Implied Terms by Statute Law

• Consumer Rights Act 2015 covers business to consumer agreements
• s.2(3) CRA 2015 defines a consumer as 'An individual acting for purposes that are wholly or mainly outside that individual's trade, business, craft or profession'
• Contracts for the supply for goods are covered by s.9 / s.10 / s.11 of the CRA 2015
• Section 9 - The right of satisfactory quality

  • s.9(1) - Contracts to supply goods should be treated as if they include a term that the goods shall be of satisfactory quality
  • s.9(2) - Satisfactory is defined as when the goods meet the standard that the reasonable person would consider satisfactory
  • s.9(3) - Satisfactory includes the state and condition - Rogers v Parish
  • s.9(4) - The above will not apply if: defects made apparent before the contract is made, consumer examines goods before the contract is made, goods have been sold after inspection and the defect would have been apparent
• Section 10 - The right of fitness for a particular purpose

  • This is where the buyer makes known the purpose for the goods, there is an implied term that the goods will be fit for purpose under s.10
  • Seller does not need to state the purpose of the goods when they are being used for their normal use - Grant v Australian Knitting Mills
  • If the purchaser is sensitive and the seller is unaware, D will not be liable as long as the goods are fit for the normal purpose - Griffiths v Peter Conway
• Section 11 - The goods must match their description

  • Every contract is to be treated as including a term that the goods will match the description
  • The description can be implied, e.g. when the goods are on display
  • When a 'model' of a particular good is seen or examined by the consumer, the good supplied must match the description of the models
• Remedies for the consumer resulting from a breach of s.9, s.10 and s.11

  • s.20 - Short term right to reject: Must be exercised in 30 days, consumer can claim a full refund, the trader must bear any reasonable costs
  • s.23 - Right to repair or replacement: Must do this within a reasonable time without significant inconvenience, trader must bear all costs, the fault must have been present from the start
  • s.24 - Right to price reduction or final right to reject: Trader has one opportunity to repair or replace, refund cannot be reduced dependent on use if exercised within 6 months
• Contracts for service are covered by s.49 / s.52 of the CRA 2015
• Section 49 - The service will be performed with reasonable care and skill

  • Contracts are treated to contain a term with regards to the traders performing the task with reasonable care and skill
  • Standard of care is comparable to the tort of negligence, but courts make a decision on a case-by-case basis
  • Thake v Maurice
• Section 52 - The service will be performed within a reasonable period of time

  • Applies when no time is specified and the work has not been completed or the work has taken longer than expected
  • The judge will decide what is reasonable based on the circumstances
• Remedies for the consumer resulting from a breach of s.49 and s.52

  • s.55 - Right to repeat performance: Trader is required to perform the service again to meet the standards of the contract, must be done in a reasonable time and without significant inconvenience to the consumer, trader must bear all necessary costs
  • s.56 - Right to a price reduction: Price is to be reduced to an appropriate amount as the trader hasn't met the standards of the contract, this could be a refund of the full contract price