[Commerce Class Notes] on Concept of Condition and Warranty Pdf for Exam

When we purchase various products we tend to check the manufacturing date and company, expiry date or year of the expiry of the warranty, check the nutritional count if it is a food product and so on. We perform a thorough quality check and go through the terms and conditions before purchasing any product. Especially if we purchase electronic goods like a laptop we are more careful than ever in checking for its specs, manufacturer and seller, the quality of the piece and the year until when its warranty is valid. 

When we go for intangible services too, we tend to check the reliability of a service provider and quality of services offered before making a decision, be it checking into a 5-star hotel, booking vacation packages or installing WiFi at home. 

A sales agreement happens when a buyer and a seller thus engage in a material transaction. Warranty and conditions are two important components of this transaction. 

What are a Condition and Warranty?

Conditions can be defined as certain obligations, terms or provisions that are associated with the transaction between a buyer and seller. Breach of these conditions can lead to cancellation of agreement and violation of warranty. The non-offending party can also claim appropriate reimbursements and cancel the existing contract as well. A warranty can be expressed or implied. 

What are the Types of Conditions?

Implied conditions are those terms that are not explicitly stated but rather understood and legalised as per the law – 

1. Implied Understanding Regarding Title – Here, it is implied that the seller can sell his goods with all rights and transfer ownership to the buyer. It is understood that before the transaction takes place, the seller is the owner of the goods. In case of any defects, the buyer can claim damages as per the conditions and warranty. It is implied that no fraudulent third party charges will be imposed upon the goods. 

2. Implied Knowledge of Quality and Fitness – The buyer engages in a transaction with the seller with the belief that about the seller’s skill, that he can sell appropriate goods and the seller is aware of the intentions of the buyer.

3. Sale by Description – If the goods are being sold as per the description of the product, then the warranty and conditions will be in accordance with the same. If there is a sample involved as well, then the warranty and conditions will again conform to both. 

4. Sale by Sample – When products are being sold as per the samples earlier marketed, it is implied that the warranty and conditions for the bulk products have to match the quality of the original sample. Buyers should receive sufficient time to compare what they purchase with the quality of the sample and check for defects if any. 

5. Expressed Conditions – The terms and conditions that are explicitly stated in the sale agreement are known as express conditions. Buyers should go through this and have a complete understanding before purchasing.