Sale of Goods Act 1930

Contract of Sale of Goods

A contract of sale of goods is a

contract whereby the seller transfers
or agrees to transfer the property in
goods to the buyer for a price.
 Essentials of a contract of sale

 Two parties
 Goods
 Price
 Transfer of general property
 Essential elements of a valid contract
 Goods

All kinds of movable property other than

actionable claims and money.
 Types of Goods

Goods

Existing
•Specific or
Ascertained Future Contingent
•Unascertained or
generic
 Classification of goods (contd…)

Existing goods
a) Ascertained goods (Identified and agreed
upon at a time of contract)

b) Unascertained goods( Not identified and

agreed upon at the time of contract)
 Classification of goods (contd…)
Future goods
A railway administration entered into a contract for
sale of coal-ash that may be accumulated during the
period of contract

Contingent goods
A agrees to sell specific goods to B to be delivered
on the arrival of particular ship. If the ship arrives
but with no such goods on board ,the seller is not
liable.
 Price

 The money consideration for the sale of goods.

 Price has to be in terms of money.

 Fixing the price

 Price is mentioned in the contract.

 The manner of fixing the price is mentioned in

the contract.

 It is determined by the course of dealings of

the parties. when price is not fixed by any of
the above modes a ‘reasonable price’ is
considered as the price of the contract.
 Conditions
A condition is a stipulation which is
essential to the main purpose of the
contract. It goes to the root of the
contract. Its non fulfillment upsets the
very basis of the contract
 Warranty
A warranty is a stipulation which is
collateral to the main purpose of
the contract. it is not of such vital
importance as a condition is.
 Caveat Emptor

 Meaning :Buyers be-aware

 As to quality of goods
 As to the quantity of goods
 As to the necessary services provided by
the goods
 As to justifiable price of the goods.
 Caveat Emptor (contd…)

H sold 32 pigs by way of auction to W “with all

faults of errors of description”. W knew that the
pigs were suffering from swine fever. The sale is
good and H is not liable for any damages.
 EXCEPTIONS to the Principles

 Fitness for buyer’s purpose

 Sale under a patent or trade mark
 Merchantable quality
 Consent by Fraud
 WHEN DOES PROPERTY PASS FROM
THE SELLER TO THE BUYER?

 Goods must be ascertained

 Property passes when intended to pass

 Specific goods in a deliverable state

 WHEN DOES PROPERTY PASS FROM
THE SELLER TO THE BUYER? (CONTD…)

 Specific goods to be put into a deliverable state

 When the seller has to do ascertain price

 When goods are to be measured, tested, etc.

 WHEN DOES PROPERTY PASS FROM
THE SELLER TO THE BUYER? (CONTD…)

 Unconditional Appropriation

 Delivery to the carrier

 Goods sent on approval or “on sale or return”

TRANSFER OF OWNERSHIP: TIME OF

1. Risk passes with property

2. Who can take action?

3. What is the effect of insolvency?

 Delivery

A voluntary transfer of possession from one

person to another.
 TYPES OF DELIVERY

1. Actual Delivery – the goods are physically

handed over to the seller.

2. Symbolic Delivery – specific goods are locked

in the godown and the seller gives the key of
the godown to the buyer.

3. Constructive Delivery – the delivery of the bill

of lading with which goods may be obtained.
 Duties of Seller /
Rights of Buyer
 Delivery

 Risk of deterioration in the goods

 Damages for non-delivery

 Specific performance
 Duties of Buyer /
Rights of Seller

 Payment of Price

 Compensation

 Delivery

 Liability of Buyer

 Interest and Special Damages

 Unpaid seller

When the whole of the price has not been paid;

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 dishonor of the instrument
 Rights of an Unpaid seller
Right

Against the
Against the
buyer
goods
personally

Where the
Property in Where the property Suit
Suit for Repudiation Suit for
the goods in the goods for
has has not passed Damages of contract interest
price
passed

Stoppage in Withholding
transit delivery

Stoppage
Re-sale
in transit
THANKS ALL