Condition and Warranty - Breach of contract do not give right to reject the goods - Section 12, 13 and 14 of Sale of Goods Act 1930

Warranty conditions in the sale agreement have very important role for the successful completion of a transaction. Sometimes the seller may breach sale contract terms and the buyer may reject the goods. But the breach of contract by seller does not give right to the buyer to reject the goods.  But the breach gives the right to claim for damages from the seller. When the goods is delivered and the buyer accepted the goods, breach of contract of any terms by the seller will not amount to rejection of goods, but it gives right of claiming damages by the buyer. Sometimes the buyer considers it a reason to reject the goods purchased him by citing any breach of contract by seller. Provisions in the Sale of Goods Act 1930 related to this issue is as under:

Condition and warranty - Section 12 of Sale of Goods Act 1930
As per Section 12(1) A stipulation in a contract of sale with reference to goods which are the subject thereof may be a condition or a warranty.


(2) A condition is a stipulation essential to the main purpose of the contract, the breach of which gives rise to right to treat the contract as repudiated.


(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.


(4) Whether a stipulation in a contract of sale is condition or a warranty depends in each case on the construction of the contract. A stipulation may be a condition.


When condition to be treated as warranty - Section 13 of Sale of Goods Act, 1930
As per Section 13(1) Where a contract of sale is subject to any condition to the 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 a ground for relating the contract as repudiated.


(2)      Where a contract of sale is not sever able and the buyer has accepted the goods or part thereof, 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.


(3)      Nothing in this section shall affect the case of any condition or warranty fulfillment of which is excused by law by reason of impossibility of otherwise.


Implied undertaking as to tile, etc - Section 14 of Sale of Goods Act, 1930
As per Section 14 in a contract of sale, unless the circumstances of the contract are such as to show a different intention there is-


(a) an implied condition on the part of the seller that, in the case of a sale, he has a right to sell the goods and that, in the case of an agreement to sell, he will have a right to sell the goods at the time when the property is to pass.


(b) an implied warranty that the buyer shall have and enjoy quiet possession of the goods.


(c)      an implied warranty that the goods shall be free from any charge or encumbrance in favour of any third party not declared or known to the buyer before or at the time when the contract is made.

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