Commercial and consumer law

721 Pages·2010·3.895 MB·English

by  M P Furmston, Jason Chuah, Chris Willett, et al

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Are Scottish bank notes legal tender in the UK? Find out on page 310
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If you worked in a restaurant, would you be entitled to customer tips processed on a credit card? Find
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out on page 323
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If you brought something on eBay could you claim your money back from your credit card company if
you didn’t receive it? Find out on page 524
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If you booked a package holiday and your hotel wasn’t booked when you arrived, could you take any R
action against the tour operator? Find out on page 418 C
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In Commercial and Consumer Law, a team of specialists draw upon their extensive expertise in this fi eld
to provide you with this essential guide to the key legislation and case law relating to both domestic and L
international commercial transactions. Recognising that commercial and consumer law does not operate in
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isolation, the book offers not only a scholarly, yet highly readable, account of commercial and consumer law
principles, but also highlights the commercial and socio-economic context of the law. N
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To help you get the most from the book, a range of features designed to support you during your study are used
throughout including:
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• Summaries of the essential cases and extracts from key legislative provisions that you will need to draw upon
when answering problem or essay questions O
• Debate and issues boxes to highlight particularly contentious areas of the law and help you refi ne your critical
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analysis skills necessary for gaining those top marks in exams
COMMERCIAL AND
• Real life examples to illustrate how the law in this area operates in practice
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• Further reading lists at the end of all chapters point you to relevant academic articles enabling you to delve
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deeper into the academic debates surrounding the subject
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Commercial and Consumer Law is particularly suitable for both undergraduate and postgraduate law students.
For the undergraduate student, the text is clear and accessible, and provides a thorough coverage of the law E
CONSUMER LAW
syllabus. For the postgraduate student, there are numerous references provided to guide a deeper research of R
the subject.
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ABOUT THE EDITORS ABOUT THE CONTRIBUTORS
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Michael Furmston is Dean and Professor Chris Willett, Professor of Consumer Law, De Montfort University
of Law at Singapore Management David Oughton, Professor of Commercial Law, De Montfort W
University’s School of Law, and an University EDITED BY MICHAEL FURMSTON AND JASON CHUAH
Emeritus Professor at the University
Howard Johnson, Senior Lecturer, University of Wales Bangor
of Bristol.
James Devenney, Senior Lecturer, University of Durham
Jason Chuah is Professor of International
Jo Reddy, Adjunct Lecturer, University of Hong Kong
Commercial Law at the University of
Westminster and has held visiting Louise Merrett, Fellow and Lecturer in Law, University of Cambridge
appointments in the UK and elsewhere. Susan Hawker, Principal Lecturer, London Metropolitan University
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Further your understanding through mylawchamber C M
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Visit www.mylawchamber.co.uk/furmston to access regular updates to help you keep up to
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date with important legal developments in commercial and consumer law. H N

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Commercial and Consumer Law
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Commercial and Consumer Law
Edited by:
MichaelFurmston
Dean and Professor of Law, Singapore Management University
and Emeritus Professor, University of Bristol
JasonChuah
Professor of International Commercial Law, University of Westminster
With contributions from:
ChrisWillett,Professor of Consumer Law, De Montfort University
DavidOughton,Professor of Commercial Law, De Montfort University
HowardJohnson,Senior Lecturer, University of Wales Bangor
JamesDevenney,Senior Lecturer, University of Durham
JoReddy,Adjunct Lecturer, University of Hong Kong
LouiseMerrett,Fellow and Lecturer in Law, University of Cambridge
SusanHawker,Principal Lecturer, London Metropolitan University
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First published 2010
© Pearson Education Limited 2010
All rights reserved. No part of this publication may be reproduced, stored in a retrieval
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ISBN: 978-1-4058-7367-3
British Library Cataloguing-in-Publication Data

A catalogue record for this book is available from the British Library
Library of Congress Cataloging-in-Publication Data
Furmston, M. P.
Commercial and consumer law / Michael Furmston and Jason Chuah.
p. cm.
Includes bibliographical references and index.
ISBN 978-1-4058-7367-3 (pbk. : alk. paper) 1. Commercial law–Great Britain.
2. Consumer protection–Law and legislation–Great Britain. 3. Dispute resolution
(Law)–Great Britain. I. Chuah, Jason. II. Title.
KD1629.F87 2010
346.4107–dc22
2010009903
10 9 8 7 6 5 4 3 2 1
14 13 12 11 10
Typeset in 9/12.5pt Giovanni by 35
Printed by Ashford Colour Press Ltd., Gosport
Brief contents
Guided tour xii
Preface xv
Contributors xvi
Table of cases xvii
Table of statutes xlii
1 What is commercial law? 1
by Michael Furmston
2 Aspects of property, security and guarantees 5
by James Devenney
3 Agency 50
by Jo Reddy
4 Sale of goods 91
by Michael Furmston
5 International sale of goods 234
by Susan Hawker
6 Payment and payment instruments 301
by Jason Chuah
7 Consumer protection 376
by Chris Willett and David Oughton
8 Consumer credit law and regulation 473
by Howard Johnson

9 Commercial mediation, conciliation and arbitration 541
by Jason Chuah
10 Commercial conflict of laws 558
by Louise Merrett
11 Insurance 628
by Michael Furmston
References 637
Index 645
v

Contents
Guided tour xii
Preface xv
Contributors xvi
Table of cases xvii
Table of statutes xlii
1 What is commercial law? 1
by Michael Furmston
Chapter outline 1
1.1 What is commercial law? 1
2 Aspects of property, security and guarantees 5
by James Devenney
Chapter outline 5
2.1 Aspects of property 5
2.2 Possessory security 9
2.3 Non-possessory security 12
2.4 Contracts of guarantee 24
Further reading 48
3 Agency 50
by Jo Reddy
Chapter outline 50
3.1 Introduction 50

3.2 Types of authority 52
3.3 Agency without actual agreement 56
3.4 Ratification 63
3.5 Agency relationships 66
3.6 Limitations 68
3.7 Election 74
3.8 Merger 75
3.9 Agent and the third party 75
3.10 The principal and the agent – duties of an agent 78
3.11 Rights of the agent 83
3.12 Termination of agency 85
3.13 Commercial Agents (Council Directive) Regulations 1993 86
Further reading 90
vii
CONTENTS
4 Sale of goods 91
by Michael Furmston
Chapter outline 91
4.1 Introduction 91
4.2 Types of transaction 95
4.3 Meaning and types of goods 104
4.4 Price 108
4.5 Delivery and payment 114
4.6 Ownership 133
4.7 Non-existent goods, risk and frustration 162
4.8 Defective goods 174
4.9 Exemption and limitation clauses 203
4.10 Remedies 213
Further reading 232
5 International sale of goods 234
by Susan Hawker
Chapter outline 234
5.1 Introduction 234
5.2 The matrix of contracts in international trade 242
5.3 The international sale contract 254
5.4 Standard form contracts and shipment terms 260
5.5 CIF contracts 269
5.6 FOB contracts 278
5.7 Remedies 284
5.8 Conclusion 298
Further reading 300
6 Payment and payment instruments 301
by Jason Chuah
Chapter outline 301
6.1 Introduction 301
6.2 Money 309

6.3 Payment cards 315
6.4 Funds transfers 324
6.5 Regulation of payment services 328
6.6 Negotiable instruments 334
6.7 Bills of exchange 338
6.8 Cheques 360
6.9 Banker’s draft, counter cheques and travellers’ cheques 366
6.10 Trade finance 367
Further reading 375
7 Consumer protection 376
by Chris Willett and David Oughton
Chapter outline 376
7.1 How and why the law protects consumers 376
viii
CONTENTS
7.2 Information and cancellation rights 386
7.3 Performance Standards (1) – Implied terms as to goods 393
7.4 Performance Standards (2) – Implied terms as to services 413
7.5 Performance Standards (3) – Liability in tort for defective
products 424
7.6 Performance Standards (4) – General product safety and
food safety in public law 430
7.7 Unfair terms 436
7.8 Preventive and criminal law regulation of unfair practices 453
Further reading 470
8 Consumer credit law and regulation 473
by Howard Johnson
Chapter outline 473
8.1 Introduction 474
8.2 Some key definitions and features 477
8.3 Further reform of consumer credit law – the Consumer
Credit Directive 2008/48/EC 486
8.4 Consumer credit licensing 489
8.5 Seeking business and making agreements 498
8.6 Pre-contract disclosure 506
8.7 Form and content of agreements 508
8.8 Customer rights to end the agreement 514
8.9 Creditor liability for dealer actions – connected lender liability 520
8.10 Consumer default and protection 527
8.11 Security agreements 531
8.12 Negotiable instruments 533
8.13 Land mortgages 534
8.14 Enforcement of the Act 534
8.15 Dispute resolution – role of the Financial Ombudsman Service 537
8.16 Reform of law – EU Consumer Credit Directive 539
8.17 Conclusion 540
Further reading 540

9 Commercial mediation, conciliation and arbitration 541
by Jason Chuah
Chapter outline 541
9.1 Introduction to alternative dispute resolution 541
9.2 Mediation and conciliation 542
9.3 Arbitration 544
Further reading 557
10 Commercial conflict of laws 558
by Louise Merrett
Chapter outline 558
10.1 Introduction 558
10.2 Jurisdiction 559
ix