Page 147 - DMGT407Corporate and Business Laws

Corporate and Business Laws

Notes Goods: It means every kind of movable property, other than actionable claims and money; and
includes stocks and shares, growing crops, grass and things attached to or forming part of the
land which are agreed to severed before sale or under the contract of sale.
Warranty: It is a stipulation collateral to the main purpose of the 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.
Unpaid Seller: A seller of goods is an unpaid seller when (i) the whole of the price has not been
paid or tendered, or (ii) 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 dishonour of the instrument or otherwise.

5.13 Review Questions

1. J, the owner of a Maruti car, wants to sell his car. For this purpose he hands over the car to
P, a mercantile agent for sale at a price not less than ` 90,000. The agent sells the car for
` 80,000 to A, who buys the car in good faith and without notice of any limitation on P’s
authority. P misappropriated the money also. J sues A to recover the car. Decide giving
reasons whether J would succeed.
2. Analyse the circumstances when the right of stoppage in transit ends.

3. A bought 3,000 tins of preserved milk from U.S.A. The tins were labelled in such a way as
to infringe the Nestlé’s trade mark. As a result, they were detained by the custom authorities.
To get the clearance certificate from the customs, A had to remove the labels and had to
sell them at a loss. Can A recover damages? Justify.
4. “In every contract for the sale of the goods, a time limit for the performance of the promise
is fixed”. Analyse the importance of the time clause in the contracts and their performance.
What would be the consequences if time limit is not included? Comment.

5. What is the practical importance of knowing the exact moment when the property in
goods passes from the seller to the buyer? State and illustrate the rules which determine
such moment.

6. You are the buyer and wanted to make the contract for the sale. What are the essential
things you will include in the contract to make it valid?
7. A asked for a special quality of Dehradun rice. When the rice was cooked, A found that the
quality, though good, was not the same as the one he had asked for. Advise A.
8. ‘No one can give what he himself has not’. Elucidate.
9. “Buyer must be aware about the defects in the goods he is purchasing from the seller.” Do
you agree? Justify.
10. ‘Risk prime facie passes with property’. Elucidate.
11. “Sale & agreement to sell is same.” Do you agree? Justify.

12. A agrees to sell to B 10 bales of Egyptian cotton out of 90 bales lying in his godown. The
godown has been destroyed by fire at the time of contract. A is unaware of this fact. What
happens to the contract?
13. A agrees to sell to B 200 tons of potatoes to be grown on his land at a specific price. He sows
the crop but without any fault on his part, the yield was only 80 tons. Decide.

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