SALE OF GOOD ACT / HIRE PURCHASE ACT

SALE OF GOODS

A contract of sale of goods is a contract whereby the seller transfer the property in goods to the buyer for a money consideration called the price. The parties to this contract are known as the seller (vendor or transferor) and the buyer (vendee or transferee). The seller must be either the owner of the goods or his duly authorized agent.

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The relevant law is the Sale of Goods Act 1893. This law does not cover the buying and selling of immovable or real property like land and houses. The Sale of Goods Act deals with only the rules and regulation which governs the buying and selling of personal movable property like motor vehicle, future, machinery, food, clothing and other similar commodities.

PROVISION OF THE SALE OF GOODS ACT (1893)

A seller has the legal rights to offer goods for sale
The sample goods offered to the customer must have the same quality with the actual goods the seller display for sale
If the seller sells by description, the description must correspond with the description of the actual goods displayed for sale
The goods must be suitable for the purpose they are meant to serve
The goods offered for sale must be free from any claim in favour of any third parties (i.e. equities).
A buyer must examine carefully the goods he is to buy and make sure of the quality before buying and failure to do so; he bears the consequences of any default. This is the principle of “CAVAET EMPTOR” or “let the buyer beware”

CONDITIONS THAT CONSTITUES ACCEPTANCE IN THE CONTRACT OF SALE OF GOODS

In a contract of Sale of Goods, the buyer is deemed to have accepted goods (i.e.) taken over their ownership under the following circumstances

If he informs the seller that he has accepted them
If, after receiving the goods he does any act in relation to the goods which can only be done by the owner e.g. reselling the goods.
If he retains the good beyond a reasonable period without informing the seller that he rejected them.