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Answer to Tutorial Exercise Semester 2, 2011 Question An Lushan operates the Tang Empire restaurant in Hawthorn. He places his regular weekly order for $1000 worth of ‘Yellow Turban’ noodles with his supplier, Wu Zetian, who manufactures foodstuffs in Victoria. Unfortunately on one week the noodles are adulterated with a cleaning agent. Fortunately An Lushan realises that the noodles are unfit to eat before he serves them to his customers. (a) Explain whether there is a breach by Wu Zetian of the implied term under s 19(a) of the Goods Act. (b) Explain whether there is a breach by Wu Zetian of the implied term under s 19(b) of the Goods Act. (c) What would the position be if the contract contained the following …show more content…

The final issue in the interpretation of s. 19(a) is the provision about trade names. The section states that, even if the particular purpose is known, ‘in the case of a contract for the sale of a specified article under its patent or trade name, there is no implied condition as to its fitness for any particular purpose’. Does this mean that because An Lushan ordered ‘Yellow Turban’ noodles he has bought by its trade name and therefore there is no implied term under s 19(a)? This was the early interpretation in Wren v Holt (1903) where the purchaser asked for ‘Holden’s beer’. However this interpretation was changed in later cases. The courts have given not given the provision about ‘patent or trade names’ its full literal meaning. An example is the case of Baldry v Marshall (1925) where the buyer bought a ‘Bugatti’. The modern interpretation is that the trade name proviso of s.19(a) only protects Wu Zetian, the seller, if An Lushan specified the goods under their trade name in such a way to indicate that Wu Zetian’s skill and judgement was not being relied upon. This is not the case here so the trade name proviso would not apply. The conclusion therefore is that in the contract between An Lushan and Wu Zetian there would be an implied condition that the noodles be fit for eating. However as discussed below, the parties may agree to exempt the seller from

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