BUS 360

Introduction to
Business

Prepared By:
Name
ID
1.Mirajul Islam
1210431
2. Md.Raihan Uddin 1210349
3. Md ArmanFor:
Hossain Prepared
1210085
Hasan
MD Mahmudul
4. Mahasina nasrin
Haque
-1210799

Lecturer
School Of Business

The
The Sale
Sale Of
Of Goods
Goods Acts,1930
Acts,1930

Conditions & Warranties

What is condition ?
A condition is a stipulation essential to the main purpose of the
contract, the breach of which gives right to repudiate the
contract and to claim damages.
EXAMPLE : P goes to R, a horse dealer, and says, I want a horse
which can run at a speed of 30 km. per hour. The horse dealer
points out a particular horse and says, this will suit you. P buys
the horse. Later on P finds that the horse can run only at a
speed of 20km./hr. there is a breach of condition, P can
repudiate the contract, return the horse to R and get back the
price.

What is warranty?
A warranty is a stipulation collateral to the purpose of the
contract, the breach of which gives the aggrieved party a right to
sue for damages only, and not to avoid the contract.

The f o l l o w i n g a r e i m p o r t a n t d i ff e r e n c e s
warranties

Condition

between conditions and

warranties

1. A condition is essential to the main 1. It is only collateral to the main

purpose of the contract.
Purpose of the contract.
2. The aggrieved party can repudiate
contract

The aggrieved party can not repudiate

the contract

3. The aggrieved party can not only

repudiate the contract but also can
claim damages in case of breach of
condition

3. The aggrieved party can only claim

the damages.

4. A breach of condition may be

treated as breach of warranty

4. The breach of warranty can not be

treated as breach of warranty.

Types of conditions and warranties

EXPRESS CONDITION AND WARRANTY

When both the buyer and seller agree to

provide for certain Terms and
conditions, either by words spoken And
written, they are known as express
condition and warranty .
The implied conditions, on the other hand,
are those, which are presumed by law to be
present in the contact.

Implied condition
1. condition as to title: In every contract of sale,
unless the circumstances of the contract are such as to
show a different intention, there is an implied condition
on the part of the seller, that :
a) In case of a sale, he has a right to sell the goods,
and
b) In case of an agreement to sell, he will have a right
to sell the goods at the time when the property is to
pass.
Example: X purchases a car from Y. After 6 months Z ,the
true owner of the car ,demanded it from X. X had to
return it to its true owner. X was entitled to recovery
the full price even through several months had passed

Implied Condition
2. Condition as to 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.

For example a sale of Seedless Grapes, signifies that the

fruit will have no seeds. If it turns that the fruit is with
seeds the buyer can reject the goods.

Implied Condition
3. Condition as t o 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.

Implied Condition
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.
Example: A agreed with B to sell certain oil described as
refined sunflower oil, warranted only equal to sample.
The goods tendered were equal to sample, but
contained a mixture of hemp oil. B can reject the
goods.

Implied Condition
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.
Example: A sold a pencil without led. Thus buyer can
reject the goods as it is not able to satisfy the purpose
of buying.

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.

Implied Condition
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.

Implied warranties

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.

Implied warranties

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.

Caveat E m p t o r
In a contract of sale of goods the seller is under no duty to reveal
unflattering truths about the goods sold. Therefore, when a
person buys some goods, he must examine them thoroughly.
If the goods turn out to be defective or do not suit his purpose,
he cannot blame anybody excepting himself.
A common example is a used car transaction between two
private parties The buyer must take on the responsibility of
thoroughly researching and inspecting the carperhaps
taking it to a mechanic for a closer lookbefore finalizing the
sale. If something comes up after the sale, maybe a
transmission failure, it is not the seller's responsibility. Garage
sales offer another example of caveat emptor, in which all
sales are final and nothing is guaranteed.

Thank You