What is Doctrine of Caveat Emptor? Exception to Doctrine of Caveat Emptor?

Doctrine of Caveat Emptor: The maxim of caveat emptier means “Let the buyer beware” according to this it is the duty of the buyer to be careful while purchasing goods of his require­ment, and in the absence of any inquiry from the buyer, the seller is not bound to disclose every defect in goods of which he may be aware. The buyer must examine the goods thoroughly and must see that the goods he buys are suitable for the purpose for which he wants them. If the goods turn out to be defective the buyer cannot sue the seller because there is no implied undertaking by the seller that he shall supply goods to suit the buyer’s purpose. If the buyer depends on his own skill and makes bad choice he must suffer in the absence of any misrepresentation or fraud or guarantee by the seller.

Example: A buys a horse from B for riding –but did not mention this. The horse was found fit only for carriage. A cannot claim damage.

However caveat emptor is subject to following exceptions:

Exceptions. The doctrine of caveat emptor is subject to the following exceptions:

1. Where the seller makes a mis-representation and the buyer relies on it, the doctrine of caveat emptor does not apply. Such a contract being voidable at the option of the innocent party, the buyer has a right to rescind the contract.

2. Where the seller makes a false representation amounting to froud and the buyer relies on it, or where the seller actively conceals a defect in the goods so that the same could not be discovered on a reasonable examination, the doctrine of caveat emptor does not apply. Such a contract is also voidable at the option of the buyer and the buyer is entitled to avoid the contract and also claim damages for fraud.

3. Where the goods are purchased by description and they do not correspond with the (Sec.15). See implied condition ‘in a sale by description’ discussed earlier).

4. Where the goods are purchased by description from a seller who deals in such class of goods and they are not of ‘merchantable quality’, the doctrine of caveat emptor does not apply. But the doctrine applies, if the buyer has examined the goods, as regards defects which such examination ought to have revealed [Sec. 16(2)]. (See implied condition ‘as to merchantability’ discussed earlier).

5. Where the goods are bought by sample, the doctrine of caveat emptor does not apply if the bulk does not correspond with the sample, or if the buyer is not provided an opportunity to compare the build with the sample, or if there is any hidden or latent defect in the goods (Sec. 17). (See implied condition ‘in a sale by sample’ discussed earlier).

6. Where the goods are bought by sample as well as by description and the bulk of the goods does not correspond both with the sample and with the description, the buyer is entitled to reject the goods (Sec. 15). (See implied condition ‘in a sale by sample as well as by description’ discussed earlier).

7. Where the buyer makes known to the seller the purpose for which he requires the goods and relies upon the seller’s skill

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