Question 1

Akiko Ltd manufactures industrial pipework for the oil industry. It agrees to buy 2000 tonnes of a pipe coating product called Pipeguard from Soloku Ltd, manufacturers of the Pipeguard on an instalment; 1000 tonnes on each instalment, the first on 20^th December, 2017 and the second on 6^th January, 2018. Soloku Ltd advertises Pipeguard widely within the oil industry claiming, "It is the leading brand and the best among the best".

Akiko Ltd explained to Soloku Ltd before the contract that it intended to use Pipeguard in anti-corrosion coatings in industrial pipes. Akiko examined the pipes and found them to be in good order and condition.

After delivery of the first instalment of 1000 tonnes,Akiko Ltd used Pipeguard to coat pipes for its client. However, shortly after installation, the coating failed and its client seeks redress from Akiko Ltd. Akiko Ltd contacts Soloku Ltd, alleging that the Pipeguardsupplied was defective and that Soloku Ltd had implicitly held out Pipeguard as meeting all of AkikoLtd's needs including successfully fulfilling contracts with their own clients. Soloku Ltd replied that although Pipeguard is the standard chemical known throughout the industry it did not undertake to guarantee success in every instance. They also assert that the batch supplied to Akiko Ltd had been used successfully by other industrial pipe coaters.

Akiko seeks your advice with regard to its rights of rejection of the second instalment payment scheduled for 6^th January, 2018.

Advise Akiko about the remedies available to themas well as its right of rejection under the Sale of Goods Act 1962 (Act 137).

Question 2

Kristo Ltd, a private limited liability company recently bought two used cars, each six months old, for two of its executives to drive. Kissi, the managing director of the company, first saw the two cars at Kormivi's Garage, a Car Dealership about a month ago. Whilst at the Dealership, Kissi noticed that one of the cars, a Roadster, had an engine oil leak and the other, a Speedster, had water leak in the boot. Kissi did not, however, look in the boot of the Roadster. Kormivi's Garage assured Kissi: "They are good little buses; you can rely on them". After test driving both cars, Kissi, on behalf of Kristo Ltd, signed two contracts of purchase, one relating to each of the two cars.

Kissi left the Roadster with Kormivi to have the oil leak repaired and drove away in the Speedster. Two weeks later, Kissi returned the Speedster for its boot leak to be repaired and collected the Roadster. The next day, Kissidiscovered that the Roadster had a water leak in its boot; secondly, that the engine oil leak had not been repaired and was irreparable (meaning a new engine was necessary); and, thirdly, that soon after delivery to its first buyer the Speedster had been involved in an accident and subsequently treated by its owner's insurance company as a write off. Upon learning these facts, Kissi informed Kormivi's Garage that he was rejecting the cars and demanded the return of the purchase price to Consultants Ltd.

You are to advise the parties on the following:

a) Whether or not Kormivi's Garage is in breach of its obligations under the Sale of Goods Act, 1962 (Act 137)?b) Whether or not under Act 137, Kristo Ltd can reject the cars after having taken delivery of them?

Question 3

In July, 2016 Pasima Ltd ("Pasima"), a manufacturer of machinery, entered into two contracts with Askay Ltd ("Askay") a furniture manufacturer. Each contract was for the sale of an identical wood-planing machine, warranted to produce 500 feet of planed wood per hour. One machine was to be delivered on 2^nd December 2016and the other on 2^nd August 2017.

The machines were priced at Gh60,000 each; and each contract provided that the price was payable by 12 monthly instalments commencing on delivery, and that property in the goods was to pass on completion of the payments. The first machine was delivered and installed, but after it had been working for a fortnight, it was clear that by reason of its design the machine could only produce 250 feet of planed wood per hour. Askay therefore rejected the second machine on 1^st August 2017.

By August 2017 the market price of comparable wood planing machines warranted to produce 500 feet of planed wood per hour had fallen to Gh40,000 and a machine warranted to produce 250 feet of planed wood per hour would likely receive only Gh25,000. The delay in Askay's production of planed wood caused it to lose a valued customer. It also deprived Askay of an estimated profit of Gh10,000 during the month of February 2015.

Advise Askay Ltd about the remedies available under the Sale of Goods Act 1962 (Act 137)