Introduction
This advice addresses the legal position of Orange Cafe (“the Cafe”) regarding a delivery from Berjaya Grocery Store (“the Seller”). The Cafe ordered 100 kg of ‘Rose’ brand brown sugar but received a mixed delivery of 80 kg of the correct sugar and 20 kg of ‘Key’ brand refined sugar. This is a business-to-business (B2B) transaction, meaning the key legal framework is provided by the Sale of Goods Act 1979 (SGA 1979). The Consumer Rights Act 2015 is not applicable as the Cafe is not acting as a "consumer" in this commercial context. This advice will establish that the Seller has breached the contract and will outline the remedies available to the Cafe. The core issue revolves around the seller’s failure to deliver goods that correspond with the contractual description.
Breach of Contract: The Implied Term as to Description
The primary ground for the Cafe to challenge the delivery is through the implied term regarding the description of the goods, which is found in section 13(1) of the Sale of Goods Act 1979. This section states:
> "Where there is a contract for the sale of goods by description, there is an implied term that the goods will correspond with the description."
For this section to apply, the sale must be one ‘by description’. In this case, the Cafe specifically requested "100 kg of brown sugar" and stipulated that it must be of the "Rose brand". This constitutes a clear and specific description which forms a term of the contract. The courts interpret this requirement strictly. The delivery made by the Seller consisted of two parts: 80 kg of Rose brand brown sugar, which conforms to the description, and 20 kg of Key brand refined sugar. The latter part fails to correspond with the description in two ways: it is the wrong brand (‘Key’ instead of ‘Rose’) and it is the wrong type of sugar (‘refined’ instead of ‘brown’).
Case law demonstrates that strict and complete compliance with the description is required. In Arcos Ltd v E A Ronaasen & Son [1933], wooden staves intended for making barrels were described as being half an inch thick. The staves delivered were only slightly different in thickness but were still perfectly usable for their intended purpose. Nevertheless, the House of Lords held that the buyers were entitled to reject the goods because they did not correspond with their description. Similarly, in Re Moore & Co and Landauer & Co [1921], a contract for the sale of 3,000 tins of canned fruit described them as being packed in cases of 30 tins. The goods were delivered but were packed in cases of 24 tins. Although the total quantity of tins was correct, the court held that the way they were packed was part of the description, and the buyer was entitled to reject the entire consignment.
Applying this strict principle to the present facts, the delivery of 20 kg of Key brand refined sugar is a clear breach of the term implied by section 13 SGA 1979. The goods delivered do not match the description stipulated in the order. This failure to comply gives rise to remedies for the Cafe.
The Right to Reject the Goods
Under the SGA 1979, the term implied by section 13 is classified as a condition (s.13(1A)). The traditional remedy for a breach of a condition is that the innocent party is entitled to repudiate the contract, reject the goods, and claim damages for any losses incurred. This would mean that the Cafe could, in principle, reject the entire 100 kg delivery, even though 80 kg of it conforms to the contract.
However, this right is subject to certain statutory limitations. The most relevant here is section 15A of the SGA 1979, which applies to non-consumer sales. This section provides that if a breach of a condition (such as the one under section 13) is "so slight that it would be unreasonable for the buyer to reject them," the breach is to be treated as a breach of warranty instead. A breach of warranty only entitles the buyer to claim damages and does not give them the right to reject the goods.
The question for the Cafe is whether a 20% non-conformity (20 kg out of 100 kg) can be considered a "slight" breach. The statute does not define "slight," leaving it to the courts to decide on the facts of each case. However, it is highly unlikely that a court would consider a 20% deviation to be slight. This is a significant part of the total order, not a trivial or microscopic defect. Therefore, it is probable that section 15A would not apply in this situation, and the Cafe would retain its right to reject the goods on the basis that a condition has been breached.
The Option of Partial Rejection
In addition to the rights arising from the breach of condition under section 13, section 30 of the SGA 1979 provides further options when incorrect deliveries are made. Section 30(3) is particularly relevant here:
> "Where the seller delivers to the buyer the goods he contracted to sell mixed with goods of a different description not included in the contract, the buyer may accept the goods which are in accordance with the contract and reject the rest, or he may reject the whole."
This provision gives the Cafe a clear and commercially flexible choice. It can either exercise its right to "reject the whole" delivery of 100 kg, as discussed above, or it can choose to "accept the goods which are in accordance with the contract" (the 80 kg of Rose brand brown sugar) and "reject the rest" (the 20 kg of Key brand refined sugar). If the Cafe chooses to accept the 80 kg, it must pay for them at the contract rate (s.30(3)). This option may be attractive if the Cafe has an immediate need for the brown sugar and cannot easily source a full replacement order from another supplier in time.
Loss of the Right to Reject: Acceptance
It is important for the Cafe to be aware that the right to reject goods can be lost if the buyer is deemed to have ‘accepted’ them. According to section 35 of the SGA 1979, a buyer is deemed to have accepted the goods if:
- They intimate to the seller that they have accepted them; or
- When the goods have been delivered, they do any act in relation to them which is inconsistent with the ownership of the seller (e.g., using or selling the goods).
The facts state that the Cafe is "dissatisfied" and is seeking legal advice, which strongly suggests that it has not yet accepted the goods. To preserve its right to reject, the Cafe should not use any of the sugar delivered, particularly the non-conforming 20 kg. It should also inform the Seller promptly of its decision to either reject the whole delivery or reject the non-conforming part.
Summary of Advice and Available Remedies
In summary, Berjaya Grocery Store is in breach of the contract for the sale of goods by failing to deliver goods that correspond with the description, contrary to the implied condition in section 13 of the SGA 1979. The Cafe has two main courses of action available:
- Reject the Entire Delivery: The Cafe can reject the entire 100 kg shipment. It would not have to pay for the sugar and could terminate the contract. It could then bring a claim for damages for non-delivery under section 51 of the SGA 1979. The measure of damages would typically be the difference between the contract price and the market price of obtaining 100 kg of Rose brand brown sugar from an alternative supplier.
- Accept the Conforming Goods and Reject the Rest: The Cafe can, under section 30(3) of the SGA 1979, accept the 80 kg of Rose brand brown sugar and reject the 20 kg of Key brand refined sugar. The Cafe would be obliged to pay for the 80 kg it accepts at the contract price. It would still be entitled to claim damages for the breach in relation to the 20 kg shortfall, such as any extra cost incurred in sourcing the remaining 20 kg of Rose brand sugar from another seller.
The best option depends on the Cafe’s commercial priorities. If it urgently requires the 80 kg of brown sugar and a full replacement is not immediately available, partial acceptance is a practical solution. If it can easily source the full amount elsewhere and wishes to sever ties with the unreliable seller, rejecting the entire delivery is a valid and legally sound option. The Cafe should communicate its decision to Berjaya Grocery Store clearly and without delay to avoid any suggestion that it has accepted the goods.
References
Arcos Ltd v E A Ronaasen & Son [1933] AC 470
Re Moore & Co and Landauer & Co [1921] 2 KB 519
Sale of Goods Act 1979
