Transfer of Property in Unascertained & Future Goods

3916 WordsDec 28, 200916 Pages
TRANSFER OF PROPERTY IN UNASCERTAINED AND FUTURE GOODS INTRODUCTION: Where there is contract for the sale of unascertained or future goods, the property therein does not pass at the time of making of the contract. The property in unascertained goods cannot pass until the goods are ascertained . Similarly, if the subject- matter is future goods , the contract operates as an agreement to sell , i.e., the buyer does not become the owner at the time of making of the contract. After the goods have been ascertained, the property in them will pass when the parties intend it to pass . If the parties have expressed the intention, the property in them passes in accordance with the provisions of Sec. 23, which is as under: Section 23(1): When…show more content…
Generally, the appropriation is to be made by the seller. In some cases, however, the appropriation may have to be made by the buyer. For example, B has 1,000 bags of wheat belonging to A lying in his godown and if A agrees to 100 bags of wheat to B permitting B to select 100 bags out of the 1,000 bags of A which are ready in B’s possession, the appropriation of the goods to the contract would, in this case, be made by B, the buyer. When the goods are destroyed before the appropriation could be mad, the loss has to be borne by the seller as no property in them is deemed to have been passed. Thus, for example, out of a big heap of coal only 10 tons are to be supplies t a buyer, the seller having a duty to separate and despatch the coal, if before the seller could separate the despatch the 10 tons, the whole of the lot is destroyed by fire, the seller will have to bear the loss for the same as the property in the goods has passed to the buyer. In M/s oriental Fire & General insurance Co. Ltd. V. Union of India , there was a contract for the sale of a transformer on F.O.R. basis. The seller booked the same to the buyer through Rail. It was held that the property in the transformer had passed to the buyer when the delivery of the

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