.IMPLIED TERMS IN A CONTRACT OF SALE OF GOODS.

A contract of sale of goods is defined as one whereby the seller transfers or agrees to
transfer the property in goods to the buyer for a money consideration called the price 1.
Under this agreement, the transaction will be called either a sale2 or an agreement to
sale3 depending on whether the property is transferred promptly or executory.

Terms of a contract refer to statements made by parties or practices normally followed

by parties which govern them in a contractual relationship. Terms under a contract are
generally categorized into two rather broad categories; Conditions and Warranties.
A condition is an agreement with reference to goods which are the subject of a
contract of sale, but collateral to the main purpose of such a contract, the breach of
which gives rise to a right to reject the goods and treat the contract as repudiated 4. On
the other hand, a warranty is an agreement with reference to goods which are the
subject of a contract of sale, but collateral to the main purpose of that contract, the
breach of which gives rise to a claim for damages, but not to a right to reject the
goods and treat the contract as repudiated5.

Generally, parties engaging in a contract are at liberty to negotiate terms of their

contract and the law will abstain from imposing anything otherwise agreed. This is in
the interest of the presumption that parties have freedom to contract. Terms agreed
by parties during the making of a contract fall within the ambit referred to as (express
terms). Express terms are those that are agreed upon by parties to the contract.
Cognizant of the fact that Express terms in a contract are more likely to be dictated by
the seller because of his higher bargaining power in the transaction, the law 6 implies
terms in the contract that are usually not provided for. Most of these implied terms
are biased towards the protection of the buyer as shall be demonstrated in the essay
below.

1
Sale of Goods and Supply of Services Act Cap 227 Section 2(1)
2
Ibid Section 2(4)
3
Ibid Section 2(5)
4
Ibid Section 1(1)
5
Ibid Section 1(1)
6
Ibid Section (1) to (8)

A.M. MUSEKURA
Implied terms as to title7. The law presumes that anyone selling a commodity/good
to a buyer posses a good title (right to sell) to the commodity. For an agreement to
sale, this (right to sale) must be got before the property in the goods is to pass to the
buyer. As such therefore if the owner’s title turns out to be flawed, the buyer will be
able to return the goods and sue for the price. It is only in very rare exceptional
circumstances that this condition can be by-passed.

The operation of the Implied condition as to title is demonstrated in the case of

Rowland v Divall8 wherein the defendant honestly bought a stolen car from a thief
and sold it to the plaintiff, who happened to be a car dealer that subsequently sold off
the car to another buyer. In due course, some four months after the sale by the
defendant to the plaintiff, the car was repossessed by the police and returned to its true
owner. Clearly, on these facts, there was a breach of the implied term as to title and
the plaintiff was able to recover the entire price he had paid for the car.

Implied terms for Goods sold by description. It is implied by the law in Section
14(1)9 that where a buyer is specific on the nature and quality, brand of a product,
time for the delivery or even the desired quantity he is to buy, the seller must deliver
an article that fit the buyers specific description. This is illustrated in the case of
Bowes v Shand10 where it was held that the item delivered had not been the item
bargained for and as such the item was inconsistent with the buyer’s description. In
the case in point, the buyer who is the defendant rejected a consignment of rice that
was delivered between February because he had negotiated that it be delivered
between March and April.

Section 1411 further illustrates that where there is a sale by description and sample, it
will be insufficient for the bulk of the goods to be consistent with the sample. The
bulk of goods in such cases should be consistent with both the description and the
sample. It shall also not be relevant that the goods delivered without proper regard to
description are fit for purpose. Such was the holding in Acros v Ranaasen12where in
7
Ibid Section 13 (1)
8
[1923] 2 KB 500.
9
Act (n 1)
10
 (1877) 2 A.C. 455
11
Act (n 1) Section 14 (2)
12
[1933] AC 470

A.M. MUSEKURA
the description was for staves that where half an inch thick. The bulk of the delivery
was slightly thicker and yet could perfectly be used by the buyer. It was however
emphasized that the goods must fit the buyers description.

Implied term in a Sale by sample. A sale by sample is a contract where there is a

term in the contract express or implied to that effect13. Generally under a sale by
sample, the buyer will be able to reject goods and sue for the price of the goods where
in they don’t match with the sample. The buyer shall also be given a reasonable
opportunity to examine the bulk of the goods and the sample looking out for any
deviations. This is illustrated in the case of Loymer v Smith14 where the buy was not
allowed to examine fully the parcels of wheat he had contracted for and thereby
giving him the liberty to ignore the contract.

The condition still applies even if the buyer inspected the sample as well as the goods
and the deviation was not apparent to a reasonable man 15. The case of Godle v
Perry16, where the buyer purchased catapults from the seller. On examination of a
sample of the catapults, the buyer dint see a defect, however, in normal use, the
catapults snapped due to a latent defect in them that was not reasonably apparent at
the purchase time.

Implied under taking as to quality and fitness for purpose 17. Prima facie, there is
no implied term as to quality and fitness for any purpose of a good sold to a buyer.
This is because the law expects the buyer to exercise due diligence and indeed
investigate the goods to measure if they satisfy his standards. This is technically
called the doctrine of cavaet emptor. However, If the buyer describes what he is going
to use the goods for or if the goods sold lie within the ordinary business of the seller
which would make it reasonable that the buyer relied on the sellers expertise with the
product to assume its fit for the intended purpose , it shall be implied that the goods
sold are reasonably fit for purpose. This was demonstrated in the case of Gouster
Enterprises limited v John Kakas Oumo18, the buyer had to prove that he had relied
13
Act (n 1) Section 17(1)
14
(1822) 1 B&C1.
15
Act (n 1) Section 17 2(C)
16
[1960] 1 WLR 9
17
Ibid Section 15
18
SCCA No. 8 of 2003

A.M. MUSEKURA
on the seller's skill and judgment to supply the goods fit for the purpose for which the
buyer bought them.

Similarly, the goods shall need to reach a satisfactory quality19 except if; the buyer
is informed of any defects in the quality of the goods prior to the contract. An
opportunity to inspect goods will also serve to disqualify the implied condition as to
quality.

Implied condition as to merchant-ability of the goods. For this condition to apply,

it is not only that the sale must be by description but the following conditions must
also be satisfied; (i) The seller should be a dealer (should deal) in goods of that
description whether he is a manufacturer or not (ii) The buyer must not have any
opportunity of examining the goods or there must be some latent defect in the goods,
which would not be apparent on reasonable examination of the same (goods). Where
the buyer had an opportunity to inspect and examine the goods but he did not do so, or
if he has examined the goods, there is no implied condition as to merchant-ability as
regards the defects which such examination ought to have revealed. Merchant-ability
is measured objectively against the standard of the reasonable man. In the case of
Grant v Australia Knitting Company20, The products supplied had been bought
from a knitting contained certain components that would irritate the skins of those
who put them on. It was held that these goods were not of merchantable quality.

In addition to the implied conditions, the law will also imply Warranties into
contracts of sale the breach of which can entitle the aggrieved party to a claim for
damages but not to repudiate the contract.

Implied warranty that the buyer will enjoy quiet possession of the goods. Quiet
possession is the right to awn and use goods without anyone giving you a hard time.
This warranty is implied by Section 13(2)(b). As such therefore, where a buyer’s
possession of the commodity is interrupted by any other person, he will have a legal
right to claim for damages in respect to that disturbance. The implied warranty of
quiet posses-ion was illustrated in the case of Mason v Burmingham21 wherein the
case involved a buyer who bought a second hand type writer. The person who sold it

19
Ibid Section 15 (3) and (4)
20
 [1936] AC 85
21
(1949) 2 KB 545

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to him had also bought it oblivious of the fact that the typewriter had been stolen from
the original owner. As such, the true owner recovered the type writer from the
plaintiff thus interrupting his quiet possession. The buyer was able to get a remedy.

Common law will also imply a term that the seller should disclose any information
regarding the potential dangerous nature of their commodities. This implication is
what forces manufactures of alcoholic beverages as well as cigarettes to always warn
their customers of the potential dangers of their commodities.

In conclusion therefore, the terms that are applicable to a contract are not limited to
the terms negotiated by parties to that contract. The applicable terms will also be
implied by statute and court.

Yours truely,

A.M. Musekura.

A.M. MUSEKURA
BIBLIOGRAPHY

 The Sale of Goods and Supply of Services Act 2017

Case law

 Acros v Ranaasen [1933] AC 470

 Bowes v Shand (1877) 2 A.C. 455

 Godle v Perry [1960] 1 WLR 9

 Gouster Enterprises limited v John Kakas Oumo SCCA No. 8 of 2003

 Grant v Australia Knitting Company [1936] AC 85

 Loymer v Smith (1822) 1 B&C1.

 Mason v Burmingham (1949) 2 KB 545

A.M. MUSEKURA