Comm Law - Pass of Property

Card Set Information

Author:
sokol
ID:
275397
Filename:
Comm Law - Pass of Property
Updated:
2014-05-27 03:04:36
Tags:
Comm Law Pass Property
Folders:

Description:
Comm Law - Pass of Property
Show Answers:

Home > Flashcards > Print Preview

The flashcards below were created by user sokol on FreezingBlue Flashcards. What would you like to do?


  1. Passing of property and risk - GENERAL
    s. 2 SGA A contract of sale of goods is a contract by which the seller transfers or agrees to transfer the property in goods to the buyer for a money consideration, called the price.

    (2) Once ownership passes, the owner can sue for the price  under 

    49 (1) SGA Where, under a contract of sale, the property in the goods has passed to the buyer and he wrongfully neglects or refuses to pay for the goods according to the terms of the contract, the seller may maintain an action against him for the price of the goods.

    (2) Risk passes to to B when property passes unless otherwise agreed 

    20(1) Where, under a contract of sale, the property in the goods has passed to the buyer and he wrongfully neglects or refuses to pay for the goods according to the terms of the contract, the seller may maintain an action against him for the price of the goods, unless 20 (4) In a case where the buyer deals as consumer subsections (1) to (3) above must be ignored and the goods remain at the seller’s risk until they are delivered to the consumer.

    (3) If seller resells unless ownership passed, then subsequent B does not take title (unless NEMO DAT) 

    RISK MAY PASS AT DIFFERENT TIME
  2. Passing of property - the Rules
    Rules in SGA ss. 16-20

    Rules are different for specific or unascertained

    Title cannot pass until the goods have been identified to the contract and then it will pass when parties intend.
  3. Overview of approach to passing of property
    • SPECIFIC GOODS 
    • (1) s. 17 look for contractual intention
    • (2) If no contractual intention then follow rules 1-4 s. 18
    • UNASCERTAINED GOODS 
    • (1) s. 16 no transfer until goods ascertained 
    • (2) s. 17 once ascertained - look for contractual intention 
    • (3) s. 18 - If no contractual intention - apply rule 5 of s. 18
  4. Specific goods
    Goods which are Identified / Agreed upon at the time of the sale

    Kursell v Timber Operators & Contractors - the plaintiff sold the defendants all the trees in a forest and the court held that the property in the trees had not passed to the defendants as the goods are insufficiently identified
  5. Passing of property in specific goods
    • s. 17
    • (1)Where there is a contract for the sale of specific or ascertained goods the property in them is transferred to the buyer at such time as the parties to the contract intend it to be transferred.
    • (2)For the purpose of ascertaining the intention of the parties regard shall be had to the terms of the contract, the conduct of the parties and the circumstances of the case.

    • Establishing intention of the parties: 
    • - Ward v Bignall - inference that  property is passed only on delivery or payment 
    • - Dobson v General Accident Fire 1990 and Lacis v Cashmarts - if payment is to be made later, it is likely that the court will infer an intention for property to pass when it is made 

    Otherwise apply rules 1-4 s. 18 if the intention cannot be ascertained
  6. Rules 1-4 s. 18 - Passing of Property in specific goods
    • Rule 1.— Where there is an unconditional contract for the sale of specific goods in a deliverable state, the property in the goods passes to the buyer when the contract is made, and it is immaterial whether the time of payment or the time of delivery, or both, be postponed.
    • Rule 2.— Where there is an unconditional contract for the sale of specific goods the seller is bound to do something to the goods for the purpose of putting them into a deliverable state, the property does not pass until the thing is done and the buyer has notice that it has been done.
    • Rule 3.— Where there is an unconditional contract for the sale of specific goods in a deliverable state but the seller is bound to weigh, measure, test, or do some other act or thing with reference to the goods for the purpose of ascertaining the price, the property does not pass until the act or thing is done and the buyer has notice that it has been done.
    • Rule 4.—When goods are delivered to the buyer on approval or on sale or return or other similar terms the property in the goods passes to the buyer:(a)when he signifies his approval or acceptance to the seller or does any other act adopting the transaction;(b)if he does not signify his approval or acceptance to the seller but retains the goods without giving notice of rejection, then, if a time has been fixed for the return of the goods, on the expiration of that time, and, if no time has been fixed, on the expiration of a reasonable time.
  7. Rule 1 s. 18 - Specific Goods
    Where there is an unconditional contract for the sale of specific goods in a deliverable state the property in the goods passes to the buyer when the contract is made, and it is immaterial whether the time of payment or the time of delivery, or both, be postponed.

    • Deliverable state - 61(5) SGA- when goods  are in such a state that the buyer would under the contract be bound to take delivery of them.
    • Underwood Ltd V Burgh Castle - the engine (which it was intended to sell) was fixed to the premises, so was in undeliverable state.
    • Unconditional contract  - Kursell v Timber Operators & Contractors - i.e. contract which contains no conditions which prevents property to be passed.

    HOWEVER Ward v Bignall - very little would be needed in the modern times to give rise to the inference that the property in specific goods is to pass only on delivery or payment 

    Dobson v General Accident Fire - if payment is to be made later, it is likely that the court will infer the intention for property to pass when it is made
  8. Conditional sales?
    I.e. Seller reserves the passing of the title until payment 

    s. 19(1) Where there is a contract for the sale of specific goods or where goods are subsequently appropriated to the contract, the seller may, by the terms of the contract or appropriation, reserve the right of disposal of the goods until certain conditions are fulfilled; and in such a case, notwithstanding the delivery of the goods to the buyer, or to a carrier or other bailee or custodier for the purpose of transmission to the buyer, the property in the goods does not pass to the buyer until the conditions imposed by the seller are fulfilled.
  9. Rule 2 s. 18 - Specific Goods
    • Where there is a contract for the sale of specific goods and the seller is bound to do something to the goods for the purpose of putting them into a deliverable state, the property does not pass until the thing is done and the buyer has notice that it has been done.
    • Underwood Ltd V Burgh Castle - the engine (which it was intended to sell) was fixed to the premises, so was in undeliverable state.
  10. Rule 3 s. 18 - Specific Goods
    Where there is a contract for the sale of specific goods in a deliverable state but the seller is bound to weigh, measure, test, or do some other act or thing with reference to the goods for the purpose of ascertaining the price, the property does not pass until the act or thing is done and the buyer has notice that it has been done.

    Nanka - Bruce v Commonwealth Trust - it was held by Privy Council that where specific goods are to be weighed or tested, by some person other than the seller
  11. Rule 4 s. 18 - Specific Goods
    • When goods are delivered to the buyer on approval or on sale or return or other similar terms the property in the goods passes to the buyer:
    • (a)when he signifies his approval or acceptance to the seller or does any other act adopting the transaction;
    • (b)if he does not signify his approval or acceptance to the seller but retains the goods without giving notice of rejection, then, if a time has been fixed for the return of the goods, on the expiration of that time, and, if no time has been fixed, on the expiration of a reasonable time.
  12. Passing of property in unascertained goods
    - Goods which are defined only by description , depending on their IDENTIFICATION upon some subsequent act of appropriation 

    - s. 16 SGA Goods must be ascertained.(Subject to section 20A) Where there is a contract for the sale of unascertained goods no property in the goods is transferred to the buyer unless and until the goods are ascertained. 

    - Ascertained - Re Wait - identified in accordance with agreement after the contract is made

    However, even when ascertained, no property will pass to the B until the parties intend it to pass as if no such intention is clear from the contract, under s. 18 Rule 5(1) - Where there is a contract for the sale of unascertained or future goods by description, and goods of that description and in a deliverable state are unconditionally appropriated to the contract, either by the seller with the assent of the buyer or by the buyer with the assent of the seller, the property in the goods then passes to the buyer; and the assent may be express or implied, and may be given either before or after the appropriation is made.

  13. Unconditional appropriation
    • Carlos Federspiel SA v Charles Twigg - court said that the goods are appropriated to the contract when when the parties had an intention to attach the goods irrevocably to the contract 
    • Aldridge v Johnson - the goods must no longer be under S control 
    • Hendy Lennox Ltd v Graham Puttick Engines Ltd. - S sent B an invoice showing the serial number of engines to be delivered to B. The goods were unconditionally appropriated to the contract as they were no longer able to substitute the engines for others without B's consent.
  14. s. 18 Rule  5(1) - Unascertained goods - Consent
    Consent may be express or implied and can be made before or after appropriation is made - Pignataro v Gilroy - delay in collection of rice by months was amounted to consent to the S's appropriation of the bags of rice to the contract (the consent may be express or implied)
  15. Deliverable state (s. 18 rule 5(1) - Unascertained goods)
    • Must be deliverable state. 
    • Kulkarni v Manor Credit - car without number plates is unascertained good and not in deliverable state until number plates are affixed.
  16. s. 18 Rule  5(2) - Unascertained goods - Delivery by 3rd party
    • Where, in pursuance of the contract, the seller delivers the goods to the buyer or to a carrier or other bailee or custodier (whether named by the buyer or not) for the purpose of transmission to the buyer, and does not reserve the right of disposal, he is to be taken to have unconditionally appropriated the goods to the contract.
    • Warder's (import & Export) v Norwood & Sons - Frozen kidney became spoiled. Property in the goods and therefore the risk passed to the buyers either when the goods were placed on the pavement, or at the latest when the buyers agent called at 8am, presented his delivery docket and began loading. In either view, damage occurred subsequently and the buyers therefore bore the loss and had to pay the price.
    • Healy v Howlett & Sons - the contract was for 20 boxes of fish. The seller put 190 boxes onto a train, with instructions that 20 were to be delivered to the seller. It was held that in this case that delivery to the carrier did not amount to an unconditional appropriation. Such appropriation could only occur when the defendant's 20 boxes were separated from the rest of the 190.
  17. Bulk - appropriation by exhaustion Rule 5(3) - Unascertained goods
    • Where there is a contract for the sale of a specified quantity of unascertained goods in a deliverable state forming part of a bulk which is identified either in the contract or by subsequent agreement between the parties and the bulk is reduced to (or to less than) that quantity, then, if the buyer under that contract is the only buyer to whom goods are then due out of the bulk—
    • (a)the remaining goods are to be taken as appropriated to that contract at the time when the bulk is so reduced; and
    • (b)the property in those goods then passes to that buyer.

    If your good left in the bulk it is automatically appropriated - Wait & James v Midland Bank

    This is so if you have more than one order that adds up to the whole bulk - The Elafi 

    But if seller mixes B's goods with others, the B becomes a joint owner of the resulted mixed goods as a tenant in common - Indian Oil Corporation Ltd V Greenstone Shipping 
  18. Passing property in part of a specific bulk - s. 20A - Unascertained goods
    • s. 20A re Bulk Shipments - Undivided shares in goods forming part of specified bulk 
    • - if bulk is identified in the contract or subsequently, and 
    • - at least some of the goods are paid for, then 
    • - Buyer becomes an owner in common of the bulk
  19. Risk usually passes with property - s. 20 (1) Unascertained goods + Limitations
    Unless otherwise agreed, the goods remain at the seller’s risk until the property in them is transferred to the buyer, but when the property in them is transferred to the buyer the goods are at the buyer’s risk whether delivery has been made or not.

    • Limitations 
    • unless otherwise agreed 
    • - where delivery has been delayed through the fault of either buyer or seller the goods are at the risk of the party at fault as regards any loss which might not have occurred but for such fault
  20. Passing of property and risk - 20(3) - 20(4) - Unascertained goods
    • 20(3) - Custodian must take reasonable care 
    • 20(4) If B is customer - risk with S until goods are delivered to B 
    • "Deals as Customer" - refer to UCTA 1977 s.12
    • - neither makes the contract in the course of business
    • - nor the other party does

What would you like to do?

Home > Flashcards > Print Preview