The sale is done, but do the risks remain?

For better or worse, these days the seller of goods has to ensure what he or she is selling is of a suitable quality.

Livestock is no exception, particularly in respect of disease. Anyone selling diseased livestock is at risk of being found to have been negligent and potentially liable for any losses the purchaser suffers as a result, including losses for livestock already on the land which becomes infected as a result of mingling with the diseased livestock.

An issue can arise when the seller of livestock is not aware of the presence of the disease. Is there any liability for the seller if it later turns out that the livestock is diseased?

The answer to this is not straightforward. To determine whether there was any negligence, it is necessary to look at all the circumstances surrounding the sale. This includes considering whether the seller didn’t know about the disease because the seller ‘turned a blind eye’, or if there was information that meant the seller should have made further inquiries about the presence of the disease. If there was no way that the seller could or should have known about the disease, then it is unlikely that there would be any liability.

Sellers also need to be aware of the Livestock Act 1997 (SA), which makes it a criminal offence to fail to report the existence or suspected existence of ‘notifiable’ diseases in livestock or to commit an act with the intention of, or being recklessly indifferent to, livestock becoming affected with a notifiable disease. The wording in the Act is sufficiently broad so as to include people who were not, but should have been, aware of the presence of disease.

The old adage of ‘Buyer Beware’ still rings true to some extent, but there is also an onus on the seller to ensure that they are open and transparent about the quality of their products.

By Anthony Kelly, Partner

This article originally appeared in The Stock Journal on Thursday 14 April 2016.

Practice Area: Farm Law

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