GSM 5131

BUSINESS LAW AND ETHICS

Sale of Goods Act 1957
Name Student ID
Sugasni
Viveksarati Sandrasigaran
PBS1311014
Tan Zhu Zhen
GM05107

Chin Wai Loong
GM05106

Lai Chee King
Lecturer
Dr.Tengku Naufal Tengku Mansor

Question a) Susila told the sales person that she was suffering from
insomnia. The sales person recommended a luxury, deep filled
duck-down pillow. Susila purchased the pillow and slept on it.
However, she suffered an allergic reaction and developed a
severe rash. Susila did not inform the seller of her allergy.
Legal
analysis

Whether Susila can sue the sales person for selling unfit pillow to
her?

Relevant Law Sec 16 (1) (a) SOGA 1957 :Buyer should disclose the purpose of
goods are required. If no disclosure made, the seller will not be
liable if the good purchase is not fit for usage

Ref to case : GRIFFITHS v PETER CONWAY LTD
Court held that
A woman with an unusual sensitive skin who bought a Harris Tweed
coat, without disclosing her sensitivity to the seller, did not succeed
under this section.
Application to
Law
Susila couldnt sue the sales person under this section unless she
inform the seller earlier about her allergy .
Question b) Susila purchased a catapult for her son that broke during the first use. Her son
suffered an eye injury;
Legal issues Whether the seller should be made liable for the mishap?
Relevant Law

Section 16 ( 1 ) b , Sale of Goods Act , 1957 (Goods Must be of Merchantable
Quality)
Where goods are bought by description from a seller who deals in goods of that
description (whether he is the manufacturer or producer or not) there is an implied
condition that the goods shall be of merchantable quality. Provide that if the buyer
has examined the goods , there be no implied condition as regards defects which
such examined ought to have revealed.

Section 17 ( 2 ) c , Sale of Goods Act , 1957 (Sale by sample)
In the case of a contract for sale by sample there is an implied condition that the
goods shall be free from any defect rendering them non-merchantable which would
not be apparent on reasonable examination of the sample.
Relevant Case Godley v. Perry (1960)
Drummond v. Van Ingen (1887)
Application to
Law

The catapult is defective for use as it broke during the first time using and caused
Susilas son eye injury and consider is an non-merchantable quality goods that not fit
for the particular use to which they were sold. Susila is a buyer with ordinary
experience and diligence and she is not discover on reasonable inspection of the
sample. Moreover , the catapult was not fit for the purpose for which buyer wanted it
and it was of non-merchantable quality. Hence, Susila can sue the seller liable for
damages to her son and claim for personal remedy for damages against her son.
Question c) Susila needed a new pair of training shoes for the gym. She selected a
pair that was described as having gel-filled soles and being suitable for
running on a treadmill. Unfortunately, the shoes fell apart during the
first gym session. Susila discovered that the soles were not gel-filled as
advertised.

Legal issues Whether the seller should be made liable for unfit product sold.

Relevant Law Sec 16 (1) (b) SOGA 1957 :Where goods are bought by
description from a seller who deals in goods of that description, there is an
implied condition that the goods shall be of merchantable quality.

Ref to case : Wilson v Ricket, Cockerell & Co. Ltd
A lady ordered fuel by its trade name Coalite from a fuel merchant. The
consignment included a piece of coal in which a detonator was embedded and
resulting in an explosion in the fireplace.

Held:
The consignment as a whole was non-merchantable. It had defects making it
unfit for burning.
Application to
Law
Since the product sold by the seller deemed unfit, and was not as per
described. Thus the seller should be made liable for it.
Question c) Susila needed a new pair of training shoes for the gym. She selected a
pair that was described as having gel-filled soles and being suitable
for running on a treadmill. Unfortunately, the shoes fell apart during
the first gym session. Susila discovered that the soles were not gel-
filled as advertised.
Legal issues Whether Susila entitled to claim damage for the training shoes?

Relevant Law Sec 15 SOGA 1957 : Where there is a contract for the sale of goods by
description, there is an implied condition that the goods shall correspond with
the description.

Ref to case : Nagurdas Purshotumdas & Co v. Mitsui Bussan Kaisha
Ltd (1911)
Previous contract between the parties for the sale of flour had been sold in bags
bearing a well known trademark. Further flour was ordered described as the
same as our previous contract. However, flour identical in quality was
delivered but without the trademark.

Held: It did not comply with the description.
Application to
Law
Since the training shoes did not correspond with the description as having gel-
filled soles, Susila is entitled to claim damage for the shoes.
SUMMARY OF THE MINI CASE
Sam made a proposal to Susila, that he would like to purchase a Han dynasty sword for RM 21,000.
Susila agreed to the initial proposal. The antique is to be transferred to Sam after two days. Song made
a counter proposal to Susila that he would like to purchase it by cash for RM 25,000 and will take the
ownership of the antique on the same day. Susila agreed to it.

Case analysis
Legal issues Whether Sam can sue Susila for breach of contract?
Relevant Law Section 60, repudiation of contract before due date.
Where either party repudiates the contract before the delivery date,
the other party may treat the contract as rescinded and sue for
damages for the breach.
Application to
Law
Susila repudiate the contract before the promised delivery date to
Sam, hence Sam can sue Susila for breach of contract and claim
personal remedy for damages against Susila.
Case analysis
Assumption Sam have not made any payment to Susila before the sale is made
between Susila and Song.
Relevant Law Section 4(4), agreement to sell becomes a sale when the time
elapses or the conditions are fulfilled subject to which the property
of goods is to be transferred.
If the seller breaches the agreement to sell, the buyer has only a
personal remedy for damages against the seller.
Application to
Law
Based on above assumption, there was only agreement to sell
between Sam and Susila. Therefore, Sam could only sue personal
remedy for damages against Susila.
Case analysis
Legal issues

Whether Sam is able to retrieve the sword from Song?

Relevant
Law
Sec 30 (1): Sale by a Seller in Possession after Sale.
If a seller resells to a second buyer the goods sold by him
previously to the first buyer, the second buyer will obtain the
good title to the goods if he has received the goods in good faith
and without notice of the previous sale.
Motor Credits (Hire Finance) Ltd v Pacific Motor Auction Pty
Ltd

Application
to Law
Song noticed the previous sale between Susila and Sam and
obtained the antique without good faith. Thus, Sam should be
entitled for the good title of the antique.
Case analysis
Legal issues

Whether there is a contract between Susila and Sam?

Relevant Law Sec 2(b) CA 1950 :When the person to whom the proposal is made signifies his assent
thereto, the proposal is said to be accepted: a proposal, when accepted, becomes a
promise.

Sec 26 CA 1950: An agreement made without consideration is void.

Sec 19 SOCA 1957: Sale of specific and ascertained goods- Property transferred to
buyer at the intended time by parties.

Sec 57 SOCA 1957: Where the seller wrongfully neglects or refuses to deliver the
goods to the buyer, the buyer may sue the seller for damages for non-delivery.
Application to
Law
1. There is an offer made by Sam to Susila.
2. There is an acceptance by Susila.
3. There is a consideration (RM 21,000.00 for the antique)
4. The antique does not transferred to Sam at the intended time.
5. Sam may sue Susila for damages for non-delivery.
Thank You