Coursework Consumer Law

Introduction

Summary of rights and remedies

Sale of Goods Act 1979

Supply of Goods and Services Act 1982

Consumer Protection Act 1987

Unfair Contract Terms Act 1977 and Unfair Terms in Consumer Contracts Regulations 1995

Commentary and conclusion

Bibliography

In this coursework I want to analyse the different aspects of consumer protection covered by UK consumer law and the effectiveness of the current laws in protecting consumers. I want to focus only on consumer law which applies to England, as there are some differences between laws in England, Wales, Northern Ireland and Scotland.

Consumer law has its roots in consumer protection, which is broadly the effort of the government, public-interest organisations, individuals, and businesses to establish, protect, and enforce the rights and interests of consumers.

There exist two distinct definitions for consumers. Under the Unfair Contract Terms Act 1977, section 25 a so-called 'consumer contract' is one where “(a) one party to the contract deals, and the other party to the contract (‘the consumer’) does not deal or hold himself out as dealing, in the course of a business, and (b) in the case of a contract such as is mentioned in section 15(2)(a) of this Act, the goods are of a type ordinarily supplied for private use or consumption.”

But, where a contract is governed by the Unfair Terms in Consumer Contracts Regulations 1999, a consumer is defined in Regulation 3(1) as: “any natural person who, in contracts covered by these Regulations, is acting for purposes which are outside his trade, business or profession.”

Consumer protection is directly linked to the idea of consumer rights, and to consumer organisations which help consumers make better choices in the market. These institutions and bodies are advocacy groups which have been set up to protect and inform the consumer. Consumer organisations may engage in single-issue advocacy (e.g., the organisation CAMRA, which is an independent, voluntary, consumer organisation in the United Kingdom, with the main aim of promoting real ale and the traditional British pub; it is now the biggest single-issue consumer group in the UK), or set themselves up as consumer watchdogs such as the Consumers' Association. One common method is the independent comparative survey or test of a particular type of product or service, involving different manufacturers or companies (e.g., Which?, Consumer Reports, etc.).

Which?, until September 2004 known also as the Consumers' Association, is a consumer rights organisation in the UK, which has statutory powers under the Unfair Terms in Consumer Contracts Regulations 1999 to seek an injunction to restrain the use of an unfair contract term by a trader against consumers.

Consumer law, which is considered an area of public law that regulates private law relationships between individual consumers and businesses, has its roots in laws regulating trade, which date back centuries, but the most important law has been introduced in the last 30 years. One reason why consumer law is continually evolving over many years is the rapidly increasing technical development of consumer goods.

Many acts have been passed to protect the rights and interests of consumers. The most important act is the Sale of Goods Act 1979 which has been amended by the Sale and Supply of Goods Act 1994 and more recently by the Sale and Supply of Goods to Consumers Regulations 2002.

At the same time similar remedies are applied by the Supply of Goods and Services Act 1982 to those in the sale of goods legislation where the seller installs the goods or a contract is agreed for goods to be manufactured or produced.

Consumers are entitled to remedies under the legislation and cannot be restricted by any terms in the contract when being sold or supplied a good or service. Restrictions are subject to the provisions of the Unfair Contract Terms Act 1977.

Where the seller breaches any term of the contract the buyer is entitled under the Sale of Goods Act 1979, Section 15B to “(a) claim damages, and (b) if the breach is material, to reject any goods delivered under the contract and treat it as repudiated.”

Buyers are entitled to goods of satisfactory quality, which are as described, taking into account the price and other relevant circumstances.

Seller and buyer have certain rights of action in case of a breach of contract. When the seller does not deliver the goods (covered under Section 51, SOGA 1979), there is a right of action against the seller for recovery of the price, damages for non-delivery and a decree of specific performance. When there is a breach of warranty or when there is a breach of condition by the seller there is equally the right of action for damages. The consumer has the right to complain if an item has a fault at the time of sale (latent or inherent fault), however, a legal remedy cannot be expected when the item has been subject to fair wear and tear, misuse or accidental damage or if the consumer does no longer want the item.

Equally, if the buyer knew about the fault of the product before the purchase after inspection a legal remedy cannot be expected.

If a faulty product (which has been faulty at the time of sale) is returned to the retailer, the buyer is legally entitled to demand damages (which a court would equate to the cost of a repair or replacement) for up to six years from the date of sale.

If repair and replacement are not possible or too costly for the retailer, then the consumer can request a partial or full refund of the product, depending on what is reasonable in the circumstances (i.e. the consumer might have enjoyed some of the benefit from the goods before the fault appeared).

It is usually for the buyer to prove that the goods were faulty at the time of sale (i.e. did not conform to the contract) and should have reasonably lasted until this point of time. This is the case except when the consumer returns the goods in the first six months from the date of the sale, and requests a repair or replacement or a partial or full refund.

In that particular case it is assumed that the goods were faulty at the time of sale and if the retailer does not agree, it is for him to prove that the goods were satisfactory at the time of sale (reversed burden of proof). After six months and until the end of the six years, it is for the consumer to prove the lack of conformity.

“The seller’s remedies for breach by the buyer [...] fall broadly into two groups: those which enable the seller, if he wishes, to disengage from the transaction, and those which assume continuance of the contract.” (Goode, p 390).

Under Section 49 of the Sale of Goods Act 1979 the seller has a right of action for the price of the goods and under Section 50 the seller may claim for damages for non-acceptance by the buyer.

Although sometimes court action is taken by buyers, in most cases buyer and retailer are able to reach an extra-judicial solution. If this is not possible, buyers can seek details from the retailer, the Community Legal Service or a Citizens Advice Bureau.

While laws concerning sale of goods date back 100 years, the most important is the Sale of Goods Act 1979 (as amended).

The Sale of Goods Act 1979 lays down several conditions that a trader must meet. Firstly, the seller has the duty to deliver (SOGA 1979, Section 27) and secondly he has the duty to provide goods which conform to contract (i.e. as described, fit for purpose and of satisfactory quality). Goods may be defined as tangible things which can be physically possessed.

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