Question

Business Law Thomas Crown sells a priceless Monet painting to the Prado Art Gallery in Madrid. The gallery pays him a fortune for this masterpiece. A few months later, Monet’s great granddaughter produces a document proving without a doubt that she is the rightful owner of the artwork, and that it was stolen from her. She claims the painting back from the Prado Gallery. 1.1. Advise Prado Gallery on the relevant warranty that may assist them on a claim against Thomas Crown and any requirements that they must satisfy before they may bring a claim against the seller. 1.2 Identify and discuss any limitations of the warranty.

Answer 1

The implied warranty of merchantability is governed by State law every consumer product purchase leading to guarantee that the product will function as implied and in the manner expected when used for its intended purpose. This requires the standard for merchantability being maintained in accordance with article 2 of the uniform commercial code by meeting the specified criteria:

• The item must be in conformance with the standards of the trade applicable to the specific contract for sale.
• The item must be suitable for the specific purpose which it is ordinarily put to use even if the buyer has ordered it for different use.
• The item must always be in accordance with the quality and quantity at specified within the contract for sale and have a uniformity within the tolerance levels specified
• Item must conform to all the packaging and labeling requirements established within the contract for sale.
• The specification mentioned on the packaging and labels needs to be strictly adhered to even when not specified by the contract for sale. As everything on the package and label is a promise by the supplier.

The implied warranty of fitness establishes that a product is absolutely guaranteed for a specific purpose which is beyond the lower threshold of merchantability. For Example, when a cleaning product is purchased with the specific request of it being able to remove stains from ceramic tiles but the product fails to do so but performed the basic cleaning it is meant for the item can be returned by the consumer under its implied warranty of fitness having failed. This establishes that consumer goods which perfectly perform the required function but do not meet the consumer's planned and stated use are considered to breach an implied warranty of fitness. A product can be sold with the condition "sold as is" or "with all faults" to avail immunity from implied warranty but this is not allowed in most of the states.

Express warranties of authenticity arise from a seller’s affirmation of facts, promises or statements about authenticity, provenance, etc. Unless specifically excluded or modified, every contract for the sale of art includes a warranty stating that the seller is transferring good title, the seller has the right to transfer title, and the works are transferred free of security interests, liens or other encumbrances of which the buyer has no knowledge. Implied warranties arise from the circumstances or conduct of the sale and not from express statements of the seller. The statute of limitations under section 2 of the UCC is four years from the breach, regardless of knowledge of the breach

Section 12(1) of the sale of goods act 1979 provides that "there is an implied term on the part of the seller that in the case of a sale he has a right to sell the goods" to essentially transfer title of the goods.

The buyers are at the mercy of the principle of caveat emptor or let the buyer beware and take all due care by performing due diligence before making a purchase to establish title to the goods in case the buyers a merchant dealing in works of that kind and having expertise in the field which is true in the case of Prado art gallery.

There is a relief to an extent arising from the duty of the seller to disclose any latent defects in type and other considerations which may become applicable due to consumer protection regulations on the practice of conveyancing. the seller in order to adequately satisfy the required express and implied warranty obligations under the uniform commercial code outlined in section 2. The seller must be satisfied that they can absolutely warrant free and clear type along with authenticity and quality as required under the warranty as the section requires disclosure of any information which provides material evidence of lack of title, quality, or authenticity.

The statute of limitation which is responsible for determining the commencement of a plane tends to favor the rightful owner subsequent purchaser on the basis of the discovery rule establishing the exercising of reasonable due diligence for discovering the facts regarding title and authenticity. Under US laws, a title to stolen goods cannot be passed even in case of good faith acquisition. In situations involving stolen goods statute of limitations is applicable even in case of a bona fide purchaser for value. In case of voidable title arising from fraud or non-payment, the bona fide purchaser in good faith can acquire good title even when the seller has a voidable title. The statute of limitations of the recovery right for stolen goods where there is an unreasonable delay in asserting the claim over the stolen goods, beyond three years, resulting in prejudice to the good faith purchaser. It is also important to establish Thomas Crown had bad title arising from awareness of the painting having been stolen.