Buyer and Seller
3. When there is an unconditional contract for the
sale of specific goods in a deliverable state, the
property in the goods passes to the buyer when
the contract is made and it is immaterial whether
the time of payment or the time of delivery, or
both, be postponed (s20) (Mohamed Mydin v
Ramiah (1965))
4. Where there is a contract of the sale of specific
goods and the seller is bound to do something to
the goods, for the purpose of putting them into a
deliverable state, the property does not pass until
such thing be done and the buyer has notice
thereof (s21)
Transfer of Property between
Buyer and Seller
5. Where there is a contract for the sale of specific goods in a
deliverable state, but the seller is bound to weigh, measure, test,
or do some other act or thing with reference to the goods for the
purpose of ascertaining the price, the property does not pass until
such act or thing be done, and the buyer has notice thereof (s22)
6. Where, in pursuance of the contract, the seller delivers the goods
to the buyer or to a carrier or other bailee (ng nhận hang) (whether
named by the buyer or not) for the purpose of transmission to the
buyer, and does not reserve the right of disposal, he is deemed to
have unconditionally appropriated the goods to the contract
(s23(2))
Transfer of Property between
Buyer and Seller
7. When goods are delivered to the buyer on approval
or ‘on sale or return’ or other similar terms, the
property therein passes to the buyer:
◦ When he signifies his approval or acceptance to the seller
or does any other act adopting the transaction (s24(a))
◦ If he does not signify his approval or acceptance to the
seller but retains the goods without giving notice of
rejection, then if a time has been fixed for the return of the
goods, on the expiration of such date, and if no time has
been fixed, on the expiration of a reasonable time. What is
a reasonable time is a question of fact (s24(b)) (Inter Diam
Pte Ltd v Diamond Centre Sdn Bhd (2002))
Romalpa Clause
 Under s25 SOGA, parties may agree when title
passes in goods even though they are already
delivered to the buyer. Such clauses in the contract
are known as Romalpa clauses.
 The importance of such a clause is that if the buyer
goes into liquidation or bankruptcy, the unpaid seller
can take possession of the goods.
 A lot depends on how Romalpa clauses are worded.
Where goods are not incorporated into other goods,
the seller gets possession. BUT if goods are
incorporated, a simple Romalpa clause will not
prevent goods from passing to a third party,
although the buyer is liable in conversion.
Romalpa Clause
• To prevent such a matter from happening, a sophisticated
Romalpa clause may be incorporated, one which
indicates that in what circumstances property will not pass
when incorporated into other products. When such a
clause is effective, the seller is entitled to the proceeds of
sale.
 Nemo Dat Rule (s27 SOGA 1957) – X title X transfer

Exceptions

Estoppel (s27 Sale by Sale under Sale by a Sale by a

SOGA 1957) mercantile avoidable seller in buyer in
agent under contract possession possession
the proviso to under s29 of the goods of the goods
s27 SOGA SOGA 1957 under s30(1) under s30(2)
1957 SOGA 1957 SOGA 1957
Sale by one
of joint
sellers under Sold to a Sold to a
s28 SOGA bona fide bona fide
1957 purchaser purchaser

One of Possession Sold to a

several with the bona fide
owners consent of purchaser
his co-
owners
Transfer of Title
 “Nemo dat quod non habet” literally
translated this means, “no one may give what
he does not have”
 This is contained in s27 – when a non-owner
transfers goods, his purchaser does not get a
good title and the true owner can recover
them from the buyer
Transfer of Title
• There are, however, exceptions: -
• Estoppel (s27)
• Sale by merchantile agent under the proviso to s27
• Sale by one of joint sellers under s28
• Sale under avoidable contract under s29
• Sale by a seller in possession of the goods under s30(1)
• Sale by a buyer in possession of the goods under s30(2)
Estoppel (s27)
• Where the true owner by his conduct represents or holds
out that a party has the authority to pass title, then the
owner is estopped from denying his conduct
• However, merely leaving goods in the hands of the person
does not amount to a representation
• The goods must be legally entrusted.
Sale by Merchantile Agent
under the proviso to s27
• A mercantile agent is someone who is in the business of
buying or selling a particular product and buys or sells the
product in the course of business
• The need for good faith is essential
Sale by one of Joint Sellers
under s28
• Possible for one of such joint owners to transfer a
good title to a buyer although the other owners may
not have authorised the sale
• Condition, the seller must: -
• Be one of several owners;
• Be in sole possession of the goods with the consent of his
co-owners
• Sell the goods to a bona fide purchaser who is not aware of
the seller’s want of authority at the time of the sale
Sale under a voidable contract
under s29
• Where the seller has a voidable title to the goods, but this
has not been avoided at the time of the sale, the buyer will
get a better title than the true owner.
Sale by a seller in possession
of the goods under s30(1)
• If the seller has already sold the goods to the buyer and
title has passed but is in possession of the goods and re-
sells them to a bona fide purchaser, the new purchaser
gets a better title than the old.
Sale by a buyer in possession
of the goods under s30(2)
• Where the buyer has already bought the goods and is in
possession of them but where title remains with the seller,
the buyer may re-sell the goods and property passes
provided the buyer is a bona fide purchaser.
Performance of the Contract
of Sale
 SOGA deals with the physical
performance of the terms of the contract
which includes: -
 Delivery
 Acceptance
The Delivery of Goods
 It is the duty of the seller to deliver the goods whilst the
buyer’s duty is to accept and pay for them in accordance
with the terms of the contract of sale (s31)
 S32 goes on to say that unless otherwise agreed,
delivery of goods and payment of the price are
concurrent conditions
 This means that the seller shall be ready and willing to
give possession of the goods to the buyer in exchange
for the price, and the buyer shall be ready and willing to
pay the price in exchange for possession of the goods
The Delivery of Goods
• Definition
• Voluntary transfer of possession from one person to another
• Every delivery need not involve physical transfer e.g. seller
give keys to the motor cycle to the buyer and tells him where
it is kept
• S33 provides that delivery of goods may be made by doing
anything which the parties agree shall be treated as delivery
or which has the effect of putting the goods in the possession
of the buyer or any person authorised to hold them on his
behalf
The Delivery of Goods
• Place
• Whether the seller is required to send the goods to the buyer
or the buyer has to take possession of the goods depends on
what has been agreed upon between them (s36(1))
• Apart from such agreement, the general rule is that goods
are to be delivered at the place at which they are at the time
of the sale
• In the case of goods which are still non-existent, at the place
of manufacture or production (s36(1))
• S36(5) provides that unless the parties agree otherwise, the
expense of and goods incidental to putting the goods into a
deliverable state shall be borne by the seller
The Delivery of Goods
 Place
 When the seller agrees to deliver the goods at his own risk
at a place other than that where they are sold, the buyer
shall, unless otherwise agreed, take any risk of
deterioration in the goods necessarily incident to the course
of transit
The Delivery of Goods
• Time
• Not stated – reasonable time (question of fact)
• If a time is stated in the contract for the delivery of goods, it may be
a condition of the contract
The Delivery of Goods
• Delivery of wrong quantity
• If lesser delivered, buyer may reject all the goods so
delivered. If the buyer accepts, he is bound to pay for them
at the contract rate (s37(1))
• If more delivered, the buyer may accept the goods included
in the contract and reject the rest, or reject all the goods, or
accept all the goods. If accept all, buyer has to pay for the
goods at the contract price (s37)
• If mix, the buyer may accept the goods which are in
accordance with the contract and reject the rest, or reject the
whole (s37)
The Delivery of Goods
• Installment delivery
• Buyer not bound to accept
The Delivery of Goods
 Delivery to carrier or wharfingers
◦ When the seller is authorised or required to send goods sold to
the buyer and the goods are delivered to a carrier for
transmission to the buyer or to a wharfinger for safe custody, such
delivery to the carrier or wharfinger is prima facie deemed to be a
delivery of the goods to the buyer (s39(1))
◦ Such delivery would mean that the property and risk would pass
to the buyer
◦ However, unless otherwise authorised by the buyer, the seller
shall make such contract with the carrier or wharfinger on behalf
of the buyer as may be reasonable having regard to the nature of
the goods and other circumstances of the case. If the seller omits
to do so, and if the goods are lost or damaged in the course of
transit or whilst in the custody of the wharfinger, the buyer may
decline to treat the delivery to the carrier or wharfinger as a
delivery to himself, or hold the seller responsible in damages
(s39(2))
The Acceptance of Goods
 Under s42, the buyer is deemed to have accepted
the goods:
◦ When he intimates to the seller that he has accepted
them (Bragg v Villanova (1923)). This is not
straightforward – either words or conduct suffice to imitate
acceptance.
◦ When the goods have been delivered to him and he does
any act in relation to them which is inconsistent with the
ownership of the seller e.g. the buyer resells or treating
the goods as if they were his own.
◦ When, after the lapse of a reasonable time, he retains the
goods without intimating to the seller that he has rejected
them
The Duty to Pay the Price
• The buyer has the duty to pay the price of the goods he
buys
• Unless the contract provides otherwise, payment is due at
the time the contract is made provided the seller is ready,
willing and able to deliver the goods
Remedies of the Buyer and
Seller
• Rights of Unpaid Seller against the Goods
• An unpaid seller is a seller to whom:
• The whole of the price has not been paid or tendered; or
• Where a bill of exchange or other negotiable instrument has been
received as conditional payment, and the condition on which it was
received has not been fulfilled due to the instrument being
dishonoured or for other reason (s45(1))
 REMEDIES

Seller Buyer

Goods Buyer Specific

performance
(s58 SOGA
Lien Stoppage Right to Suit for 1957)
(s46(1)(a) in transit resell if the price
& s47 (s46(1)(b) goods are (s55 Damages
Damages
SOGA & ss50-52 perishable SOGA for non
acceptance for
1957) SOGA in nature 1957)
(s56 SOGA breach of
1957) (s46(1)(c) &
Provided 1957) warranty
s54 SOGA
the buyer is Provided Right to (s59
1957) Damages
the owner that the withhold if SOGA
for non 1957)
of the transport the seller is delivery
goods & ers are still the (s57
the seller is the owner and in Damages
SOGA under
in seller’s possession 1957)
possession agents (s46(2) Tort
of it SOGA 1957)
Rights of Unpaid Seller against
the Goods
• The rights of an unpaid seller against the goods are: -
• Where he is in possession of the goods a lien on the goods for the
price (s46(1)(a) & s47)
• Where he has parted with the possession of the goods a right of
stopping the goods in transit in the case of the buyer’s insolvency
(s46(1)(b) & ss50-52)
• Subject to s54, a right of resale (s46(1)(c) & s54)
• Where the property in goods has not passed to the buyer, a right of
withholding delivery s46(2)
 Lien (s46(1)(a) & s47)
• This right exists where a sale has been made but the
seller is in possession of the goods and learns that the
buyer is insolvent.
• Provided there are no agreed credit terms the seller can
retain the goods until payment time and demand
payment as a condition for delivery of the goods. If the
buyer does not pay, the seller can re-sell the goods.
• The seller loses his right of lien, if he delivers the goods
to the buyer’s agent.
 Stoppage in transit (s46(1)(b) &
ss50-52)
• The seller can still stop delivery and retain the goods that
are on the way to the buyer provided that the transporters
are his agents and not the buyer’s.
• If the transporter is an independent agent e.g. the rail,
stoppage can still be made as long as they have not
reached the buyer’s premises.
• The only exception is where the independent agent informs
the buyer that they are holding the goods to their order.
 Right of Resale (s46(1)(c) &
s54)
• This right exists where, as with the other two, the buyer is
insolvent but in addition the goods are of a perishable nature.
• Provided such a right is included in the contract, the seller
can detain the goods and demand payment as a condition for
delivery immediately.
• He must, in addition, notify the buyer that he wishes to
exercise this right.
Remedies of the Buyer and
Seller
• Right of seller to sue for breach of contract
• Suit for price
• S55
• Where the property in the goods has passed to the buyer and the
buyer wrongfully neglects or refuses to pay for the goods according to
the terms of the contract, the seller may sue him for the price of the
goods
• If the price is payable on a day certain irrespective of delivery, the
seller may sue the buyer for the price although the property in the
goods has not passed
• Damages for non acceptance
• S56
• Where the buyer wrongfully neglects or refuses to accept and pay for
the goods the seller may sue him for damages for non-acceptance
Remedies of the Buyer and
Seller
 Right of buyer to bring an action
◦ S57 – where the seller neglects or refuses to deliver the goods to
the buyer, the buyer may sue the seller for damages for non-
delivery
◦ S58 – the buyer may bring an action for specific performance of
the contract by the delivery of specific goods
◦ S59 – where the seller commits a breach of warranty or where
the buyer elects or is compelled to treat a breach of condition by
the seller as a breach of warranty, the buyer cannot reject the
goods but may sue for damages
◦ Buyer’s action in tort – If the property in goods has passed to the
buyer and he is entitled to possession which is withheld, he may
bring an action in detinue against the seller claiming possession
of the goods. Detinue is wrongful detention of chattels (goods)
belonging to P after their return has been demanded
Consumer Protection Act 1999
Introduction
• The term “consumer protection” can be used to describe
rules of law which recognises the bargaining weakness of
individual consumers as well as ensure that their
weakness is not unfairly exploited
• The main concern of this law is defective goods and
services.
Introduction
• Relevant law is the Consumer Protection Act 1999
• It provides: -
• For consumer protection in relation to supply of goods and
services, and
• Established the National Consumer Advisory Council and the
Tribunal for Consumer Claims
Introduction
• Some key consumer rights are:
• Right to obtain fundamental goods and services to guarantee a
satisfactory life
• The consumer is protected from the processing and marketing of
goods as well as services which can be harmful
• Sufficient, accurate and precise information to assist him/her in
making the right decision
• The consumer reserves the right to have access to direct
information with regards to all goods and services
• The consumer must have the right and opportunity to voice out
• Right for compensation
Introduction
• Application of this Act is supplemental
• This Act does not affect the liability arising under any
other law such as the Sale of Goods Act or the Contracts
Act etc
• By an amendment carried out in the Act in year 2007,
transactions effected by electronic means are also
covered by the Consumer Protection Act
• The Act does not apply to all transactions involving sale of
goods
• It must be goods and services supplied to a consumer in
the course of a business and there are a number of
transactions which are excluded
Introduction
• This is stated in Section 2 of the Act which reads as follows:

1. Subject to subsection 2(2), this Act shall apply in respect of all

goods and services that are offered or supplied to one or more
consumers in trade.
2. This Act shall not apply —
a. to securities as defined in the Securities Industry Act 1983;
b. to futures contracts as defined in the Futures Industry Act 1993;
c. to contracts made before the date on which this Act comes into
operation;
d. in relation to land or interests in land except as may be expressly
provided in this Act;
e. to services provided by professionals who are regulated by any written
law; and
f. to healthcare services provided or to be provided by healthcare
professionals or healthcare facilities.
S3 Consumer Protection Act
1999
A “consumer” means a person who —
a. acquires or uses goods or services of a kind ordinarily acquired for
personal, domestic or household purpose, use or consumption;
and
b. does not acquire or use the goods or services, or hold himself out
as acquiring or using the goods or services, primarily for the
purpose of:
i. resupplying them in trade;
ii. consuming them in the course of a manufacturing process; or
iii. in the case of goods, repairing or treating, in trade, other goods or
fixtures on land.
Goods
“Goods” means goods which are primarily purchased,
used or consumed for personal, domestic or household
purposes and includes —
a. goods attached to, or incorporated in, any real or personal
property;
b. animals, including fish;
c. vessels and vehicles;
d. utilities; and
e. trees, plants and crops whether on, under or attached to land or
not, but does not include choses in action, including negotiable
instruments, shares, debentures and money.
Services
• Services are also defined in s3 as follows:

any rights, benefits, privileges or facilities that are or are

to be provided, granted or conferred under any contract
Implied Terms
• Statutes have implied certain terms into
contracts in order to protect consumers
Implied Terms
• In transactions involving consumers, consumers have
very little bargaining power compared to sellers
• They often have no choice but to contract based on the
seller's standard terms
• These terms are mostly one-sided, to the seller's
advantage
Implied Terms in SOGA & CPA
• Examples of statutes that imply terms into contracts are:
• Sale of Goods Act 1957 (SOGA)
• Consumer Protection Act 1999 (CPA)
• These statutes imply into the seller's contract certain
terms/guarantees that favour the consumers
• In other words, a seller is presumed to have included the
terms into a contract even if the actual contract is silent on
such matters
• In the event that the seller falls short of the standards
imposed by SOGA or CPA, he shall be liable to the
consumer.
Implied Terms in SOGA & CPA
• To some extent, the both SOGA and CPA deal with the
same thing
• However, there are some differences
• SOGA applies only to sale of goods. Terms that are
implied for the protection of buyers do not apply where a
person purchases services
• For example:
• If Ali buys a TV and it turns out to be defective, he has a claim
under SOGA. But if he purchases a holiday package and the
services promised are not delivered, he has no claim under SOGA.
Implied Terms in SOGA & CPA
• By contrast, the terms implied by CPA apply to both sale
of 'goods' and 'services'.
• Clauses similar to those in SOGA were included in the
CPA to ensure that people who purchase services benefit
from similar implied terms
Implied Terms in SOGA & CPA
• Since the CPA covers both sale of goods and services, is
SOGA still relevant?
• The answer is 'Yes‘
• This is because the CPA only applies to consumers (s 2 of
the CPA)
• By 'consumer', we mean people who buy things for
personal, domestic or household use
• By contrast, SOGA covers sale of goods to non-consumer
as well
Implied Terms in SOGA & CPA
• Contrast these two situations:
• If you buy a washing machine for your home, you are a
consumer. If the washing machine is defective, you may
have a claim under SOGA and CPA
• But if you own a laundrette and you buy five new
washing machines for your business, you only have a
claim under SOGA if the washing machines are
defective
Implied Terms in SOGA
• The implied terms in SOGA:
• s 14(a)—seller's undertaking as to title (condition)
• s 14(b)—buyer's right to quiet possession of the goods (warranty)
• s 14(c)—the goods must be unencumbered (warranty)
• s 15—in a sale by description, the goods must correspond to the
description (condition)
• s 16(l)(a)—the goods must fit the buyer's purpose (condition)
• s 16(l)(b)—the goods must be of merchantable quality (condition)
• s 17—in a sale by sample, the goods must correspond to the
sample (condition)
Implied Terms in CPA
• Implied guarantees under the CPA:
• In respect of supply of goods
• Section 31 -Title
• Section 32 - Acceptable quality
• Section 33 - Fitness for purpose
• Section 34 - Compliance with description
• Section 35 - Compliance with sample
• Section 36 - Price
• Section 37 - Repairs and spare parts
• Section 38 - Manufacturer's guarantee
• In respect of supply of services
• Section 53 - Reasonable care and skill
• Section 54 - Fitness for purpose
• Section 55 - Time of completion
• Section 56 - Price
Implied Terms in SOGA & CPA
• Sale of Goods Act 1957
• All implied terms can be expressly excluded (s62
SOGA) 
• Consumer Protection Act 1999
• Producer cannot exclude liability for damage caused by
its 'defective products'.
• Supplier cannot exclude liability for loss or injury
negligently caused
• In all other cases, a supplier can exclude implied terms
provided he has adequate justification.
Conclusion
• The National Consumer Advisory Council and The
Tribunal for Consumer Claims are two specialised bodies
established under the Consumer Protection Act 1999
• The former act as an advisory to the Minister and the
latter is a mechanism to determine consumer claims
Let’s do some MCQs first
Please download “Socrative for Student” app from
your App Store/Google Play Store in your handphone

Or alternatively, go to
https://b.socrative.com/login/student/

Under Room Name, type SINGH7905

Start doing the questions now