In: Accounting
After only 3 days of using her new MowMaster 6000, Joanna
notices that it is not cutting as well. When she inspects the
blades, she finds that they are already worn down and
blunted.
When she calls Lawnmower City to complain, she is told, “We’re not
responsible for any problems like that. Didn’t you see the sign at
the counter?”
At the sales counter where Joanna had paid for her MowMaster 6000,
there was a small sign: Lawnmower City is not liable for any breach
of warranty or condition in any sale of its products.
When Joanna was at the counter, the sign had been partially hidden
by a group of pot plants being held aside for another customer to
collect.
2. Does the sign apply to Joanna’s sale contract with Lawnmower
City? (use IRAC model)
Issue : Joanna notices after 3 days of use that her new MowMaster 6,000 is not functioning as efficiently as it should. On inspecting the blades, they are already worn down and blunted. While making the purchase, Joanna missed the sign at the seller's counter that the seller is not responsible for any breach of condition or warranty.
Rule: In a contract of sale of goods, a stipulation essential to the main purpose of the contract is a condition, and a breach of a condition entitles the buyer to repudiate the contract and to a refund of the price plus damages if any. Such stipulation may be express or implied.
In any contract of sale there is an implied condition that the goods would be of merchantable quality, i.e, they should be fit for the ordinary purpose for which they were intended. In the given situation for example, the MowMaster 6,000 should have been fit to mow.
On the other hand, the Doctrine of Caveat Emptor ( buyer beware ) implies that the buyer buys at his own risk. This basically means that before buying the goods, the buyer should inspect and examine the goods, and purchase them only after being completely satisfied that the quality and fitness of the goods are suitable for his purpose. The seller is not responsible for any defects in the goods which can be revealed by an examination of the goods.
Application: In the given situation, the MowMaster was defective no doubt, and there was a breach of the implied conditions of merchantability, description, quality and fitness. But the defect was not a latent defect. It would have become apparent to Joanna if she had taken the trouble to inspect the blades of the mower before buying it. By failing to do so, she falls within the scope of the maxim of Caveat Emptor.
Conclusion. Yes, the sign would apply to Joanna in this case, as the Doctrine of Caveat Emptor would apply.