This document discusses conditions and warranties under the Sale of Goods Act in India. It defines conditions and warranties, distinguishes between them, and outlines implied and express conditions and warranties. Conditions are stipulations essential to the main purpose of the contract, while warranties are collateral. Breach of a condition allows contract repudiation, while breach of a warranty only permits damages. Exceptions to the caveat emptor doctrine for buyers are also noted.

1. Post Graduate and Research Department of Commerce
Commercial Laws
Dr. S. CHANDRASEKARAN
Assistant Professor of Commerce
PG & Research Department of
Commerce
Vivekananda College
Tiruvedakam West
Madurai

2. Sale of Goods Act
Conditions and Warranties

3. Conditions and Warranties
Introduction
At the time of selling goods, a seller usually makes
certain statements or representations with a view to induce
the intending buyer to purchase the goods. Such
representations are generally about the nature and quality of
the goods, price, mode of its payment, delivery of goods etc.
When forming a contract of sale. a party may make a
statement with a view to inducing the other party to enter
into the contract. Such statements when made before
entering into the contract are known as representations. Such
representations may be mere expression of opinion or
commendation by the seller of his goods

4. The representations may be a mere
expression of the opinion of the seller and may
not form a part of the contract. But sometimes
these may also form a part of the contract and the
intending buyer may rely upon such
representations. When these statements or
representations do not form a part of the contract
of sale, they are not relevant and have no legal
effect on the contract. But when these forms a part
of the contract of sale and the buyer relies upon
them, they are relevant and have legal effect on
the contract.

5. Condition and Warranty Defined
According to Sec. 12( 1) of the Act, "A
stipulation in a contract of sale with reference
to goods which arc the subject thereof may
be a condition or a warranty". Some
stipulations may be essential to the contract
while some may be collateral or incidental to
the contract. A stipulation essential to the
contract is called a 'condition'. That which is
collateral or incidental to the contract is
called a warranty.

6. What is a Condition? [Sec. 12 (2)]
According to Sec. 12(2), "A condition is a
stipulation essential to the main purpose of the contract,
the breach of which gives rise to a right to treat the
contract as repudiated."
What is Warranty? [Sec. 12(3)]
According to Sec. 12(3), "A warranty is a
stipulation collateral to the main purpose of the
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 repudiated".

7. Condition and Warranty – Distinction
Condition
It is a stipulation which is essential to the main purpose of the
contract.
A contract of sale cannot be fulfilled unless the condition to it, is
fulfilled.
The breach of condition gives the aggrieved party the right to
repudiate the contract and also claim damages
A breach of condition may be treated as a breach of warranty.
Warranty
It is a stipulation which is only subsidiary or collateral to the main
purpose of the contract
It is not of vital importance, The main contract can be fulfilled even
if the warranty is not fulfilled.
The breach of warranty gives the aggrieved party a right to claim
damages only,
A breach of warranty cannot be treated as a breach of condition.

8. When Condition to be Treated as Warranty (Sec. 13)
A condition is treated to be a warranty and the aggrieved
party has the right to claim damages only and not to repudiate the
contract under the following circumstances:
(a) Voluntary Waiver of Condition (Sec. 13 (1))
"Where a contract of sale is subject to any condition to be
fulfilled by the seller, the buyer may waive the condition or elect to
treat the breach of the condition as a breach of warranty and not as
ground for treating the contract as repudiated."
(b) Acceptance of goods by the Buyer [Sec. 13 (2)]
Under Section 13 (2), "Where a contract of sale is not
severable and the buyer has accepted the goods or part thereof, or
where the contract is for specific goods, the property in which has
passed to the buyer, the breach of any condition to be fulfilled by
the seller can only be treated as a breach of warranty and not as a
ground for rejecting the goods and treating the contract as
repudiated, unless there is a term of the contract, express or
implied, to that effect."

9. Meaning of Acceptance:
According to Sec. 42, the buyer is deemed to have
accepted the goods in any of the-following cases:
(i) When he intimates the seller that he has accepted them,
(ii) When the goods have been delivered to him and he
does any act in relation to them which is inconsistent with the
ownership of the seller, for example, resells or pledges or uses
etc.
(iii) When, after the lapse of a reasonable time, he retains
the goods without intimating the seller that he has rejected them.
(c) By Impossibility
. "Nothing in this section shall affect the case of any
condition or warranty fulfillment of which IS excused by law by
reason of impossibility or otherwise" [Sec. 13 (3)].

10. REMEDIES AVAILABLE TO THE BUYER ON BREACH OF CONDITION
1. If the condition is broken, the affected party may repudiate the
contract and reject the goods.
2. Elect to treat the breach of condition as breach of warranty and
claim damages i.e., monetary
compensation.
3. When the affected party treats the breach of condition as breach
of warranty, he cannot avoid the contract but he is entitled to recover
damage only.
4. No remedy is available when fulfillment of condition is excused
by law by reason of impossibility or otherwise [Sec. 13(3)].
Consequences of Breach of Warranty
Following are the consequences of breach of warranty:
I. The breach of warranty gives right to a claim for damages but not
to a right to reject the goods and treat the contract as repudiated.
2. The buyer may sue the seller for damages. [Sec. 59 (b)].
3. No remedy is available if the fulfillment of warranty becomes
impossible by law [Sec. 13 (3)].

11. Express and Implied Conditions and Warranties
(Sees. 14 to 17)
In a contract of sale, conditions and warranties may be
express or implied. They are said to be express when at the will
of the parties they are inserted in the contract. That is, express
conditions and warranties are those which are entered in clear
words in the contract.
Conditions and warranties are said to be implied when the
law presumes their existence in the contract automatically
though they have not been put into it in express words. An
implied condition or a warranty may be negatived by an express
term to the contrary. It is, however, open to the parties, by virtue
of Sec. 62, to vary the implied conditions and warranties
expressly agreeing to the contrary.

12. Implied Conditions
(a) Condition as to Title [Sec. 14 (a)]
(b) Condition as to Description (Sec. 15)
(c) Condition as to Sample (Sec. 17)
d) Condition as to Sample as well as Description (Sec. 15)
e) Condition as to Fitness or Quality (Sec. 16)
(f) Condition as to Merchantability [Sec. 16 (2)]
g) Condition implied by Customs
(h) Condition as to Wholesomeness

13. Implied Warranties
(a) Warranty of Quiet possession [Sec. 14(b)]
b) Warranty of Freedom from encumbrances
(c) Warranty as to Usage of Trade [Sec. 16 (3))
(d) Warranty to Disclose Dangerous Nature of Goods

14. Exclusion of Implied Conditions and
Warranties
Implied conditions or warranties in a contract of sale
may be negatived or varied by:
(a) express agreement between the parties; or
(b) course of dealing between them; or
(c) the custom or usage of trade.

15. CAVEAT EMPTOR
In the case of a sale of goods, there is a
fundamental principle of law embodied in the maxim
"Caveat Emptor", that is, let the buyer beware. It is not
a part of the seller's duty in a contract of sale to give to
the buyer, an article suitable to, a particular purpose
unless such purpose is made known to the seller.
According to the doctrine of Caveat Emptor it is the
duty of the buyer to be careful while purchasing goods
of his requirement and, in the absence of any enquiry
from the buyer, the seller is not bound to disclose every
defect in goods of which he may be cognizant. As a
matter of fact, it is the buyer's duty to select goods of
his requirement.

16. When a person buys some goods, it is his duty to
examine them thoroughly. As a general rule, the buyer
purchases goods after satisfying himself as to quality and
fitness and, therefore, the buyer purchases the goods at his
own risk, relying upon his own skill and judgment. If the
goods turn out to be defective or do not suit the purpose, or
depends upon his own skill and judgment, and makes a bad
selection he cannot blame anybody except himself. The
buyer has to bear the consequences of his wrong selection
of goods. Sec. 16 states, "Subject to the provisions of this
Act and of any other law for the time being in force, there
is no implied warranty or condition as to the quality or
fitness for any particular purpose of goods supplied under a
contract of sale.

17. Exceptions of the Doctrine of Caveat Emptor
This principle was originated at the time when goods
were mostly sold in the open market. It was presumed that the
buyer was in advantageous position to get the opportunity to
inspect the goods and to satisfy himself as to its quality and
fitness for his purpose. In modern tendency is to narrow the
scope of the rule of Caveat Emptor. These days, trade has
become international in nature and making difficult for buyers
to examine goods beforehand, for example, mail order
purchases. Because of these reasons, it became necessary
to restrict the application of the doctrine of Caveat
Emptor, by proving certain exceptions, which are
discussed below:
1. Fitness for Buyer's Purpose [Sec. 16 (1)]
2. Sale under a Patent or Trade Name [Sec. 16 (1)]

18. 3. Merchantable Quality [Sec. 16 (2)]
4. Custom or Usage of Trade [Sec. 16 (3)]
5. Consent by Fraud
6. Sale by Sample (Sec. 17)
7. Misrepresentation
8. Sale of Goods by Description (Sec. 15)
9. Sale by Sample as well as by description (Sec. 15)
10. Implied Condition as to Title to Goods (Sec. 14(a)
11. Implied warranty as quiet possession apply (Sec. 14(b).