Caveat Emptor

Today lecture class for business law was discussed about Sale of Goods. 1 of the vocabulary I learnt in the class is Caveat Emptor.

Caveat Emptor is a Latin word which can translate to English with the meaning of “Let the buyer beware”. Basically, Caveat Emptor can be defined as a property law of doctrine that controls the sale of real property after that date of closing.

The buyer could not recover from the seller for defects on the property that rendered the property unfit for the ordinary purposes under the doctrine of Caveat Emptor. The exception of Caveat Emptor is when the seller actively hided latent defects or others made material misrepresentations amounting to fraud.

The law requires the goods must be of “merchantable quality”. Unfortunately, this implied warranty can be difficult to implement and may not apply to all products. Therefore, buyers are still advised to be cautions when purchase a good.

Caveat Emptor also applies on the return policy. There is no legal requirement for the seller provides a refund or exchange. For some cases, the seller will provide a credit instead of refund.

Case of Laidlaw v. Organ is a decision written in 1817 by Chief Justice John Marshall. It is believed by scholars to have been the first U.S. Supreme Court case which under the rule of Caveat Emptor in U.S law.

Prepared by,
Fong Yok Yan (1071120015)