GENERAL OUTLINE
Module contents
Sale of goods and consumer law
• Nature of a sale of goods contract and consumer protection – Chapter 7
(Lecture 2)
• Terms implied into the contract of sale - Chapter 7 (Lecture 3)
• Passing of property and risk in goods – Chapter 3 (Lecture 4)
• Liability of a seller without the right to sell – Chapter 5 (Lecture 9/10)
• Delivery obligations – Chapter 4 +11 – (Lecture 5)
• Remedies of the buyer – Chapter 13 +14 - (Lecture 7/8)
• Remedies of the seller – Chapter 12 – (Lecture 6)
Consumer Credit
• Classification of credit agreements under the Consumer Credit Act –
Chapter 17+18 (Lecture 1 – CCA/ 11)
• Formalities for making regulated agreements – Chapter 21: (Lecture 2
CCA/12) -
• Liability of the creditor/credit broker /supplier to the debtor -Chapter 21
+22 (Lecture 3/ 13)
• Liability of the debtor to the creditor - Chapter 23,24,10 (Lecture 14/4
CCA)
• Termination of regulated agreements - Chapter 23,24,10 (Lecture 14/4
CCA)
Agency
• Definition of agency – Chapter 26 +27) (Lecture 1(Agency)/ 15)
• The agent’s authority to bind his principal – Chapter 26+27 (Lecture
2(Agency/16)
• The agent’s rights and duties - Chapter 28+29 (Lecture
3(Agency)/Lecture 17)
• Contractual relationships between the principal, agent, and third party -
Chapter 30 (Lecture 4 (Agency)/ Lecture 18)
• Termination of the agency - Chapter 32 (Lecture 4 (Agency)/ Lecture
18)
,Chapter 7 (Lecture 2 + 3 )
Introduction
1. Contracts vary. Some very detailed. Some very basic.
2. When contract basic and has deficiencies, look at SOGA and Consumer
Rights Act 2015.
3. SOGA supplements details when lacking in agreements
Freedom of Contract
1. SOGA not to dictate terms to parties; only to provide solutions.
2. Only applies when parties have no contrary agreement (ie unless contract
shows that parties agree something opposing/different to SOGA).
3. However, UCTA 1977 + CRA 2015 limits the effectiveness of exemption
clauses – in consumer sales and all other sale of goods contract
4. S55(1) SOGA 1979 – where a right, duty of liability arise under a
contract of sale of goods by implication of law – may be negatived
(rejected) by express agreement or course of dealing between the parties
or by such usage as binds both parties to the contract – subject to the
UCTA 1977 (or under the assumption that it abides to UCTA 1977)
a. similarly in s38 CRA – prevents “any attempt to exclude or restrict
trader’s liability for a number of the rights prescribed by the act ie
quality of the goods, compliance with any description etc
i. Refer to chapter 10 for more details
Rights of Third Party:
1. general rule – only buyer and seller can sue or be sued on a contract of
sale and results
a. contract can be enforced only against someone who is party to
it. (only parties in a contract has contractual obligations”
b. only someone who is a party can enforce it (only parties in contract
can act upon their contractual obligations)
2. Exception exists in The Contracts (Third Parties) Act 1999 – S1
a. “subject to the provisions of this Act, a person who is not a party to
a contract (a third party) may in his own right enforce a term of
contract it –
i. a) the contract expressly provides that he may, or
, ii. b) subject to subsection (2), the term purports to confer a
benefit on him.
b. (2) subjection (1)(b) does not apply if on a proper construction of
the contract it appears that the parties did not intend the term to be
enforceable by the third party” (Unless the contract expressly or
implicitly that the parties do not allow third parties to enforce the
contract.)
c. (3) third party must be expressly identified in the contract by name,
as a member of a class or as answering a particular description but
need not be in existence when the contract is entered into.”
- For example – X buys a gift for Y and item proves to be defective – can y
rely on the statute in 1999 to enable her to claim against the retailer under
the terms in the contract concerning quality?
o Not straightforward
o effect of 1999 act is to enable Y to enforce on a term which
purports to benefit Y – arguably only the term that purports to
benefit Y is delivery
o Will the courts read the situation as one where there was a term of
the contract that Y was to have the benefit of all the terms in the
contract?
S.2
“(a) the third party has communicated his assent to the term to the
promisor, [i.e. to the party who was contracted to perform the
term in question], or
“(b) the promisor is aware that the third party has relied on the
term, or
“(c) the promisor can reasonably be expected to have foreseen that
the third party would rely on the term and the third party has
- in fact relied on it.””
- This statute provides that the act limits the ability of the parties to the
contract to subsequently to remove or alter the third party’s right e.g by
varying the contract
Express Terms
- Parties are free to agree what terms they choose
- they will not be bound by any term which is not properly incorporated in
the contract
- under some circumstances, terms can be deemed incorporated despite
lack of formalities like signing (ie. oral agreement or written but not
signed)
, o However, for exclusion clause: the party that benefits from the
clause (usually the seller) will have to incorporate the terms by
having the other party to sign the contractual document or taken
reasonable steps to bring the exclusion clause to the attention of the
other party
§ (This rule/requirement does not limit to exclusion clause –
(includes clauses that are particularly “onerous” (a contract
or lease that has more obligations than advantages) or
unusual and unlikely to be known to the other party)
§ Interfoto Picture Library v Stiletto Visual Programmes
§ advertising agency phoned the transparency library for some
transparencies
§ there is a clause stating there will be a charge of “5 pounds +
vat per transparency for each day that they were late being
returned”
§ agency returned the transparencies 14 days late – the library
claiming over 3500 pounds under this condition
§ court refused to allow the claim
§ the clause (imposing the “exorbitant” charge (exact wording
from the judgement” – was particularly “onerous” (AKA
“burden” from latin onerōsus) and “unusual”
§ Bingham LJ “the more outlandish the clause, the greater the
notice which the other, if he is to be bound, must in all
fairness be give”
• more notice + “reasonable steps” to bring the
exclusion clause to the “attention of the other party” if
clause is “unusual” and “onerous”
o General RULE: if the clause is incorporated and sufficient notice
is given – the court will enforce it – (FREEDOM OF CONTRACT
RULE)
§ unless it is a clause that is made unenforceable by “CRA
2016 or exclusion clause – due to UCTA 1977)
§ Terms that are not expressly agreed between the parties but
imposed by law into the contract are called “implied terms”
• NB CRA does not adopt this terminology and refers as
“terms which are to be treated as being included
within the contract”
o equivalent to “implied terms” under SOGA
• NB CRA avoids the terms “condition” and “warranty”
Warranties and Conditions (Lecture 3)
- breaches of contract is divided into 2 categories:
Module contents
Sale of goods and consumer law
• Nature of a sale of goods contract and consumer protection – Chapter 7
(Lecture 2)
• Terms implied into the contract of sale - Chapter 7 (Lecture 3)
• Passing of property and risk in goods – Chapter 3 (Lecture 4)
• Liability of a seller without the right to sell – Chapter 5 (Lecture 9/10)
• Delivery obligations – Chapter 4 +11 – (Lecture 5)
• Remedies of the buyer – Chapter 13 +14 - (Lecture 7/8)
• Remedies of the seller – Chapter 12 – (Lecture 6)
Consumer Credit
• Classification of credit agreements under the Consumer Credit Act –
Chapter 17+18 (Lecture 1 – CCA/ 11)
• Formalities for making regulated agreements – Chapter 21: (Lecture 2
CCA/12) -
• Liability of the creditor/credit broker /supplier to the debtor -Chapter 21
+22 (Lecture 3/ 13)
• Liability of the debtor to the creditor - Chapter 23,24,10 (Lecture 14/4
CCA)
• Termination of regulated agreements - Chapter 23,24,10 (Lecture 14/4
CCA)
Agency
• Definition of agency – Chapter 26 +27) (Lecture 1(Agency)/ 15)
• The agent’s authority to bind his principal – Chapter 26+27 (Lecture
2(Agency/16)
• The agent’s rights and duties - Chapter 28+29 (Lecture
3(Agency)/Lecture 17)
• Contractual relationships between the principal, agent, and third party -
Chapter 30 (Lecture 4 (Agency)/ Lecture 18)
• Termination of the agency - Chapter 32 (Lecture 4 (Agency)/ Lecture
18)
,Chapter 7 (Lecture 2 + 3 )
Introduction
1. Contracts vary. Some very detailed. Some very basic.
2. When contract basic and has deficiencies, look at SOGA and Consumer
Rights Act 2015.
3. SOGA supplements details when lacking in agreements
Freedom of Contract
1. SOGA not to dictate terms to parties; only to provide solutions.
2. Only applies when parties have no contrary agreement (ie unless contract
shows that parties agree something opposing/different to SOGA).
3. However, UCTA 1977 + CRA 2015 limits the effectiveness of exemption
clauses – in consumer sales and all other sale of goods contract
4. S55(1) SOGA 1979 – where a right, duty of liability arise under a
contract of sale of goods by implication of law – may be negatived
(rejected) by express agreement or course of dealing between the parties
or by such usage as binds both parties to the contract – subject to the
UCTA 1977 (or under the assumption that it abides to UCTA 1977)
a. similarly in s38 CRA – prevents “any attempt to exclude or restrict
trader’s liability for a number of the rights prescribed by the act ie
quality of the goods, compliance with any description etc
i. Refer to chapter 10 for more details
Rights of Third Party:
1. general rule – only buyer and seller can sue or be sued on a contract of
sale and results
a. contract can be enforced only against someone who is party to
it. (only parties in a contract has contractual obligations”
b. only someone who is a party can enforce it (only parties in contract
can act upon their contractual obligations)
2. Exception exists in The Contracts (Third Parties) Act 1999 – S1
a. “subject to the provisions of this Act, a person who is not a party to
a contract (a third party) may in his own right enforce a term of
contract it –
i. a) the contract expressly provides that he may, or
, ii. b) subject to subsection (2), the term purports to confer a
benefit on him.
b. (2) subjection (1)(b) does not apply if on a proper construction of
the contract it appears that the parties did not intend the term to be
enforceable by the third party” (Unless the contract expressly or
implicitly that the parties do not allow third parties to enforce the
contract.)
c. (3) third party must be expressly identified in the contract by name,
as a member of a class or as answering a particular description but
need not be in existence when the contract is entered into.”
- For example – X buys a gift for Y and item proves to be defective – can y
rely on the statute in 1999 to enable her to claim against the retailer under
the terms in the contract concerning quality?
o Not straightforward
o effect of 1999 act is to enable Y to enforce on a term which
purports to benefit Y – arguably only the term that purports to
benefit Y is delivery
o Will the courts read the situation as one where there was a term of
the contract that Y was to have the benefit of all the terms in the
contract?
S.2
“(a) the third party has communicated his assent to the term to the
promisor, [i.e. to the party who was contracted to perform the
term in question], or
“(b) the promisor is aware that the third party has relied on the
term, or
“(c) the promisor can reasonably be expected to have foreseen that
the third party would rely on the term and the third party has
- in fact relied on it.””
- This statute provides that the act limits the ability of the parties to the
contract to subsequently to remove or alter the third party’s right e.g by
varying the contract
Express Terms
- Parties are free to agree what terms they choose
- they will not be bound by any term which is not properly incorporated in
the contract
- under some circumstances, terms can be deemed incorporated despite
lack of formalities like signing (ie. oral agreement or written but not
signed)
, o However, for exclusion clause: the party that benefits from the
clause (usually the seller) will have to incorporate the terms by
having the other party to sign the contractual document or taken
reasonable steps to bring the exclusion clause to the attention of the
other party
§ (This rule/requirement does not limit to exclusion clause –
(includes clauses that are particularly “onerous” (a contract
or lease that has more obligations than advantages) or
unusual and unlikely to be known to the other party)
§ Interfoto Picture Library v Stiletto Visual Programmes
§ advertising agency phoned the transparency library for some
transparencies
§ there is a clause stating there will be a charge of “5 pounds +
vat per transparency for each day that they were late being
returned”
§ agency returned the transparencies 14 days late – the library
claiming over 3500 pounds under this condition
§ court refused to allow the claim
§ the clause (imposing the “exorbitant” charge (exact wording
from the judgement” – was particularly “onerous” (AKA
“burden” from latin onerōsus) and “unusual”
§ Bingham LJ “the more outlandish the clause, the greater the
notice which the other, if he is to be bound, must in all
fairness be give”
• more notice + “reasonable steps” to bring the
exclusion clause to the “attention of the other party” if
clause is “unusual” and “onerous”
o General RULE: if the clause is incorporated and sufficient notice
is given – the court will enforce it – (FREEDOM OF CONTRACT
RULE)
§ unless it is a clause that is made unenforceable by “CRA
2016 or exclusion clause – due to UCTA 1977)
§ Terms that are not expressly agreed between the parties but
imposed by law into the contract are called “implied terms”
• NB CRA does not adopt this terminology and refers as
“terms which are to be treated as being included
within the contract”
o equivalent to “implied terms” under SOGA
• NB CRA avoids the terms “condition” and “warranty”
Warranties and Conditions (Lecture 3)
- breaches of contract is divided into 2 categories:
