ACTIONS FOR BREACH OF A CONTRACT OF SALE

The sales of goods act provides for actions that can be undertaken by either buyer or seller if there is a breach of the contract of sale by any of the parties. The actions available to the seller would first be examined, followed by the actions available to the buyer.

Actions Available to the Seller

The main actions available to the seller in case of a breach of contract of sale are an action for the price and damages for non-acceptance. These two remedies would be subsequently highlighted below.

Action For The Price

An action for the price is a situation in which the seller asks the court to force the buyer to pay the price agreed upon by both parties in the contract of sale.

Where under a contract of sale, the property in the goods have been transferred to the buyer but he refuses to pay the price, the seller can maintain an action for the price against the buyer; S.49(1) SOGA. If according to the contract of sale, the price of the goods is to be paid on a particular day irrespective of whether the goods are to be delivered or not, if that date elapses and the buyer hasn’t paid, the seller can bring an action for the price whether or not property in the goods has passed to the buyer; 49(2) SOGA.

Damages For Non Acceptance

This action is used when the buyer refuses to take acceptance for the goods and the seller suffers losses as a result of this’

Where the buyer wrongfully refuses to accept and pay for the goods, the seller can maintain an action against him for damages for non-acceptance;S.50(1) SOGA. The measure of damages is the estimated natural loss that results from the buyer’s breach of the contract; S.50(2). Where there is an available market for the goods, the damages to be paid would prima facie be the difference between the market price and the contract price at the time(s) the buyer was supposed to accept the goods. If no time for acceptance was fixed, the relevant time would be the time that the buyer rejected the goods; S.50(3) SOGA.

Actions Available to The Buyer

There are three actions that have been made available to the buyer in case of the breach of a contract of sale. they are:

  • Damages for non-delivery
  • Specific Performance
  • Remedy for a breach of warranty.

Damages for Non-Delivery

This action is applied when the seller neglects or wrongfully refuses to deliver the goods to the buyer; S.51(1) SOGA. The measurement of damages is the estimated loss resulting naturally from the seller’s breach of the contract; S.51(2). If there is a market for the goods, then the measure of damages is prima facie the difference between the market price and the contract price at the time(s) the goods were supposed to be delivered. If there is no stipulated tike for delivery, the relevant time would be thge time when the seller refused to deliver the goods; S.51(3).

Specific Performance

This is used in order to order a defaulting party to do his own part of the contract. The Sales of Goods Act provides in S.52 that in an action for breach of contract concerning specific or ascertained goods, the court may, on the application of the plaintiff, order that the defendant specifically performs the contract, without him having the option of retaining the goods on the payment of damages. The order could be unconditional or could be done according to the terms and conditions which the courts think to be just.

Remedy For a Breach of Warranty

A warranty has been earlier defined in S.11(1)(b) of the SOGA as a stipulation in a contract the breach of which would not give rise to a repudiation of the contract but only an action for damages. According to the provision of S.53(1) of the Sales of Goods Act, where there is a breach of a warranty or the buyer elects, or is compelled to treat the breach of a condition as a breach of warranty, such breach would not entitle him to reject the goods. He can however set the breach of warranty in diminution or extinction of the price; S.53(1)(a).

The measure of damages for a breach of warranty is the estimated loss that results directly and naturally from the breach of such warranty; S.53(2). In a situation of a breach of warranty as to quality, such loss is prima facie the difference between the value of the goods at the time they were delivered and the value they would have been had they answered to the warranty; S.53(3). Also, the fact that the seller sets up the breach of warranty in diminution or extinction for the price does not stop him from applying for further damages if he has suffered additional loss; S.53(4).

Finally, it is provided under S.54 of the Sales of Goods Act that nothing in the act would affect the right of the buyer or seller to recover special damages or interests where they are entitled to such under the law. Also, they are entitled to recover money paid if what the money was paid in consideration for has failed.

SOURCES

  1. Sales of Goods Act 1893

Author: Olanrewaju Olamide

Olamide is an avid reader who believes that no knowledge is wasted. If he is not surfing the internet, he would be doing something else to get more information, whatever that is.

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