Sale of Goods Act 1979

Act Summary

Introduction

This summary examines the Sale of Goods Act 1979 (“the Act”) within its context: why it was drafted, what are its important provisions, and how it has changed since it came into force. It is submitted that the Sale of Goods Act 1979 has been part of a change in consumer dealings, with its most significant contributions being to the rights consumers have where they buy products that turn out to be faulty. Indeed, its use has been so central to implied terms in particular, that one author has been criticised for failing to see the contribution of the Act to the law of implied terms.[1] At the same time, the Act’s importance has to an extent been diminished by the Consumer Rights Act 2015.[2]

Rationale for Drafting

The Act consolidated the Sale of Goods Act 1893 and related legislation. Its provisions on matters such as the formation of a sale contract reflect rules already established in the common law.[3] However, its contribution was to enhance consumer confidence. It has been argued that without the Act, and its successors, there would be little protection for consumers.[4] This imbalance of consumer rights would lead to significant caution, and even “defensive consumerism.”[5] If consumers believe they have few rights when purchasing goods, then they are slow to trust newer and less-familiar brands, and will continue to buy goods from established brands, even where those goods actually lack in quality. Therefore, if the legislature does not guarantee certain minimums for consumer confidence, competition would suffer.[6] Protection for buyers under the consolidated rules helped to promote consumer confidence and competition amongst producers.

Provisions of Note

The Act is recognised for its contribution to the law of implied terms. Sections 12–15 imply terms relating to title, sale by description, quality and fitness for purpose, and sale by sample. These sections are disapplied for contracts within Chapter 2 of Part 1 of the Consumer Rights Act 2015. A private sale can still carry implied terms as to title and, where the sale is by description or sample, conformity. It has been submitted these sections are central to any considerations about implied terms.[7]

Section 14(2) implies a term of satisfactory quality[8] where the seller sells in the course of a business.[9] Quality includes the state and condition of the goods. The test is what a reasonable person would regard as satisfactory, taking account of description, price where relevant and the other circumstances. The 1994 amendments replaced the original standard of merchantable quality with satisfactory quality. Section 14(2C) excludes defects disclosed before the contract or which the buyer’s actual examination ought to reveal, and in a sale by sample defects apparent on reasonable examination of the sample. Under section 14(3), goods must be reasonably fit for a particular purpose made known to the seller or, in the case specified in the section, the credit-broker, unless the buyer did not rely, or could not reasonably rely, on their skill or judgment. There are also provisions for trade usage and sales through business agents. Ervine discussed the significance of the business-sale requirement.[10] In MacDonald v Pollock[11] the Inner House held that the disposal of a vessel used in a charter business was a sale in the course of that business. The decision illustrates that a business can sell an asset in the course of its business even if it does not ordinarily sell goods of that kind.[12][13]

Section 15A modifies remedies for breach of a term implied by section 13, 14 or 15. Where the buyer would otherwise have a right to reject, the breach is treated as a breach of warranty if it is so slight that rejection would be unreasonable.[14] The seller must prove that it is slight and the rule is subject to any contrary intention in the contract. The buyer can claim damages or rely on the breach to reduce or extinguish the price under section 53. Arcos Ltd v EA Ronaasen & Son[15] illustrates the earlier strict approach to compliance with description, discussed by Campbell.[16] In Scotland, section 15B instead permits damages for breach of an express or implied term and rejection and repudiation if the breach is material, subject to the separate Consumer Rights Act regime.

Section 3 generally leaves capacity to buy and sell to the law of capacity. Where necessaries are sold and delivered to a minor in England, Wales or Northern Ireland, section 3 requires payment of a reasonable price. Necessaries must suit the person’s circumstances and actual requirements at the time of sale and delivery.[17] A person who is incompetent to contract because of drunkenness must also pay a reasonable price for necessaries supplied under the section.[18] The rule for minors was removed in Scotland by the Age of Legal Capacity (Scotland) Act 1991. In England and Wales, section 7 of the Mental Capacity Act 2005 provides for reasonable payment for necessary goods and services supplied to someone who lacks capacity to contract for them.

The Act also governs the passing of ownership, risk and performance. Sections 16–18 govern when ownership passes, subject to the rules in sections 20A and 20B for identified bulk goods. In a sale governed by section 20, risk normally follows ownership unless otherwise agreed or delivery is delayed through a party’s fault. Section 21 states the general rule that a seller cannot pass a better title than they have, subject to statutory and other exceptions. Sections 27–28 set out the duties to deliver, accept and pay. Sections 49–53 provide remedies including an action for the price and damages. Section 55 is subject to the Unfair Contract Terms Act 1977. Where that Act applies, liability for breach of the implied title obligations cannot be excluded and restrictions on liability under sections 13–15 are subject to reasonableness.

In conclusion, it is submitted the Act has codified the law, provided guidance on various miscellaneous issues, and has been most significant for its contributions to consumer protection and commercial practice through the use of implied terms.

Redefined and Repealed

The Act’s role in consumer dealings was supplemented by the unfair terms regime. The Unfair Terms in Consumer Contracts Regulations 1994 introduced the good faith requirement in this context. The 1999 Regulations replaced them and continued that test.[19][20] Under regulation 5, a non-negotiated term was unfair if, contrary to good faith, it caused a significant imbalance to the detriment of the consumer. The use of good faith in this area illustrates the influence of European law on English contract law, which has traditionally emphasised freedom of contract.[21] Good faith has been described in English law as relatively “primitive”.[22] The unfair terms rules operated alongside the Sale of Goods Act’s implied terms.[23]

The Consumer Rights Act 2015 (“the 2015 Act”) introduced a consolidated framework for consumer contracts from 1 October 2015.[24] It replaced the earlier regime governing unfair terms and the Sale of Goods Act’s additional consumer remedies.[25][26] It also introduced statutory protections for digital content, such as software and apps.[27] The Sale of Goods Act remains significant in business-to-business and private sales. Many principles in the 2015 Act, including satisfactory quality and fitness for purpose, carry forward protections from the earlier legislation.[28]

Conclusion

It is submitted the Act has been part of, and has helped to develop, consumer protection. It has been part of an effort to boost competition by giving consumers certain assurances about their rights when purchasing from businesses (hence why the definition of a “business” is such an important issue). To an extent, subsequent developments have introduced concepts to consumer-to-business dealings that were not envisaged in the Act. Nevertheless, it is submitted these developments were only possible, at least in part, due to the foundations of the Act and its provisions relating to implied terms.

2026 update

For goods supplied by a trader to a consumer under a contract made from 1 October 2015, Chapter 2 of Part 1 of the Consumer Rights Act 2015 generally governs quality, fitness for purpose, description and the right to supply. For goods that fail to conform, the remedies include a short-term right to reject, normally within 30 days, repair or replacement, and in specified circumstances a price reduction or final rejection. The Sale of Goods Act still applies to matters such as passing of ownership where its provisions have not been disapplied. The older provisions and the 1999 Regulations can still apply to pre-October 2015 contracts under the commencement order’s savings. Part 2 of the 2015 Act now governs fairness of consumer terms and notices.

BIBLIOGRAPHY

Cases

Arcos Ltd  v EA Ronaasen and Son [1933] A.C. 470

MacDonald v Pollock [2012] CSIH 12 (IH, Extra Division)

Statutes

Consumer Rights Act 2015

Sale of Goods Act 1979

Unfair Terms in Consumer Contracts Regulations 1999

Journal articles

Oliver Bray, Ben Kerry, ‘Digital Content under the Consumer Rights Act 2015’ (2015) Ent. L. R.  271

David Campbell, ‘Contract Law and Contract Practice: Bridging the Gap Between Legal Reasoning and Commercial Expectation’ (2014) L.Q.R. 526

Cowan Ervine, ‘Clarifying the Sale of Goods Act’ (2012) S.L.T. 187

Cowan Ervine, ‘Implied Terms in English Contract Law’ (2012) J.B.L. 163

Paula Giliker, ‘The influence of EU and European human rights law on English private law’ (2015) I.C.L.Q. 237

Reshma Korde, ‘Good Faith and Freedom of Contract’ (2000) UCL Juris. Rev. 142

Andre Naidoo, ‘Consumer remedies following the sale of faulty goods’ (2011) J.B.L.  805

Eimear O’Brien, ‘The UK Consumer Rights Act 2015: unfair contract terms considered’ (2015) Comp. & Risk 12

Website

Daniel Greenberg, ‘Contracts: Implied Terms’ accessed at http://login.westlaw.co.uk/maf/wluk/app/document?docguid=I947D3FF03E2311E298C9E4E30120A4B4&context=13&crumb-action=replace&crumb-label=Contracts: implied terms at 18th February 2016

FOOTNOTES

[1] Cowan Ervine, ‘Implied Terms in English Contract Law’ (2012) J.B.L. 163, p 163

[2] Consumer Rights Act 2015

[3] Andre Naidoo, ‘Consumer remedies following the sale of faulty goods’ (2011) J.B.L.  805, p 806

[4] Ibid, p 806

[5] Ibid, p 806

[6] Ibid, p 807

[7] Daniel Greenberg, ‘Contracts: Implied Terms’ accessed at http://login.westlaw.co.uk/maf/wluk/app/document?docguid=I947D3FF03E2311E298C9E4E30120A4B4&context=13&crumb-action=replace&crumb-label=Contracts: implied terms at 18th February 2016

[8] Sale of Goods Act 1979, s.14

[9] Ibid, s.14(2)

[10] Cowan Ervine, ‘Clarifying the Sale of Goods Act’ (2012) S.L.T. 187, p 191

[11] [2012] CSIH 12 (IH, Extra Division)

[12] n 10, p 187

[13] n 11

[14] Sale of Goods Act 1979, s.15A(1)(b)

[15] Arcos Ltd  v EA Ronaasen and Son [1933] A.C. 470

[16] David Campbell, ‘Contract Law and Contract Practice: Bridging the Gap Between Legal Reasoning and Commercial Expectation’ (2014) L.Q.R. 526, p 527

[17] Sale of Goods Act 1979, s.3

[18] Ibid, s.3

[19] Paula Giliker, ‘The influence of EU and European human rights law on English private law’ (2015) 64 I.C.L.Q. 237, pp 237–265

[20] Unfair Terms in Consumer Contracts Regulations 1994, reg. 4, and Unfair Terms in Consumer Contracts Regulations 1999, regs. 3 and 5.

[21] Giliker, n 19, pp 237–265.

[22] Reshma Korde, ‘Good Faith and Freedom of Contract’ (2000) UCL Juris. Rev. 142, p 151

[23] Ibid, p 151

[24] Eimear O’Brien, ‘The UK Consumer Rights Act 2015: unfair contract terms considered’ (2015) Comp. & Risk 12, p 14

[25] Sale of Goods Act 1979, former ss. 48A–48F

[26] Consumer Rights Act 2015, Schedule 1, para 27

[27] Oliver Bray, Ben Kerry, ‘Digital Content under the Consumer Rights Act 2015’ (2015) Ent. L. R.  271, p 271

[28] Consumer Rights Act 2015, ss. 9–10; Bray and Kerry, n 27, p 271.

Last updated: 12 November 2026