Page 132 - DMGT407Corporate and Business Laws

Unit 5: Law of Sale of Goods

delivery of the key of a warehouse. In the case of constructive delivery or attornment, there is Notes
neither change of physical possession of goods, nor delivery of a symbol, but there is only an
acknowledgment by the person in possession that he holds them on behalf of another. This type
of delivery may be effected in three ways, viz., (i) where the buyer, who is already in possession
of the goods as bailee of the seller, holds them as his own, after the sale; (ii) where the seller, who
is in possession of goods holds them as bailee of the buyer after the sale; and (iii) where a third
person, like a carrier or a warehouseman, who holds the goods, as bailee for the seller agrees
and acknowledges to hold them for the buyer.
Rules regarding delivery: The following are the rules regarding delivery of goods:

1. Delivery of part of goods sold may amount to delivery of the whole if it is so intended and
agreed: Where however, the part is intended to be severed from the whole, part delivery
does not amount to be delivery of the whole (s.34).

Example: Certain goods lying at a wharf are sold in a lot. The seller instructs the
wharfinger to deliver them to the buyer who has paid for them and the buyer thereafter accepts
them and takes away a part of them. It amounts to delivery of the whole.

2. Unless agreed otherwise, the seller is not bound to deliver goods, till the buyer applies for
delivery (s.35): Even where the goods are to be acquired by the seller, the duty of the seller
ends with notifying the buyer that they have been acquired. It is still the duty of the buyer
to apply for delivery.

3. Place of delivery: Whether it is for the buyer to take possession of the goods or for the
seller to send them to the buyer is a question depending in each case on the contract,
express or implied, between the parties. Apart from any such contract, goods sold are to be
delivered at the place at which they are at the time of the sale and goods agreed to be sold
are to be delivered at the place at which they are at the time of the agreement to sell, or if
not then in existence, at the place at which they are manufactured or produced [s.36 (1)].
4. Time of delivery: Where under the contract of sale the seller is bound to send the goods to
the buyer, but no time of sending them is fixed, the seller is bound to send them within a
reasonable time [s.36 (2)].
5. Unless otherwise agreed, the expenses of and incidental to putting the goods into a
deliverable state shall be borne by the seller.
6. Demand for and tender of delivery must be at a reasonable hour: What is a reasonable hour
is a question of fact.
7. Delivery of wrong quantity: 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 shall be required to pay for them at the contract rate [s.37 (1)]. Where a larger
quantity is delivered, 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 shall pay for them at the contract rate [s.37(2)]. Where the goods of the contract description
are mixed up with other goods, the buyer may accept the goods which are in accordance
with the contract and reject the rest, or may reject the whole, [s.37(3)].

Example: The coal which is supplied is partly according to the contract and partly not.
The buyer is entitled to reject the whole.
The above provisions regarding delivery of wrong quantity are subject to any usage of
trade, special agreement or course of dealings between the parties [s.37(4)].

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