TRANSFER OF PROPERTY IN GOODS

It is also known as passing of property in the goods or transfer of ownership from seller to buyer
Passing of property in the goods means passing of absolute legal ownership of the goods under a contract of sale from seller to the buyer for a price Transfer of ownership is different from transfer of possession(custody and control)

Risk follows owner ship :- also known as risk prima facie passes with property. Exceptions:- i) express agreement ii) Default by the party iii)When seller is bailee.

Example:- A buys 2000 tons of oil from B.B informs A that goods are ready for delivery but A does not take delivery for few days, before delivery of oil to A there is fire in Bs warehouse and whole oil was burnt . Who is liable for loss ( A is liable for loss because property in goods was with A)

Example 2:A agrees to buy Bs car for Rs One lakh on April ,15 while the price is paid in advance on march 15.On march 10 ,the car is damaged in an accident .Who will bear loss (B will have to bear loss because property in goods did not pass to A on march 10.and also B is liable to refund advance)

Action against third party:- Owner alone

can exercise proprietary rights. Example:A sells his car to B but insurance policy is still in the name of A .The car is damaged in accident .Who can claim for damages from insurance . (B cannot claim from insurance company)

Transfer of property in the specific or ascertained goods Transfer of property in the unascertained goods Transfer of property in goods sent on approval Transfer of property in the goods sent or delivered when right of disposal is reserved.

Passing of property at the time of contract (unconditional) Example :- A sold B certain stake of hay for which Rs 1000 was to be paid on the ensuing of march 10. The stake was allowed to stand on the premises of A until may 10. when does the property transferred (The property has transferred immediately on march 10)

Example :- B selects certain books in shop .the price is settled. He arranges to take delivery of the books the next day through his servant and agrees to pay for the books on the first of the next month .the books are destroyed by fire in the same evening .is the property passed to the buyer ( The property in the books has passed to the buyer and he is liable to pay the price)

Passing of property delayed beyond the date of the contract

Goods not in the deliverable state

i)

Example;-A sells a dining set to B .As per the terms of contract it is to be polished by A ,before delivery .thus the set is not in the deliverable state but A is to put it in deliverable state. When the set has come in to deliverable state .does the transfer of property take place. (No untill B is not informed)

ii) When something is to be done for ascertaining the price by weighing etc :Example:- A entered into a contract with B for the sale of entire rice in his godown .According to A, it amounted 975 tons was to remove the rice after weighing .After removing 20 tons ,there was fire in the godown, consequently rest was destroyed by fire. Who will be liable loss. (B was liable for the loss because nothing remained to be done by A)

Example:A sold 24 tins of oil by auction which were to be fully filled by the seller .He filled up all the tins but 10 and B had a notice of it .before he could fill the remainder ,they were all destroyed by fire .who will be liable for loss

( A was liable for the loss of 10 and B for the 14 as sale was complete as to the tin which has been filled but not for the rest 10)

The property of ownership does not pass untill it does not become ascertained

Example:-

A agrees to sell b ,500 units of toys out of a lot to be manufactures in his factory. B has an option to select toys out of the lot .B goes to the factory and selects 500 units with the consent of A .They are packet in a cartoon by A to be taken by B .
Thus at the time of contract the goods were unascertained but with the consent of seller buyer ascertained the good and become liable.

Delivery to carrier :i) Absolutely for the buyer (if bill of lading or receipt is made out in the name of buyer and is sent to him ownership passes to him) ii) Absolutely for the seller (if bill of lading or receipt is not made out in the name of buyer ownership remains with seller)

In such case the property passes to buyer: When he signifies his approval or acceptance to the seller When he does any other act adopting the transaction.

Example:- A horse was delivered to B on condition of sale or return within 8 days .the horse died within 8 days .Held who will bear loss ( Seller will bear the loss because ownership has yet not transferred)

Example:Goods are delivered by A to B on sale or return. They are further delivered by B to C and then by C to D on similar terms. The goods are stolen while in custody of D.

( Between A and B ,B and C sale is complete but between C and D sale is not complete. Therefore C cannot recover the loss from D but is bound to pay amount to B and B is bound to pay to A)

If the seller reserves a right of disposal of the goods appropriated ,the property in the goods does not pass to the buyer until the condition imposed by seller are not fulfilled .

No one can give that which one has not got Example:- If A steals an article and sell it to B,B does not become the owner of article i.e if the seller has no title of the good the buyer does not acquire even if he has acted honestly

I ) Sale by a person not the owner or title by estopel (by the act or conduct causing buyer to believe that the seller has the authority to sell) Example:- A says to B in the presence of C that he (A) is the owner of the goods where as C is the true owner.C remains silent. A sells the goods to B ,Can C recover goods from B (No, because C has given an implied authority by his conduct to A to sell the goods)

II) Sale by mercantile agent III) Sale by one of the joint owners IV) Sale by a person in possession of goods under voidable contract Example:- A by fraud induces B to sell and deliver a diamond ring .A sells the ring to C before B rescinds the contract .C keeps the ring in good faith without the notice of misrepresentation . (Sale is valid ,C gets a good title)

It means as regards the seller, delivery of goods to the buyer of the quality, in the quantity, at a place and in the manner agreed As regards to the buyer ,acceptance of the delivery of the goods validly tendered and paying the price at a time and place agreed upon

DELIVERY means voluntary transfer of possession of goods from one person to another.

Three modes of delivery :ACTUAL DELIVERY :- It is a physical delivery of the goods sold to the buyer SYMBOLIC DELIVERY :It is not a physical delivery of the goods sold to the buyer. For example :delivering keys of a warehouse containing goods sold. CONSTRUCTIVE DELIVERY :- It takes place when the seller does some act that causes the delivery of the goods to any person authorized to hold them on behalf of the buyer

Example:A sold 100 TV sets to B .The TV sets are in a warehouse .A orders to the warehouse keeper that he will henceforth hold them for the use of B.What type of delivery it is ?

(Constructive delivery)

Mode of Delivery Delivery and payment concurrent conditions Effect of part delivered :- A delivery of part of goods ,in progress of the delivery of whole has same effect as a delivery of the whole.

Example:- A sold 1000 tons of sugar to B ,B requested A for a permission to remove 200 tons of sugar and A allowed. Held it is a part delivered

Place of delivery
In case of SALE (at the place where they were at the time of the sale) In case of Agreement to sell (at the place where they were at the time of the agreement to sell) If goods are not in existence ( where they are manufactured)

Time of delivery Cost of delivery (exception making of delivery are born by

seller ,but all expense of obtaining of delivery are born by the buyer)

Delivery of wrong quantity

Delivery of lesser quantity Delivery of larger quantity
Effect :- Can reject whole, Can accept whole and in case larger quantity can accept the ordered quantity and return the rest Right to reject the goods is not equivalent to the right to cancel the goods

Delivery of goods mixed with other

Effect :- Can reject whole, Can accept whole

Buyers liability in case of rejection of goods

Effect :- If seller refuses to take away the goods ,buyer become bailee and may charge for keeping them

Buyers liability for neglecting or refusing delivery of goods

Effect :- buyer has to bear any loss occasioned by his neglect or refusal to take delivery And reasonable charge for the care and custody of the goods

RIGHTS OF THE BUYER: Right to have delivery Right to return the goods Right to reject the goods Right to reject the goods if delivered in installment Right to examine the goods before accepting Right in case of breech of contract by the seller i) suit for damages for non delivery ii)suit for specific performance iii) suit for breach of warranty

DUTIES OF BUYER
Duty to accept goods Duty to make payment Duty to apply for delivery of goods Duty to demand delivery of goods at reasonable time Duty to intimate the seller when he rejects the goods Duty in case of breach of contract by him i) Duty to pay the price ii) Duty to pay damages for non acceptance iii) Duty to pay damages for repudiation iv) Duty to pay interest

Consumer means any person, who Buys any goods for a consideration (a) which has been

paid or promised or partly paid and partly promised, or (b) under any system of deferred payment. It also includes any user of such goods other than the buyer himself
Exception:Consumer does not include a person who obtains goods for resale or for any commercial purpose.

Consumer means any person, who Hires or avails of any service for a consideration

which has been paid or promised or partly paid and partly promised, or any system of deferred payment It also includes any beneficiary of such services other than the person who avails or hires the service. The Act extends to the whole of India except the state of Jammu and Kashmir

Better protection of interests of consumers( Provisions for establishment of consumer councils and other authorities) Consumer Protection Councils Quasi judicial machinery for speedy redressal of consumer disputes

Protection of rights of consumers : The right to be protected against marketing of goods or services which are hazardous to life property Right to be informed about the quality , quantity, potency, purity, standard and price of goods Right to be assured, wherever possible ,access to goods and services at competitive prices. Right to seek redressal against unfair trade practices or restrictive trade practices or exploitation of consumers

It means a trade practices which a trader for the purpose of promoting the sale ,use or supply of any goods or for the provisions of any service. adopts any unfair method or unfair deceptive practice. It includes any of the many practices

Falsely represents the goods of particular standard, quality, quantity etc. Falsely represents services are of particular standard Falsely representing any second hand, rebuilt, renovated or old good as new goods. Represents that the goods or services have sponsorships ,approval, uses of goods which it does not have

Falsely gives to be public any warranty or guarantee of the performance, efficacy of a product that is not based Materially misleads the public concerning the price at which a product or like product or goods or services have been.

2) Permits the publication of any advertisement or the sale or supply at a bargain price, or goods or services that are not intended to be offered for sale 3) Manufacture of spurious goods or offering such goods for sale

Permits The offering of the gifts ,prizes or other items with the intention of not providing them as offered or creating impression that something is being given or offered free of charge when it is fully or partly charged. The sale or supply of goods intended to be used by consumers knowing or having reason to believe that the goods do not comply with the standards prescribed by competent authority relating to performance, composition, contents ,design etc as are necessary to prevent or reduce the risk of injury to the person using goods

Central Council ( 150 members ) (3 years)

Minister in charge of consumer affairs Minister of state Minister of food and civil supplies 8 members of parliament,5 members of lok Sabha and 3 from rajya sabha Commissioner for Scheduled caste and scheduled tribes Representative of central government departments ,autonomous organization not more than 20 Representatives of consumer organization not less than 35 Representatives of women not less than 10 Representatives of farmer,trade,industries not more than 20

State Council
Headed by Minister in charge of consumer affairs Other members of official representing such interests.

District Council
The collector of the district who shall be its chairman

(2 meetings shall be held every year in both the above council)