14. The main aspects of sale of goods law.

The sale of goods entails a broad area of the law which is largely governed by legislation. Where an aspect of the law is not regulated by legislation, it is governed by the common law or often by general principles of law in non-common law jurisdictions.

The applicable legislation sets forth the nature of what is involved in the sale of goods. Naturally, this includes definitions of what constitutes a sale and goods. A sale entails the transfer of title in a good from the seller to the buyer. Goods can be defined broadly as some type of tangible chattel. Application of the legislation depends upon: the type of sale; whether the seller is a merchant or not; and, if the seller is a merchant, whether he is trading in the course of his usual business.

The aspects of sale of goods governed by legislation include such things as contract formation, price, passage of title, warranties of title, implied warranties, express warranties, disclaimers of warranties, remedies for breach of warranty, delivery and acceptance of goods, and the passing of risk. The principal relevant legislation in the UK is the Sale of Goods Act 1979 {including its amendments}.

Contract formation in this context includes the requirements applied to contracts in general with some added details such as agreements implied by conduct of the parties. The price to be paid for the goods is usually set forth in the agreement, but in some instances relevant legislation will determine the price if this term is left out. At the very least, the buyer is generally required to pay a reasonable price. Contractual provisions concerning the transfer of title dictate when good title is transferred, for example between a person who has possession but not title to a third-party buyer. Generally, good title cannot be transferred to a third party from a person not authorised to do so by the holder of title. Naturally, aspects of good faith and apparent authority come into play in this context.

Different warranties play a major role in the sale of goods. Implied warranties are such warranties which do not need to be expressed but which the law implies. Some of these types of warranties would include warranties of title, fitness for a particular purpose, and quality or merchantability. Many times the application of the latter two types of warranty depends upon the type of sale (for example sales by sample) and whether the seller is a merchant acting in the course of business. Express warranties are warranties which are specifically stated either in writing or orally. as the case may be. Under many statutory provisions, an express warranty cannot negate an implied warranty of the relevant legislation. A common feature of legislation governing the sale of goods is to restrict the ability to limit warranty liability through exclusions or disclaimers in the contract.

Another general aspect of this type of legislation is to regulate performance between the parties. Aspects covered in this area would include delivery and acceptance, inspection by the buyer, the buyer's right to refuse acceptance and return of goods.

An international convention which should be particularly mentioned in this context is the United Nations Convention on Contracts for the International Sale of Goods Act (CISG). The Convention sets forth rules that govern contracts for the international sale of goods and takes into consideration different social, economic and legal systems to remove legal barriers and foster the development of international trade.