Business Sales in 'Consumer' Retailer

mattgod69

Hi

I think there is a lot of confusion over rights under the sale of goods act and purchases with retailers as a business.

My understanding is that the Sale of Goods Actapplies to all contracts for the sale of goods the difference when buying as abusiness is the remedies available. Also, when purchasing in the course of a business, my understanding isthat the provisions of the SoGA are reinforced with the protection offered bythe Unfair Contract Terms Act 1977 which prohibits their exclusion. Finally, under the provisions of the Act, aBusiness can also be treated as a consumer if it is purchasing goods which areordinarily supplied for private use or consumption.

So if someone bought say a PC from a large electrical retailer or specialist computer store for their own business, even though it was a business to business transaction, there would still be rights and potential remedies under the Sale of Goods Act....

Is this everyones undertsanding?

Regards.

Matt

antrobus

mattgod69 wrote: »

My understanding is that the Sale of Goods Act applies to all contracts for the sale of goods the difference when buying as a business is the remedies available.

That's correct. SOGA applies to all contracts for the sale of goods. However SOGA imposes additional obligations on business sellers, and gives consumer buyers additional rights, so you have to ask the right questions in order to establish which bits of SOGA apply to a particular contract.

mattgod69 wrote: »

Also, when purchasing in the course of a business, my understanding is that the provisions of the SoGA are reinforced with the protection offered by the Unfair Contract Terms Act 1977 which prohibits their exclusion.

Well s5 UCTA 1977 which deals with the exclusion of "liability for the loss or damage" relating to the goods only applies to goods "supplied for private use or consumption". In a B2B contract (or even C2B) it would therefore be possible for the contract to exclude such liability.

mattgod69 wrote: »

Finally, under the provisions of the Act, a Business can also be treated as a consumer if it is purchasing goods which are ordinarily supplied for private use or consumption.

The phrase "ordinarily supplied for private use or consumption" is straight from s5(1) of UCTA, but I think you should also pay attention to what it says in s5(2) - "goods are to be regarded as “in consumer use” when a person is using them, or has them in his possession for use, otherwise than exclusively for the purposes of a business"

mattgod69 wrote: »

So if someone bought say a PC from a large electrical retailer or specialist computer store for their own business, even though it was a business to business transaction, there would still be rights and potential remedies under the Sale of Goods Act....

Yes.

bris

Anything you buy for your business from another business such as pc world will be a B2B purchase even though it is normally selling to consumers.
Some aspects of SOGA do apply, but contract law takes precedence and some similarities between the two may be coincidental.
What may be classed as an unfair term to a consumer is not necessarily an unfair term to a business. A consumer is helped and protected by SOGA because they are ordinary people who don't know the ins and out of the law and find contracts confusing, so need protecting.
A business on the other hand need no such protection and should know exactly what terms a contract lay out and understand them, so no surprises when a contract goes against them.
This is why Dab's, Pc world, Dell etc have different departments to deal with consumers and businesses, the T&C's are completely different and to get a remedy under contract law is much more difficult if anything goes wrong. When it comes to B2B purchases these contracts are written by the top corporate solicitors and are pretty much watertight.

mattgod69

Thanks everyone. This is very interesting as i am a businesss= owner, but also a consumer as i am a sole trader based as home. Much of what i buy is purchased by the business even though there may be an element of personal use (say in the case of a laptop).

The following page has some good points:

http://www.consumeractiongroup.co.uk/forum/showthread.php?117106-Sale-of-Goods-basic-guide-to-rights-and-obligations

My situation is that a laptop i purchased has failed prematurely due to a defect from new.

I have asked PC World to send me their T&Cs when purchasesare made. As i read it, in business sales the exclusion of liability of sections 12-15 of the SGA is subject to the Unfair Contract Terms Act 1977. In theinstance of a business to business sale you can exclude liability but only ifit is reasonable for the seller to do so. If they have varied these termsthen the burden of proof lies on them to prove the term was reasonable. Ineed to know if there are specific conditions in their T&Cs which I signedup to without this being made aware to me, so I have asked them for these……

Section 14 of the SoGA specifically applies to Goods sold in thecourse of a business. It states that they must be of satisfactoryquality. The laptop I purchased was not, in my opinion, of satisfactoryquality. I think i am therefore entitled to damages for the loss of the laptop,costs and inconvenience caused. Also, under the SoGA, a Business can alsobe treated as a consumer if it is purchasing goods which are ordinarilysupplied for private use or consumption.

The cynical amongst us might think that this issue is why PC World try and steer you to their business section..... I do recall them doing this for this purchase and i thought at the time, 'what difference does it make' so I did purchase the laptop through the business! Possible big mistake eh!

What do you all think?

Cheers for all your responses....

Regards. Matt

mattgod69

Just a thought.... can i also make a claim under Section 75 of the Consumer Credit Act 1974?

The credit card used was a Capital One business credit card.... are these cards excluded..... ?

Matt

shaun_from_Africa

Just a thought.... can i also make a claim under Section 75 of the Consumer Credit Act 1974?

Highly unlikely as B2B transactions are not covered.
Even if you were to argue successfully that although a business card was used, the laptop was for consumer use, the CC company could state that there was no longer a direct consumer,creditor supplier link in place as this was added to by the business whose name was on the card.

CoolHotCold

If you paid in store, all business centres have T&C on the desk and you should of had them supplied on the invoice/stapled to the invoice. To create a business account you also have to sign the T&C.

The T&C state you are buying it in a business capacity.

So even if you were going to use it as a consumer, you've agree'd to PCWB T&C stating you are going to be using in a business capacity as per the contract both parities have agree'd to.


They do not have any Unfair T&C, they simply state that any warranty is from the manufacture and such fulfilling the 3 main clauses a B2B must have (Clauses for Injury and Death and be fit for purpose), everything else from consumer law, or statutory rights can be excluded.

arcon5

What is unfair in a consumer and unfair in a business contract are many miles apart.

A couple of example,

as a consumer if you breach a contract any penalty clauses are likely to be unfair. As a business this is not the case. For example BG impose a £35k penalty if G4S do not hit targets over a set period for meter reading.


if you sign a lease and subsequently exit (breach) from the contract, as a consumer the LL would be required to mitigate his losses. If however that lease is a commercial lease there is not this obligation and exiting a commercial lease outside of the contractual break clauses is near impossible (hence why you never sign a commercial lease without a solicitor).


If you are operating in a business capacity you are expected to know and understand what you are signing.
Yes there is protection available, but that protection can be limited.

mattgod69

arcon5 wrote: »

What is unfair in a consumer and unfair in a business contract are many miles apart.

A couple of example,

as a consumer if you breach a contract any penalty clauses are likely to be unfair. As a business this is not the case. For example BG impose a £35k penalty if G4S do not hit targets over a set period for meter reading.


if you sign a lease and subsequently exit (breach) from the contract, as a consumer the LL would be required to mitigate his losses. If however that lease is a commercial lease there is not this obligation and exiting a commercial lease outside of the contractual break clauses is near impossible (hence why you never sign a commercial lease without a solicitor).


If you are operating in a business capacity you are expected to know and understand what you are signing.
Yes there is protection available, but that protection can be limited.

Arcon

Agreed... interesting comments from all.

In my case, the laptop was not, i would suggest, fit for purpose, so there is a claim.

Re commecrical leases.... agreed but as well as a solicitor, always consult a Chartered Surveyor!

The problem I have is that whether this was a consurmer or business to business sale, the goods were inherinelty defective and consequently they could not be used for the length of time one would reasonmably expect a product like this to last. Whatever transaction this was, i, as the buyer, was unaware of this issue with the product, which, had it been made aware to me at the point of sale, i would not of course purchased. The remedies and processes are different, but the eventual outcome should be the same.

Matt