Keenan and Riches’BUSINESS LAW

of knowingly or recklessly engaging in an unfair com-
mercial practice under reg 8 of the Consumer Protection
from Unfair Trading Regulations 2008 (CPRs) can only
be committed by a trader who is acting for the purposes
relating to his business. Although we do not know yet
how the courts will approach the question of whether a
trader is acting for business purposes, case law relating
to the Trade Descriptions Act 1968, which the CPRs
replace, indicates that the courts are likely to take a
restrictive approach. The principles are set out in the
following cases.

Part 3Business transactions

402

Havering LBC v Stevenson(1970)

The Divisional Court of the Queen’s Bench held that the

purchase and sale of cars used in a car hire business

formed an integral part of the business and were cov-

ered by s 1 of the Trade Descriptions Act 1968 which

provided that anyone who in the course of a trade or

business applied a false trade description to goods or

supplied or offered to supply any goods to which a false

trade description was applied was guilty of an offence.

Daviesv Sumner(1984)

The House of Lords held that the sale of a car which

had been used by the defendant in his business as a

self-employed courier was not ‘in the course of trade or

business’ since the transaction lacked the degree of

regularity which was present in the Haveringcase.

The more exacting requirements developed by the
courts in relation to trade description can be justified
because the Trade Descriptions Act 1968 imposed crim-
inal penalties, while the Sale of Goods Act 1979 merely
establishes civil liability.

3 Goods and services intended for private use or
consumption.Section 12 of the Unfair Contract Terms
Act 1977, for example, stipulates that a person only deals
as a consumer where there is a contract for the supply
of goods if the goods are of a type ordinarily supplied for
private use or consumption. There are problems with
such an approach. Is a person dealing as a consumer if the
goods are used for both business and private purposes?
What is the position in relation to goods which are ordin-
arily supplied for business purposes but then put to

private use, or vice versa? Some of these uncertainties

have been resolved by amendments to s 12 made by the

Sale and Supply of Goods to Consumers Regulations

2002 (SI 2002/3045), which came into force on 31 March

2003. If the consumer is an individual (rather than a
      business as in the R & B Customs Brokerscase) it is no
      longer necessary to show that the goods are of a type
      ordinarily supplied for private use or consumption.

Consumers do not have to have a contract with the

business supplier in order to attract protection. Many

consumers will have purchased the goods and services

and have a contractual relationship with the supplier, but

there are also other consumers who make use of goods

and services without having entered into a contract. In

recent years, there has been growing recognition of the

need to protect non-contractual consumers.

Why do consumers need

protection?

The idea that consumers need protecting has been around

since the Middle Ages, yet most of the consumer protec-

tion measures which exist today have been developed

over the past 30 or so years. The earliest forms of con-

sumer protection were designed to discourage fraudulent

trading practices and to protect the consumer from dan-

ger. The main justification for intervening on behalf of

consumers today is that the nature of modern markets is

such that consumers can no longer make prudent shop-

ping decisions. Enormous changes in the way we acquire

goods and services have taken place since the Second

World War. Consumers now have access to a much wider

range of more technologically complex goods. Whereas

in the past retailers were expected to use their skill and

judgment to select good quality products, today’s retailer

often has limited technical knowledge of the products

he sells. There has been a move towards large-scale retail

businesses, e.g. supermarkets and, more recently, the

development of large out-of-town shopping complexes.

At the same time, advertising and marketing techniques

have become much more sophisticated. Today’s con-

sumers enjoy far greater spending power than their

grandparents did; disposable incomes are higher and

credit is more easily available. Expensive and highly

complex goods can be purchased relatively easily, but

there is less time for consumers to spend on shopping.