This principle refers to the practice of selling items for which no refund or warranty is provided. These items are usually faulty, defective or inferior, and as such, are being sold in their present condition and usually at discounted prices. Further, the seller is not expected to transport such an item to the buyer; transporting the item is the buyer’s responsibility. That is, the item is sold “as is where is”. The buyer is usually made aware, and has a duty to make himself aware, of what defects exist, and should be able to make a decision as to whether the reduced price compensates for any deficiency which the item might have. A used car dealer may, for example, offer a very old, defective car “as is where is”. The buyer will not receive a warranty, or be entitled to return this vehicle.
“Caveat emptor” is a Latin expression, meaning “let the buyer beware”. It is the principle that fixes the buyer with a responsibility for assessing the quality of a good before buying. The potential purchaser is being warned that the good being purchased might not satisfy the terms of the contract under which it is being purchased. Under this principle, the purchaser is responsible for protecting himself in the transaction. Smart consumers know their rights and enforce them. It remains in the best interest of every consumer to learn the facts about his transaction and ask questions if he is unsure about the merchants’ policies or about their own rights. Information is the best defence against purchasing defective products or falling victim to fraudulent practices.