Seeking Justice for Consumers

Submitted To: Mr. Harpal Singh

Submitted By: Debashree Manna Dheeraj Nayal Gagan Chopra Gaur Govind Kamaldeep Jay Kumar .C

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Generally. if a person buys skis. ɑit ɛmptɔr is Latin word for "Let the buyer beware". Latin for. or jewelry from a jeweler. judge. for example. A seller who is in the business of regularly selling a particular type of goods has still greater responsibilities in dealing with an average customer. has minimized the importance of this rule. Caveat emptor.CAVEAT EMPTOR Caveat means formal notice or warning. there is an implied warranty that it will clean. increased responsibilities have been placed upon the seller. this implied warranty can be difficult to enforce and may not apply to all products. caveat emptor is the property law doctrine that controls the sale of real property after the date of closing. and test a product considered for purchase him or herself. A person purchasing antiques from an antique dealer. is justified in his or her 2 . One such Warranty is the Implied Warranty of merchantability. there is an implied warranty that they will be safe to use on the slopes. Although the buyer is still required to make a reasonable inspection of goods upon purchase. the buyer could not recover from the seller for defects on the property that rendered the property unfit for ordinary purposes. buyers are still advised to be cautious. When a sale is subject to this warning the purchaser assumes the risk that the product might be either defective or unsuitable to his or her needs. If a person buys soap. however. A warning that notifies a buyer that the goods he or she is buying are "as is. The only exception was if the seller actively concealed latent defects or otherwise made material misrepresentations amounting to fraud. Generally. Before statutory law. the law requires that goods must be of “merchantable quality". the buyer had no warranty of the quality of goods. there is a legal presumption that a seller makes certain warranties unless the buyer and the seller agree otherwise. It merely summarizes the concept that a purchaser must examine. usually as an entry into a court register. given by a concerned party to a court or judge to prevent some action (such as granting of a probate) being taken without prior notice to that party. let him beware. pronounced kævi. In many jurisdictions now. This rule is not designed to shield sellers who engage in Fraud or bad faith dealing by making false or misleading representations about the quality or condition of a particular product. and the doctrine of caveat vendetta (Latin for "let the seller beware") has become more prevalent. Under the doctrine of caveat emptor." or subject to all defects. However. MODERN TREND The modern trend in laws protecting consumers. Hence.

S. the law implies a condition in the contract that the bulk of the merchandise will correspond with the sample in quality and that the buyer will have a reasonable opportunity to examine the bulk of the merchandise. If both the buyer and the seller are negotiating from equal bargaining positions. homeowner to buyer). there is no legal requirement for the vendor to provide a refund or exchange. however. The modern law of commercial transactions recognizes this and protects the buyer by implying various exceptions to the principle of caveat emptor. In the US The modern trend in the US. Organ. a decision written in 1817 by Chief Justice John Marshall. with or without proof of purchase. Most stores require proof of purchase and impose time limits on exchanges or refunds. However. some larger chain stores will do exchanges or refunds at any time. In many cases. in the case of a sale by sample. law. Laidlaw v. however. movies and other copyrighted material many vendors will only do a direct exchange for another copy of the exact same title. 3 . He is forced to rely more and more upon the skill. As a maxim of the early common law. The increasing complexity of modern commerce has placed the buyer at a disadvantage. and honesty of the seller and manufacturer.reliance on the expertise of the seller. the law implies a condition in the ensuing contract that the merchandise is of merchantable (average) quality and reasonably fit for the intended purpose. In addition to the quality of the merchandise. although they usually require a form of picture ID and place quantity or dollar limitations on such returns. principle that the buyer purchases at his own risk in the absence of an express warranty in the contract. is one of the Implied Warranty of Fitness that applies only to the sale of new residential housing by a builder-seller and the caveat emptor rule applies to all other sale situations (i. the vendor will not provide a refund but will provide a credit. is believed by scholars to have been the first U. the doctrine of caveat emptor would apply. this phrase also applies to the return policy.e. Caveat Emptor in the law of commercial transactions. when the buyer has made known to the seller the particular purpose for which the goods are required. Likewise. the rule was well suited to buying and selling carried on in the open marketplace or among close neighbors. Supreme Court case which laid down the rule of caveat emptor in U. Many other jurisdictions have provisions similar to this. In most jurisdictions. Thus.S. judgment. In the cases of software.

Have the buyer sign a credit application with adequate terms of sales and have the principal of the debtor sign a personal guaranty. for example online or via phone. 4 . In private sales (where the seller is not acting as a business). with laws passed that have enhanced consumer rights and allow greater leeway to return goods that do not meet legal standards of acceptance. most retail companies will allow customers to return goods within a specified period (typically a month or two) for a full refund or an exchange. the goods must be as described. in addition to any other return policies. also have a statutory 'cooling off' period of seven working days. however by convention. The best source is a copy of a check. You need two separate signatures: one for the corporation and one for the guarantor. It is a counter to caveat emptor and suggests that sellers can also be deceived in a market transaction. Consumer purchases are regulated by The Sale of Goods Act.In the UK In the UK. 2. Before you make your first sale. RULES OF SALES 1. consumers have the right to a full refund for faulty goods. Know your buyer. even if there is no fault with the product. In the UK. CAVEAT VENDETTA Caveat vendetta is Latin for "let the seller beware". Goods bought via 'distance selling'. consumer law has moved away from the caveat emptor model. obtain the correct legal composition of your customer. This forces the seller to take responsibility for the product and discourages sellers from selling products of unreasonable quality. Advance Sales Protection. Exceptions may apply for goods sold as damaged or to clear. but the sale is not covered by the rules on satisfactory quality and fitness for purpose.

2. modern concepts such as an implied warranty of merchantability (that the item is fit for its intended purpose). you MUST stamp. or impose other requirements. However. The seller or the seller's agents knew of the defect before the sale.” appears on a check. For example.3. require a receipt. and forced sales.I. When a payment is received by check with a notation on the front or the reverse side that the check is given in full payment. Preserve your rights. Prepare for suit.P. When a customer has failed to pay invoices timely. in at least one state. On the reverse side of the check below the customer's notation. However. 5. 5 . sheriff's sales. There was a material defect which adversely affects health or safety. it does still apply to sales of used homes. The concept also applies to returns. This will reflect a change in the buyer's legal status. when you seek recovery from a business customer. write or type 4. the rule applies in "as is" sales. In order to hold the seller liable in such cases of new home sales. Monitor sales activity. For example. RULE OF CAVEAT EMPTOR Today. Suit delayed is collection denied. so that a buyer is responsible for following the seller's policies which may limit the time for returning an item. your debtor are in Chapter 11 and credit sales should be avoided. you can deposit the check. Photocopy all checks received from your buyer. The defect was such that it could not be discovered by due diligence. suit should be anticipated. have softened the harsh application of the rule. if--and only if--you preserve your right to pursue payment for the balance due. implied warranty of habitability in landlord-tenant law. the buyer must show: 1. if the words “D. Certain states have abolished the rule in regard to certain purchases. the rule of caveat emptor no longer applies to new home sales. 3. and financial disclosure rules in stock transactions.

television advertising moved into the realm of co-regulation with a government notification making the Advertising Standards Council of India’s (ASCI) code compulsorily applicable to all TV advertisements. arguably no other economic actor in the advanced industrial countries — not the investor.”. there is very little consumer interest in using them as a basis for purchase decisions (Insight magazine by the Consumer Education and Research Center publishes comparative product testing reports). In India. Caveat Emptor is still the norm in India Aug 14. In India. very few consumer groups have the facilities to do comparative testing. 6 .4. This has happened under pressure from consumer groups who have been lobbying hard for an independent regulator and a stricter advertising code. This development is expected to put an end to surrogate advertising by liquor companies and it is only a matter of time before the Ministry of Consumer Affairs extends the rule across all media and forces advertisers and advertising agencies to become more responsible. That will happen only when all stakeholders — manufacturers. or deceit. Some things are indeed improving. Consumer attitudes and protection standards vary in intent and scope from one country to another and influence the quality of products and design. For instance. only recently. one would even argue that the pendulum may have swung to the other extreme in America where MacDonald’s was sued by a customer who spilt scalding-hot coffee on her own laps and by the parents of obese kids who gorged on junk food and held the food chain responsible for their condition. the concept of ‘caveat emptor’ is alive and kicking and we have a long way to go before consumer laws evolve adequately. And even when they publish reports with fairly startling findings. or to make misrepresentations about the condition of the property. The law prohibits seller or the seller's agents to engage in fraud. The house was not bought "as is. not the welfare recipient — enjoys a more thorough set of legal and institutional protections than the modern consumer when he or she enters the corner store." 5. the media (including advertising agencies). “Today. policy makers and the judiciary — realize that they are all consumers too. 2006 Caveat Emptor means ‘let the buyer beware’ —has become redundant in the western world over the last four decades as consumer protection rules have evolved to provide vast statutory protection to buyers. not the worker. but slowly. In fact.

customers have to be educated not to focus merely on the price and free gift but make an informed decision on quality as well. In all probability. but still awarded a compensation of just Rs 2 lakh. the Supreme Court overturned two lower court judgments and decided (after a 10-year battle) a consumer who was sold a car with a defective clutch (that never got fixed for various reasons) was only entitled to a replacement of the clutch assembly and not the car. consumer protection is one area where the policy makers. since large retailers will have the necessary marketing clout with manufacturers to demand minimum quality requirements or force them to replace substandard products without burdening consumers with the task. In a case against Maruti. have been fairly receptive over the decades and we have seen a slow but steady improvement in consumer protection rules. in a recent judgments by the NCDRC the court calculated the minimum financial loss suffered by the consumer at Rs 9. Strangely. we will be able to skip one step in the evolution of better consumer protection. Consumer cases drag on for a decade from the district courts to the national commission. when awarded are a mere pittance. And even when consumers have pursued cases with enormous doggedness and won their case. In fact. For instance. Curiously enough. anxiety and mental torture suffered by the consumer and even costs. When a dozen different brands of the same products are lined up in a supermarket. the retail revolution has just begun and companies have yet to wake up to its implications. the judiciary is rather less sensitive. but have awarded a compensation that is a fraction of that figure. the NCDRC ordered a compensation of just Rs 25. it is for companies to highlight their product quality where it is applicable. Ideally. In India.Credible growth in retailing or changed shopping experience and shows that government stepped in with regulation to make up for the loss of personal attention and recommendations lavished on customers by the local corner store or grocer. the courts seem to perceive it as a sign of their ‘even-handedness’ in allowing only a part of the notional loss suffered by the consumer.000 to a senior citizen who was harassed and humiliated by a corrupt and malicious railway 7 . a series of cases recently settled by the National Consumer Disputes Redresser Commission (NCDRC) have made it a point to mention the notional loss of income suffered by the consumer. There is rarely any cognizance taken of the harassment. In another bizarre case. especially at the Ministry of Consumer Affairs.24 lakh (and a maximum of Rs 20 lakh). Indian consumers still pay very little attention to the price-quality trade off. However. the courts have invariably been niggardly in their compensation.

employee who falsely alleged that her concessional fare was not in order. EXCEPTIONS OF CAVEAT EMPTOR CAVEAT EMPTOR. Unless courts begin to hand out punitive damages at least in case of deliberate harassment. 8 . can carry a seller just so far. Indian consumers have a long way to go before the concept of ‘Caveat Emptor’ becomes redundant in India. If the product or services do not meet reasonable levels of merchantability or practice standards. the goods must be always suitable for that usual purpose. However. It may work when a private owner sells an old Junker "AS IS". Such judgments make manufacturers. The seller will always be liable if there is breach of any of the implied conditions. or buyer beware. Unfair business practices: The seller would be held liable under custom of trade or trade usage. service providers and government agencies unconcerned about consumer issues. Special state consumer laws that protect consumers such as lemon laws or demand letter. Where the goods can be put to only one type of use. otherwise seller would be held liable. in other instances a know-how consumer can use several legal principles to counter the doctrine of caveat emptor: • • • • • • Fraudulent or negligent misrepresentation: A seller would be liable if he is committing a fraud.

indianexpress.uslegal.BIBLIOGRAPHY http://www.org/wiki/Caveat_emptor http://legal-dictionary.com/news/caveat-emptor-is-still-the-norm-in-india/10528 http://en.britannica.wikipedia.com/c/caveat-emptor/ 9 .com/caveat+emptor http://www.com/EBchecked/topic/100648/caveat-emptor http://definitions.thefreedictionary.