Sale by description (goods as described)
Under Section 56 of the ACL when a person buys goods based on how they’re described – without seeing what they’re buying – the goods need to correspond with that description.
Many consumer transactions are by description, that is, the consumer does not actually see the goods being purchased. This may occur in two ways:
- Goods are ordered from a distance, for example, by telephone, or online; or
- A consumer may, for instance, ask for a tin of fine-ground coffee, or select a tin labelled fine-ground coffee from a supermarket shelf.
Both of these are sales by description.
In the latter case it can be argued that the consumer relies on the description on the label (compared with the situation where the tin is opened and the contents examined).
If the tin does not contain fine-ground coffee then the consumer may take advantage of the protection offered by the ACL.
Note that Section 56(2) provides that supply of goods is not prevented from being supply by description merely because a consumer selects goods exposed for sale or hire.
If the sale is by reference to a sample as well as by description, then it is not sufficient that the goods correspond to the sample if they do not also correspond with the description Section 56(3).
Protections when goods are bought by sample
A few consumer transactions are of the type where the consumer buys by reference to a sample of the goods or a demonstration model.
For example, a consumer may buy carpet by reference to a sample shown in a samples book.
In this case, Section 57 of the ACL provides that where this is done in the course of the seller’s business (other than by auction) it is a condition of the contract that:
- The bulk of the goods will correspond with the sample in quality;
- The consumer will have a reasonable opportunity of comparing the bulk with the sample; and
- The goods will be free from any defects rendering them unacceptable that would not be apparent on a reasonable examination of the sample.
In the example given, if the sample of the carpet shown to the consumer was a pure wool carpet and the bulk of the carpet delivered to the consumer turned out to be a blend of wool and synthetic, the consumer will be entitled to reject the carpet delivered.
It is most important that the consumer reject the goods as soon as the defect is discovered and preferably not accept the goods at all.
If the goods are accepted, the right to terminate the contract may be lost, and the consumer will be forced to rely on a remedy for damages.
This of course may not be satisfactory because the court will award damages on the basis of the difference between the price of, in this example, a wool carpet and the carpet of wool and synthetic material.
A consumer who does not wish to accept a wool and synthetic carpet under any circumstances but nonetheless accepts delivery of the goods may have to accept the carpet and be content with what can be gained by way of damages.
For this reason if you have taken delivery of goods that don’t match the sample you inspected you should seek prompt legal advice.