Introduction
In the context of contracts of sale, the terms “condition” and “warranty” refer to the stipulations related to the quality, fitness, or performance of the goods sold. These concepts are defined under the Sale of Goods Act, 1930. Understanding their differences is crucial as they determine the remedies available in case of breach.
Main Body
Definition of Condition
According to Section 12(2) of the Sale of Goods Act, a condition is a stipulation essential to the main purpose of the contract. Its breach gives the aggrieved party the right to repudiate the contract and claim damages.
Example: A agrees to sell a new car to B. If the car delivered is old, B can reject the car and cancel the contract.
Definition of Warranty
Section 12(3) defines a warranty as a stipulation collateral to the main purpose of the contract. Breach of a warranty does not allow repudiation of the contract but gives the right to claim damages.
Example: If a new car sold has a faulty stereo system, B cannot reject the car but can claim compensation for the defective stereo.
Key Differences between Condition and Warranty
| Basis | Condition | Warranty |
|---|---|---|
| Definition | Essential term to the contract | Collateral or secondary term |
| Breach Effect | Right to terminate contract and claim damages | Right to claim damages only |
| Legal Provision | Section 12(2) | Section 12(3) |
| Conversion | Can be treated as a warranty by choice | Cannot be treated as a condition |
| Example | Wrong model of product delivered | Minor defect in product function |
Doctrine of Waiver of Condition
Section 13 of the Act allows the buyer to waive a condition or treat it as a warranty if the goods are accepted despite the breach.
Implied Conditions and Warranties
The Sale of Goods Act implies certain conditions and warranties unless otherwise agreed. These include:
- Condition as to title
- Condition as to merchantable quality
- Warranty as to undisturbed possession
- Warranty as to disclosure of defects
Case Law: Baldry v. Marshall
The court held that breach of a condition related to the purpose of the product entitled the buyer to reject the goods and cancel the contract.
Conclusion
While both conditions and warranties are contractual terms, their legal implications differ significantly. Breach of a condition goes to the root of the contract and justifies rejection of goods, while breach of a warranty allows only for compensation. Understanding the distinction ensures proper enforcement of rights and remedies in sale contracts.