MLL215 Study Guide - Final Guide: Fide
2 Jun 2018
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1. TRANSFER OF PROPERTY
Property in goods = ownership/title
Possession of goods = custody/control
Important to determine the time that ownership transfers from S to B because the
risk of loss falls on the owner.
Specific goods – property passes when the parties intend.
Unascertained goods – property cannot pass until the goods become ascertained.
APPROPRIATION:
WARDAR’“ CO LTD V W NORWOOD & “ON“ 1
600 cartons of frozen ox kidneys.
Property in the kidneys ad risk of deterioratio had passed to B he B’s arrier
handed over the delivery to S at 8 am. Kidneys were in good condition at delivery
time and deterioration occurred subsequently.
B was held liable for price of kidneys.
B or S may appropriate goods to the contract by selecting certain goods to satisfy the order.
THC HOLDINGS
- contract for the sale of metal. There was a shortfall. S obtained metal from TP and
placed it in a separate pile. S was placed into administration before B could collect
etal. Was the etal asertaied? Did it elog to B or “’s reditors?
Held: metal was ascertained and property passed to B.
RESERVATION OF RIGHT OF DISPOSAL:
S may by the terms of the contract reserve the right of disposal in the goods until
certain conditions are fulfilled.
Ownership does not pass to B or carrier upon delivery until the conditions are
fulfilled.
ROMALPA CLAUSES:
Reservation of title clauses – attept to presere “’s rights i the goods util “ is
fully paid by B.
Enables S to recover the goods (or the proceeds of sale where resold by B) in the
eet B’s isoley. Preet the goods fro eoig part of the property of B and
aailale for distriutio aog B’s other reditors.
RISK:
The risk of loss or damage to the goods and the question of ownership of
goods are linked together, and it is often important to know who is really the
owner of goods as a loss of such goods must be borne by the person who
owns them, ie the risk of loss prima facie passes with property.
find more resources at oneclass.com
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Specific goods destroyed – impossibility of performance = void contract.
Unascertained goods destroyed – S must perform the contract = valid
contract.
ASSOCIATED ALLOYS PTY LTD V ACN 001 452 106 PTY LTD (2000).
Romalpa clause said that B would hold the proceeds for goods sold to
customers made with supplies provided by S on trust for S.
I the eet that the uyer uses the goods i soe aufaturing process,
then the buyer shall hold such part of the proceeds of such manufacturing
proess as relates to the goods i trust for the seller.
Held: the trust created by the Romalpa clause did not constitute an
unregistered charge and was not rendered void against the liquidator.
ALLIED MILLS V GWYDIR VALLEY [1978]
B bought linseed meal from S.
Property passed to B on making contract of sale. Agreed on future delivery.
S declined to deliver within agreed period.
Goods destroyed i fire at “’s store.
Held: B was relieved from liability to pay for goods and entitled to damages. Risk
remained with S.
Where delivery has been delayed through the fault of either B or S, the goods are at
the risk of the party in fault.
2. TITLE OF TRANSFEREE
General rule: the transferee of goods cannot obtain a better title than the transferor
Exceptions:
a. a sale where the owner is estopped from denying the
authority of the seller;
ESTOPPEL:
Where the owner of goods is by his/her conduct precluded from denying the seller’s
authority to sell, the buyer obtains a good title.
To permit goods to go into the possession of a person in circumstances which make
it appear that such person has authority to sell the goods may estop (prevent) the
owner from upsetting a purchase of the goods by a buyer in good faith and for value.
b. a sale by a mercantile agent or a sale under a special common
law or statutory power of sale;
SALE BY MERCANTILE AGENT OR UNDER SPECIAL POWER:
When goods are sold by a mercantile agent to a person who takes them bona fide,
such person obtains a good title to the goods, notwithstanding that the principal
ay hae reoked the aget’s authority to sell.
c. a sale by a person having a voidable title; or
find more resources at oneclass.com
find more resources at oneclass.com
Document Summary
Important to determine the time that ownership transfers from s to b because the risk of loss falls on the owner. Specific goods property passes when the parties intend. Unascertained goods property cannot pass until the goods become ascertained. Wardar" co ltd v w norwood & on (cid:894)1(cid:1013)(cid:1010)(cid:1012)(cid:895) Property in the kidneys a(cid:374)d risk of deterioratio(cid:374) had passed to b (cid:449)he(cid:374) b"s (cid:272)arrier handed over the delivery to s at 8 am. Kidneys were in good condition at delivery time and deterioration occurred subsequently. B was held liable for price of kidneys. B or s may appropriate goods to the contract by selecting certain goods to satisfy the order. Thc holdings contract for the sale of metal. S obtained metal from tp and placed it in a separate pile. S was placed into administration before b could collect (cid:373)etal. Held: metal was ascertained and property passed to b.
