American

AmericanInternational University-
International University-
Bangladesh
Bangladesh
Faculty:
Dr. Mohammad Abu Taher
Course: Mercantile Law
Department of Law
THE DOCTRINE OF
CAVEAT EMPTOR

Presented by,
Name : Ayan Majumder Joy
ID :20-42464-1
Section : A
Department of Law
 What is Caveat Emptor?

Caveat emptor is a Latin phrase that translates to

"let the buyer beware." It means that an individual
buys at their own risk. Potential buyers are warned
by the phrase to do their research and ask pointed
questions of the seller. The seller isn't responsible
for problems that the buyer encounters with the
product after the sale.
When can this Doctrine be
Applied?
Caveat emptor is intended to
prevent post-purchase disputes
caused by information not
matching up, which occurs when
the seller has more information
about the quality of a good or
service than the buyer.
 Example:
Chandelor v. Lupus
In this case, the buyer bought a stone thinking it
was a bezoar stone. The buyer bought the stone
thinking that it had magical healing powers.
However, the stone turned out to be fake. The
buyer filed a suit claiming refund of the amount.
However, the Court held that the seller had not
undertaken any implied warrant of the quality of
the stone and the buyer was under a duty to
examine the product before purchase. Thus, the
seller was under no liability to refund the amount
under Caveat Emptor.
 Exceptions of Caveat Emptor

Merchantable quality:

“Merchantable quality” means, if the goods are not of marketable quality, the buyer will not be held liable. It will be the seller's responsibility
to handle it. and if the goods are purchased for self-use, they must be reasonably fit for the purpose for which they are generally used.

Goods sold by Description:

When the buyer buys the goods based only on the description there will be an exception. If the goods do not match the description then in
such a case the seller will be responsible for the goods.

Sale by Description and Sample:

If the sale is done via a sample as well as a description of the product, the buyer will not be responsible if the goods do not resemble the
sample and/or the description. Then the responsibility will fall squarely on the seller.
 Exceptions of Caveat Emptor

Fraud:

This is another important exception. if the seller conceals any material defects of the goods which are later
discovered on closer examination then again the buyer will not be responsible. If the seller obtains the consent
of the buyer by fraud then caveat emptor will not apply.

Product fit for the buyer's needs:

When the buyer informs the seller of his intention to purchase the goods, it is implied that he trusts the seller's
judgment. It is then the seller's responsibility to ensure that the goods are fit for their intended purpose.