ARRANGEMENT OF SECTIONS
1. Short title.
PART I. Formation of the Contract of sale
2. Sale and agreement to sell
3. Capacity to buy and sell.
Formalities of the Contract
4. Contract of sale, how made.
5. Contracts of sale for twenty dollars and upwards.
Subject Matter of Contract
6. Existing or future goods.
7. Goods which have perished.
8. Goods perishing before sale. but after apartment to sell.
The Price
9. Ascertainment of price.
10. Agreement to sell at valuation.
Conditions and Warranties
11. Stipulation as to time.
12. When condition to be treated as warranty.
13. Implied undertaking aa to title, etc.
14. Sale by description.
15. Implied Conditions as to quality or fitness.
Sale by Sample
16. Sale by sample
PART II. Effect of the Contract Transfer of Property as between Seller and Buyer
17. Goods must be ascertained.
18. Property passes when intended to pass. 19. Rules for ascertaining intention.
20. Reservation of right of disposal.
21. Risk prima facie passes with property.
Transfer of Title
22. Sale by person not the owner.
23. Sale under voidable title.
24. Revesting of property in stolen goods on conviction of offender.
25. Seller or buyer in possession after sale.
26. Effect of writs of execution.
PART III. Performance of the Contract
27. Duties of buyer and seller.
28. Payment and delivery are concurrent conditions.
29. Rules as to delivery.
30. Delivery of wrong quantity.
31. Installment deliveries.
32. Delivery to carrier.
33. Risk where goods are delivered at distant place.
34. Buyer’s right of examining goods.
35. Acceptance.
36. Buyer not bound to return rejected goods.
37. Liability of buyer for neglecting or refusing delivery of goods.
PART IV. Rights of Unpaid Seller against the Goods
38. Unpaid seller defined.
39. Unpaid seller’s rights.
40. Seller’s lien.
41. Part delivery.
42. Termination of lien.
Stoppage in Transit
43. Right of stoppage in transitu. 44.Duration of transit.
45. How stoppage in transitu is effected.
Resale by Buyer or Seller
46. Effect of such sale or pledge by buyer.
41. Sale not generally rescinded by lien or stoppage in transitu.
PART V. Actions for Breach of the Contract
Remedies of the Seller
48. Action for price.
49. Damages for non-acceptance.
Remedies of the Buyer
50. Damages for nondelivery.
51. Specific performance.
52. Remedy for breach of warranty.
53. Interest and special damages.
54. Exclusion of implied terms and conditions.
55. Reasonable time a question of fact.
56. Rights,etc., enforceable by action.
57. Auction sales.
58. Repeal.
59. savings.
60. Interpretation.
THE SALES OF GOODS ACT
1st July 1895
1. This Act may be cited as the Sale of Goods Act
PART I. Formation of the Contract Contract of Sale
2.- (1) A contract of sale of goods whereby the seller transfers or agrees to transfer the property in goods to the buyer for a money consideration called the price. There may be a contract of sale between one part owner and another.
(2) A contract of sale may be absolute or conditional.
(3) Where under a contract of sale the property in the goods is transferred from the seller to the buyer the contract is called a sale; but where the transfer of the property in the goods is to take place at a future time or subject to some condition thereafter to- be fulfilled the contract is called an agreement to sell.
(4) An agreement to sell becomes a sale when the time elapses or the conditions are fulfilled subject to which the property in the goods is to be transferred.
3. Capacity to buy and sell is regulated by the general law concerning capacity to contract, and to transfer and acquire property
Provided that where necessaries are sold and delivered to an infant, or minor, or to a person who by reason of mental incapacity or drunkenness is incompetent to contract he must pay a reasonable price therefor.
Necessaries in this section mean goods suitable to the condition in life of such infant or minor or other people, and to his actual requirements at the time of the sale and delivery.
5.-(1) A contract for the sale of any goods of the value of twenty dollars or upwards shall not be enforceable by action unless the buyer shall accept part of the goods so sold, and actually receive the same, or give something in earnest to bind the contract, or in part payment, or unless some note or memorandum in writing of the contract be made and signed by the party to be charged or his agent in that behalf.
(2) The provisions of this section apply to every such contract, notwithstanding that the goods may be intended to be delivered at some future time, or may not at the time of such contract be actually made, procured, or provided, or fit or ready for delivery, or some act may be requisite for the making or completing thereof or rendering the same fit for delivery.
(3) There is an acceptance of goods within the meaning of this section when the buyer does any act in relation to the goods which recognizes a pre-existing contract of sale whether there be an acceptance in performance of the contract or not.
.-(1) The goods which form the subject of a contract of sale may be either existing goods, owned or possessed by the seller, or goods to be manufactured or acquired by the seller after the making of the contract of sale, in this Act called “future goods”.
(2) There may be a contract for the sale of goods, the acquisition of which by the seller, depends upon a contingency which may or may not happen.
(3) Where by a contract of sale the seller purports to effect a present sale of future goods, the contract operates as an agreement to sell the goods.
7. Where there is a contract for the sale of specific goods, and the goods without the knowledge of the seller have perished at the time when the contract is made, the contract is void.
8. Where there is an agreement to sell specific goods, and subsequently the goods, without any fault on the part of the seller or buyer, perish before the risk passes to the buyer, the agreement is thereby avoided.
The Price
9.-(1) The price in a contract of sale may be fixed by the contract, or may be left to be fixed in manner thereby agreed, or may be determined by the course of dealing between the parties.
(2) Where the price is not determined in accordance with the foregoing provisions the buyer must pay a reasonable price. What is a reasonable price is a question of fact dependent on the circumstances of each particular case.
10.-(1) Where there is an agreement to sell goods on
the terms that the price is to be fixed by the valuation of a third party, and such third party cannot or does not make such valuation, the agreement is avoided :
Provided that if the goods or any part thereof have been delivered to and appropriated by the buyer he must pay a reasonable price therefor.
(2) Where such third party is prevented from making the valuation by the fault of the seller or buyer, the party not in fault may maintain an action for damages against the party in fault.
Conditions and Warranties
11.-(1) Unless a different intention appears from the terms of the contract, stipu1ations as to time of payment are not deemed to be of the essence of a contract of sale. Whether any other stipulation as to time is of the essence of the contract or not, depends on the terms of the contract.
(2) In a contract of sale “month” means prima facie calendar month.
12.(1) (a) Where a contract of sale is subject to any condition to be fulfilled by the seller, the buyer may waive the condition or may elect to treat the breach of such condition as a breach of warranty, and not as a ground for treating the contract as repudiated.
(b) Whether a stipulation in a contract of sale is a condition, the breach of which may give rise to a right to treat the contract as repudiated, or a warranty, the breach of which may give rise to a claim for damages but not to a right to reject the goods and treat the contract as repudiated, depends in each case
on the construction of the contract. A stipulation may be a condition, though called a warranty in the contract.
(c) Where a contract of sale is not severable, and the buyer has accepted the goods, or part thereof, or where the contract is for specific goods, the property in which has passed to the buyer, the breach of any condition .to be fulfilled by the seller can only be treated as a breach of warranty, and not as a ground for rejecting the goods and treat- ing the contract as repudiated, unless there be a term of the contract, express or implied, to that effect.
(2) Nothing' in this section shall affect the case of any condition or warranty, fulfillment of which is excused by law by reason of impossibility or otherwise.
13. In a contract of sale, unless the circumstances of Implied undertaking the contract are such as to show' a different intention, as to title, there is-
an implied condition on the part of the seller that in the case of a sale he has a right to sell the goods, and that in the case of an agreement to sell he will have a right to sell the goods at the time when the property is to pass;
an implied warranty that the buyer shall have and enjoy quiet possession of the goods;
an implied warranty that the goods shall be free from any charge or encumbrance in favour of any third party, not declared or known to the buyer before or at the time when the contract is made.
14. Where there is a contract for the sale of goods by sale by description, there is an implied condition that the goods shall correspond with the description; and if the sale be by sample, as well as by description, it is not sufficient that the bulk of the goods corresponds with the sample if the goods do not also correspond with the description.
15. Subject to the provisions of, this Act and of any statute in that behalf, there is no implied warranty or condition as to the quality or fitness for any particular purpose of goods supplied under a contract of sale, except as follows-
(a) Where the buyer, expressly or by implication, makes known to the seller the particular purpose for which the goods are required, so as to show that the buyer relies on the seller’s skill or judgment, and the goods are of a description which it is in the course of the seller’s business to supply (whether he be the manufacturer or not), there is an implied condition that the goods shall be reasonably fit for such purpose, provided that in the case of a contract for the sale of a specified article under its patent or other trade name, there is no implied condition as to its fitness for any particular purpose.
(b) Where goods are bought by description from a seller who deals in goods of that description (whether he be the manufacturer or not), there is an implied condition that the goods shall be of merchantable quality; provided that if the buyer has examined the goods, there shall be no implied condition as regards defects which such examination ought to have revealed.
(c) An implied warranty or condition as to quality or fitness for a particular purpose may be annexed by the usage of the trade.
PART II. Effect of the Contract
Transfer of Property as between Seller and Buyer
17. Where there is a contract for the sale of unascertained Goods goods no property in the goods is transferred to the buyer unless and until the goods are ascertained.
18.-(1) Where there is a contract for the sale of specific or ascertained goods the property in them is transferred passes when intended to the buyer at such time as the parties to the contract pass.
(2) For the purpose of ascertaining the intention of the parties regard shall be had to the terms of the contract, the conduct of the parties, and the circumstances of the case.
19. Unless a different intention appears the following are rules for ascertaining the intention of the parties as
to the times at which the property in the goods is to pass to the buyer.
Rule 1.-Where there is an unconditional contract for the sale of specific goods, in a deliverable state, the property in the goods passes to the buyer when the contract is made and it is immaterial whether the time of payment or the time of delivery, or both, be postponed.
Rule 2.-Where there is a contract for the sale of specific goods and the seller is bound to do something to the goods, for the purpose of putting them into a deliverable state, the property does not pass until such thing be done and the buyer has notice thereof.
Rule l-Where there is a contract for the sale of specific goods in a deliverable state, but the seller is bound to weigh, measure, test or do some other act or thing with reference to the goods for the purpose of ascertaining the price, the property does not pass until such act or thing be done, and the buyer has notice thereof.
Rule 4.-When the goods are delivered to the buyer on approval or “on sale or return” or other similar terms the property therein passes to the buyer-
(a) when he signifies his approval or acceptance to the seller or does any other act adopting the transaction;
(b) if he does not signify his approval or acceptance to the seller but retains the goods without giving notice of rejection, then, if a time has been fixed for the return of the goods, on the expiration of
such time, and, if no time has been fixed, on the expiration of a reasonable time. What is a reasonable time is a question of fact.
unascertained or future goods by description, and goods of that description and in a deliverable state are unconditionally appropriated to the contract, either by the seller with the assent of
Rule 5.-(1)buyer, or by the buyer with the assent of the seller, the property in the goods thereupon passes to the buyer. Such assent may be express or implied, and may be given either before or after the appropriation is made.the
(2) Where, in pursuance of the contract, the seller delivers the goods to the buyer or to a carrier or other bailee or custodian (whether named by the buyer or not) for the purpose of transmission to the buyer, and does not reserve the right of disposal, he is deemed to have unconditionally appropriated the goods to the contract.
Where there is a contract for the sale of
Where there is a contract for the sale of specific Reservation
20.-(1) goods or where goods are subsequently appropriated to the contract, the seller may, by the terms of the contract or appropriation, reserve the right of disposal of the goods until certain conditions are fulfilled. In such case, notwith- standing the delivery of the goods to the buyer, or to a carrier or other bailee or custodian for the purpose of transmission to the buyer, the property in the goods does not pass to the buyer until the conditions imposed by the seller are fulfilled.
(2) Where goods are shipped, and by the bill of lad- ing the goods are deliverable to the order of the seller or his agent, the seller is prima facie deemed to reserve the right of disposal.
PART III. Performance of the Contract
27. It is the duty of the seller to, deliver the goods, and buyer and of the buyer to accept and pay for them, in accordance seller. with the terms of the contract of sale.
28. Unless otherwise agreed delivery of the goods and Payment and delivery payment of the price are concurrent conditions, that is to say, the seller must be ready and willing to give possession concurrent of the goods to the buyer in exchange for the price, and Condition. the buyer must be ready and willing to pay the price m exchange for possession of the goods.
29.-(1) Whether it is for the buyer to take possession ~desasto of the goods or for the seller to send them to the buyer delivery. is a question depending in each case on the contract, express or implied, between the parties. Apart from any
such contract, express or implied, the place of delivery is the seller’s place of business, if he has one, and if not, his residence :
Provided that, if the contract be for the sale of specific goods, which to the knowledge of the parties when the contract is made are in some other place, then that place is the place of delivery.
(2) Where under the contract of sale the seller is bound to send the goods to the buyer, but no time for- sending them is fixed, the seller is bound to send them within a reasonable time.
(3) Where the goods at the time of sale are in the possession of a third person, there is no delivery by seller to buyer unless and until such third person acknowledges to the buyer that he holds the goods on his behalf:
Provided that nothing in this section shall affect the operation of the issue or transfer of any document of title to goods.
(4) demand or tender of delivery may be treated as ineffectual unless made at a reasonable hour. What is a reasonable hour is a question of fact.
(5) Unless otherwise agreed, the expenses of and incidental to putting the goods into a deliverable state must be borne by the seller.
30.-(1) Where the seller delivers to the buyer a quantity of goods less than he contracted to sell, the buyer may reject them, but if the buyer accepts the goods so delivered he must pay for them at the contract rate.
(2) Where the seller delivers to the buyer a quantity of goods larger than he contracted to sell, the buyer may accept the goods included in the contract and reject the rest, or he may reject the whole. If the buyer accepts the whole of the goods so delivered he must pay for them at the contract rate.
(3) Where the seller delivers to the buyer the goods he contracted to sell mixed with goods of a different description not included in the contract, the buyer may accept the goods which are in accordance with the contract and reject the rest, or he may reject the whole.
(4) The provisions of this section are subject to any usage of trade, special agreement, or course of dealing between the parties.
31.-(1) Unless otherwise agreed, the buyer of the goods is not bound to accept delivery thereof by installments.
(2) Where there is a contract for the sale of goods to be delivered by stated installments, which are to be separately paid for, and the seller makes defective deliveries in respect of one or more installments, or the buyer neglects or refuses to take delivery of or pay for one or more installments, it is a question in each case depending on the terms of the contract and the circumstances of the case whether the breach of contract is a repudiation of the whole contract, or whether it is a severable breach giving rise to a claim for compensation but not to a right to treat the whole contract as repudiated.
32.-(1) Where, in pursuance of a contract of sale, the seller is authorized or required to send the goods to the buyer, delivery of the goods to a carrier, whether named by the buyer or not, for the purpose of transmission to the buyer is prima facie deemed to be a delivery of the goods to the buyer.
(2) Unless otherwise authorized by the buyer, the seller must make such contract with the carrier on behalf of the buyer as may be reasonable having regard to the nature of the goods and the other circumstances of the case. If the seller omits so to do, and the goods are lost or damaged in course of transit, the buyer may decline to treat the delivery to the carrier as a delivery to himself, or may hold the seller responsible in damages.
(3) Unless otherwise agreed, where goods are sent by the seller to the buyer by a route involving sea transit, under circumstances in which it is usual to insure, the seller must give such notice to the buyer as may enable him to insure them during their sea transit, and, if the seller fails so to do, the goods shall be deemed to be at his risk during such sea transit.
PART IV. Rights of Unpaid Seller against the Goods
38.-(1) The seller of goods is deemed to be an “Unpaid seller” within the meaning of this Act-
(a) when the whole of the price has not been paid or tendered;
(b) 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 or otherwise.
(2) In this Part the term “seller” includes any person who is in the position of a seller, as, for instance. an agent of the seller to whom the bill of lading has been indorsed, or a consignor or agent who has himself paid, or is directly responsible for the price.
39.-(1) Subject to the provisions of this Act,
any statute in that behalf, notwithstanding that the property in the goods may have passed to the buyer, the unpaid seller of goods, as such, has by implication of law-
(a) a lien on the goods or right to retain them for the price while he is in possession of them;
(b)in case of the insolvency of the buyer, a right of stopping the goods in transitu after he has parted with the possession of them;
(c) a right of resale as limited by this Act.
(2) Where the property in goods has not passed to the buyer, the unpaid seller has, in addition to his other remedies, a right of withholding delivery similar to and co-extensive with his rights of lien, and stoppage in transitu where the property has passed to the buyer.
40. (1) Subject to the provisions of this Act, the unpaid seller of goods who is in possession of them, is entitled to retain possession of them until payment or tender of the price in the following cases, v k -
(a)where the goods have been sold without any stipulation as to credit;
(b) where the goods have been sold on credit, but the term of credit has expired;
(c) where the buyer becomes insolvent.
(2) The seller may exercise his right of lien notwithstanding that he is in possession of the goods as agent or bailee or custodian for the buyer.
41. Where an unpaid seller has made part delivery of the goods, he may exercise his right of lien or retention on the remainder, unless such part delivery has been made under such circumstances as to show an agreement to waive the lien or right of retention.
42. (1) The unpaid seller of goods loses his lien or right of retention thereon-
(a) when he delivers his goods to a carrier or other bailee or custodian for the purpose of transmission to the buyer without reserving the right Qf disposal of the goods;
(b) when the buyer or his agent lawfully obtains possession of the goods;
(c) by waiver thereof.
PART V. Actions for Breach of the Contract Remedies of the Seller
48.-(1) Where, under a contract of sale, the property in the goods has passed to the buyer, and the buyer wrong- fully neglects or refuses to pay for the goods according to the terms of the contract, the seller may maintain an action against him for the price of the goods.
(2) Where, under a contract of sale, the price is payable on a day certain irrespective of delivery, and the buyer wrongfully neglects or refuses to pay such price, the seller may maintain an action for the price, although the property in the goods has not passed, and the goods have not been appropriated to the contract.
49.-(1) Where the buyer wrongfully neglects or refuses to accept. and pay for the goods, the seller may maintain an action against him for damages for non-acceptance.
(2) The measure of damages is the estimated loss directly and naturally resulting, in the ordinary course of events, from the buyer’s breach of contract.
(3) Where there is an available market for the goods in question the measures of damages is prima facie to be ascertained by the difference between the contract price and the market or current price at the time or times when the goods ought to have been accepted, or, if no time was fixed for acceptance, then at the time of the refusal to accept.
50. (1) Where the seller wrongfully neglects or refuses to deliver the goods to the buyer, the buyer may maintain delivery.
an action against the seller for damages for non-delivery.
(2) The measure of damages is the estimated loss directly and naturally resulting, in the ordinary course of events, from the seller's breach of contract.
(3) Where there is an available market for the goods in question the measure of damages is prima facie to be ascertained by the difference between the contract price and the market or current price of the goods at the time or times when they ought to have been delivered, or, if no time was fixed, then at the time of the refusal to deliver.
51. In any action for breach of contract to deliver specific or ascertained goods the court may, if it thinks fit, on the application of the plaintiff, by its judgment or decree, direct that the contract shall be performed specifically without giving the defendant the option of retaining the goods on payment of damages. The judgment or decree may be unconditional, or upon such terms and conditions as to damages, payment of the price, and otherwise, as to the court may seem just, and the application by the plain- till may be made at any time before judgment or decree.
52.-(1) Where there is a breach of warranty by the seller, or where the buyer elects or is compelled to treat any breach of a condition on the part of the seller as a breach of warranty, the buyer is not by reason only of such breach of warranty entitled to reject the goods; but he may-
(a) set up against the seller the breach of warranty in diminution or extinction of the price;
54. Where any right, duty, or liability would arise under
a contract of sale by implication of law, it may be negatived or varied by express agreement or by the course of dealing between the parties, or by usage, if the usage be such as to bind both parties to the contract.
55. Where, by this Act, any reference is made to a reasonable time the question what is a reasonable time is a question of fact.
56. Where any right, duty or liability is declared by this Act, it may, unless otherwise by this Act provided, be enforced by action.
57. In the case of a sale by auction-
(a) where goods are put up for sale by auction in lots, each lot is prima facie deemed to be the subject of a separate contract of sale;
(b) a sale by auction is complete when the auctioneer announces its completion by the fall of the hammer, or in other customary manner. Until such announcement is made any bidder may retract his bid;
(c) where a sale by auction is not notified to be subject to a right to bid on behalf of the seller, it shall not be lawful for the seller to bid himself or to employ any person to bid at such sale, or for the auctioneer knowingly to take any bid from the seller or any such person. Any sale contravening this rule may be treated as fraudulent by the buyer;
(4 a sale by auction may be notified to be subject to a reserved or upset price, and a right to bid may also be reserved expressly by or on behalf of the seller.
Where a right to bid is expressly reserved, but not otherwise, the seller, or any one person on his behalf, may bid at the auction.
58.-(1) The Act of the United Kingdom Parliament, 1 Jac. 1 cap. 21 intituled “An Act against Brokers” shall, in so far as under the provisions of the English Laws in Force Law (now repealed), the same has hitherto had the force of
law in the Island, cease to have such force.
(2) The Act of the United Kingdom Parliament of 29 Car. II., ch. 3, intituled “An Act for the prevention of Frauds and Perjuries” shall, in so far as under the provisions of the Law aforesaid it has the force of law in this
Island, continue to be in force as aforesaid in an amended form only, to wit, with the omission of section 16 (the marginal note of which is “Writs of execution shall bind the property of goods but from the time of the delivery to the officer”) and section 17 (the marginal note of which is, “Contracts for sales of goods for ten pounds or more”).
59.-(1) The rules in bankruptcy relating to contracts of sale shall continue to apply thereto, notwithstanding anything in this Act contained.
(2) The rules of the common law, including the law merchant, save in so far as they are inconsistent with the express provisions of this Act, and in particular the rules relating to the law of principal and agent and the effect of fraud, misrepresentation, duress or coercion, mistake, or other invalidating cause, shall continue to apply to contracts for the sale of goods.
(3) Nothing in this Act or in any repeal effected thereby shall affect the enactments relating to bills of sale, or any enactment relating to the sale of goods which is not expressly repealed by this Act.
(4) The provisions of this Act relating to contracts of sale do not apply to any transaction in the form of a contract of sale which is intended to operate by way of mortgage, pledge, charge or other security.
60.-( 1) In this Act-
“action” includes counter-claim and set-off;
“buyer” means a person who buys or agrees to buy goods;
“contract of sale” includes an agreement to sell as well as a sale;
“delivery” means voluntary transfer of possession from one person to another;
“document of title to goods” means and includes any bill of lading, dock warrant, warehouse keepers’ certificate, warrant, or order for the delivery of goods, or any other document used in the ordinary course of business as proof of the possession or control of goods, or authorizing or purporting to authorize, either by endorsement or by delivery, the possessor of such document to transfer or receive goods thereby represented;
“fault” means wrongful act or default;
“future goods” means goods to be manufactured or acquired by the seller after the making of the contract of sale;
“goods” includes all chattels personal other than things in action and money. The term includes emblements, industrial growing crops, and things attached to or forming part of the land which are agreed to be severed before sale or under the contract of sale;
“plaintiff’ includes every person asking any relief against any other person, by any form of proceeding, whether the same be taken by way of action, suit, petition, motion, summons, counter-claim or otherwise;
“property” means the general property in goods, and not merely a special property;
“quality of goods” includes their state or condition; “sale” includes a bargain and sale as well as a sale and
delivery;
“seller” means a person who sells or agrees to sell goods;
“specific goods” means goods identified and agreed upon at the time a contract of sale is made;
“warranty” means an agreement with reference to goods which are the subject of a contract of sale, but collateral to the main purpose of such 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 as repudiated.
(2) A thing is deemed to be done “in good faith” within the meaning of this Act when it is in fact done honestly, whether it be done negligently or not.
(3) A person is deemed to be insolvent within the meaning of this Act, who either has ceased to pay his debts in the ordinary course of business, or cannot pay his debts as they become due, whether he has committed an act of bankruptcy or not, and whether he has been adjudicated bankrupt or not.
(4) Goods are in a “deliverable state” within the meaning of this Act when they are in such a state that the buyer would under the contract be bound to take the delivery of them.
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