Caveat emptor

Caveat emptor is Latin for "Let the buyer beware". Generally caveat emptor is the property law doctrine that controls the sale of real property after the date of closing.

Explanation

Under the doctrine of caveat emptor, the buyer could not recover from the seller for defects on the property that rendered the property unfit for ordinary purposes. The only exception was if the seller actively concealed latent defects. The modern trend in the US, however, is one of the Implied Warranty of Fitness that applies only to the sale of new residential housing by a builder-seller and the rule of Caveat Emptor applies to all other sale situations (i.e. homeowner to buyer). Many other jurisdictions have provisions similar to this.

Before statutory law, the buyer had no warranty of the quality of goods. In many jurisdictions, the law now requires that goods must be of "merchantable quality". However, this implied warranty can be difficult to enforce, and may not apply to all products. Hence, buyers are still advised to be cautious.

In addition to the quality of the merchandise, this phrase also applies to the return policy. In most jurisdictions, there is no legal requirement for the vendor to provide a refund or exchange. In many cases, the vendor will not provide a refund but will provide a credit. In the case of software, movies and other copyrighted material many vendors will only do a direct exchange for another copy of the exact same title. Most stores require proof of purchase and impose time limits on exchanges or refunds. However, some larger chain stores will do exchanges or refunds at any time with or without proof of purchase- although they usually require a form of picture ID and place quantity or dollar limitations on such returns.

Laidlaw v. Organ, a decision written in 1817 by Chief Justice John Marshall, is believed by scholars to have been the first U.S. Supreme Court case which laid down the rule of caveat emptor in U.S. law.

In the UK, consumer law has moved away from the caveat emptor model, with laws passed that have enhanced consumer rights and allow greater leeway to return goods that do not meet legal standards of acceptance. Many companies operating in the UK will allow customers to return goods within a specified period for a full refund, even if there is no problem with the product.

Caveat venditor

Caveat venditor is Latin for "let the seller beware". It is a counter to caveat emptor, and suggests that sellers too can be deceived in a market transaction. This forces the seller to take responsibility for the product, and discourages sellers from selling products of unreasonable quality.

In the landmark case of MacPherson v. Buick Motor Co. (1916), New York Court Appeals Judge Benjamin N. Cardozo established that privity of duty is no longer required in regard to a lawsuit for product liability against the seller. This case is predominantly regarded as the origin of caveat venditor as it pertains to modern tort law in US.

Caveat emptor references in popular culture

In the book Ubik by American science fiction writer Philip Dick the character Pat has a tattoo with "Caveat Emptor" on her arm
Matt Damon's character mentions Caveat Emptor in the 1998 Poker movie Rounders
Caveat Emptor is mentioned in the British Sea Power song "Atom"
Caveat Emptor is mentioned in The Mars Volta song "Roulette Dares (The Haunt Of)"
Leland Gaunt has a sign that reads "Caveat Emptor" in his shop Needful Things in the Stephen King novel of the same name.
Caveat Emptor is mentioned by the android character Data, in the Star Trek TNG Episode "The Last Outpost" (season 1, episode 4, original airdate: 10/19/1987), in reference to the profit-obsessed Ferengi.
Also it is mentioned in Qwarks Opera in Secret Agent Clank
In the book Gone with the Wind, Rhett Butler nearly convinces Scarlett O'Hara to name her new store 'Caveat Emporium'.