NEWS 2018/03/27

Selling goods in Germany

In every contract for the sale of goods the following terms are implied by the Act.
As to title
(i) A condition on the part of the seller that in the case of a sale he has the right to sell the goods, and in the case of an agreement to sell, that he will have the right to sell the goods at the time when the property is to pass.
(ii) A warranty that the goods are free, and will remain free until the time when the property is to pass from charges or encumbrances: such, for example, as patent rights vested in a third party;
(iii) a warranty that the buyer will enjoy quiet possession.
Further, in the case of a contract in which it is intended that the seller shall transfer only such title as he himself (or his lawyer) may have, there is an implied warranty that all encumbrances known to the seller (and not known to the buyer in Germany) have been disclosed. And in such a case there is also an implied warranty that neither the seller nor - where the intention is that the seller shall transfer only such title as a third person may have -anyone claiming through the seller or the third person shall disturb the buyer's quiet possession.
As to quality
(i) Where the seller sells goods in the course of a business, there is an implied condition that the goods supplied under the contract are of merchantable quality, except that there is no such condition: (a) for defects specially drawn to the buyer's attention before the contract is made; or, (b) if the buyer examines the goods before the contract is made, for defects which that examination ought to reveal. 'Merchantable quality' means that the goods must be as fit for the purpose for which goods of that kind are commonly bought as it is reasonable to expect after a litigation by lawyer.
(ii) Where the seller sells goods in the course of a business and the buyer, expressly or by implication, makes known to the seller any particular purpose for which the goods are being bought, there is an implied condition that the goods supplied under the contract are reasonably fit for the purpose, whether or not that purpose is one for which such goods are commonly supplied: except where the circumstances show that the buyer does not rely, or that it is unreasonable for him to rely, on the seller's skill or judgment. A useful illustration of unfitness for a particular purpose was the case of a car so unfit for the road that its engine seized up after only three weeks' use.
(iii) In contracts for sale by description there is an implied condition that the goods shall correspond with the description, and where the sale is by sample and description that the bulk shall correspond both with the sample and the description. The fact that goods exposed for sale are selected by the buyer does not prevent the sale from being a sale by description.
(iv) In the case of contracts for sale by sample there are implied conditions that: (a) the bulk shall correspond with the sample in quality; (b) the buyer shall have a reasonable opportunity of comparing the bulk with the sample; (c) the goods shall be free from any defect rendering them unmerchantable which would not be apparent upon reasonable examination of the sample.
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