In order to ascertain whether there has occurred sale of goods between two businesses, the requirement of a valid contract of sale of goods must exist i.e. a valid B2B contract must be concluded and the formal requirements must be met therein. As the topic of sale of goods is extensively broad and covers contracts such as delivery, insurance, bills of lading the analysis for present purposes will be restricted to in what circumstances a web-shop may return goods to the manufacturer. The choice of law between the businesses of contracting states must be established and may be governed by various international legislative instruments such as the United Nations Convention on Contracts for the International Sale of Goods (hereafter-CISG) 1980 or Sale of Goods Act 1979 (hereafter-SoGA) which only applies to English Law. For the purpose of simplification we will assume that both businesses in the current scenario, i.e. the manufacturer and the web-shop respectively, are based in two different contracting states.
The relevant legislation that applies to international contracts of sale of goods, provided that it is the choice of legal instrument between parties whose place of businesses are in different states is the CISG 1980 (art.1). A valid contract for the sale of goods must satisfy the requirements of an offer by the supplier and must be”sufficiently definite and indicate the intention of the offeror to be bound in case of acceptance.” Conversely, the offeree must indicate his assent to an offer by accepting it by means of a statement or conduct Under English Law, the Sale of Goods Act 1979 governs the law of sale of goods relating retailers and manufacturers for the benefit of the consumers and anyone purchasing products in the sale of goods chain. When a retailer sells a good(s) they enter into an agreement or contract with the consumer. The Sale of Goods Act 1979 (SGA 1979) implies additional statutory terms into the sale contract for the benefit of the consumer in addition to any express terms agreed by both parties at the time the contract is made. The consumer has statutory legal rights against the retailer and the retailer has other statutory legal rights against the manufacturer of the goods. The consumer may raise his statutory legal rights against the seller yet not the manufacturer due to privity of contract. Article 35 of SoGA 1979 on the conformity of the goods and third party claims states “(1) The seller must deliver goods which are of the quantity, quality and description required by the contract and which are contained or packaged in the manner required by the contract.
(2) Except where the parties have agreed otherwise[…]. “
Furthermore, article 41 CISG 1980 states that “The seller must deliver goods which are free from any right or claim of a third party, unless the buyer agreed to take the goods subject to that right or claim.” Thus third parties to the contract for the sale of goods such as the consumer may not raise a claim against the manufacturer. In a contract for sale of goods “a) the goods ordered should be described without ambiguity; (b) the purchase price and the terms of payment should be stated; and(c) the terms of delivery should be set out, including instructions for packing and invoicing, transportation and Insurance.”The goods must be of satisfactory quality which is a condition which is implied into all contacts of sale.
The general principle under English Law is that where a buyer i.e. the web-shop in the current case, has accepted the goods he may not be eligible to reject them. Also, the buyer has to be given the opportunity to examine the goods before accepting them and ascertaining whether they are in conformity with the contract. Acceptance can take place in many forms. Also, the buyer may request for repair of the goods under an arrangement with the seller so long as it is within a reasonable time limit and that would not amount to acceptance of the property that passes in the goods. Where the seller is at fault, the buyer will not have the right to reject the goods in the event that the breach of condition is so slight that it would be unreasonable to do so, unless the contrary is agreed on in the contract.
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