Fraud and Misrepresentation | Business Law

Running head: BUSINESS LAW
BUSINESS LAW
Name of the Student
Name of the University
Author Note

1BUSINESS LAW
Issue
The issue in the given scenario is whether fraud and misrepresentation has been
committed by Cutprice Ltd. in relation to Sarah.
Rule
According to section 14 as provided in Cap. 26 Sale of Goods Ordinance, an implied
warranty is imposed upon the seller that the seller should disclose any charges or any kind of
burden or encumbrances to the purchaser, regarding which the purchaser might not have any
knowledge.
According to section 15 as provided in Cap. 26 Sale of Goods Ordinance, an implied
warranty is imposed upon the seller that the goods or commodities that are being sold should be
in conformity to the description, if the contract is established by description.
Section 16 as provided in Cap. 26 Sale of Goods Ordinance relates to the implied
condition in connection to the fitness or quality regarding the goods sold. The seller shall be
obligated to ensure that the goods sold are of merchantable quality. Although, no such obligation
shall be imposed if the purchaser has conducted an examination of the goods prior to the
establishment of contract.
The case of Museprime Properties v Adhill Properties [1990] 36 EG 114 shall be
considered to be a significant case in this regard. In this case, it was held that material
misrepresentation had been caused by the defendant because the imprecise statements had
persuaded the plaintiff to purchase the properties. Hence, damages were awarded to the plaintiff.

2BUSINESS LAW
The case of Gee & Others v DePuy International Limited [2018] EWHC 1208 must be
regarded as an important case in connection to the given scenario. In this case, it was stated that
it shall not be mandatory to prove that the defect was caused due to the fault of the manufacturer.
It shall be enough if the claimant merely prove the defect or flaw and a causal relation between
the injury and the defect.
Application
Applying section 14 as provided in Sale of Goods Ordinance, it may be said that Cutprice
Ltd has an implied warranty to disclose any charges or any kind of burden or encumbrances to
Sarah, regarding which she might not have any knowledge.
Applying section 15 as provided in Sale of Goods Ordinance, it may be said that an
implied warranty is imposed upon Cutprice that the goods or commodities that are being sold
should be in conformity to the description, if the contract is established by description.
Section 16 as provided in Sale of Goods Ordinance should be applied in the given
scenario. It may be said that Cutprice shall be obligated to ensure that the goods sold are of
merchantable quality. Although, no such obligation shall be imposed upon Cutprice if Sarah may
have conducted an examination of the goods prior to the establishment of contract.
Applying the case of Museprime Properties v Adhill Properties [1990] 36 EG 114, it may
be said that material misrepresentation had been caused by Cutprice Ltd because the imprecise
statements made by the company persuaded Sarah to purchase the properties. Hence, damages
should be awarded to Sarah.

3BUSINESS LAW
Applying Gee & Others v DePuy International Limited [2018] EWHC 1208, it may be
said that it shall not be mandatory to prove that the defect was caused due to the fault of the
manufacturer. It shall be enough if Sarah merely proves the defect or the flaw.
Conclusion
To conclude, it may be said that fraud and misrepresentation has been committed by
Cutprice Ltd. in relation to Sarah.

4BUSINESS LAW
References
Cap. 26 Sale of Goods Ordinance.
Gee & Others v DePuy International Limited [2018] EWHC 1208.
Museprime Properties v Adhill Properties [1990] 36 EG 114.