Ref: Sale of Goods Act, 1930.
A contract to transfer the ownership (title) of the goods from one person (seller) to another (buyer) for a price as consideration is called Sale.
ESSENTIALS OF A SALE
1. Two Parties
2. Transfer of title.
AGREEMENT TO SELL
Where under a contract of sale the transfer of ownership in the goods is to take place at some future time subject to some condition thereafter to be fulfilled the transaction is said to be an agreement to sell.
DISTINCTIN BETWEEN SALE AND AGREEMENT TO SELL
SALEAGREEMENT TO SELL
|Ownership or title of property passes |Title in the goods passes at some certain future time or on | |to the buyer immediately as the contract is executed. |fulfillment of some condition attached to the contract. | |2. Risk of loss passes with the title even if the goods are in |Risk of loss rests with the seller even though the goods are in | |the possession of the seller unless otherwise agreed. |the possession of the buyer. | |3. A sale is an executed contract because the ownership passes to|An agreement to sell is an executory contract as the property in | |the buyer from seller simultaneously. |goods has to pass in future. | |4. Seller has no right to resell the goods even though they might|Seller can resell the goods and give a good title to new buyer; | |be in his possession.(jus in rem) |original buyer can however sue for breach of contract. | |5. In case buyer is adjudged as insolvent the goods are to be |The seller may refuse to deliver the goods to official receiver | |delivered to the official receiver either by the seller or buyer.|unless paid for. | |6. In case seller is adjudged as insolvent, the buyer is entitled|The buyer can not recover the goods from official receiver. | |to recover the goods from the official receiver as title lies | | |with him. | |
KINDS OF GOODS
1. Existing goods.
a) Specific: - Goods identified and agreed upon at the time a contract of sale is made. b) Ascertained: - Goods identified and agreed upon after the contract of sale is made. c) Unascertained: - Goods defined by description and not specifically identified at the time of a contract of sale.
2. Future goods: - Goods which are to be manufactured, produced or acquired by the seller after the making of the contract of sale.
3. Contingent goods: - Goods the acquisition of which depends on a contingency that may or may not happen.
The monetary consideration, paid or promised, for the sale of goods and is the essence of the contract.
MODES OF FIXING THE PRICE
The price must be either certain and definite or must be determinable by some method of calculation or criterion prescribed by the Contract.
1. It may be left on the mutual agreement of the parties.
2. It may be left for valuation by a third party.
3. It may be determined by the course of dealing between the parties. 4. Reasonable price.
CONDITIONS AND WARRANTIES
In a contract of sale, the buyer may make statements or representations regarding the nature or quality of goods, or for their fitness for buyers’purpose with a view to influence the buyer to buy the goods. These statements or representations or terms are called STIPULATIONS. The breach of stipulations give rise to legal consequences, but all of them are not important. Mere expression of opinion is however not a stipulation.
A stipulation essential to the main purpose of...