CONDITION AND WARRANTY

CONDITION
A condition is a stipulation essential to the main purpose of the contract, the breach
of which gives the right to repudiate the contract and to claim damages. (Sec 12 (2)).

EXAMPLE : Say ‘X’ wants to purchase a car from ‘Y’, which can have a mileage of 20
km/lt. ‘Y’ pointing at a particular vehicle says “This car will suit you.” Later ‘X’ buys
the car but finds out later on that this car only has a top mileage of 15 km/ liter. This
amounts to a breach of condition because the seller made the stipulation which
forms the essence of the contract. In this case, the mileage was a stipulation that
was essential to the main purpose of the contract and hence its breach is a breach of
condition.

WARRANTY
A warranty is a stipulation collateral to the main purpose of the said contract. The
breach of warranty which gives rise to a claim for damages. However, it does give a
right to reject the goods or treat the contract as repudiated. (Sec 12(3)).

CONDITION AND IMPLIED ARE TWO TYPES

1. EXPRESS CONDITION : An express condition is the manifested intention

of the parties. Express conditions are created through the agreement
of the parties. This is so whether the intention to have the duty
subject to a condition is manifested in words, or through any other
conduct or type of utterance
2. IMPLIED CONDITION AND WARRANTIES : Implied condition and warranties
are those which the law incorporates into the contract unless the parties
stipulate to the contrary.

MOHAMMAD IBRAHIM
www.yccindiaes.com
 IMPLIED CONDITION ( SEC 14 TO 17 )
1.Implied condition as to title – S. 14(a)– In every contract of sale, unless
the circumstances are such as to show a different intention, there is an implied
condition on the part of the seller that in case of sale, he has a right to sell the
goods and in the case of agreement to sell, he will have the right to sell goods at
the time when property in them is to pass.

2.Implied Condition in sale by description – S. 15– When the goods

are sold by description there is an implied condition that the goods supplied shall
correspond with the description. Lord Blackburn inBowes v Shand[iv] stated: If
you contract to sell peas, you cannot oblige to take beans.

3. Implied condition in a sale by sample – S. 17– According to S. 17 (1) -

A contract of sale is a contract for sale by sample where there is a term in the
contract, express or implied, to that effect. The purpose of a sample is to present
to the eyes the real meaning and intention of the parties with regard to the
subject matter of the contract which owing to the imperfection of language, it may
be difficult or impossible to express in words. According to S. 17 (2)- In the case
of a contract for sale by sample there is an implied condition-
(a) that the bulk shall correspond with the sample in quality;
(b) that the buyer shall have a reasonable opportunity of comparing the bulk with
the sample;
(c) that the goods shall be free from any defect, rendering them unmerchantable,
which would not be apparent on reasonable examination of the sample

4.Implied condition as to quality or fitness – S. 16(1) {First exception

to caveat emptor}- Where the buyer, expressly or by implication, makes known to
the seller the particular purpose for which the goods are required, so as to show
that the buyer relies on the seller's skill or judgment, and the goods are of a
description which it is in the course of the seller's business to supply (whether he
is the manufacturer or producer or not), there is an implied condition that the
goods shall be reasonably fit for such purpose.

5.Implied condition of merchantable quality – S. 16(2) {Second

exception to caveat emptor}-S. 16 (2) contains another implied condition which is
by way of exception to the rule of caveat emptor. It has been noted before in
S.15 that when the goods are bought by description, there is an implied condition
that the goods supplied shall answer the description. Goods supplied shall be of

MOHAMMAD IBRAHIM
www.yccindiaes.com
 merchantable quality where –
-the goods are bought by description;
-from a seller who deals in the 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.

1. Conditions implied by trade usage - S. 16(3)-Sub-Section (3) of section

16 gives statutory force to conditions implied by the usage of a particular trade. It
says: "An implied warranty or condition as to the quality or fitness for the
particular purpose may be annexed by the usage of trade

IMPLIED WARRANTY

WARRANTY OF QUIET POSSESSION : { SEC. 14 (B) } In a contract of sale, unless there is

a contrary intention there is an implied warranty that the buyer shall have and enjoy quiet
possession of the goods. If the buyer is in any way disturbed in the enjoyment of the goods in
consequence of seller’s defective title to sell, he can claim damage from the seller.

WARRANTY OF FREEDOM FROM ENCUMBRANCES : [ SEC. 14 (C)] : The goods

are not subject to any change to any change or right of a favour of a third party.

WARRANTY AS TO QUALITY [ SEC.16(4)] : An implied warranty as to quality or

fitness for a particular purpose may be annexed by the usage of trade

WARRANTY TO DISCLOSE DANGEROUS NATURE OF GOODS: Where a person sell

goods, knowing that the goods are inherently dangerous or they are likely to be
dangerous to the buyer and that the buyer is ignorant of the danger, he must
warn the buyer of the probable danger, otherwise he will be liable in damages.

MOHAMMAD IBRAHIM
www.yccindiaes.com