CONDITIONS &

WARRANTIES
REPRESENTATION:
The Statements which are made before
entering into the contract are known as
“representations”.
STIPULATION IN CONTRACT OF SALE
The representation that becomes terms of the
agreement are called as “stipulations”.
Acc to Sec12(1)
“ Stipulation in a contract of Sale with
reference to goods which are subject matter
thereof, may be a condition or warranty”.
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CONDITION:
“According to Sec 12(2) of Sale of Goods Act” Condition
is defined as
It is a stipulation essential to the main purpose of
the contract, the breach of which gives rise to a
right to treat the contract as rejected.
Ex: ‘Tom’ wants to purchase a car from ‘Jerry’, which
can have a mileage of 20 km/lt. ‘Y’ pointing at a
particular vehicle says “This car will suit you.” Later
‘X’ buys the car but finds out later on that this car only
has a top mileage of 15 km/ liter. This amounts to a
breach of condition because the seller made the
stipulation which forms the essence of the contract. In
this case, the mileage was a stipulation that was
essential to the main purpose of the contract and hence
Essential Elements Of The
Condition
1.Essential for the main purpose
of the contract
2.Breach of the condition destroy
the very purpose of the contract.
3.Breach of the condition gives
the buyer the right to claim
WARRANTY
It is a stipulation (secondary)Collateral to the main
purpose of the contract, the breach of which gives
rise to claim damages only.
Ex: A man buys a particular car, which is warranted to
be quite to drive and very comfortable. It turns out that
after some days the car starts to make a very
unpleasant noise every time it is operated. Also sitting
inside it is also not very comfortable.
Thus the buyer’s only remedy is to claim damages. This
is not a breach of the condition but rather a breach of
warranty, because the stipulation made by the seller was
only a collateral one.
Essential Elements Of
The Warranty
1.It is the collateral to the main
purpose of the contract.
2.Breach of the warranty do
not destroy the very purpose of
the contract.
3.Breach of the warranty gives
Difference Basis Warranty Condition

A warranty is only collateral to It is essential to the main

Nature
the main purpose of the contract. purpose of the contract.

The aggrieved party can

In this case, the aggrieved party repudiate the contract
Consequences of
can’t rescind the contract but can and is exempted from
Breach
claim damages only. performance and can also
claim damages.

Breach of warranty can’t be
Treatment
treated as a breach of condition.
A breach of condition
may be treated as a
breach of warranty.

Scope It is narrow It is wider term

Circumstances when
Condition to be treated as
Warranty:
1)When the buyer waives off his right :
U/S 13(1) in foll.ways
oWhere he completely excuses the
breach
oWhere he waives his right to reject
the goods & repudiate the contract.
oBy his conduct also
 Conditions & Warranties

Express Conditions Implied Conditions

& Warranties & Warranties

Express Conditions & Warranties:

The conditions & Warranties which are agreed upon
between the parties either in spoken or written are
called express conditions & warranties.
Condition
Impliedas to title
Conditions
Sale by Description
Sale by Sample &
Description
Condition as to quality or
fitness
Condition as to
merchantability
Sale by Sample
1) Condition as to Title: U/S 14(a)
In a Contract of Sale ,it is an implied condition that the seller should be
the true owner of the goods sold & he should be having all the rights to
sell the goods.
There are some implied condition on the part of the seller regarding title
to the goods.
A. In case of a sale, he has a right to sell the goods. In case of an
agreement to sell, the seller will have a right to sell the goods at the
time when the property is to pass.
B. Seller must be the owner of goods & have right to resell
C. Goods shall encumbrance be free from any charge or
D. Seller must not infringe or trademark or patent
Consequences :
The aggrieved party has the right to
cancel or repudiate the contract.
Ex: Rowland v.Divali(R sold car to K.)
In this case Rowland purchased a second
hand car from dealer, Divali. And within
few months of his purchase police seized
the car as a stolen one. Rowland sued
Divali for return of price. It was held
that Rowland can recover the price as he
2) Sale by Description: U/S 15
Where there is a contract for the sale of goods by description,
there is an implied condition that the goods shall correspond
with the description.
Consequences: The buyer can reject the goods & repudiate the
contract.
This includes the following situations:
1) Where buyer has not seen the goods & relies on the
description given by the seller.
Ex: Varley v. Whipp( Sale of Second hand reaping machine)
2)Where buyer has seen the goods but relies on description
stated
Ex: In an auction ,the furniture was described as “dating from
17th Century". After buying it, buyer found the furniture was
from !8th Century.
3) Packing can be part of Description: Where the packed goods
stated some description related to size,colour,quantity etc
Ex: X bought rice bags from a seller, on which it was mentioned
each bag contained 80 kg. But Subsequently the buyer found
that each bag weighed 76 kg. Held, X could cancel the contract.
3) Sale by Sample & Description: U/S
15
If the goods were sold by showing the
sample & also by giving description ,the
goods must correspond both to the
sample shown & the description stated.
Ex: N agreed to sell to D oil Described as
“ foreign refined rape oil, warranted
only equal to sample”. N delivered oil
equal to the quality of samples ,but
4) Condition as to quality or fitness:
U/S 16(1)
Where :
i. The buyer needs goods for a
special purpose
ii. Buyer tells that purpose to seller.
iii. The buyer relies on skill &
judgment of the seller
iv. The seller deals or trades in
similar goods
It is an implied condition that the goods sold
The following issues need to be considered for the condition as
to quality:

1) When the goods are used for only one purpose: In those cases
the buyer need not be told to the seller.
Case 1: Frost v.Aylesbury Dairy Co.,(Milk)
2)If the buyer suffers from an abnormality: If buyer has some
abnormality ,then it should be made known to the seller at
the time of sale.
Case 1:Griffiths v.Peter Conway( P bought a tweed coat from
G)
Case 2:Gauri purchased a pair of socks which caused
inflammation to her skin.
3)If the buyer purchases a product under a trademark or
Patent:
In those cases the seller shall not be liable ,but if the buyer
relies & tells the seller that he is relied upon him, then
the seller shall be held liable.
Case: Baldry v.Marshall(Motor car for touring purpose
“Bugatti Car”)
4) If the goods can be used for a number of purposes:
Where the goods can be used for different purpose, the
buyer must inform the purpose.
Case: A woollen merchant also a tailor bought indigo cloth
for the purpose of making liveries (Uniform).The cloth
had a latent defect & the purpose was not told to the
seller.
5) Condition as to Merchantability: U/S
16(2):
When the goods are sold by description
& the seller trades in similar goods then
the goods should be “Merchantable.”
Merchantability means:
The goods should be fit for
consumption.
The goods should not be injurious
when used.
The Condition as to Merchantability shall consider the following
points:

a. Right to examine the goods: The

buyer must given to examine
the goods, if the defects could
not be revealed after a
reasonable examination then
the seller is held liable & those
defects are called Latent
defects.
b.Implied condition is negatived if
defect is Patent Defect:The defect
which can be revealed by
reasonable level of examination
are called as Patent defects.
Where a buyer overlooked a
defect which could have been
revealed by reasonable
examination, the seller shall not be
6)Sale by Sample: U/S 17: When goods
are sold by sample, there is an implied
condition that:
1) The bulk shall correspond with the
sample: The buyer can repudiate the
contract.
2) The buyer shall have reasonable
opportunity to compare bulk with
the sample: Can reject & repudiate
3) The goods shall be free from any
defect: If it is latent defect, the buyer
7)Condition implied by custom or
usage of Trade: U/S 17: In some
situations even the buyer does not
disclose the purpose for which he
intends to buy the product, the
purpose is implied from the
customs of the trade or from usage
of the products.
Ex: Jones v.Bowden(Sale of drugs by auction ,it
was a trade usage to declare any sea damages.
 IMPLIED
WARRANTIES

1) Warranty as to quiet
Possession
2) Warranty of Freedom
from charges or
Encumbrances
3) Warranty as to quality or
fitness by usage of trade
1) Warranty as to Quiet
Possession: U/S 14(b)
 In a Contract of Sale there is an implied warranty
that the buyer shall enjoy quiet possession of the
goods.
 If the buyer disturbed as to possession of goods
because of defective title of the seller, the buyer
claim damages from the seller.
Ex: Mason v.Burningham( P purchased a hand
typewriter for $20 from D) In 1945, the plaintiff, a
woman, had bought a second-hand typewriter for the
defendant. She subsequently spent some money on its
restoration and used it for several months. The
2)Warranty of Freedom from
charges or
Encumbrances(mortagages):
U/S 14(c):
The goods should not be subject to any charge or right in
favour of a third party.
If it happens the buyer has to discharge the same, he is
entitled to get compensation for the same from the seller.
Ex: Amir pledges his scooter with Balu for a loan of Rs.2000 &
promises him to give its possession the next day.
After that Amir Sells his scooter to Kumar, an innocent buyer
3)Warranty annexed by usage
of Trade:U/S 16(3)
A Warranty As to fitness for a
particular purpose may be
annexed to a contract of Sale
by a custom or usage of
Trade.