A well written, detailed assignment which meets the criteria for P6 M2 and D2- Unit 21 Aspects of Contract and Business Law. BTEC Level 3 Extended Diploma in Business. P6 - Explain the law with respect to consumer protection in given situations. M2 - Analyse how consumers are protected in the even...
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Unit 21 - Aspects of Contract and Business Law
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Conor Cunningham P6 M2 D2
Task 3
Using your two chosen contracts or any other relevant scenarios, prepare an informal
report which
a) Explains the law with respect to consumer protection in your given situations. (P6)
(You should be addressing primarily the Sale of Goods Act 1979 and the Supply of
Goods and Services Act 1982, Consumer Rights Act 2015 and addressing terms such
as implied terms of title, description, fitness, satisfactory quality , sample, implied
terms for the supply of goods and services, work and materials and for hire of goods
etc.
Such laws as the Unfair Contract Terms Act 1977; Unfair Terms in Consumer Contract
Regulations 1994; Consumer Protection (Distance Selling) Regulations and The
Electronic Commerce Regulations 2002 should also be referred to again where
appropriate.)
b) Analyses how consumers are protected in the event of breach of contract in both of
your chosen contracts or any other contracts which you would deem relevant. (M2)
Again you should focus on the remedies under the Sale of Goods Act 1979 and the
Supply of Goods and Services Act 1982, Consumer Rights Act 2015 but you could also
include any other remedies which might also apply.
c) Finally include a section which provides an evaluation of the statutory protection
given to a consumer in their dealings with a business and the remedies available.
(D2)
(You need to finalise by evaluating what your views are on all the statutory
protection given to the consumer. Much of your answer should relate to the validity
of contract terms. Consideration should then be given to the effectiveness of the
remedies. This may include a discussion of potential difficulties of enforcement but
does not need to consider the underlying problems of the limits of equitable
remedies. You should also include the application of remedies i.e. courts and time
limits)
This provides evidence for P6, M2 & D2
Introduction
This report will explain the law with respect to consumer protection as well as an analysis of
how consumers are protected in the event of a breach of contract and an evaluation of the
statutory protection given to a consumer in their dealings with a business and the remedies
available.
,Conor Cunningham P6 M2 D2
A contract is a sales contract if under if the trader transfers or agrees to transfer ownership
of goods to the consumer and the consumer pays or agrees to pay the price. A contract is
for the hire of goods (a service) if under it the trader gives or agrees to give the consumer
possession of the goods with the right to use them, subject to the terms of the contract, for
a period determined in accordance with the contract. However, a contract is not for the hire
of goods if it is a hire-purchase agreement.
P6 - Explain the law with respect to consumer protection in your given situations
In a standard form contract, there are many different laws and terms which protect the
different parties in the contract. Different implied terms in the Consumer Rights Act 2015
which protect consumers include goods to be of satisfactory quality, goods to be fit for
particular purpose, goods to be as described, goods to match a sample and title.
Satisfactory quality – Under section 9 of the Consumer Rights Act 2015, goods to be of
satisfactory quality states that the quality of goods sold are satisfactory if they meet the
standard that a reasonable person would consider satisfactory. This takes account of ‘any
description of the goods, the price or other consideration for the goods and all the other
relevant circumstances’. This implied term clearly sets out the principles of quality with
relation to the product being sold. With regards to a standard form contract for the
purchasing of a product from JD, this will include selling a product which is of satisfactory
quality, freedom from minor defects and safe to use. As a result of signing the contract, the
customer will expect all of the above to be correct against the law. This implied term also
sets out clearly for JD and the consumer the stage at which the product should be examined
to identify defects.
This implied term will have effects on the consumer (the customer who is purchasing the
product). It affects them as it states that if they make a purchase after an inspection of the
product, they cannot blame JD for selling them a good which is of unsatisfactory quality as
they had the chance to see and review the product. It also is effective in protecting the
consumer with respect to receiving defective goods. This is effective against legislation such
as the Consumer Rights Act as, for example JD would be protected if the consumer bought
the product after inspecting it as this implied term clearly states this.
If the goods are of satisfactory quality, the buyer will not be able to rely on this implied term
and may lose out on consumer protection if;
The seller brought the matter of the goods being in unsatisfactory condition to the
buyers attention before the contract was completed
If the buyer examined the product and noticed the matter of unsatisfactory quality
(at the initial inspection before sale was agreed)
If the buyer had examined a sample of the goods and noticed the matter (the matter
must be noticeable)
In Grant V Australian Knitting Mills (1936), a buyer was entitled to damages after the
underwear he bought was held not to have been of satisfactory quality. The garment
contained an excess of sulphite, which resulted in the plaintiff contracting dermatitis.
, Conor Cunningham P6 M2 D2
Fit for particular purpose – Under section 10 of the Consumer Rights Act 2015, where a
buyer makes known to the seller the particular purpose for which the goods are required
there is an implied duty imposed on the seller that he provides goods fit for that particular
purpose. It is for the buyer to prove that the product is ‘not fit for purpose’. However, even
if the buyer has made known the purpose, the seller can avoid liability if he can prove that
the buyer did not reply on his skill or judgment as to whether the product was ‘fit for the
required purpose’.
The implied term ‘Goods to be fit for a particular purpose” from the Consumer Rights Act
2015 clearly sets out the principles of the circumstances when a product is sold as being fit
for purpose. For JD, this will include selling a product which is fit for the purpose in which
the consumer requires it for. As a result of signing the contract, the customer will expect
their product to be fit for the purpose they need it for. This implied term also sets out
clearly for JD and the consumer the stage at which the products purpose is identified and
this is before the contract is made.
This implied term will have effects on the customer who is purchasing the product from JD.
It affects them as it states that if they do not make it clear what the purpose of their desired
product is at the time of creating the contract, then JD are not to be held responsible as – in
a sense – they were unaware of what the customer wanted. Under the Unfair Terms in
Consumer Contract Regulations, the consumer will be protected here for example if they
are sold a product which wasn’t fit for the purpose they stated they were going to use it for.
The ‘Goods to be fit for a particular purpose’ implied term is effective in protecting the
consumer with respect to receiving a product which is fit for the particular purpose (which
they must have stated before the contract was created). This is effective against legislation
such as the Consumer Rights Act as, for example JD would be protected if the consumer
bought the product without stating its particular purpose and then decided it wasn’t
suitable. This is because the contract was already created before the consumer stated its
particular purpose.
Title – Under section 17 of the Consumer Rights Act 2015, title of goods states that it is the
sellers duty to pass on goods with a ‘good title’. This means that the seller must have the
right to sell the goods and is either the owner of the goods or has been nominated by the
owner to sell the goods and thereby pass on good title (ownership to the buyer). If the
buyer pays the seller money for foods and the seller does not have a right to sell, the buyer
is entitled to a full refund, even if the buyer has enjoyed the goods for a period before
having to return them to the rightful owner.
In Rowland v Divall 1923, the plaintiff bought a car from the defendant and used it for
several months. Later, he discovered that the defendant never actually owned the car and
so the plaintiff had to restore it to the true owner. The plaintiff sues to recover the purchase
price on the ground that there was a total failure of consideration. The defendant argued
that there was no total failure as the plaintiff had enjoyed the use of the car for several
months. The Court of Appeal held that there was a fundamental breach of contract which
entitled the plaintiff to treat the condition as discharged. The judge stated that there was a
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