On buying a pig in a poke

In two recent cases, the Court of Appeal has examined the right to reject goods. In Jones vs Gallagher, the court looked at the decisive case of Clegg vs Andersson (see 9 May 2003, page 55).

Clegg vs Andersson concerned a £250,000 yacht. The Clegg family owned it for seven months before they validly rejected it, but during that time they had been seeking information from the seller regarding various faults and how they might be remedied.

The vice-chancellor held that amendments to section 35 of the Sale of Goods Act 1979 meant that, as a matter of law, time spent requesting repairs, agreeing repairs, carrying them out or in waiting for the seller to explain what repairs were required could not deprive the Cleggs of their right to reject the boat. The harsh case of Bernstein vs Pamson Motors (1987), which implied the opposite when a customer lost the right to reject a car after three weeks, was consigned to the dustbin.

The Jones case went to court before Clegg was even reported. Here are the facts of that case in a nutshell. It concerned a wooden kitchen that was given the wrong stain. The supplier finished the installation and said that the colour would darken. It never did. Many other things were wrong and remedies were promised. Some were attempted. Many never happened. The housing for a special fridge was defective. The fridge heated food and then burned out. No replacement had arrived by mid-September, by which time the Joneses gave up: they needed a working kitchen and rejected the one they had.

The judge decided that, at the time of rejection, there were at least 20 unremedied breaches of contract. He awarded substantial damages for each.

But applying the pre-Clegg law, he held that the right to reject had been lost, so the Joneses did not get all their money back because there was "no initial rejection" (an implicit reference to Bernstein), the sink and the burned-out fridge had been used, and the Joneses had "gone so far as to put things on the shelves".

Lord Justices Buxton and Thomas held that the Joneses had lost their right to reject by lapse of time. What is a "reasonable time" is a question of fact, to be determined in all the circumstances.

However, Buxton went further than Thomas, saying that assessment of loss of right to reject is also a matter of fact to be considered in all the circumstances. Buxton's insistence that this was not a mixed question of fact and law, but a mere question of fact was surprising and difficult, if not impossible, to reconcile with Clegg and the amended section 35 of the Sale of Goods Act, which protects customers from judicial discretion.

Of course, each of the enquiries under section 35 is "factual" but, as the Court of Appeal in Clegg made abundantly clear, there are underlying principles of law. The first instance judges in both Clegg and Jones failed to follow them. The consequence in Clegg was that the Court of Appeal held that the various facts found by the judge could not amount to rejection or could not amount to lapse of time.

Thomas acknowledged the vice-chancellor's comment in Clegg that section 35 "shows that time taken merely in requesting or agreeing to repairs, and for carrying them out, is not to be counted". However, both he and Buxton held that, although the judgment at first instance in Jones was far from perfect, the judge had evidence before him that entitled him to reach his conclusion that the right to reject had been lost. They therefore allowed a flawed exercise of discretion to stand.

Is this a sign of retreat from Clegg or simply an instance of the Court of Appeal categorising an appeal as a question of fact to facilitate dismissing it? Whichever it is, the decision will give heart to sellers who procrastinate and concern to the consumers that section 35 of the Sale of Goods Act was designed to protect.