Description

Commercial Transactions

1. Commercial law is the branch of law that is concerned with rights and duties arising from, amongst others, the supply of goods and services.

• Discuss the significance of the following as sources of law on the sale of goods and transactions:

Contract

• Uncodified custom and usage
• Codified custom and usage
• Domestic and international legislation (9 marks)
• Section 55 of the Sale of Goods Act (Cap 31, Laws of Kenya) states that:

“Where any right, duty or liability would arise under a contract of sale by implication of law, it may be negatived or varied by express agreement or by the course of dealing between the parties, or by usage, if the usage is such as to bind both parties to the contract.”

Read the facts provided hereunder, and answer the question that follows:

The plaintiff and defendant entered into a contract in January 2011 for the sale of 15,000 liters of diesel C.I.F Mombasa. There was a clause in the contract which provided that the contract “contains the entire agreement of the parties and there is no other promise, representation, warranty, usage or course of dealing affecting it.” A dispute arose and the defendant wanted to rely on a custom or usage for the retention of samples of oil being tested. The plaintiff contends that the contract does not admit such terms.

In view of the law and the facts provided, prepare a considered judgment on that particular aspect of the case.