Conformity Obligations

Conformity with Description Condition

It is an implied condition in a contract for the sale of goods, that the goods comply with their description.  The provision applies to all sales of goods, irrespective of whether or not, the seller acts in the course of business (unlike the position with most other implied terms).  This is of particular importance where the goods are manufactured or where there is no sample available.

Generally, the goods must conform exactly with the description, apart from minimal deviations. The description must relate to a matter that is material to the sale. It is necessary that the buyer has relied on the description.  If the buyer was aware of the non-conformity with the description then he will not have a remedy.

The condition requires that the goods comply with their essential characteristics as described.  Where the goods are more fully described, the term may be express rather than implied. The condition will be breached, only where the goods provided do not conform with this essential description.


Sale by Description

Not all statements used in connection with goods are descriptions, under the provision.  Some may be representations or warranties, breach of which would at most create a right to damages, if at all.

There may be a sale of goods by description, even where the goods are visible to the buyer in advance.  Where goods are packaged or labelled, the package or label will usually comprise part of the description. The reference to goods on a label or descriptive matter accompanying the goods exposed for sale may thereby constitute a description.

There is a sale by description if a description is used in connection with the goods, on which the buyer might reasonably rely. The description must be such that it has a bearing on the buyer’s decision to purchase.   It is a matter of interpretation of the contract, as to how wide the description goes.

Goods which are wholly defective may still conform to their description, notwithstanding that the defect may constitute a breach of the other implied terms.


Extent of the Description

The description does not apply to all aspects of the goods, but only to their essential characteristics.  Other failures to conform with the terms of the contract or with representations may constitute a breach of contract, but not a condition, breach of which entitles the buyer to terminate the contract. Some aspects of a description may be representations or statements only, regarding the goods.

What is or is not an essential part of the description, is a matter of interpretation in the circumstances.  Goods can be sold by description even if they are seen by the buyer in advance.  The condition can be breached, even if goods are exposed for sale and selected by their buyer.  The Act states that reference to goods on a label or other descriptive matter accompanying the goods may constitute part of the description.


Description Issues

What constitutes a breach of description is a matter to be decided by the court, in the circumstances.  In some cases, the breach will be readily apparent, as where the goods are entirely nonconforming.  In other cases, it will be a question of interpretation of the extent and breadth of the description.

Where particular characteristics are specifically described, then they are likely to form part of the description for the purpose of the provision. Because the implied term as to description is a condition, its breach, no matter how small, entitles the buyer to reject the goods and to the return of the price.

False trade descriptions are offences contrary to the Consumer Protection Act. The Merchandise Marks Act contains an implied warranty (as well as creating a criminal offence for breach) that a trademark or description is genuine and not forged or falsely applied and that the description is not a false trade description unless otherwise agreed.


Merchantable Quality I

The expression “merchantable” is somewhat old-fashioned and has been replaced in the UK by the word “satisfactory.” Merchantability implies that the goods are appropriate for the purposes for which a reasonable person would use them. Durability is an aspect of merchantability.

The fact that a defect may be discoverable does not of itself make them non-merchantable.  Merchantability implies the absence of significant defects.

Merchantability refers to the condition of the goods at the time of delivery.  Breach of the merchantable quality warranty may arise long after a guarantee has expired. The failure of merchantability must be proved to have been present at the point of purchase. This may be presumed in some cases where there is a later manifestation of a defect or failure.


Merchantable Quality II

It is an implied condition that goods supplied in the course of a business are of “merchantable quality” and reasonably fit for the buyer’s purpose.  The condition does not apply in relation to defects specifically drawn to the buyer’s attention before the contract is made. Where the buyer examines the goods before the contract, the condition does not apply to defects which ought to have been apparent.

The goods need not be of the type which the business seller normally sells.  It is sufficient that the sale is for the purpose of, or in the course of a business. Where sales are undertaken on behalf of another, such as by an auctioneer, the status of the seller determines whether the condition applies. The provision applies both to the goods and to everything supplied with the goods.

Goods are of merchantable quality if they are fit for the purposes for which goods of that kind are commonly bought and are as durable as is reasonable to expect, having regard to the description applied to them, the price (if relevant) and all other circumstances. The quality includes the state and condition of the goods. Ultimately, what constitutes merchantable quality is a matter of judgment for the court in the circumstances.


Elements of Merchantability I

Where goods have multiple purposes, questions may arise as to whether the fact that they are fit for one purpose means they are fit for other purposes.  Where a buyer purchases goods for a non-normal, it is probably sufficient that they are fit for their normal purpose.  The buyer should in effect, advise the seller of the intended purpose.

Goods must be reasonably durable in order to be merchantable.  They must remain fit for their purpose for a reasonable time. The durability must be present at the time of supply.  If they break or become defective soon after supply, this may be evidence that they were not durable at the time.  However, the seller might be in a position to show that the breakage or defect is due to abnormal use by the buyer or some other post-purchase event.

The nature and description of goods will be relevant in the court’s appraisal of what might reasonably be expected. More would be expected from goods described as “new” or “top class” than of second-hand use, shop soiled, et cetera.  Defects and deficiencies in second-hand goods may be expected which would not be expected in the case of new goods.


Elements of Merchantability II

The price paid is relevant to the expected merchantability. Where particular goods range in price, the expectations of quality will increase with the price increase.  The quality might be expected to vary proportionately to the price. If goods are purchased by a wholesaler or retailer for resale, then they may be unfitting for resale as new products, even with minor defects.

The fact that goods may be repaired under a manufacturer’s warranty does not make them merchantable, where they are not otherwise merchantable. The description of goods will be relevant to their merchantability.  In this context, the description embraces a wider range of matters than under the implied condition relating to a sale by description.  The entirety of the description is relevant together with other factors in considering whether the requisite merchantable quality is present.


Elements of Merchantability III

Defective and unsafe goods are likely not to be merchantable.  The Irish Sale of Goods Act has specific provisions for the sale of motor vehicles.  This does not apply to trade purchasers.  It is an implied condition that at the time of the delivery, the motor vehicle is free from any defect which would render it a danger to the public, including persons travelling in it.

A minor defect may not make the goods unmerchantable.  The buyer would therefore not be entitled to reject them and rescind the contract.  He may be entitled to claim for damages arising from the nonconformity. In some cases, minor defects may make the goods unmerchantable. If in the circumstances, there are particular expectations of luxury quality and finish, then relatively minor defects may constitute a breach of the merchantability condition.

The implied obligations in relation to merchantability apply at the time of sale. Where goods later cease to function or defects manifest themselves, it may be possible to trace this to an inherent defect which was present at the time of sale. See the presumption created by the 2002 Regulations in consumer sales.


Fit for Purpose; Ordinary Use

Where goods are sold in the course of business, it is an implied term that they are fit for the purpose or purposes for which goods of that kind are commonly bought and are as durable as is reasonable to expect having regard to any description applied to them, the price, if relevant, and all other relevant circumstances.

The condition is that the goods are reasonably fit for purpose.  They need not be perfect.  The entire circumstances are taken into account.

The implied term covers all of the goods and things supplied, including the packaging.  It may include packaging. As a minimum, goods must be fit for some purpose. The fitness for purpose requirement applies at the date of delivery. It overlaps the requirement that the goods be merchantable.


Fit for Purpose; Particular / Buyer’s Special Use I

Where the seller sells goods in the course of business and the buyer makes known to the seller, any particular purpose for which the goods are bought, it is an implied condition that the goods supplied are reasonably fit for that purpose.

Where the buyer mentions a particular purpose, it is a condition that the goods are reasonably fit for that purpose.  If no purpose is mentioned, it may be implied that are to be fit for a particular purpose of the buyer.

This is so, whether or not this is a purpose for which the goods are commonly supplied, except where the circumstances show the buyer did not rely on, or it was unreasonable for him to rely on the seller’s skill or judgment. Questions of interpretation may arise as to who the risk lies with.

The burden of proof is on the seller to show the buyer did not rely on his judgment or that it would be unreasonable for him to so rely.

Where goods are manufactured to the buyer’s specifications, the buyer is not likely to have relied on the seller. The seller’s obligations will usually be limited to conformity with the specification and to supplying appropriate material and services.


Fit for Purpose; Particular / Buyer’s Special Use II

The goods must be reasonably fit for the purpose indicated by the buyer. The indication may be explicit or implicit. The requirement for fitness for purposes is judged at the time of sale. As with merchantability, if defects arise shortly thereafter, this will tend to prove unfitness for the purpose at the relevant time.

The more explicit the requirement, the greater will be the burden on the seller. It may be easy to infer that a consumer has relied on the skill of a specialist / professional retailer, in relation to a designation of purpose.  However, in a business to business sale, this may not be as easily inferred

Where goods have a normal use, it is presumed that they are bought for that use. If the buyer wants to put goods to a special or unusual use, this must be disclosed in order for the provision to apply. The buyer must, in words or by implication, make known to the seller, the particular purposes for which he purchases the goods. This may be implied in some circumstances.


Elements of Fitness

The permissible durability of the goods depends on their nature. The goods are presumed to be subject to normal deterioration, wear and tear with the passage of time. Less is usually expected of second-hand goods. If goods don’t work shortly after their purchase, they are likely to be unfit for purpose and not of merchantable quality at the point of sale.

It is presumed that the buyer relied on the goods being fit for purpose.  The seller has to show that the buyer did not rely on, or that it would be unreasonable for him to rely on the seller’s skill and judgment, in order to avoid liability.  If a problem or defect is disclosed in advance, it is unlikely the buyer relied on the seller’s skill and judgment.

Where the buyer has provided the specifications and the goods were manufactured to them, there is no reliance on the seller in relation to the specification. This does not preclude the possibility of another breach of contract


Sale by Sample

If the sale is by sample, there is an implied condition that the goods correspond with the sample in terms of quality.  If a defect is reasonably discoverable from the sample, it is deemed to be disclosed. The buyer must have been given the opportunity to compare the sample with the bulk and to examine the sample.

There is an implied condition that the goods shall be free from any defect, rendering them unmerchantable, which would not be apparent on reasonable examination of the sample.

The Sale of Goods Act provides that where goods are sold by sample, three conditions apply.

  • the bulk must comply with the sample in quality;
  • the buyer must have a reasonable opportunity to compare the bulk with the sample;
  • the goods will be free from any defect rendering them unmerchantable, which would not be apparent on reasonable examination of the sample.

This condition applies irrespective of whether the seller acts in the course of business or otherwise.  However, most sales in bulk are likely to be in the course of the business.


Nature of Conditions

The implied terms and conditions in relation to goods are strict unconditional obligations.  This means that the retailer is strictly liable notwithstanding the complete absence of fault.  An exclusion or limitation of liability is not possible in consumer cases. An exclusion must be fair and reasonable in a business to business sale.

This is in contrast with the position in respect of services. The obligation is usually to exercise due care and skill. This liability can be excluded or limited, even in consumer cases subject to the fair and reasonable test.

Where the retailer is liable, he would, in general, have a claim against his immediate wholesaler and so on up the chain.


Motor Vehicles

There are special provisions for motor vehicles.  It is an implied condition that at the time of the delivery, a motor vehicle is free from any defect which would render it a danger to the public, including persons travelling in it. The benefit of this condition does not apply to trade purchasers.

Motor dealers must supply a certificate that the vehicle is free from defects.  If this is not delivered, the onus is on the motor dealer in the event of a later dispute, to prove the defect was not present at the time of sale.  It is not possible to exclude these terms.

The condition may be avoided if it is agreed that the vehicle is not intended for use in the condition in which it is sold, a document is signed to this effect and given to the buyer prior to delivery and the clause is just, fair and reasonable.

The above provision applies for the benefit both of the buyer and other persons using the vehicle.  Therefore, persons using the vehicle with the buyer’s consent who suffer loss or damage may sue for breach of the implied condition.  A special three-year limitation period applies.


References and Sources

Irish Texts

Brian Doolan, A Casebook on Irish Business Law (1989)

Henry Ellis, Modern Irish Commercial and Consumer Law (2004)

Michael Forde, Commercial Law, 3rd Edition (2005)

Linehan, Irish Business and Commercial Law (1995)

McCormack, Reservation of Title 1990 (1994)

Patrick O’Reilly (ed.), Commercial and Consumer Law  (Statutes) (2000)

Sean Quinn (ed.), Statutes Revised on Commercial Law, 1695-1913 (1994)

Fidelma White, Commercial Law (2003) (2nd Ed 2012)

Fidelma White, Commercial and Economic Law In Ireland (2011)

Vincent Grogan, Thelma King and Edward J. Donelan, Sale of Goods and Supply of Services: A Guide to the Legislation (Law Society of Ireland, 1983)

Paul Anthony McDermott, Contract Law (Butterworths, Dublin, 2001)

2011 Report of the Sales Law Review Group,

UK texts

Atiyah and Adam’s Sale of Goods 13th Ed (2016)

Bridge, Benjamin’s Sale of Goods 9th Ed (2015);

Bridge, The Sale of Goods 3rd Ed (2014)

Blackstones’ Statutes Commercial and Consumer Law 2017

Goode on Commercial Law 5th Ed 2017

Legislation

Sale of Goods Act 1893

Sale of Goods and Supply of Services Act 1980

Electronic Commerce Act 2000

Criminal Justice (Theft and Fraud Offences) Act 2001 (50/2001)

International Carriage of Goods by Road Act 1990 (13/1990)

European Union (Consumer Information, Cancellation and Other Rights) Regulations 2013 (S.I. No. 484 of 2013)

European Communities (Certain Aspects of the Sale of Consumer Goods and Associated Guarantees) Regulations 2003 (S.I. No. 11 of 2003)