Consumer sales and guarantees in europe

2. Remedies

The Directive not contain any provision regard damages 40

does as . For other

remedies, the Directive offers consumers select 41

four choices they can . What is

rather new compared to the Member States' existing legal framework is the hierarchy

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provided by the directive . This distinctive feature show that the Directive is before
all aimed at ensuring the performance of the contract by giving to sellers, in case of

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failure, the opportunity to solve the problem and make the goods conforming . More precisely, remedies are organised in two tiers, repair or replacement first (a) and rescission or reduction of price then (b).

a. Repair and replacement

In case of non-conforming goods, consumers have first the choice between repair and replacement⁴⁴. However, albeit this choice has to be done by consumers, sellers have the final word since they can refuse the remedy chosen on the ground that it is impossible or disproportionate and can then carry out the other remedy (replacement or repair, as the case may be) 45.

A remedy is deemed to be disproportionate if it entails u nreasonable costs on the seller⁴⁶. To assess such unreasonable costs, article 3(3) of the Directive specifies that the value of the good (if it was conforming), the importance of the lack of conformity and the existence of alternative remedies which do not cause significant inconvenience to consumers are taken into account. As an example, a seller can refuse to replace a car with a slight defect (defective lights for instance) which can be easily fixed without any inconvenience and can choose instead to repa ir it. In this example, replacing a car because its lights are merely broken is obviously disproportionate. However, it is important to keep in mind that most of the time, regardless of the defect affecting the good, the seller will prefer to repair it rather than replace it, mostly for financial reasons. It is thus important that consumers have the

choice at first and that this choice can only be amended in case of impossibility or disproportion, which have to be demonstrated.

Once the remedy has been cho sen, the seller must carry it out free of charge, this
being seen quite broadly since it involves the cost related to postage, labour and
materials⁴⁷. In addition, the seller must carry out the remedy within a reasonable time

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and without any great inconveni ence for the consumer . The reasonable time and
great inconvenience must be assessed as regard the nature of the good and the

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purpose for which the consumer required the good . As an example, whereas a car's light can be expected to be repaired in a couple of days, it usually takes longer to repair a laptop as it often has to be sent to a special repair shop.

If the consumer is not entitled to repair or replacement, presumably when these

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remedies are impossible or disproportionate , or if the remedy chosen has not been achieved within a reasonable period of time or without great inconvenience, the consumer can claim for a price reduction or a rescission of the contract⁵¹.

b. Rescission and reduction of price

First of all, it is worth noting that the Directiv e is rather lapidary on these remedies. As an example, the Directive only provides that rescission is not available if the lack of conformity is minor⁵² but does not give any definition of rescission or any guidance as to the consequences of such remedy and the ways to carry it out. This is rather surprising as such remedy leads to the termination of the contract and as, in practice, a lot of disputes arise on the consequences attached to it⁵³. This lack of precision

shows the importance given by the Directive to the performance of the contract rather than its termination.

Conversely, in case of reduction of price, the consumer keeps the good but is entitled to Òan appropriate reduction of the priceÓ⁵⁴. It seems to be fair to consider that this sum of money should be the difference between what has actually been paid and what would have been paid by the consumer for the defective good⁵⁵. However, here again, no precisions is provided by the Directive.

B. The current regime in France - A fragmented regulatory
framework

Contrary to the UK⁵⁶, in France, many debates arose as regard the best way to transpose the Directive of 1999. Indeed, some authors claimed that the Directive should be transposed as part of a broad reform of the Civil Code modifying and simplifying the general lawof sale 57 . However, most authors supported another view and argued that a transposition a minima providing for a new regime would be the most adequate solution. They declared that as such, the new law created would naturally fit in the Consumer Code (Code de la consommation) and were opposed to any amendment to the Civil Code⁵⁸. Indeed, as a matter of fact, in France, the Civil Code is seen as a national pride and few authors actually dare to suggest its amendment. All these disputes led to a delay in the transposition of the Directive which was condemned by the European Court of Justice (ECJ) the 1 July 2004⁵⁹. On

2004⁶⁰, it was finally decided to transpose the Directive in the Consumer Code and,
accordingly, this process led to the adoptio n of Ordinance of 17 2005 61

the February

which offers to consumers a new set of rules on which they can base their claim⁶².

What was at the core of the arguments dividing the doctrine was the relevance of the dual regime existing between latent defect (garantie des vices cachés) and what is called in France «obligation de déliverance conforme» or «garantie de conformité» (conforming delivery). Pursuant to article 1603 of the Civil Code 63 , both obligations have to be complied with by all sellers but remain by nature different. Put it simply, latent defect refers to the quality of the good purchased (a defective car which engine does not work for instance) whereas the «garantie de conformité» refers to the good's compliance with the contract's specifications (a yellow car instead of the red car described in the contract for example). This distinction was the stumbling-block dividing authors as some of them believed it unnecessary, complicated and irrelevant⁶⁴.

As a matter of fact, with the legal regime coming from the Directive of 1999 which adds a new lay to the existing and confusing dual system set in the Civil Code, overlaps and difficulties as regard the handling of such rules are unavoidable. In addition, other provisions which concern the general law of contracts, such as misrepresentation or the error about a substantial quality of the good for instance, can also be used by buyers willing to escape from a contract which provided them with a non-conforming good⁶⁵. Thus, it can be said that the French law of sale applicable to consumers has become dreadfully complicated. That is why there are calling for a reform simplifying the law of sale in general⁶⁶.

As latent defects and the «garantie de conformité» are applicable to all buyers, from lay people to transnat ional companies, the rules are not especially designed for consumers and are unwieldy to use as regard daily transactions concerning low or medium-value goods. Moreover, the complexity pertaining to both regimes is highly questionable since it is confusing for consumers. Conversely, as we will see in next part (C. The current regime in the UK - A unified and efficient regime), the system currently prevailing in the UK is much simpler and the regime easier for consumers' use. As a consequence, for the sake of consumers' understandability, one could think of a single regime especially shaped for consumers which would draw upon the European notion of non-conformity but would in any case provide for a better protection. Such system would make it much easier for consumers to defend their rights in front of sellers.

In the scope of this part, we will first analyse the dual regime laid down in the Civil Code which provide s two grounds on which buyers can base their claim depending on the nature of the problem affecting the product: non-conformity to the contract (1) or latent defect (2). Then, we will have a look at the rules transposing the Directive of 1999 and creating a new and unique regime of non-conformity (3).

1. The «obligation de deliverance conforme»

The «obligation de délivrance conforme» is laid down in the Civil Code from article 1604 to article 1624. As a matter of fact, the regime has been mostly shaped by judges themselves and is contractual by nature⁶⁷. If the notion of «obligation de

délivrance conformeÓ is in theory very clear (a), its distinction from latent defect can in practice be very difficult to draw (b) and its regime is not designed for consumersÕ use (c).

a. Notion of Òobligation de délivrance conformeÓ
The Òobligation de délivrance conformeÓ is an obligation lying on sellers who have to

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make sure the good delivered to buyer s conforms with all contractual specifications . Proving this absence of conformity is easy. Indeed, as it is an obligation of result (an obligation to c ertain result) 69

achieve a , it is enough to show that there is a difference

between the good's description in the contract and the good actually put in possession of the buyer⁷⁰. As an example, a watch which is described as being able to go under water will be non-conforming if it breaks as soon as it is in contact with water. Even a slight difference is regarded as a breach of the «obligation de délivrance conformeÓ, as expresse d in two cases delivered the same day by the Cour de cassation. In the first one, the carÕs colour was slightly different from what was depicted and in the second one, the home furnishing's ironworks were not exactly as described and, aesthetically, the buyer was not satisfied⁷¹. In both cases, the goods were considered as being non-conforming.

Furthermore, it is important to note that as the Òobligation de délivrance conformeÓ is part of the contract's execution, it encompasses situations where the seller does not provide the goods, provides the wrong quantity of goods or provides them with a delay.

b. Distinction with latent defect

At first sight, the «garantie de conformité» and latent defects are easily distinguishable from each other. As an example, a table which is in plastic instead of wood would be regarded as non-conforming. Conversely, if the table is, as agreed, in wood but is full of woodworms, then it contains a latent defect. However, such clarity can be blown on both a theoretical and a practical ground. First, it can be said that a good which is flawed is a non-conforming good since a buyer would obviously not agree to purchase a faulty item. In other words, as it is self-evident that the good on which buyers and sellers agree must be free of flaw, if there is in fact a defect, then the item could be simply regarded as non-conforming. This reasoning is the one prevailing in the UK where the law provides that there are implied terms in the contract which prevent buyers from delivering goods which contain a defect. Moreover, on a practical ground, the distinction made in the Civil Code can lead to absurd results. Indeed, coming back to our table eaten away by woodworms, if the buyer especially mentioned in the contract his willingness to buy furniture which does not contain any woodworms, then the very same table with the very same defect would be regarded as non -conforming rather than containing a latent defect.

As a result, some authors and lawyers have been willing to merge both concepts.

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This so -called monist doctrinewas not only based on intellectual arguments since the regime attached to latent defect and the «obligation de délivrance conforme» was used to be different, in particular as regard the period during which a complain could be lodged. Indeed, whereas a buyer confronted to a non-conforming good could act during ten years⁷³, a buyer discovering a latent defect only had a brief period («bref

délaiÓ) to lodge a claim. Thus, whenever buyers were late to take action, lawyers would allege that the good containing a latent defect was per se a non-conforming good. As a consequence, they based their claim on a breach of the «obligation de délivrance conformeÓ instead of latent defect and thus asserted that they were still on time⁷⁴. For a while, some judges of the Cour de cassation were convinced and enlarged the notion of Òobligation de délivrance conformeÓ in order to encompass the notion of latent defect⁷⁵ whereas some other resisted and stick to the traditional distinction⁷⁶. The definition of the «obligation de délivrance conformeÓ was then not merely non-conformity to the contract but also non -conformity to the utilisation of the good, which permitted to include latent defects. However, even though some authors are still defending this view, this monist conception is now abandoned⁷⁷.

c. Regime of the «obligation de délivrance conformeÓ

The provisions related to the period during which a claim can be lodged are rather buyer-friendly (i). However, the regime of the Òobligation de délivrance conformeÓ as a whole is not designed for consumers which are likely to face difficulties when using it. Indeed, albeit the provisions concerning the proof itself are rather clear and easy to comply with, the importance given to the reception of the good does not really fit with consumers' interests (ii). Likewise, in practice, the remedies available are hard to carry out as regard consumers' position (iii).

i. The period during which a claim can be lodged

We shall first recall that the «obligation de délivrance conformeÓ is contractual by nature⁷⁸. To put it concretely, when a seller delivers a non-conforming good, he is in breach of contract. Thus, it is the statute of limitations as regard contract law which is applicable. This statute deeply in 2008 79

has been modified . Before the reform, the

period to lodge a claim for non-conformity was of 30 years and was beginning at the

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delivery of the good ⁸⁰. Since the reform, the period is of five years and begins when the buyers knew or should have known the fact permitting them to exercise an action⁸². More precisely, the period begins at the delivery of the good if the nonconformity is immediately detectable or at the discovery of the non -conformity if it is hidden⁸³.

This provision seems to be reasonable as 5 years is a period long enough to lodge a claim. Moreover, the fact that this period is flexible, which is to say that it does not begin at the same moment depending on whether the defect is apparent or not, is an interesting way to strike the balance between buyers and sellers with more accuracy. As a matter of fact, if the defect is apparent, it is only fair that the period of time begins at the delivery of the good. Conversely, when the non-conformity is non-apparent, it is normal that the period of time begins only at the moment of the discovery of the non-conformity. Thus, as such, these provisions protect efficiently consumers who will always have a reasonable time to lodge a claim.

Finally, in any case, the period during which a buyer is entitled to lodge a claim for
non-conformity is limited by article 2232 of the Civil Code⁸⁴. Indeed, buyers have a

maximum of twenty years to complain from the moment they purchased the good regardless of the moment they detected the defect.

ii. The issues pertaining to the proof

The notion of «obligation de délivrance conforme» includes both non-performance (when the seller does not provide any good at all) and non-conforming performance (when the seller provides a non-conforming good). As a result, the provisions concerning the burden of proof are dual: sellers have to prove that they have

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delivered the g ood to buyers ⁸⁵ during the agreed period of deliverywhereas buyers have to prove that the good they have received does not conform to the contractual specifications⁸⁷.

Thus, proving the non-conformity or the delivery is not very burdensome either for consumers or for sellers. Indeed, the former only have to show the differences existing between the good delivered and the contractual specifications whereas the latter can easily prove the delivery by ensuring that all buyers sign a receipt at the reception of the good.

However, as regard consumer protection, things get tricky when the goods purchased are not delivered immediately but later. In this case, the buyers see the goods for the first time after the conclusion of the contract and what is called a reception of the goods takes place. In practice, professionals often ask buyers to sign a receipt stating that the good if free of apparent defect, sometimes even before the buyer has the time to proceed to any verification⁸⁸. But even in the absence of such

receipt, buyers have nonetheless a duty to examine the goods at their reception and

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have to verify their conformity to the contract . Then, if they find a defect or a detail from which they can infer that the good might be non -conforming, they must either express reservations of directly refuse the good. As an example, the delivery of a green car instead of a white one is obviously an apparent non-conformity which must be noted by the buyer. The reservations or refusal have to be given at the reception of the good or briefly after it⁹⁰. If the buyers accept the good without any reservations, they will not be able, later on, to complain for any apparent non-conformity they should have noticed⁹¹. Such point has been argued at length in cases law but the judges' position always remained still⁹² . However, if the non-conformity is hidden and cannot be discovered at the reception, the buyers will still be entitled to lodge a claim for non-conformity later even though they did not express any reservation at the reception⁹³.

Such consequences given to the reception of the good are rather ruthless, especially for consumers who might not know these rules. Such provisions are understandable in the field of business where there is a need for rapidity and legal certainty bu t do not seem very useful as regard consumer sales. Moreover, even though judges have a tendency to be more lenient with consumers⁹⁴, in practice, some of them are likely to be unmindful when verifying the good delivered. In addition, consumers might not dare to protest right away when they detect a non-conformity and may then exceed the length of time (not detailed but short) allowed to complain. Thus, I think that these provisions should be removed when the buyers are consumers since their mere inattention and their ignorance of the applicable rules should not lead to the lost of all remedies.

It can be argued that, in the field of consumer sales, the rules pertaining to reception are not often applicable. Indeed, they only concern goods delivered to buyers and not those purchased and taken directly at the store, which is in practice the most common modality. However, it should be recalled that goods delivered are often expensive and are of those for which consumers might be willing to take action in case of non-conformity. Thus, the provisions regarding the reception of goods are of great relevance in the protection of consumers.

iii. Remedies available for non-conforming goods

It is worth recalling that the «obligation de délivranceÓ conforme is contractual⁹⁵. As such, the remedies available are those applicable for contract law in general. However, as diverse and powerful as these remedies are, they remain difficult to handle for consumers. Indeed, admittedly, what is first striking when looking at the French remedies English variety 96

as compared to those providing for in law is their .

However, in practice, most of the remedies available for lack of conformity can only
be commanded by a judge while consumers are generally reluctant to spend time

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and money going to court unless the good purchased is really expensive . As a matter of fact, in practice, most difficulties encountered by consumers concern goods for which they think it does not worth the trouble to go to court⁹⁸.

Moreover, except for damages, prior to any claim for remedies, buyers must first give
a formal notice to sellers pointing out the non-conformity of the good or the non-
performance of the contract⁹⁹ . Such formal notice is aimed at warning sellers that

they have to perform the contract as agreed and gives them another chance to do so. However, some a priori of formal notice 100

situations exclude the given any . Indeed, if a cake is purchased for a wedding and is not delivered (non-performance) or if a wrong cake is delivered (non-conformity), then, after the wedding, there is nothing the seller can do to perform again the contract since no cake is needed anymore and the wedding is already ruined. Thus, the buyer can ask directly for a remedy. But except in these kinds of situation , the necessity to give a formal notice is rather heavy and works as a disincentive for buyers, especially consumers, confronted to nonconforming goods and willing to obtain remedies.

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Buyers who have the choice amongst all remedies made available to them . This is important as they can select the one which best fit to their situation and which is the most adequate to solve their problem.

Generally speaking, the remedies available for buyers are aimed at ensuring the proper performance of the contract by the sellers (á), those leading to its termination being seen as last resort remedies (â)¹⁰². In any case, damages are available regardless of the remedy chosen (ã)¹⁰³.

á. Remedies encouraging the right performance of the contract

Remedies which do not lead to the destruction of the contract and induce its performance are the withholding of performance, specific performance, replacement and price reduction.

The withholding of performance («exception d'inexécution»)

Intellectually speaking, it is considered that the sell er must first perform the contract

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before any payment is due by the buyer . Thus, albeit the Civil Code does not explicitly provides for it, if the seller does not deliver the good or if he delivers a nonconforming good, the buyer is allowed to retain payment until the contract is performed as agreed 105 . Moreover, the withholding of performance needs not be ordered by a judge so buyers can use it as they want, the only condition being that the non-performance or the non-conforming performance of the sellers must be serious. Thus, such remedy seems at first sight to be rather strong and to be an efficient incentive encouraging the sellers' performance.

However, in contracts concluded between consumers and professionals, the consumer is often required to pay prior to the delivery of the good. Thus, in practice, the withholding of performance is not used by consumers.

Specific performance («exécution en nature») and constraint («astreinte»)

Specific performance is a remedy laid down in article 1610 of the Civil Code which obligate which contract 106

s the seller to deliver a

good conforms to the or, if it is not

possible, an equivalent good¹⁰⁷. Specific performance is thus a very powerful remedy

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since it can lead to the replacement of the good or its reparation . In addition, when commanding specific performance, the judge can even force the seller to perform under constraint¹⁰⁹. This means that the seller will have to pay a sum of money per day, week or month until compliance with the judge's instruction is fully met 110 .

However, constraint is in practice rarely ordered in consumers' sales as it is limited to the business field . Moreover, specific performance is a judiciary remedy and, as already highlighted, consumers usually do not take the trouble to go at court to defend their rights unless the good is of great value.

Replacement

Replacement is a remedy rather unknown and its name is in fact quite misleading.

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Indeed, it is not the good which is replaced but the other party . To put it concretely, a buyer confronted to the non-performance of the contract by the seller (seller 1) can ask another seller (seller 2) to provide him with the good¹¹². What is very interesting is that the buyer does not have to pay seller 2 since it is seller 1 who has to make such payment. However, providing that only a judge can allow for replacement, here again, this remedy does not fit for consumers and is in practice only used between professionals.

Price reduction («réfaction» or action quanti minoris)

This remedy is not provided for in the Civil Code but has been made available, after many hesitations 113 , by judges 114 . Thus, in practice, its regime is rather unclear depending on whether the good is non-conforming or whether the sel ler has merely not performed his obligation¹¹⁵. At first sights, it seems that this remedy is more in line with consumers' interests and the Directive of 1999 also provides for it. However,

conversely to the Directive's system, price reduction has to be commanded by a judge, which is, again, problematic as regard consumers.

â. Remedy leading to the termination of the contract: resolution

Buyers confronted to a non-conforming good are entitled to claim for resolution of the contract¹¹⁶. Resolution leads to the termination of the contract with retroactive effects. More precisely, parties are deemed to be in the situation they would have been if they had never contracted. Thus, the buyer has to give back the good purchased and the seller the price paid for it by the buyer. The regime of resolution is rather buyer-friendly since they do not have to return the good but only have to make it available to the seller. Moreover, sellers cannot ask for an indemnity on the ground that the buyer used the good¹¹⁷ or for the wear and tear caused by the utilisation of the good¹¹⁸.

As regard these consequences, such remedy is very powerful for buyers and works as an incentive for sellers who do not want to lose all benefits arising from the contract. However, it has to be noted that unless specifically allowed in the contract, which is in practice unusual in consumer sales, resolution has to be decided by a judge. Moreover, to be allowed by judges, the non-conformity or the nonperformance to the contract must not be trivial and must reach a certain level of

gravity 119120

. Even though the level of gravit y required is not very high , such remedy is uneasy to carry out for consumers. As a comparison, the resolution provided for in article L. 114-1 of the Consumer Code (created by the transposition of the Directive of 1999) is automatic and consumers need not see a judge¹²¹. Likewise, the English

system provides consumers with a right to terminate the contract which can be used without any judge's help. Thus, here again, the French remedy seems at first glance to be interesting but, when closely analysed, appears to be unwieldy for consumers.

ã. Damages
In the French legal system, the integral compensation for any prejudice suffered is

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set up as a principle . Thus, damages cover a wide area and can repair virtually all losses endured by the consumers¹²³ including those related to the delay until the right performance of the contract is done¹²⁴, the reparation carried out by a third-party to render the good conforming¹²⁵, the difference in terms of value between the good delivered and the conforming good expected¹²⁶ or even moral damages.

To obtain damages, buyers must prove that the prejudice they suffered is certain,

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foreseeable ¹²⁷ and that it has been caused by the lack of conformity . These conditions are usually easy to fulfill and a consumer who suffered a prejudice will not, in practice, have any difficulty to obtain a full compensation for the prejudice he suffered as a consequence of this non-conformity. Here again, damages have to be granted by a judge. However, this is a normal modality as such remedy could not work without a judge.

2. Latent defect

The regime of latent defect, also called hidden defect, originated in Roman law where
it was especially created to regulate the sale of slaves and animals since these kinds

of sellers swindlers 129

were as

seen . Until the XXth century, it had a limited role and

was rather unused. However, with the development of consumption and the increasing in goods' complexity which makes it harder for a buyer to detect a problem affecting a good, latent defect experienced a growing use.

Latent defect has been laid down in the Civil Code since the beginning and can be found from article 1641¹³⁰ to article 1649. As such, the regime of latent defect is available for all buyers. However, it is worth noting that prior to the ordinance of 2005 which transposed the Directive of 1999, article L. 211 -1¹³¹ of the Consumer Code provided specifically that the regime of latent defect was applicable for consumers and reproduced verbatim the corresponding articles of the Civil Code.

The notion of latent defect is seen as complementary to the «obligation de délivrance conforme». Indeed, as the latter makes sure that the buyers is provided with conforming goods, the former ensures that the buyers can fully enjoy these goods since they must be free of flaws. If the notion of latent defect is rather easy to understand (a), regrettably, its regime is not shaped for consumers' use (b).

a. The notion of latent defect

Firs of all, it is worth noting that latent defect is a guarantee due by the seller to the buyer and does not have any contractual basis. The notion of latent defect refers to the quality of the good. More precisely, the good delivered must not contain any hidden defect preventing the buyer from using it. The notion of latent defect is best

described by detailing the four conditions a flow must fulfilled to be regarded as a hidden defect.

i. The existence of a defect

A defect is a flaw which affects the utility of the good or decreases so much its potential use that the buyer would not have acquired it or would have purchased it for

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a much lower price . As an example, a coffee-maker which is unable to make coffee or a car which brakes are not working would both be considered as containing a latent the good 133

defect. The defect is ascertained as regard norm use

al of the , not

the particular use a buyer might make of it¹³⁴. However, if such specific use is known
by the seller¹³⁵ or if the good is sold especially for a specific purpose, then the defect
will be determined with regard to this particular use¹³⁶. As an example, a dog sold for

reproduction is not expected to have the same pet 137

qualities as a dog sold as a .

Generally speaking, proving the existence of a defect is not difficult.

ii. A defect affecting the utilisation of the good

The defect must affect the utilisation of the good, which is to say that it must not be too slight¹³⁸. As an example, a car which is a bit noisy when driven in reverse would most likely not be considered as defective. It is important to note that the gravity of the defect is assessed in a different way depending upon the remedy requested by the buyer. Indeed, judges are likely to be stricter when evaluating the seriousness of the flaw if the buyer asks for the resolution of the contract rather than a price

reduction¹³⁹. However, consumers who are in good faith generally do not have problems in showing that the defect is serious enough.

iii. A hidden defect

This condition is the non-apparent 140

double. First, must

defect be , as a laptop which

cannot go on the internet for example. Being non-professional, consumers are not required to inspect the good but only to be reasonably caution when purchasing¹⁴¹. Thus, no judge would expect a consumer to verify that a lawn mower is in practice able to cut the grass for instance. As such, except if they are acting in bad faith, buyers will not have problem as regard the fact that the flaw must be non-apparent.

defect must be buyer 142

Moreover , the also unknown from the . Indeed, if the latter

actually knows that the television he is purchasing can only provides the programs in black and white, he or she cannot complain on such ground later. The buyer is presumed to be unaware of the defect affecting the good and it is the seller who has to prove that such flaw was already known purchasing 143

by the buyer when . Thus, here again, consumers acting in good faith will generally not face any problem as regard their ignorance of the flaw.

iv. A defect anterior to the purchase

Finally, the defect must exist prior to the purchase of the good and, more precisely,

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before the property over the good transferred

is . On this matter, it is important to

distinguish the origin of the defect from the moment when it manifests. As an

example, if an animal becomes ill after its purchase but it can be proved that the virus which caused the illness was already in the animal's blood before it was bought, then the buyer can claim that there is a latent defect. However, the proof of the anteriority has to be provided by the buyer, which is in practice very difficult unless the defect

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appeare d very quickly after the purchase of the good . Indeed, even though there is
no presumption as regard the anteriority existence of the defect, as it is the case in
the Directive of 1999, in practice, judges infer the existence of a latent defect from the

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fact that the problem appeared soon after the good has been bought . To put it concretely, consumers experiencing problems soon after they have bought a good will generally no have problem to prove that the defect existed priori to the purchase.

In other cases, in practice, an expert is often used in order to prove that the defect was already latent in the good before its purchase¹⁴⁷. Such necessity can be very onerous for buyers since they have to pay for the expert and are reimbursed only if they win the case. Thus, in practice, consumers can be deterred from going to court and ask for an expert's evaluation. Indeed, a fair quantity of problems encountered by consumers concern inexpensive goods which worth neither the trouble nor the costs of asking an expert to prove the anteriority of the defect.

However, if buyers can prove that the problem affecting the good fulfills these four conditions, they will be able to claim for a remedy.

b. The regime of the action

Before going any further, it is interesting to notice that the rules governing the reception of the good as regard the «obligation de délivrance conformeÓ do not apply to latent defect¹⁴⁸. This seems in fact logical as latent defect are hidden and as only the apparent non-conformity of the good is covered by its reception.

If the time limit to lodge a claim is long enough (i) the functioning of the remedies available makes it hard to use for consumers (ii).

i. The period during which a claim can be lodged

Prior to the Ordinance of 2005, buyers could only complain within a brief period (Òbref délaiÓ) discovery good 149

after the of a defect affecting the . Such brief period was

rather unclear¹⁵⁰ and led to several disputes in cases law until it was recently abandoned and replaced by a period of two years¹⁵¹. This period is to be distinguished from the the of 1999 152

one provided for in Directive . Indeed, albeit they

both provide for a two years length of time during which buyers are entitled to lodge a claim, the period begins at the discovery of the defect for buyers complaining for a latent defect whereas it begins right at the delivery of the good for consumers complaining for non-conformity on the ground of the ordinance of 2005. Thus, the period of two years stated in the Ordinance is mechanically shorter. This difference is paradoxical since on this point, it can be more interesting for a consumer to rely on the regime of latent defect, as a professional buyer, than on the specific regime especially designed for consumers.

In addition, the period provided for in the Ordinance is close since it begins at the delivery of the good. Conversely, the period stated for latent defect is open for it only begins at the detection of the defect, providing that such detection can be made years after the delivery of the good. As a matter of fact, judges are ready to accept that a latent defect can be discovered more than 200 years after the creation of the good¹⁵³. This case shows that the regime of latent defects does not provide any security to sellers who can receive claims many years after the delivery of the good. For this reason, such open period can be questioned as it leads to legal uncertainty for sellers. Moreover, the open period is also problematic since it relies on the good faith of buyers who can make up the moment of discovery of the defect to avoid the two years time limit.

However, the advantages of an open period appear to surpass its drawbacks. First of all, it can be noted that in practice, the more buyers will wait before they complain and the more it will be difficult for them to prove that the defect existed prior to the purchase of the good and that it does not result from the normal wear and tear resulting from its utilisation. In addition, the life span of numerous goods is much longer than two years so an open period is adjusted to each kind of good. Conversely, a closed period of two years is too short for goods such as car or washing machine which are expected to last longer than two years and for which a latent defect can be discovered after such length of time. Furthermore, it would be unfair to deny any right to complain to buyers who discover a defect after two years following the delivery since they would be in a situation where they had lost a right before knowing they had it¹⁵⁴.

In any case, as for non-conformity, the open period for latent defect is not indefinite since the statute of limitation stated in article 2232 of the Civil Code applies. Accordingly, buyers have a maximum of twenty years to complain from the moment they purchased the good regardless of the moment they detected the defect.

ii. The remedies

First of all, it is worth noting that the obligation lying on sellers to provide a good free
of defect is an obligation of result (obligation to achieve a certain result). Thus, the

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fact that sellers are unaware of the flaw affecting the good or did not commit any fault¹⁵⁶ is immaterial and will not stop buyers from obtaining a remedy.

Pursuant to article 1644 of the Civil Code¹⁵⁷, buyers who purchased a good with a
latent defect have the choice between two remedies: resolution of the contract (á)
and price reduction (â). The choice given to buyers between these two remedies is

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absolutely free, which is really favourable for buyers . In addition, buyers can also claim for reparation or replacement of the product affected by a latent defect (ã). Finally, in any case, buyers are entitled to damages for any loss they have suffered as a result of the non-conformity of the good (ä).

á. The resolution of the contract («action rédhibitoire»)

Resolution is the most used remedy¹⁵⁹ and leads to the termination of the contract
with retroactive effects. Generally speaking, the effects of the resolution for latent

defect are the same as those applicable for the resolution for non-conforming goods¹⁶⁰: the return of the good to sellers and a full refund for buyers. The slight differences in terms of regime will anyway be highlighted.

Resolution provides buyers with a really strong bargaining power since they can still

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terminate the contract even after a rep air has been carried out if it failed . In
addition, they can impose resolution to sellers even if they have first asked for price

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reduction or for the replacement of the good . However, contrary to the «garantie des vices cachés », to obtain the refund, the buyers need to return themselves the good to the sellers¹⁶³. In addition, if sellers cannot claim for an indemnity on the ground that the buyers used the good 164 , they can however, contrary to the solution applicable for non -conformity, ask for a compensation for the depreciation of the good¹⁶⁵.

At first sight, it seems that the rules are rather harsh for sellers since as soon as a latent defect is detected, they can lose the contract and all the benefits pertaining to it. On the other hand, however, as highlighted as regard non-conformity, buyers still have to ask a judge to order the resolution. Thus, here again, such rule is rather difficult to put in practice by consumers when the good purchased is not of great value.

â. Price reduction («réfaction» or action quanti minoris)

Instead of resolution, buyers can also ask for price reduction. Accordingly, they will
obtain a sum of money corresponding to the difference between the price paid for the

good and its actual value when taking into account the defect¹⁶⁶. It is important to note that technically, the fraction of price given back to buyers has to be decided by experts¹⁶⁷. Thus, consumers confronted to a latent defect need to go to Court to obtain a price reduction. Such process is heavy and is likely to discourage most of them from so doing, unless the good concerned is of great value.

y. Repair or replacement of the good

Buyers can also choose specific performance and can thus ask sellers for a repair or the replacement of the good¹⁶⁸ . Generally speaking, these remedies are preferred by sellers who then do not lose all benefits arising from the contract. As regard replacement, it seems that such remedy can be asked by the buyers when the good purchased is not individualised and can be replaced by another good which is exactly the same as the former one. As a example, a new car is a good w hich is not individualised and can be replaced whereas an original 1956 Thunderbird purchased in 2010 is unique and could not be replaced if it proves itself to be defective. Theoretically, repair and replacement have to be ordered by a judge.

However, in practice, buyers can threaten sellers of resolution in order to obtain the replacement of the good or its reparation¹⁶⁹. This depends however upon the respective bargaining power of the parties. As far as consumers are concerned, this bargaining power is often small and they can experience difficulties in the obtaining of this kind of remedy.

ä. Damages

Regardless of any other remedy chosen, buyers can also claim for damages for the
losses they suffered¹⁷⁰. Damages can be obtained for the compensation of a wide

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variety of prejudices corresponding to the costs which arose from the sale , the unavailability of the good¹⁷² or, more broadly, to all the costs caused by the defect itself¹⁷³.

The obtaining of damages is subject to the proof of the defect, the prejudice it caused and the casual link between them both. No further conditions are required to obtain compensation for the costs which arose from the conclusion of the contract¹⁷⁴.

However, for the obtaining of any other damages, the bad faith of the sellers has to be proved. In fact, sellers are in bad faith if they knew that the good sold contained a latent defect¹⁷⁵. At first sight, it seems that this proof is very difficult to show. However, all professional sellers are deemed to be aware of all defects affecting the goods they sell, providing that such presumption is conclusive unless the buyer is also a professional from the same specialty¹⁷⁶. Thus, at least when contracting with consumers, professional sellers are always considered as being in bad faith and are thus always liable for all damages resulting from the latent defect affecting the good. This is very protective of consumer interests.

3. The Directive's implementation in France

Directive without deficiencies 177

The has been transposed in French Law by the

Ordinance of 2005 and can be found in the Consumer Code from article L. 211 -1 to L. 211-18¹⁷⁸. As the Directive's content has already been analysed, we will only look at the specificities of the French measure of transposition and what is new compared to the existing legal framework in France.

First of all, it is worth noting that the scope of application of the Ordinance is much narrower than the one of latent defect and the «garantie de conformity». Indeed, the Ordinance only applies to contracts concluded between consumers and professionals¹⁷⁹ and which concern tangible movable items¹⁸⁰. However, consumers are free to choose any regime they want and do not have to rely on the Ordinance of 2005¹⁸¹. On the one hand, this situation is a good thing as all three regimes are different and, depending on the problems they encounter, consumers will be best protected by a different set of rule¹⁸². On the other hand, this situation can be criticised as leading to confusions for consumers, especially the less educated one¹⁸³, who are rather unlikely to understand easily their rights.

The two main important points of the Ordinance of 2005 concern the notion of non conformity (a) and its regime (b).

a. The notion of non-conformity

The notion of non-conformity itself is at the core of the transposition of the Directive¹⁸⁴. Indeed, as it is a monist conception which is thus new compared to the existing framework in France, its transposition was carried out very carefully. To make it simple, according to the new concept of conformity, goods have to be as specified in the contract agreed between the consumer and the seller (equivalent to the Ògarantie de conformityÓ) and must also be able to work properly (equivalent to the latent defect).

It is worth noting that France transposed the notion of non-conformity differently from the way it is provided for in the Directive. Indeed, the Directive provides for a presumption of conformity when some criterions are fulfilled whereas France only provides for a general about fitness 185

requirement goods' . Moreover, the French

transposition of the notion of non-conformity is dual, but not as the provisions of the Civil Code¹⁸⁶. Indeed, it distinguishes between contracts which are negotiated and those which can only be agreed as such and cannot be negotiated, the so-called adhesion contracts¹⁸⁷. Accordingly, to be conforming, a good must:

· Correspond to the use usually made for this kind of good and, if applicable, to the description and the sample given by the seller and to the public statement made by the seller or the producer ¹⁸⁸; or

· Have the characteristics specifically agreed by the parties or correspond to the use the consumer is willing to make of the good as long as such use has been known and agreed by the seller¹⁸⁹.

Such distinction is rather well-thought and intellectually relevant as there is, in practice, a clear distinction between adhesion contracts and contracts which can be negotiated and for which the consumer can ask for specific requirements. Moreover, it can be noted that this distinction is not completely different from the distinction between latent defect and the «garantie de conformité» in the Civil Code. Indeed, whereas the part referring to adhesion contracts¹⁹⁰ broadly corresponds to the «garantie de conformité», the part about negotiated contracts¹⁹¹ corresponds in fact to the concept of latent defect¹⁹².

In addition, as with latent defect and in accordance with the Directive, the nonconformity good must be ignored by the consumer 193

of the and cannot take its origin

in the materials himself 194

the consumer provided . Likewise, the seller cannot be held

liable on the basis of public statements he was not and could not reasonably be aware of¹⁹⁵ although, conversely to the directive, no reference is made to the correction of the public statements and the fact that the consumer might not have been influenced by them¹⁹⁶. This difference is thus more protective of consumers who are less likely to face a denial of their right from sellers claiming the irrelevance of such public statement.

Furthermore, it can be noted that, as in the Directive, France did not assimilate the delivery of the wrong quantity of goods to non-conformity. This solution was nonetheless conceivable and has in fact been carried out by Germany¹⁹⁷.

The only difficulty as regard the notion of non-conformity and its inclusion in the
French legal system is that nothing is specified as regard the importance of the

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reception of the good . Indeed, as already highlighted as regard the «garantie de conformité», when being delivered, it is important that the consumer expresses reservation if the good seems to be non-conforming, or even refuses it. Otherwise, he will not be entitled to claim for any apparent non-conformity. As nothing is specified, one can wonder whether such obligation is also applicable for consumers under the new regime¹⁹⁹. This is a fairly important question as regard the consequences at stake: the lost of all rights to claim remedy for the consumer. Regrettably, no case law has clarified this point yet and consumers are thus advised to make all reservations as regard possible non-conformity of the good when it is delivered to them.

b. The regime of non-conformity

Whereas the time limit during which consumers are entitled to complain is not so much protective and not free of defect (i), the presumption of anteriority is a new and very welcome provision in French law (ii) and the functioning of the remedial scheme, although providing for a hierarchy, appears to be rightly designed for consumers (iii).

i. The period during which a claim can be lodged

The Directive of 1999 provides for two distinct length of time during which consumers
can claim for non-conformity, one of two years from the delivery of the good and
another one of two months from the moment when the consumer detected the non-

conformity²⁰⁰. However, providing that the Directive is of minimal harmonisation, France decided to transpose only the first period. Accordingly, consumers confronted to a non-conforming good have two years from the delivery to complain²⁰¹.

The fact that the two months period has not been transposed in French law is
satisfactory for consumers who then enjoy a longer period to complain. However, the

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two years period duly implemented is rather short , especially for goods which are expected to last much longer such as televisions or bicycles for instance. Moreover, this two years period begins right at

the delivery of the good and not, as for latent defect, when the defect is detected. As a consequence, consumers discovering a defect three years after the delivery of the good will then not be allowed to lodge a claim. This is highly questionable as they will have lost their right before even knowing they had it.

Finally, it can be noted that no clue is given as regard the applicability of the two years time limit to the claim for damages, in particular when no other remedy is asked by the consumer²⁰³. Indeed, damages are not provided for by the Directive and their allocation is thus governed by national laws. This is an important question as if the time limit does not apply consumers who are late to claim for other remedies will be willing to obtain their compensation on this other ground. As such, this legal uncertainty is questionable.

ii. The presumption of anteriority

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The non -conformity of the good must exist prior to its delivery . In conformity with the Directive, all defects arising within six months following the delivery of the good are deemed to be anterior²⁰⁵ . This presumption can be fought if the seller can prove that the presumption is not compatible with the nature of the good or with the non- confo rm ity²⁰⁶. Indeed, as an example, a tomato is obviously not supposed to last six month.

Such presumption is a great step forward for consumers since it did not exist in French law prior to the Ordinance of 2005. Albeit judges were sometimes lenient and easily ready to regard any defect appearing soon after the delivery of the good as being anterior to the delivery²⁰⁷, as a matter of fact, the proof lying on consumers was rather burdensome.

iii. The remedies

The Directive of 1999 provides for four remedies in case of non-conformity and, most importantly, provides for a hierarchy as regard the choice between these remedies. The transposition operated by the Ordinance is conformed to the Directive's provision²⁰⁸. As these provisions have already been detailed (A. The Directive of 1999 on certain aspect of goods and associated guarantees), they will not be recalled here. However, the principle of a hierarchy is questionable as it lowers consumers' choice and, thus, their bargaining power. As a matter of fact, this hierarchy is not protecti ve of consumers' interest since terminating the contract or

obtaining a price reduction are legitimate claims which should not be granted only as second tiers remedies.

In accordance with the Directive, resolution is not available for a minor nonconformity and the remedies must be carried out free of charge for consumers. However, conversely to the Directive, the Ordinance specifically allows consumers to claim for damages²⁰⁹.

As compared to the two-hundred-years old regimes set in the Civil Code, the new one provided for by the Ordinance in accordance with the Directive does not refer to any judge's help. This means that in daily transactions, consumers can claim for remedies directly to the sellers and need not to give any formal notice or to ask a judge to provide the remedy²¹⁰. This is also true for the resolution of the contract which can be, though as a second tier of remedy, decided by consumers on their owns. Likewise, it is self-evident that the first tier of remedy provided, replacement or reparation, has to be asked directly to the seller. As a matter of fact, it is only if the sellers refuse to carry out any remedy that consumers will face a dilemma: does the goodÕs value worth the trouble and the money to go to court? As such, assessed only on thi s highly practical ground, the new regime is much handier, and thus much more protective of consumers.

C. The current regime in the UK - A unified and efficient regime

The current regulatory framework applicable in the UK is based on the Sale of Goods Act 1979 as amended by the Sale and Supply of Goods Act 1994 (the SoGA) and by the Sales and Supply of Goods to Consumer Regulations 2002 (referred to as the Regulations)²¹¹ which transposed the Directive of 1999. Thus, the regime applicable to all buyers and the one applicable only to consumers as resulting from the Directive of 1999 are both laid down in the same Statute. As a result, consumers benefit from the general provisions laid down for all contract of sales as well as from the provisions especially designed for consumers sales. As the regime especially designed for consumers fits naturally in the general framework of contract sales law²¹², the law applicable to consumers is particularly clear. This is especially true in comparison to the French regime. Moreover, it is worth noting that oddly enough, the French regime has been greatly construed by judges and do not rely as much on writing rules than the English system which is plainly established on the SoGA.

In addition, the UK's notion of non-conforming good is unique and encompasses both the French notion of latent defect and the Ògarantie de conformitéÓ. As such, both the complexity and the confusion pertaining to the French legal system on this matter are avoided. Moreover, more than being clear, the regime set in the SoGA is particularly protective of buyers as it offers them remedies, and in particular the right of rejection, which use is simple and which can be exercised without any judge's help. As such, buyers, and in particular consumers, are granted with a strong bargaining power and are thus well-protected.

Before going any further, it is important to keep in mind that within the UK, the English, the Welsh and the Northern Ireland law can sometimes be different from the Scottish law²¹³. Thu s, all relevant differences will be highlighted throughout our analysis.

Except on a few issues adapted to consumers, the notion of non-conforming good is a unique and general one applicable to all buyers (1). Conversely, the remedial scheme is dual: one laid down for all contract of sales and available for all buyers without restriction and another one especially drafted for consumers (2).

1. The notion of non-conforming goods

Non-conforming goods will also be referred to as faulty goods. Goods do not conform

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when there are in breach of an express or an implied term of the contract of sales . The first hypothesis is easily understandable: a seller who expressly states that the mobile phone sold can go on the internet whereas in fact it cannot is in breach of an express term of the contract. As a consequence, the buyer is entitled to all contractual remedies available for breach of contract. Conversely, the concept of «implied term», detailed in sections 13, 14 and 15 of the SoGA, is not self-evident from a continental point of view. Yet, it is at the core of buyers' protection in contract of sales and is one of the most used provisions of the SoGA²¹⁵.

The notion of «implied term» is a system whereby some goods' characteristics, being regarded as of great significance, are considered as being included in all contracts of

sales exactly as if the parties have decided to include it themselves²¹⁶. As the parties have never specifically agreed on this point, this system of implied terms is a «legal fiction».

If a good does not comply with one of the implied characteristics detailed in the SoGA, the seller is in breach of this term, which is to say in breach of contract. In English law, there are two kinds of breaches of contract: the breach of warranty, which is regarded as a minor breach, and the breach of conditions which is regarded as an important breach²¹⁷. Only the latter breach gives without contest a right to the party who suffered it to terminate the contract²¹⁸ . However, as far as consumers are concerned, this distinction is most of the time irrelevant. Indeed, the SoGA provides that as regard consumers' sales, minor defects or minor non-compliance are always treated as breaches of conditions²¹⁹ . As a result, providing that sellers cannot exclude any implied term i n a consumer contract²²⁰, consumers confronted to a nonconforming good are entitled, regardless of the seriousness of the defect, to all contractual remedies, including the termination of the contract.

Furthermore, sellers cannot defend themselves by arguing that they have done all

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they could to ensure that the good was of quality

satisfactory . Such provision is

equivalent to the French notion of obligation of result whereby a party has to achieve a certain result and does not have any way of defense if such result is not reached. This provision is thus protective of buyers' interests as there is no debate as regard the existence of a fault attributable to the seller.

The implied terms specifically stated in Sections 13, 14 and 15 of the SoGA are only

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the basic one and the list provided is thus not comprehensive . As a result, a buyer
can always argue that a particular trade or local custom exists and provides for

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another implied term not listed in the SoGA . Likewise, buyers can also claim that a

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particul ar term, though not listed, is necessary to give to the contract its efficacy . As an example, in Mash and Murrell v Joseph I Emmanuel, the goods' ability to withstand the journey which had to be done was considered as an implied term of the contact. Thus, as the potatoes did not withstand the journey, they were regarded as non-conforming²²⁵.

The system of implied terms is rather inventive. Indeed, as it has a contractual basis, it gives the right to consumers, in any case, to escape from a contract which provided them with a faulty good. Thus, consumers are granted with a strong bargaining power. As a consequence, consumers' claims for a repair or a replacement for instance are likely to be agreed by sellers who are threatened by the fact that consumers might impose the termination of the contract. However, sellers can always choose to ignore consumers' claim. Consumers would then have to go to court to obtain the refund. Nonetheless, this system seems better than the French one laid down in the Civil Code whereby most of the times, consumers' claims for a remedy must be commanded by a judge.

Three main matters are of significance as regard the goods' conformity to the implied terms of a contract. More precisely, to comply with the implied terms stated in the SoGA, a (ii) 227

good must be as described (i) ²²⁶, must be of « satisfactory quality» and

must fit with its purpose (iii)²²⁸.

i. The goods must comply with their description or with the sample

Section 13 of the SoGA provides that in sales by description, there is an implied term that the goods sold will correspond to their description. Albeit there has been many debates surrounding the notion of description» 229

«sales by , it is nowadays assumed

that every good which contains words of description, on their packaging for instance,
are sales by description²³⁰. Thus, it can be said that virtually all sales are concerned
with the provisions laid down in Section 13. However, that does not mean that all

231

words written in relation to a good are treated as part of this good's description . Indeed, what is important good 232

is whether the words are used to describe the and

whether the buyer relied on the description before purchasing the good²³³.

Where a contract of sale is regarded as a sale by description, judges have to decide whether a given good complies with the description attached to it. As a matter of fact, judges appear to be largely in favour of buyers and to regard any slight discrepancy between a good's description and its real characteristics as being a breach of the implied term that the good must conform to its description. As an example, cans were regarded as being non-conforming to their description where, though the right number was delivered and their packaging was irrelevant for the buyer, they were packed in boxes of 24 instead of boxes of 30²³⁴. As a result, Section 13 of the SoGA appears to give buyers an efficient ground on which they can rely when they are confronted to a good which is not as described by the seller.

In addition, if the sale is a sale by sample, the SoGA specifically provides that the good must be free of any defect which is not apparent on a reasonable examination of the sample²³⁵ . One the one hand, this means that buyers cannot complain for a defect which was apparent on the sample. However, on the other hand, it is easy for buyers to show that the good purchased does not comply with the sample presented and that it does not conform. The significance of this provision must not be underestimated as some kind of sales are usually made by sample, such as the sale of paving for instance.

ii. The goods must be of Òsatisfactory quality»

Under the Sale of Good Act 1893, any good which was not of «merchantable quality» was regarded as faulty²³⁶. However, the Sale and Supply of Goods Report drafted by the Law in 1987 237

Commission and the

Scottish Law Commission criticised such

condition as being unclear for both buyers and sellers²³⁸ and suggested instead that goods should be of «acceptable quality». This report led to the amendment of the SoGA 1979 by the Sale and Supply of Goods Act 1994 which provides that goods must be of «satisfactory quality»²³⁹ .

Section 14 of the SoGA details all the characteristics which make a good of satisfactory quality. Accordingly, goods are considered as being of satisfactory quality if «they meet the standard that a reasonable person would regard as satisfactory, taking account of any description of the goods, the price (if relevant) and all other relevant circumstancesÓ²⁴⁰. More precisely, the terms provided by the SoGA includes the goods' state and condition, their fitness for the purposes such kind of goods are

usually used, their appearance and finish, their freedom from minor defects, their

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safety and their durability . As already highlighted, all elements which make a good of satisfactory quality are described in the SoGA as being «implied terms» in all contracts of sales²⁴².

In practice, the assessment as to whether a good

is of satisfactory quality or not can be very difficult to carry out and depends upon numerous factors such as the good itself and the circumstances of the sales. Indeed, as an example, the good's age and

243

price is of great significance since a cheap or an old good is not expected to reach

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a level of quality as high and to perform as well as an expensive or a n ew one . Section 14(2A) provides specifically that the good's price is taken into consideration as being part of the « other relevant circumstances». No specific reference is made to the age of the good but, in fact, judges take this element into account on the same basis, which is to say as being part of the «other relevant circumstances».

Moreover, it is worth noting that sellers are protected as regard all defects and specific points they have shown to the buyers before the purchase. Indeed, such matters are not considered as implied terms and consumers cannot complain about them²⁴⁵. Likewise, if an examination is done prior to the conclusion of the contract, defects which are apparent on a reasonable examination of the good or which are ought to be revealed by such examination are not regarded as implied terms either²⁴⁶. However, buyers are not required to carry out such examination, which is a good point . In addition, it must be noted buyers cannot claim for remedies in case of fair wear and tear or if they misused the good²⁴⁷.

In addition, when the buyer is a consumer, the Regulation, in accordance with the Directive it has transposed, adds another implied term. Indeed, Section 14(2D) of the SoGA includes in the « other relevant circumstances» the public statements on the good made by the seller or the producer, especially those made in advertisings or on the labeling. However, sellers can defend themselves by showing that they were not aware and could not reasonably be aware of this public statement, that such statement has been withdrawn or corrected in public or if they prove that the consumer could not have been influenced by the statement²⁴⁸. In such cases, sellers will not be regarded as being in breach of contract.

iii. The goods must fit for their purpose

Section 14(3) of the SoGA specifically provides that when buyers makes known to sellers that they intent to use of good for a particular purpose which is different from the normal use such kind of goods are usually purchased, the good must fit for this specific purpose²⁴⁹. Here again, what is important is the description of the good, an issue already dealt with under Sections 13 (sales by description), 14(2A) and 14(2D) of the SoGA. However, the specificity of this provision is that it allows more flexibility for buyers. Indeed, they can buy a good for a specific use which requires qualities not included in the good's description without loosing the protection they are granted with. However, the particular use the good will be used for must be drawn to the sellers' attention²⁵⁰.

If, somehow, the goods are non-conforming, the sellers are in breach of contract and, subsequently, consumers can claim for remedies.

2. The remedies

In addition to the remedies stated for all buyers (a), Section 48 of the SoGA also provides for specific remedies especially designed for consumers by the Regulations (b).

a. The traditional remedies in the UK

As highlighted above, a non-conforming good is a good which does not fit with the implied terms stated in the SoGA or any other relevant terms as those agreed by the parties or those coming from customs. Sellers delivering faulty goods are in breach of contract and buyers are thus entitled to remedies. These remedies can be the termination of the contract and the rejection of the goods (i), the withholding of performance (ii), specific performance (iii) and damages (iv)²⁵¹.

i. The termination of the contract and the right of rejection

The termination of the contract and the right of rejection are two different figures (á) but as far as consumers are concerned, the right of rejection is emblematic and the focus must then be put on it (â).

á. An overview on the termination of the contract

First of all, when consumers are entitled to terminate the contract that does not mean
they must do so. Indeed, in English law, the termination of the contract is seen as a
matter of «election» and the party who suffered the breach can choose to terminate

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the contract or to continue its performance (affirmation of the contract) . No

particular from choice 253

is required to make the and the only thing which matters is

»254

that there must be « unequivocal words or conduct . Thus, consumers should be aware that their choice can be, for instance, inferred from the mere fact that the good is rej ected ²⁵⁵. This shows the ambiguous relationship existing between the right of rejection and the right to terminate the contract, especially in contracts of sales.

The rejection of the good is a way for the aggrieved party to express his choice to terminate the contract. However, in practice, the rejection of the good does not necessarily lead to the termination of the contract. As an example, say a seller has a period of time of one week to perform a contract which consists in the delivery of a television. If he delivers it on Day 2 but it appears to be non-conforming, then the buyer can reject the good but wait for another delivery to be made on time. Thus, if a conforming good is delivered on Day 5, the buyer will have exercised his right of rejection without terminating the contract. As regard consumers, we have seen that

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any non -conformity, even slight, gives them the right to terminate contract

the . However, this does not force them to do so and they can instead wait for a conforming delivery to be done.

On a more intellectual ground, the termination of the contract is the proper name of the remedy consumers are entitled to when they suffer a breach of contract. Thus, as far as they are concerned, talking about the right of rejection as a remedy is an abuse of language as it is only a modality of exercise of the right to terminate the contract.

It shall be noted that the termination of the contract is not the equivalent to the French resolution for latent defect or «garantie de conformitéÓ. Indeed, as r egard resolution it is assumed that the co ntract has never existed and its destruction has thus retroactive effects. Conversely, the UK's notion of termination does not entail any retroactivity and the contract simply goes to an end²⁵⁷. Thus, in practice, consumers can claim damages on a contractual ground.

As consumers' most common and known way to terminate the contract is by rejecting the good, we will especially focus on it. We will nonetheless keep in mind that it remains a mere modality of the termination of the contract.

â. A focus on the right of rejection

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The regime pertaining to the right of rejection has been created by cases law and was first codified in the Sale of Goods Act 1893 though it was not defined there and has never been defined in any statute since. In practice, the right of rejection is very popular amongst consumers as they do not have to litigate but only to tell the sellers that they reject the good. It is thus to sellers to decide whether it is worthwhile to go to court or not. As such, the right of rejection is seen as one of the most emblematic

provision protecting consumers in the UK. Before detailing further its use for consumers, it is worth noting that in addition to non-conforming goods, those delivered late 260

in wrong quantity ²⁵⁹ or delivered can be rejected by consumers. This

precision is important since late delivery of goods is a matter of great significance in consumers' sales. Allowing them to take an efficient action in this case is thus a good way to protect them.

The most problematic provisions as regard the right of rejection concern the examination of the goods, their acceptance and the length of the reasonable period. The exercise of the right of rejection will also be further detailed.

The examination of the good

The first point which was discussed in early cases law was the existence of an
obligation to inspect the goods prior to the purchase. Albeit such inspection was

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required until the mid -twentieth century , it was later abandoned and buyers were then given the right to inspect the good after the property passed and to reject it in case of non-conformity²⁶³. This step forward was established in law with the 1994 amendment of the SoGA²⁶⁴ and is to be approved. Indeed, it does not seem reasonable to me to require from buyers, especially when they are consumers, to examine all goods before they acquire them. It seems better to give them some time after the purchase to do so.

The acceptance of the good

The right of rejection is granted to consumers confronted to faulty goods as long as they do not ed good 265

have accept the . Indeed, pursuant to Section 11(4) of the

SoGA, the breach of contract is to be treated as a breach of warranty if the buyer has accepted the good. As already highlighted, a breach of warranty does not give buyers the right to terminate the contract. Thus, if the good has been accepted, consumers cannot reject it.

Acceptance occurs when consumers:

> Intimate to sellers that they have accepted the goods (intimation)²⁶⁶;

> Use the good in a manner which is not consistent with the seller' s

ownership of the goods (inconsistent act, providing that consumers do not

act in such a manner by merely asking the seller for repair²⁶⁷); > Keep the good during a reasonable period²⁶⁸

The first two conditions leading to the acceptance of the good are rather clear. Intimation does not lead to any difficulty as the consumer positively expresses its acceptation of the good. Likewise, the use of the good in an inconsistent manner is usually rather clear. What is in fact difficult to assess is the acceptance inferred from the retaining of the good during a reasonable period. Such issue is of great practical significance providing that most of the times, acceptance is actually inferred from the

fact that consumers keep the good without complaining during a reasonable period of time.

The reasonable period

What exactly amounts to a reasonable period of time is not clearly stated and can
hardly be anticipated²⁶⁹. Indeed, little cases laws are available to make this point

clearer²⁷⁰ and some contradictory 271

of them are even . That is why the assessment of

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the reasonable period is regarded as a matter fact

of . Thus, only general

observations can be drawn as regard the length of a reasonable period and what is relevant for its calculation.

First of all, consumers are not considered as having accepted the good until they had the opportunity to examine them and to ascertain whether it is of satisfactory quality²⁷³. However, providing that such examination of the goods can take place after the purchase, in of period 274

it has consequences the length the reasonable . As

such, the reasonable period cannot be less (but can be more) than the time it takes to examine the goods purchased²⁷⁵. However, it is important to keep in mind that the issue is whether the buyers had the time to inspect the good, not whether they had the time to discover the defect. Thus, as a matter of fact, the reasonable period often ends prior to the detection of the defect if it is hidden.

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More precisely, t he Truk case provides that a reasonable period is the period

during which a rejection is reasonable as regard the buyer and the seller' s situation.

As an example, in the Berstein case, the buyer was ill and the judge took this fact into consideration in the assessment of the reasonable period.

Even though no exact anticipation as to the length of the reasonable period can be made, it is important to note that Consumer Direct, an online service giving advices on various issues concerning consumers and funded by the government, reports that after two weeks, consumers often have trouble to exercise their right to reject. However, the period during which consumers can reject goods is probably longer than two weeks²⁷⁷. This example shows clearly that uncertainty leads directly to practical difficulties and to a decrease in consumers' rights.

Admittedly, the right of rejection must be limited in time as otherwise it would lead to legal uncertainty for sellers. However, this limitation should be clearly stated, or, at least, more guidance should be given. Indeed, if the right of rejection is per se very protective of consumers, the fact that they can only exercise it during an undefined period of time undermines their right. This uncertainty is thus highly questionable and is to be regretted.

In addition, it appears that the period of rejection is rather short, probably not more than two or three months at most. Thus , when confronted to latent a defect or latent non-conformity which is often discovered months after the delivery of the good, consumers will not be able to reject the good and will thus loose all the bargaining power this remedy offers them. Thus, I believe that the period of time during which a good can be rejected should be longer, six months for instance. This is the same period as the one stated in the Directive and which concerns the presumption of

anteriority of the non-conformity. Both provisions are, in nature, very different. However, as they both put the consumer in a strong position when confronted to a faulty good discovered shortly after the delivery of the good, it makes sense to me to set a similar period for both of them.

The exercise of the right of rejection

Buyers exercise their right of rejection by intimating the sellers of such rejection.
Thus, the strength of the right of rejection lies on the fact that buyers can freely use it

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and need not to obtain its application by a judge . They only need to do so if sellers refuse to refund the price paid²⁷⁹. More than the content of the right itself, I believe that giving the power to terminate the contract directly to buyers is per se the best way to protect them. Moreover, unless otherwise agreed in the contract, buyers do not have to return the goods to the sellers who have to take them themselves²⁸⁰.

If faulty goods have already been accepted, no matter how, buyers have lost their right to rejection but are still entitled to damages.

ii. The withholding of performance

Conversely to France, under the SoGA, the delivery of the good and the payment of

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the price ar e concurrent conditions . This means that sellers must be willing to transfer the possession of the good in exchange of its price in the same time that buyers must be willing to pay the good in exchange of its possession. Thus, under this scheme, in principle, no party can withhold performance as this performance is a

of contract 282

condition the . However, parties can provide that one of them, the seller

for instance, must first perform his obligation. In our example, the buyer 's performance would then be conditional on the seller having delivered the goods. Then, if the seller does not deliver the goods, the buyer will be entitled to withhold performance²⁸³.

However, this kind of agreement is rather uncommon in consumers' sales and, in any case, consumers are generally required to pay before or at the delivery of the good. Thus, they can rarely use this right.

iii. Specific performance: theory and practice

Under the SoGA, buyers are entitled to specific performance 284 . However, it is to be noted that as compared to civil law countries, this remedy is not automatic and rather hard to obtain from a judge. Indeed, courts are generally reluctant to command specific performance since it is assumed that when other remedies are more

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adequate, then they are ought to be com manded instead . Thus, as far as ordinary goods are concerned, it is considered that it is more adequate for buyers to obtain a refund and then to buy another good to another seller than to obtain specific performance²⁸⁶. This remedy is then difficult to obtain for consumers since they are often concerned with ordinary goods.

However, in practice and even though there is no legal support for such claims,
consumers can ask for repair or replacement, which are forms of specific
performance. Indeed, when consumers are entitled to terminate the contract and

reject the good, they are also in a position which allows them to ask, instead, for another remedy. In practice, it is likely that consumers are only willing to have an efficient and conforming good and they need not to terminate the contract if they can obtain satisfaction in another way. As such, replacement or repair can then be satisfactory, or even price reduction if the defect or the non-compliance is, for instance, minor. As a mater of fact, unless such demands appear to be too expensive, sellers are usually happy to accept repair, price reduction or replacement instead of rejection of the good as thus, they do not lose all benefits arising from the contract.

iv. Damages

Consumers can claim damages, regardless of whether they have rejected the goods

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or not ²⁸⁷, in case of non -delivery , late delivery or delivery of faulty goods . The general requirements as to the conditions which must be fulfilled to obtain damages, such as the condition of foreseeability, will not be recalled. It is only important to keep in mind that the scope of damages which can be recovered in the UK is narrower than in France. Indeed, as an example, it is difficult for a party to obtain remedies for the benefits he was expecting to earn if the contract had been performed correctly. Likewise, consumers are unlikely to be able to obtain damages for distress, inconvenience or disappointment²⁹⁰. If fewer losses can be recovered in the UK as compared to France, as far as consumers are concerned, I believe that the rules stated are satisfying. Indeed, consumers are not concerned with businesses issues and with economic losses, for instance.

In addition, in contract law, the prejudiced party is under a general duty to mitigate his loss. This flows from the general principle that a plaintiff can only recover what arises in the course of events 291

ordinary . As regard consumers, that means they

have to report the non-conformity as soon as possible to prevent the good from deteriorating further or to cause any other damages²⁹². Albeit this looks similar to the obligation to notify the non -conformity within a period of two months stated in the Directive, it is in fact different. Indeed, it only concerns the granting of damages and is only relevant when the non-conformity can, by its nature, deteriorate further the good or cause more damages. As such, this limitation seems reasonable.

As regard the assessment of damages, the SoGA provides guidelines which are
helpful to determine what can be recovered by a buyer confronted to a non-
conforming good . Accordingly, the measure of damages is the «estimate loss directly

»293

and naturally resulting in the ordinary course of event , from the breach of contract. More precisely, in case of faulty good, what can be recovered is the difference in terms of value between the faulty the one 294

product received and expected . In addition, consumers can also ask for damages for any losses caused by the defective good itself, such as the losses caused by a leaking dish washer for instance²⁹⁵.

b. The remedies especially designed for consumers

The Directive of 1999 has been transposed in English law by the Sales and Supply of
Goods to Consumer Regulations 2002 (the Regulation) which adds new rules as
regard consumers²⁹⁶. These new provisions can be found in Section 48 of the SoGA

and are perfectly included in the SoGA. Indeed, the new rules apply if the goods delivered do not conform to the contract of sale and they are non-conforming if they are in breach of the express or implied terms of the contract as provided for under Section 13, 14 and 15 of the SoGA²⁹⁷. Rules are therefore clear and the regime provided for all buyers is per se comprehensive and easily understandable.

Providing that the main features of the Directive have already been analysed, we will only highlight the particularities pertaining to the English transposition. First of all, it can be noted that the Directive is not deeply shattered by the Regulation. Indeed, the government assured that no lowering of the protection already granted to consumers

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would flow from the transposition of the Directive . Thus, as an example, the Department of Trade and Industry, which was in charge of implementing the rules coming from the Directive, did not enforce the Directive rules about the consumers' obligation to notify any defect within two months of its discovery. To sum up, the new rules do not undermine consumers existing rights but only improve the one they already have .

One of the most important improvements for consumers is the fact that they have the

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possibility to ask the sellers for the reparation or the replacement of the good , providing that such repair or replacement must not be carried out with significant inconvenience for the consumer and must be performed at the seller's costs³⁰⁰. Thus, consumers can efficiently rely on a legal ground to make such claim and not only on their bargaining power, as it was the case before. Such possibility is of great importance since most of the time, what consumers want is a good which works properly and are thus not necessarily willing to reject it.

As provided for in the Directive, the seller can refuse to access to the consumer's claim if replacement is disproportionate 301

the repair the

or impossible or and must

then rescind the contract or reduce the price of the good. However, as compared to the Directive, no hierarchy of remedy is provided. As a result, consumers can directly ask for rescission or price reduction without asking first for repair or replacement.

Finally, in accordance with the Directive, when a non-conformity is detected within a period of six months following the delivery of the good, the non-conformity is presumed to have existed prior to the delivery³⁰². Thus, consumers can easily obtain one of the four remedies listed (i.e. repair, replacement, price reduction or rescission) if they find a problem with the good within such period. This is, again, an improvement of consumers' rights.

3. The time limit to lodge a claim

Buyers confronted to faulty goods can only claim for remedies within a time period of

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six years from the sale in England, Wales and Northern Ireland and five years from the discovery of the problem in Scotland³⁰⁴. This time limit also applies to consumers since the two years time limit provided for by the Direct ive of 1999 has not been transposed in the UK.

The time limit is satisfactory in Scotland where it begins at the detection of the
problem. It can be argued that in England, Wales and Scotland there are situations
where the six years time limit beginning at the sale of the good will be too short.

Indeed, as regard some goods which are supposed to last for a very long time, such as cars for instance, buyers might discover that they do not conform after this period of six years has elapsed. However, I believe that six years is a rather long period which strikes a fair balance between buyers' protection and sellers' interests and needs for legal security.

***

The French and the UK's system are very different. Indeed, a consumer buying a good in London can rely on a single set of rules which he can easily put in practice without any judge's help. Conversely, a consumer acquiring an item in Paris has many grounds on which he can rely to complain, but most of them require him to go to court. Thus, generally speaking, consumers enjoy a better protection in the UK than in France. These differences show how diverse can be the protection of consumers and highlight the fragmentation of the legal rules applicable to consumers in Europe. This is at the core of the Commission's critiques and explains why the Proposal it has launched on 2008 aims at full harmonisation. However, arguably, nor the method of unifying consumer protection neither the Proposal's content are good ways to protect consumers.