Loss of Bargain advice please!

[Ds3]

Hi All,

Hoping to get some advice here, I'll try and keep the story short!

Back in October I bought a 32" LCD TV for £109.99 from a reputable online company. Nearest price online for a similar model is around £270 so definitely a bargain and was advertised as such.

It was new and came with a 3 month warranty, however 3 months 1 week later it's died. Completely. They have stated a repair is not viable and a replacement not available, therefore in keeping with the sales of goods act are offering a refund.

My claim is I should be covered by loss of bargain and they should either source a replacement or give me funds to do so. At present, I do not have a functional TV and it's going to cost me £270 to buy a replacement now.

My understanding of loss of bargain is basically as per the quote below found on a legal website;

"Damages for loss of bargain are assessable to put the plaintiff, so far as money can do it, in the same situation as if the contract had been performed. For example, in a contract for the sale of goods which are defective, the plaintiff will (under this head) be entitled to damages reflecting the differences between the price paid under the contract and the actual value of the defective goods."

It's at the point now where I am looking to issue a county court claim but want to be as sure as I can be that I am right before going ahead. Any advice, recommendations etc on this matter would be very much appreciated.

Thanks!

[Guest]

Re: Loss of Bargain advice please!

You are quite correct, your loss is the loss of bargain.

When a supplier fundamentally breaches the terms of a contract, the customer has a choice either to treat the contract as still in existence, (affirming the contract) or terminate and seek damages for repudiation at common law. Lord Justice Moore-Bick stated in Stocznia Gdynia SA v Gearbulk Holdings Ltd [2009] "It is inherent in the nature of a legally binding contract that each party expects to obtain the benefit of the bargain into which he has entered, or, if the contract is not performed, a right to recover compensation in the form of damages for the loss of that benefit. Accordingly, in a case where one party's breach is such as, in the words of Diplock L.J. in Hongkong Fir Shipping Co. Ltd v Kawasaki Kisen Kaisha Ltd [1962], to deprive the other of substantially the whole benefit which it was intended that he should obtain from the contract, the common law recognises the right of the injured party to treat the contract as discharged and to recover damages for the loss of the bargain."

You could get the goods elsewhere, but you would lose the value of the deal you have struck. The loss of bargain in this case is would be the difference between the normal selling price of the television and the price at which the contract was made with the online retailer. However, do bear in mind that as a claimant you have a duty to mitigate your loss and this means that a court would expect you to calculate the amount of loss by means of where else you could buy the television for and for how much. As such, if you can find the product cheaper, then the loss of bargain will be calculated from this lower figure and you may not have lost as much as you thought.

This system is also set out in the Sale of Goods Act 1979 at section 51 - Damages for Non-delivery:

"51(3) Where there is an available market for the goods in question the measure of damages is prima facie to be ascertained by the difference between the contract price and the market or current price of the goods at the time or times when they ought to have been delivered or (if no time was fixed) at the time of the refusal to deliver."

However, before you issue a claim against the seller and depending on how you paid for the television, you may issue a claim against your credit card issuer. Section 75 of the Consumer Credit Act 1974 allows this because any claim you make would be based on a breach of contract. Section 75 of the Act makes a connected lender jointly and severally liable with any supplier for any breach of contract or mis-representation by the supplier. The provisions apply to any single item to which the supplier has attached a cash price of between £100 and £30,000. Thus your card issuer is potentially liable not only for the value of the card transaction itself but also the value of the item (if greater) and any consequential losses caused to you arising from the breach or misrepresentation.

This might be a great deal simpler than issuing a claim in the County Court against the supplier, but it is dependant upon you having paid for the television with a credit card.

Regardless of how you paid, your claim for loss of bargain looks pretty good, since it is clear that the contract was made, the goods were delivered but have failed to conform to contract. In addition, it should be noted that goods which do not conform to the contract of sale at any time within the period of six months starting with the date on which the goods were delivered to the buyer must be taken not to have so conformed at that date. I should also point out that the three month warranty offered by the retailer is meaningless in this instance and does not absolve them of their statutory obligations under the Sale of Goods Act 1979.

[Ds3]

Re: Loss of Bargain advice please!

Cetelco, thank you for your quick and very comprehensive reply. There's plenty of really useful information there which I will certainly be taking in to account.

Naturally I'm happy to adjust whatever claim I make to suit the value of the cheapest possible alternative, I'm not in this for profit I just want the contract fulfilled.

Especially interesting is the part about credit card, I'll have to check how the TV was paid for although I have a nasty feeling it may have been on switch.

One point to bear in mind was the TV was an unusual make that possibly might not be available anywhere else, can I assume in this case I can source the closest possible match from another manufacturer that fits the specifications?

[Guest]

Re: Loss of Bargain advice please!

Switch or Visa Debit? There is a crucial difference. Unless its an HSBC (including First Direct) or the Royal Bank of Scotland (including NatWest) issue Maestro (formerly Switch) rather than VISA debit card you may be able to recover your money by invoking the VISA chargeback scheme. However, if it is a VISA card, the chargeback scheme means that you must make the claim within 120 days of the transaction taking place.

You are suing for breach of contract and the normal measure for breach of contract is loss of bargain. This measure of damages is intended to place the injured party in the same situation, as far as money can do it, as if the contract had been performed (Robinson v Harman [1848]). This means, the actual make of the replacement is immaterial to your right of recovery, but it must match the financial value of your loss.

[Ds3]

Re: Loss of Bargain advice please!

Ironically enough, if it was switch it'd be either First Direct or Natwest so would rule out that option. I'll need to trawl through a few statements to confirm payment method as it's not held on the suppliers website from what I can see.

Once again, many thanks for the replies Cetelco.