Duties of the Seller Summary

Duties of the Seller

9.01 Introduction

  • Upon concluding a valid contract of sale, both parties (seller and buyer) must fulfill certain obligations.

  • These obligations may be adjusted or limited by mutual agreement.

  • This chapter reviews the seller's duties, including safe-keeping, delivery, and warranties against eviction and latent defects, considering the Consumer Protection Act 68 of 2008.

Safe-keeping of the Thing Sold
Seller's Duty

  • General Principles

    • The seller is responsible for the safe-keeping of the sold item from contract conclusion until delivery.

    • A buyer may claim damages for any harm caused by the seller's intentional or negligent acts.

    • The doctrine of passing of risk applies, determining when the risk is transferred from the seller to the buyer.

Types of Seller’s Conduct Leading to Damages

  • The seller's conduct causing damage can be classified as:

    • (a) Intentional acts: seller aimed for specific outcomes.

    • (b) Negligent acts: seller acted unreasonably given circumstances (includes mere carelessness and gross negligence).

    • If damages occur due to coincidence or an act of God, fault is irrelevant.

Factors Influencing Safe-keeping Duty

  • Mora Debitoris/Creditors:

    • If the buyer is in mora (delayed in payment or accepting the item), the seller is liable only for intentional or gross negligence.

    • If the seller is in mora (fails to deliver), they may be liable for damages even without fault.

Passing of Risk
General Principles

  • General Rule: An owner suffers losses if property is destroyed.

  • While ownership remains with the seller, they bear losses from damage during this period without claiming the purchase price from the buyer.

When Risk Passes to the Buyer

  • The risk passes to the buyer when the sale is perfecta, defined by:

    • (a) Buyer and seller intend to buy/sell;

    • (b) The sold item is specified or can be identified after agreement.

    • Types of sales include emptio rei speratae, emptio spei, or generic sales.

    • (c) The purchase price is agreed;

    • (d) No suspensive conditions on the contract.

Risk Bearing

  • Upon damage or destruction of the item due to coincidence or acts of God, the buyer bears the risk.

  • The buyer must pay for the item even if the seller hasn’t delivered it.

Damage and Advantage

  • Any damage without culpability from either party is borne by seller/buyer as outlined.

  • Examples include natural disasters (fire, floods, etc.).

Influence of the Consumer Protection Act 68 of 2008

  • According to the Act, goods remain the supplier's risk until the consumer accepts delivery.

  • Acceptance is indicated when the consumer communicates acceptance or keeps goods unreasonably without rejection notice.

Passing of Ownership
General Overview

  • Mere conclusion of a sale does not transfer ownership; specific conditions must be met.

Requirements for Passing of Ownership
Immovable Property

  • Ownership transfers only if:

    • (a) Seller is the owner;

    • (b) Intention to transfer ownership is clear;

    • (c) Property is registered in the buyer's name.

Movable Property

  • Ownership of movable property transfers if:

    • (a) Seller is the owner;

    • (b) Both parties intend transfer;

    • (c) For cash sales, the seller delivers and buyer pays; for credit sales, only delivery is necessary.

Payment of Purchase Price
General Thoughts

  • Distinction between cash and credit sales is crucial for ownership transfer.

    • Presumption exists that sales are cash unless stated otherwise.

Cash Sale Definitions

  • Cash sales occur when parties intend simultaneous delivery and payment or on the same day.

Credit Sale Concepts

  • Implicit agreements may denote credit if the seller allows delayed payment or security is involved.

Place of Delivery
Seller’s Delivery Duties

  • Seller must deliver at the agreed or implied (origin or seller’s business/residence) location.

Warranty Against Eviction
Definition and Implications

  • Eviction: Third-party actions that deprive the buyer of use or enjoyment of sold item.

Seller’s Duty to Warrant Eviction

  • Seller provides an automatic warranty against eviction to the buyer at the law's operation.

  • Eviction circumstances must exist at contract signing but may only threaten post-agreement without triggering seller's liability.

Types of Eviction

  • Various forms include claims by true owners, third-party possession without the buyer's recourse due to defects, or infringement by a leased interest.

Buyer’s Responsibilities Upon Threat of Eviction

  • Notify seller of eviction threat or risk losing recourse.

  • Seller may assist or defend against third-party claims following such notification.

Buyer’s Rights in Eviction Cases
Total Eviction Rights

  • Buyer may cancel the contract and claim full refunds or damages resulting from eviction.

Partial Eviction Rights

  • Buyer may cancel and seek a refund if too little remains of the item post-eviction, or keep intact portions while seeking a proportional refund for damaged portions.

Limitations of Seller Liability

  • Seller liable only if the eviction cause existed prior to the sale.

  • No liability if the buyer knew the seller’s ownership issue at contract conclusion.

Influence of the Consumer Protection Act on Warranties

  • Implied warranties ensure consumers assume sellers legally can supply and own goods, protecting against hidden charges and encumbrances.