* Problem base

Final
Chapter 4 Exam

Sale of
Goods
Law
Ms Noor Hattin
 Section 2-11 : Definitions

Table of
Contents Section 12-13 : Conditions & Warranty
Section 14-17 : Implied Terms

Important provisions: building, land-car

Section 19-26 : Transfer of Property
tranfer
law:
of

ownership

Section 31 : Duties of Seller & Buyer

Section 37(3) : Mixed Goods

Section 45-46 : Unpaid Seller

-
solution
Section 55-57 : Remedies -
Legal term
 Law governing sale of goods in Malaysia :

Introduction Sale of Goods Act 1957 (SOGA)

Peninsular Malaysia
(excluding Penang & Malacca)

Principles of English Law

relating to Sale of Goods
Sabah and Sarawak
 Sale of Goods Act 1957 (SOGA)

The SOGA deals with the matter of:

Passing of ownership
The risk of goods sold
reward
Remedies of buyer and seller
for breaches by the other party.
 A remember

Definitions
Section 2:

BUYER GOODS
~computer, car

A person who agrees to buy Every kind of moveable property other than
goods. actionable claims and money (i.e. stock, shares,
grass, growing crops).
SELLER
to be purchases
A person who agrees to sell
SPECIFIC GOODS already available
goods. Goods identified and agreed upon at the time a
contract of sale is made.

Mod food
FUTURE GOODS eg:
PRICE
exchange goods to be manufactured/produced/acquired by the
Money consideration for a sale of
seller after the making of the contract of sale.
goods.
Definitions
not need to remember

SECTION 4
SECTION 6 SECTION 9

A contract of sale of goods is a The goods which form the

contract whereby the seller
transfers/agrees to transfer the
ownershi
property in goods to the buyer for
a price.
SECTION 5
For a contract to exist, there
has to be an offer and
acceptance.
The contract may be in the
form of writing, word of
mouth, & conduct.
Subject matter of price:
subject of a contract of sale.
Existing goods -> specific
goods May be set accordingly by the
Future goods
contract;
May be set under agreed
conditions;
W May be set pertaining to the
SECTION 11 dealings between buyer and
time to make paymentb eseller. agree by
both parties
Whether time is of the essence of
the contract or not depends on
the terms of the contract (i.e. time
of payment).
Terms of the contract
of sale of goods

Terms of the contract need to be understood by

parties; seller and buyer
mention /
write in contract stated
not in
thing
Can be in the form of express terms or implied contract
but still
terms have

Very important to determine the intention of the

parties

Classified into condition and warranty

Section 12 Terms of the contract can be divided into conditions and warranty:

what is
what is
I

Conditions /
Warranty

improtant ferm
Refers to the fundamental terms of the
contract (primary concern)
Breach: gives the injured party the right
to reject the contract
Refers to stipulation collateral to the main
purpose of the contract (secondary
concern)
Breach: gives the injured party the right
to claim for damages but not to reject the
goods/contract.
Section 13 An exception to Section 12:

Conditions Warranty
Breach of condition can be treated as a Breach of warranty cannot be treated as
breach of warranty. a breach of condition.
Buyer can choose
reject or claim for complainsation

Illustration: Conditions and Warranty

Sam places an order to Randy for supply of

machine parts strictly according to the sample,
delivery to be made within 3 months.

Condition: Supply of parts strictly according to

sample.
Warranty: Delivery within 3 months.
 S

A remember to do
seller, ifseller to fail so
(puties of
Implied terms: Section 14-17 responsible between seller a buyer
what can
buyer do)
no the contract but still
state on -

notstate
in contrantbut has respondbility
term
I Section 16(1)(a) Implied condition as to fitness
Section 14(a) Implied condition as to title
for particular purpose quality of the goods-buyer
reject or claim

Section 14(b) Implied warranty as to quiet Section 16(1)(b) Implied condition as to

possession no reject/claim for demaged merchantable quality

Section 14(c) Implied warranty free from Section 17 Implied condition in a sale by
encumbrances -

sample

Section 15 Implied condition must correspond

same description as

with description reject goods

duties of seller (what is

indentify the

-if theseller fail the do the duties

-what is
the right of buyer
 E.
duties: ownership of the goods
buyer enjoy the
-

reject goods

Section 14(a) Implied Condition As to Title

to have ownership over the goods
to sell need
-right

The seller has the ownership/title over the goods.

The seller is presumed to have a right to sell.
elabulatioImplied
n duties of
condition to the seller to ensure that the
buyer will enjoy the ownership of the goods.
Failure to do so gives the buyer to reject the
contract.
 Rowland v Divall

Facts: The claimant, the car dealer, bought a car from the defendant for £334. He
painted the car and put it in is showroom and sold it to customer for £400. 2
ID I taken
months later the car was impounded by the police as it had been stolen. It was then
returned to the original owner. Both the claimant and defendant were unaware at
the car had been stolen. The claimant returned the £400 to the customer and
brought a claim against the defendant under the SOGA.
Held: The defendant did not have the right to sell the goods as he did not obtain
good title from the thief. Ownership remained with the original owner. Hence, the
claimant is entitled to recover the money from the defendant.
 customer quiet Possession
enjoy
-

claim for
damages
~

Section 14(b) Implied Warranty As to

Quiet Possession
T

Breach the duties, what the buyer do

What are you
doing? -.-
The buyer shall have & enjoy quiet possession of
the goods without any wrongful interference by a
stranger or 3rd party or even by the seller himself, Borrowing
your clothes!
claiming a right. Oh come on,
share la ^^
Entitled the buyer to damages.
Breach of warrently
 -goods is free from legal charges
any
~ claim for damages
Section 14(c) Implied Warranty Free
from Encumbrances -legal claims
I

The goods are free from any

charge/encumbrance, which is in favour of any
3rd party.
The seller is liable for breach of warranty and
entitled the buyer to damages.
Such fact is not declared or made known to the
buyer
borrow from bank,in this the
buy and case
Example:seller car money
goods are not free from any legal charges
 the correspond description made for the
duties:Aseller corespoable
good
-
rejectthe make
the buyer agree to buy the
goods ⑧ the seller sure

goods
made specification
Section 15 Implied Condition Must
-
Correspond with Description *sfy

mor)
Arise where the consumer selects goods on basis
of description of the goods or consumer agrees to
buy goods to be made to their specifications.
The goods must correspond with the description.
The buyer is entitled to reject the goods and
rescind the contract.
 Varley v Whipp

Facts: Varley agreed to sell to the Whipp a

“second-hand self-binder reaping machine”,
which quite new and used to cut only 50 or 60
acres. When the machine was delivered,
Whipp claim that it did not match with the
statement.
Held: So, the court held that it was a sale of
good by description and Whipp have the right
to claim.
 no duties of seller buyer make sure the
quality

Section 16(1)(a) Implied Condition as to Fitness Particular Purpose

Caveat Emptor:
There is no implied condition/warranty as to the quality/fitness for the goods. Buyer must beware.
Except for the following: It is for the buyer to
satisfy himself as to
the quality of goods
purchased.

1. INFORM THE SELLER what goods 2. RELIED ON SELLER'S SKILL 3. IN THE COURSE OF
what to
buy SELLER'S BUSINESS TO
The buyer must make known to The buyer relied on the seller’s SUPPLY
the seller to the particular skill and judgement to supply
purpose, the goods are required. suitable goods. The goods must be of a
description, which is in the
course of the seller’s business to
supply.
 check

Section 16(1)(b) Implied Condition as to Merchantable Quality examination

duties, to examing the good

Another exception to the Caveat Emptor:
buyer chack the condition of
goods

3. Does not apply if the buyer has

no have merchantable

1. The good must have a merchantable exp:

examined the goods, by which through
quality which means the goods must can't
but

the examination, the buyer might

fit the particular use which they were eat
discover the defects.
sold.

4. However, if the defects could NOT be

2. If the goods are defective for their
discovered by any reasonable
purpose, they are not merchantable
examination, then the implied condition as
quality.
to merchantable quality apply.
 David Jones v. Willis (1934)

Facts: The plaintiff has been purchased a pair of shoes from the
defendant. Defendant is the retailer distributor of the shoes but not
the manufacturer. However, when the plaintiff wears the shoes to
walk down from the stairs on the third event, the heel came off. This
cause the plaintiff fell over and injured. She tried to sue for damages
from the defendant.
Held: The court held that there was a breach of the conditions
where by the shoes are unmerchantable and didn’t fit for the
purpose as according to the Section 16(1)(b).
Section 17 Implied Condition in A Sale
by Sample
anties;goods same as sample

Sample is used to describe goods to the buyer.

It is required by the seller to ensure that the
bulk of the goods must correspond with the
sample.
Failure to comply, will entitle the buyer to
reject the goods.
 section 19 2022, and es

past

Transfer of Property seller ->

buyer

ownership
It is important to ascertain the time as to when
property in goods passes to the buyer because of:

transfer of ownership
reement final payment
SECTION 19 Conditional Contract
-

ang be made
mention

Lonly apply when it is

specific goods

Where there is a contract for the sale of specific

or ascertained goods, property in the goods is
transferred to the buyer at such time as the
parties of the contract intend it to be transferred.
①specific goods

② Contract / agreement
-mention in contract/agreement abouttranfer of property
Transfer of Property
①
no contract
SECTION 20 Unconditional Contract

Requires that the property in goods pass to

the buyer when the contract is made.
Even if the payment of price/delivery of the
goods is postponed.
section 19. 20-21 use one in one situation

Transfer of Property

Specific Goods to be put into

SECTION 21
Deliverable State

Provides that when the seller is bound to do

something to the goods
For the purpose of putting them in a
deliverable state for a contract of specific
goods.
The property is NOT pass until such thing is
done and the buyer takes note on this
matter.
not in
① defect -

a
deliverable state

(buyer not have ownership

Risk Prima Facie indentify who own the goods

passes with
Property the people thatown
of
the

the
ownership goods
people need bear the
Section 26 risk

The goods remain at the seller's risk until the property is

transferred to the buyer.

However, 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:
Provided that where delivery has been delayed
through the fault of either buyer/seller, the goods are
at the risk of the party in fault as regards any loss
which might not have occurred but for such fault.

The person who owns the property in the goods shall

bear the risk.
Duties of
Seller and Buyer
Section 31

It is essential for the parties to keep to what has been

agreed upon:

Duty of Seller: To deliver goods in accordance with

the terms of the contract of sale.

Duty of Buyer: To accept and pay for the goods in

accordance with the terms of the contract of sale.
Mixed Goods
Where the seller delivers to the buyer the goods
mixed with goods of a different description not
included in the contract, the buyer may:-

SECTION 37(3)
whatcan do
it

Accept the goods which are in accordance

with the contract;
Reject the rest; or
Reject the whole.
Rights of Unpaid Seller

Section 45

Defines Unpaid Seller as -

when the whole of the price
has not been paid.
Mr Bieber take back the goods from Hailey

Section 46

Rights of Unpaid Seller: seller take back the goods

1. A lien on the goods; seller can hold the good/

on

2. Right of stopping the goods when the

goods are on transit to the buyer; seller stop the
can

good to transit to
3. A right of resale. buyer
sale goods to other
 rightto
Remedies
sue ~En
SECTION 55 - SELLER MAY SUE THE BUYER

available for Suit for price: The goods has passed to the buyer and
the buyer wrongfully neglects/refuses to pay for the

Seller and Buyer goods careless

buyer change
Section 55-57 SECTION 56 - SELLER MAY SUE THE BUYER
-

mind

Damages for non-acceptance: The goods has passed

to the buyer and the buyer wrongfully neglects/refuses
to accept and pay for the goods

SECTION 57 - BUYER MAY SUE THE SELLER

Damages fo non-delivery: if the seller wrongfully and

neglects to deliver the goods to the buyer.
END OF CHAPTER FOUR - SALE OF GOODS LAW

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