The sale of goods Act 1930

It came in to force on 1st July 1930. Originally included in the Contract Act Sec 76 to 132. Provisions of contract applicable to this Act to a certain extent.

Goods S.2(7).
Every kind of movable property other than actionable claim or money. Actionable claims are claims enforceable in a court of Law. Eg:- action for recovery of debt. Stocks,shares,growing crops, grass, things attached to earth, standing trees are all goods. Water, gas , electricity ,copy right & trade mark are all goods.

Contract of sale (S.4)

A contract whereby the seller Transfers or agrees to transfer the property In goods To the buyer For a price.

Sale
Absolute sale .
property in the goods passes from the seller to the buyer immediately and nothing remains to be done by the seller. Eg:-X sells 10 bags of cement to Y for Rs 3500.

Conditional sale.
property in the goods do not pass from the seller to the buyer absolutely until a certain condition fulfilled. Eg:- X agrees to deliver 10 bags of cement to Y on condition that Y should personally come and pay Rs 3500.

Agreement to sell
Where the transfer of ownership in the goods is to take place at a future time or subject to some conditions thereafter to be fulfilled the contract is called an agreement to sell. An agreement to sell becomes sale when the time elapses or fulfilled subject to which the property in the goods is to be transferred.

Essential elements of Sale

1. 2. 3. 4. 5. Contract. Two parties namely buyer and seller. Transfer of ownership. Subject matter of sale of goods. Price. (Consideration)

Sale
Immediate transfer of property. Risk passes to buyer. Buyer defaults seller may sue for the price. Executed contract. If breach by seller buyer may sue for specific performance. Ownership with buyer

Agreement to sell Property pass at some future time. Seller owner and risk with him. Seller sue for damages and not price. Executory contract. Sue for damages and not recovery of goods. Ownership with seller.

Contract for sale formation(S.5)

Involves two parties. Offer and acceptance to buy or sell goods. Consideration should be the price. Implied from the conduct of the parties. Eg:-entering restaurants. May be in writing or by word of mouth.

Subject matter of contract (Goods) S.6

1. Existing goods.
a) b) c) Specific goods.-goods identified and agreed upon at the time of contract Ascertained goods.-identified in accordance with the agreement after the contract of sale is made. Unascertained goods.-goods defined by description or even by samples.

2 .Future goods.-goods to be manufactured by the seller after making contract of sale. 3 .Contingent goods.-depends upon a contingency which may or may not happen. Eg:-future crops, eggs etc

Perishing of goods
1. Perishing of specific goods before making of the contract. -void. 2. Perishing of goods before sale but after agreement to sell. -void 3. Perishing of unascertained goods .-seller liable for damages for the breach of the contract.

Price S.2 (10)

1. Fixation of price. S.9
a) b) c) d) Fixed by both the parties at the time of contract. Enter in to an agreement regarding the manner in which the price may be fixed. Determined in course of dealings market price. Price not fixed buyer should pay a reasonable price.

2. Mode of payment of price.

3.Agreement to sell at valuation of third parties.S.10.

Condition .S.12(2)
Is a stipulation essential to the main purpose of the contract. The breach of which gives rise to A right to treat the contract as repudiated.

Warranty S.12(3)
Is a stipulation collateral to the main purpose of the contract The breach of which gives rise to a claim for damages But not to a right to reject the goods And treat the contract a repudiated.

Implied conditions
1. Conditions as to title of goods S.14. Rowland V. Divall (stolen car) 2 .Goods sold should correspond to description. S.15. Walls V. Pratt (seeds) 3. Condition as to quality or fitness.S.16(1) Prieser V. Last ( Water bottle for hot water) 4. Condition as to merchantability. S.16 (2) 5. Condition as to wholesomeness. Frest V.Ayelsbury Dairy Co ( typhoid germs) 6. Condition as to sample.S.17 Ruben Ltd V. Fair Brosa & Co (vulcanized rubber)

Implied warranties
1. Warranty for quiet possession. Mason V. Burningham. 1. Implied warranty against encumbrance. 2. Implied warranty as to usage of trade.