Who Bears the Loss Between Seller and Buyer? Legal Implications of Damaged Goods In Supermarkets Before Payment

By Musbahu Yahaya Rabiu

In modern retail settings, particularly self-service supermarkets, customers routinely handle goods before purchasing them. But what happens when a customer accidentally damages an item before payment? This article examines the legal implications of such scenarios and argues that the loss lies with the supermarket owners. This is based on the principle that the display of goods is not an offer but merely an invitation to treat and that ownership and risk remain with the seller until a contract is entered.

Under contract law, a distinction exists between an offer and an invitation to treat. An offer, when accepted, creates a binding contract. An invitation to treat merely invites negotiation or expression of willingness to enter into a contract. This principle was initially established in Pharmaceutical Society of Great Britain v Boots Cash Chemists, where the court held that the display of goods on shelves constitutes an invitation to treat. The customer makes an offer by presenting the goods to the cashier, and a contract is only formed upon the cashier’s acceptance—by scanning the product and collecting payment. The authority of Lasky v. Economy Grocery Store is also instructive here.

This concept is equally recognised under Nigerian law. Although no direct Nigerian case mirrors Boots and or Lasky, the principles of contract law, as contained in the Sale of Goods Law of Lagos State 2003 and the Sale of Goods Act 1893, adopt similar rules. Sections 17 and 18 of the Act emphasize that ownership passes when the parties intend it to pass—often at the point of sale.

In Nigeria, ownership and risk generally pass to the buyer when a contract is concluded, unless the parties intend otherwise. Until that point, goods displayed in a supermarket remain the property—and risk—of the seller. Section 20 of the Sale of Goods Act provides that goods remain at the seller’s risk until the property passes to the buyer. Therefore, if damage occurs before payment, no contract exists, and the risk remains with the seller.

While the general rule absolves the customer of liability for accidental damage, it is essential to note the following exceptions:

1. Negligence or Intentional Damage: If a customer damages an item through negligence—for example, carelessly handling fragile goods—they may be liable in tort. The establishment of tort of negligence requires the existence of a duty of care, breach of the duty, and damage as a result of the breach. In such cases, the supermarkets could recover damages.
2. “You Break It, You Buy It” Policies: Many retailers display signs warning customers that they are responsible for damaging goods. However, for such policies to be legally binding, they must meet the criteria for incorporation of terms into a contract. In other words, the supermarkets must exempt themselves from liability while making the contract through what is known as exemption clause. But such a clause must be made clearly to the understanding of buyers. In Thornton v Shoe Lane Parking, the court held that contractual terms must be brought to the notice of the customer before the contract is formed. Note that since no contract exists at the time of accidental damage, such notices may not suffice unless the customer is clearly aware and agrees in advance.

From both English and Nigerian legal perspectives, goods displayed in a supermarket constitute an invitation to treat, not an offer. Therefore, ownership and its necessary risk remain with the seller until a contract is formed at the point of sale. Unless the customer has acted negligently or recklessly, they are not liable for accidentally damaging items before purchase. This understanding ensures fairness in commercial dealings and places the burden of loss appropriately on the business owner who retains control and ownership of the goods.

It is essential to however note that, given that the risk lies with the supermarkets until payment is made, the owners should take measures to mitigate potential losses, such as taking out retail insurance to cover accidental damage, securely displaying fragile items, offering customer guidance or supervision in sensitive areas, and using clear, well-communicated signage—though such warnings alone may not be sufficient to impose liability on customers.

Written by Musbahu Yahaya Rabiu, a graduate of the Faculty of Law, Bayero University Kano, and a bar aspirant. He can be reached for corrections or constructive criticism at 08107882404 or musbahuyahayarabiu@gmail.com

Source: BarristerNG