Meaning of Warranties
A warranty is a stipulation that is collateral to the main purpose of the contract of sale. Section 12(3) of the Sale of Goods Act, 1930 defines a warranty as a term of lesser importance compared to a condition. The breach of a warranty does not give the buyer the right to reject the goods or repudiate the contract. Instead, the buyer is entitled only to claim damages. This ensures that minor breaches that do not go to the root of the contract do not lead to its cancellation. For example, in a contract to sell a car, if the car matches the agreed description and is fit for driving but lacks a promised music system, the breach relates to a warranty, not a condition. Thus, warranties protect buyers against non-essential breaches while ensuring the continuity of the contract.
Types of Warranties
The Sale of Goods Act, 1930 provides for both express and implied warranties. Express warranties are specifically stated in the contract. Implied warranties, even if not expressly mentioned, automatically apply under the Act. These include: (i) Warranty of quiet possession (Section 14(b)) – the buyer shall enjoy undisturbed possession of goods; (ii) Warranty against encumbrances (Section 14(c)) – goods are free from undisclosed charges; and (iii) Warranty of quality or fitness, which may arise from trade usage or by agreement. Unlike conditions, warranties do not affect the validity of the entire contract. Instead, they provide safeguards for the buyer to claim compensation for loss suffered due to the seller’s failure to meet minor promises. These provisions ensure fair dealing and buyer protection in commercial transactions.
Legal Effect of Breach
The legal effect of a breach of warranty is confined to damages. Section 59 of the Sale of Goods Act, 1930 provides that if a breach of warranty occurs, or if the buyer elects to treat a breach of condition as a breach of warranty, the buyer cannot reject the goods but may claim compensation for loss. The measure of damages depends on the difference between the value of goods as delivered and the value they would have had if the warranty had been fulfilled. This provision balances the rights of the buyer with the need to preserve contracts where the essential purpose is still achieved. Hence, the law differentiates between breaches that undermine the whole contract (conditions) and those that merely cause minor inconvenience (warranties).
Real-Time Example
Suppose a customer buys a refrigerator from a dealer with a one-year free service warranty. The refrigerator works perfectly, fulfilling the primary purpose of cooling. However, when the customer contacts the dealer for servicing, the dealer refuses to provide free service. Here, the dealer has breached a warranty. The buyer cannot reject the refrigerator or cancel the contract, since the essential function of the product is not affected. Instead, the buyer can claim damages equal to the service cost. Similarly, if a buyer purchases a car and later finds that it does not have the promised car mats, the breach is of warranty, not condition. These examples show that warranties are collateral terms, where the remedy is limited to compensation but the contract remains intact.
Easy Mnemonic
To remember warranties, use the mnemonic “W-DQC”:
- W – Warranty is Weaker than a condition (Sec. 12(3)).
- D – Only Damages can be claimed (Sec. 59).
- Q – Implied warranty of Quiet possession (Sec. 14(b)).
- C – Warranty against Charges/encumbrances (Sec. 14(c)).
Think of it as: “Warranty Deals Quietly with Claims”, highlighting that warranty breaches do not allow rejection but only compensation. This helps distinguish warranties from conditions during exam answers.
About lawgnan:
Mastering the concept of warranties under the Sale of Goods Act, 1930 is crucial for every law student preparing for exams. At Lawgnan.in, we simplify complex legal principles like warranties, conditions, and their distinctions with clear explanations, real-life examples, and mnemonics such as “W-DQC” for easy recall. Whether you’re learning about express or implied warranties, their legal effects, or practical applications, our study materials provide exam-focused insights that make preparation stress-free. Visit Lawgnan.in today to access structured notes, case laws, and practice materials that strengthen your legal understanding and help you excel in LLB exams with confidence.
