Sale of Goods Act, 1930

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K. Vishnu Priya Pratima

Definitions

Under Section 4(1), Contract of Sale is a contract whereby the seller transfers or agrees to transfer the property in goods to the buyer for a price. Under Section 4(3), Agreement to Sell is a contract where the transfer of the property of goods is to take 4/25/12 place at a future time or subject to

Delivery: Section 2 (2), defines delivery as voluntary transfer of possession from one person to another. Deliverable State: Goods are in deliverable state when they are in such state that the buyer would under the contract be bound to take delivery of them.
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Goods: Under Section 2(7), goods

Essentials of Sale of Goods Act

1. 2. 3.

Two parties Transfer of property in goods The subject matter of the contract must necessarily be goods. Price is the consideration of the contract of sale A contract of sale may be absolute or conditional All other essentials of a valid

4.

5.

6.

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Difference between sale & agreement to sell

SALE

1.

Transfer of property takes place immediately. Contract of sale is an Executed Contract.

1.

AGREEMENT TO SELL section Transfer of 4(3) property takes place at a future date. Agreement sell is Executory Contract. to an

1.

1.

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SALE

4.

In case of breach of contract, seller can file a suit and claim the charges.

4.

AGREEMENT TO SELL Seller can refuse to deliver the goods and can claim damages in case of breach of contract.

5. When there is insolvency of seller, the receiver appointed by the court can claim
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5. When there is insolvency of seller, the buyer can only claim a ratable dividend

An agreement to sell becomes a sale when the time elapses or the conditions are fulfilled subject to which the property in the goods is to be transferred.

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Goods perishing before making of contract:

Where there is a contract for the sale of specific goods, the contract is void if the goods without the knowledge on the part of the seller have, at the time when the contract was made, perished or become so damaged as no longer to answer to their description contract.

Goods perishing before after agreement to sell:

sale

but

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there is a contract for the sale of

DOCTRINE OF RESPERITE DEMINO, Section 26

Risk prima facie passes with property. Unless otherwise agreed, the goods remain at the sellers risk until the property therein is transferred to the buyer, but when the property therein is transferred to the buyer, the goods are at the buyers risk whether 4/25/12 delivery has been made or not.

Exceptions to the Doctrine

Delay in delivery by a party Trade customs Loss caused by a party Express contract

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DOCTRINE OF CAVEAT EMPTOR

Let the buyer beware It means in a contract of sale of goods, the seller is under no duty to reveal defects of his own goods. The buyer cannot blame anybody if the goods turn out to be defective or do not suit his purpose.
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Exceptions to doctrine

Fitness for buyers purpose Merchantable quality Usage of trade Consent by fraud False representation

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TRANSFER OF TITLE BY NONOWNERS, Section 27

No one can give that which one has not got Nemo Dat Qui Non Habet It is only the owner of goods who can transfer a good title. If the seller has no title to the goods, or a person authorized by him, who can sell the 4/25/12

Exceptions to the doctrine

Sale by mercantile agent Sale by one of several joint owners Sale by a person in possession under a voidable contract Sale by buyer in possession after having bought or agreed to buy goods
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Unpaid seller

The seller of goods is deemed to be an unpaid seller within the meaning of this acta.

When the whole of the price has not been paid or tendered;

When a bill of exchange or other negotiable instrument has been received as conditional payment, and the condition on which it was received has not been fulfilled by reason of the 4/25/12 dishonor of the instrument or
b.

Rights of unpaid seller

Right of lien Right of stoppage in transit Right to resell

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Conditions and Warrantie s

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CONDITIONS

Section 12(1) defines condition as a stipulation which is essential to the main purpose of the contract It goes to the root of the contract. It is an obligation which goes so directly to the substance of the contract. [Wallis Vs Pratt, 1910] 4/25/12

WARRANTY

Section 12(3) defines warranty as a stipulation which is collateral to the main purpose of the contract. It is not of such as vital importance as a condition is. It is an obligation which , though it must be performed, is not so vital 4/25/12

When condition to be treated as warranty

Voluntary waiver of condition Acceptance of goods by buyer

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Difference as to value

Distinction between a Condition and a Warranty

Difference as to breach Difference as to treatment

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Implied and Express Conditions and Warranties

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IMPLIED CONDITIONS

Condition as to title Sale by description Conditions as to quality or fitness Sale by sample

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IMPLIED WARRANTIES

Warranty of quiet possession Warranty of encumbrances freedom from

Warranty as to quality or fitness by usage of trade

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