Sale of Goods and Consumer Protection Act

With the combination of the Sale of Goods Act 1979, The Consumer Protection Act 1987 and the General Product Safety Regulations 2005, it can be argued that the consumer is finally adequately protected against both shoddy and dangerous goods.

Discuss with reference to relevant legislation.

In a contract for the sale of goods, section 14 of the sale of goods Act 1979 which is one of the most important provisions in the act [1] sets out the obligations of the seller in relation to quality and fitness [2] .

Before the act was reformed, the early law was based on the idea that it was up to the parties to make their own bargain, and it stated it was up to the buyer to decide if the goods were merchantable and fit for purpose before they agree to buy the product. This meant that companies could exclude all implied terms. This was known as the doctrine of ‘Caveat Emptor’ which means let the buyers beware. Although the ‘let the buyer’ beware principle has been severely diminished, it is not entirely extinct by S.14 (1) [3] .

The sale of goods Act 1979 protects consumers if the seller sells in the course of a business as it restricts the use of the ‘caveat emptor’ rule, however this protection varies if the seller is a private seller as the rule may still apply. Therefore, it could be said that the amended Sale of Goods Act 1979 may not protect all consumers from dangerous and shoddy goods, as private sellers are not included and the consumer may not always be protected. Therefore, in order to ensure that the consumer is adequately protected there must be a clear distinction between a ‘sale in the course of a business’ and the sale not in the course of a business. S.14(5) makes it clear that if someone is selling in the course of a business as an agent for a private seller, then the seller must make this clear to the buyer in order to avoid liability.

In a recent Scottish case of Boyter V Thomas [4] it was illustrated that a buyer can take advantage of S.14 (5) if he buys from a dealer without knowing that the dealer is acting for a non business seller. Therefore it could be said that although by S.14 (1) the ‘caveat emptor’ may still apply in a private sale which isn’t in the course of a business. S.12 (5) ensures that the buyer must be informed if a sale is made in the course of a business for a private seller and therefore the agent cannot rely on the ‘caveat emptor’ principle on behalf of the private seller.

The case of Grant v Australian knitting Mills where a chemical in the underpants caused dermatitis clearly proved that if goods are unsafe they are not deemed as satisfactory quality, however many products such as knives, saws, and other tools have a dangerous nature and it is common sense that instructions are not needed for them to be used in a safe manner. In contrast to this, other products which such as cars, machinery and garden tools etc. would be deemed dangerous unless clear unambiguous instructions on how to handle them are supplied with them. With regards to this it is made clear that the consumer is protected against dangerous and shoddy goods if they are not of a satisfactory quality and they cause damage to the consumer, however if a good is dangerous and a clear warning is given with a set of instructions on how to operate the good is ignored then the consumer is not in a position to claim.

The definition of ‘defective’ goods is broadly similar to the definition of ‘satisfactory quality’. [5] . however the definition of satisfactory quality in the sale of goods Act 1979 covers both unsafe and shoddy, poor quality products, however defective in the 1987 Act means only unsafe or dangerous products [6] .

The aim of Consumer Protection Act 1987 is to help safeguard the consumer from the products that do not reach a reasonable level of safety. The main areas dealt with are described as Product Liability and Consumer Safety. Defective products are defined, as being those where the safety of the product is not such as persons generally is entitled to expect. A product will not be considered defective simply because it is of poor quality or because a safer version is subsequently put on the market.

The consumer protection Act 1987 was set up in response to the EC’s 1985 Directive on Product Liability. This directive was created with the aim of harmonizing law in Member States and promoting movement of goods and free trade. It introduced for the first time the concept of Strict Liability.

The consumer protection Act 1987 implies that the burden of proof lies on the claimant; this was recently confirmed in the case of Foster v Biovil [7] which was a breast implant case. Now that partial causation is seen as sufficient in bringing a claim due to the Act stateing that the manufacturer may not necessarily be wholly responsible, but as long as the claimant can prove they were in some part to blame an action can be bought against them. This has come directly from the European Directive, and which makes bringing a case to court much easier for the plaintiff.

One of the major factors which is potentially seen as a let down to the consumer when it comes to the CPA 1987 with regards to adequately protecting them from dangerous and shoddy goods is that S.6(4) still allows contributory negligence. If the consumer can be proved to have been in some way liable for the injuries received, they can have their damages reduced which leads to Another point, The CPA 1987 only covers damages of more than £275. [8] This fact alone could contribute to a lower number of claims as people simply may not qualify. In addition there is the situation where a claim would originally be worth over £275, but because of contributory negligence it could be reduced to under this and therefore invalidated, meaning in real terms a consumer isn’t protected against unsafe or dangerous goods if the damage is less than £275 or the damage is more then this but it has been reduced due to contributory negligence.

S.5(2) deals with the damages that are covered in the Act, however the CPA1987 does not cover loss of or damage to the ‘product itself ‘ or to ‘ the whole or any part of any product which has been supplied with the defective product comprised in it’. Therefore it could be said that the damages that are covered do not fully protect the consumer for everything damaged from the consequences of being supplied a dangerous good.

The consumer protection Act provides a wide range of people which a claimant can sue for damages for unsafe goods. [9] . If the injured party is unable to identify the producer, and they are able to identify another party in the supply chain who, failing to identify the producer or another supplier higher up the chain will become liable. This protects the consumer as more than one person can be held liable under the Act; liability can be joint or several. This wide range of possible liable parties increases the chance that a claimant will be protected and be able to successfully sue for damages. In addition to this, section 7 of the Act prevents the defendant from excluding or limiting liability, either contractually or in any other way. This makes the possibility of a successful claim against dangerous and shoddy goods much higher.

A further point which limits protection to the consumer is time restraints. The basic limitation period for claims under the Act is 3 years from the time of injuries sustained or from the point when the defendant could reasonably have known of the claim. There is also a “long-stop” limit which says that no claim can be bought against the manufacturer more than 10 years after the product was put into circulation. This is thought to be a serious limitation on the Act as many people may not be aware of their legal rights until it is too late. There is also the possibility that a defect in a product may not appear until after the 10 years are up.

If a consumer has a claim and the privity rules bar it, an injured claimant will have to bring proceedings in tort. This used to mean having to prove negligence existed which is very difficult. However since the arrival of the consumer protection Act 1987 and the imposition of strict liability on producers and distributors, the claimants’ position has improved [10] .

The definition of ‘defective’ goods is broadly similar to the definition of ‘satisfactory quality’. [11] . however the definition of satisfactory quality in the sale of goods Act 1979 covers both unsafe and shoddy, poor quality products, however defective in the 1987 Act means only unsafe or dangerous products [12] .

The general safety requirements 2005 came into force on 1 October 2005. The regulation is said to have intensified the protection of consumers from unsafe goods by, prohibiting producers from placing unsafe products on the market and also by imposing strict obligations on distributors [13] in respect of safety and risk management. The regulation also strengthened enforcement powers and the potential for civil actions.Regulation 9 puts joint liability on both producers and distributors to inform the enforcement authorities and local trading standards officers, Where they know they have placed an unsafe product on the market.

In addition to this the regulation obliges producers and distributors to inform the authority of the measures taken to avoid risk to consumer .A “serious risk” is defined [14] , as meaning a “serious risk, including one the effects of which are not immediate, requiring rapid intervention”. In the event of a “serious risk” occurring, then more detailed notification has to be given to the enforcement authority, such as the precise nature of the risk, precise detail as to the product or batch, and all the information which is necessary for tracing that product. [15]

The regulation [16] works with the CPA 1987 and SOGA 1979 as regulations 11-15 deal with the powers authorities have been awarded in order to ensure the consumer is adequately protected from dangerous and shoddy goods.

An enforcement authority can issue a suspension notice to suspend a product as long as necessary to evaluate the safety of the product. As well as suspension of a product Regulation 14 also gives authorities the power to issue withdrawal notices.

The regulations also provide enforcement authorities with two new important powers. The requirement to mark [17] ,gives the enforcement authority the power to require goods to be so marked that they indicate the nature of any risk which they present. Regulation 15 is altogether harsher. If a dangerous product has been placed on the market, an enforcement authority can require the recall of the product from the marketplace if it there is a severe defect.

Regulation 42 [18] makes it clear that breach of the regulations does not of itself provide a cause of action for an individual who might suffer loss because of such infringement. However Section 2 of CPA 1987 provides a remedy to a person injured by a defective product, without the need to prove negligence. Similarly, the purchaser of defective goods has all the rights provided by the Sale of Goods Act 1979 as to the provision of goods which are both of satisfactory quality and reasonably fit for their purpose [19] .

Therefore it could be said that the SGA1979 and the CPA1987 work together in order to give the consumer a base to fall on in order to have their rights protected, and the GPSR 2005 set out the obligations in which producers have to follow. With regards to the way they are combined to ensure the consumer is adequately protected it could be said that this finally happened when the GPSR2005 was enforced as it gave authorities greater powers to help ensure dangerous and shoddy goods don’t exist on the market.