Caveat Emptor in UK Law

Ordinarily the failure to disclose a material fact which might influence the mind of a prudent contractor does not give the right to avoid the contract. There are certain contracts expressed by the law to be contracts of the utmost good faith where material facts must be disclosed; if not the contract is voidable. In such cases the duty does not arise out of contract; the duty of a person proposing an insurance arises before a contract is made; so of an intending partner.

But leaving aside such cases as arise between contracting parties, when the terms of the contract have to be considered (see Voli v. Inglewood Shire Council 110 C.L.R. 74, 85, per Windeyer J.), I am unable to understand why this principle or proposition should prevent recovery in a suitable case by a person, who has subsequently acquired the house, upon the principle of Donoghue v. Stevenson: the same rules should apply to all careless acts of a builder: whether he happens also to own the land or not.

The damages recoverable include all those which foreseeably arise from the breach of the duty of care which, as regards the council, I have held to be a duty to take reasonable care to secure compliance with the byelaws.

Outside the insurance context, there is no obligation in general to bring difficulties and defects to the attention of a contract partner or prospective contract partner. Caveat emptor reflects a basic facet of English commercial law (the growth of consumer law has been moving in a different direction).

All this is a matter of common knowledge amongst dealers in the art market and, I would expect, amongst all but the most inexperienced or naive of collectors. It means that almost any attribution to a recognised artist, especially of a picture whose provenance is unknown, may be arguable.

For my part, being confident that that principle would receive general acceptance amongst dealers, I would say that the astuteness of lawyers ought to be directed towards facilitating, rather than impeding, the efficient working of the market. The court ought to be exceedingly wary in giving a seller's attribution any contractual effect.

When the learned judge speaks of the contract allocating risk "by express or implied condition precedent or otherwise" I think he includes rules of general law applicable to the contract and which, for example, provide that, in the absence of express warranty the law is caveat emptor.