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Title
1. This Act shall be cited as the “Sale
of Goods Act”.
Sale of Goods
2. A Sale of Goods is an agreement between
the seller and the buyer to transfer the
property in goods by the seller to the buyer
for a determined price. In this Act, the
said agreement shall be referred to as the
Contract for Sale of Goods.
Capacity
3. (a) Parties to a Contract for Sale of
Goods shall have the capacity to enter into
a contract.
(b) A minor or a person incapable of entering
into a contract shall pay a reasonable price
in respect of necessaries sold and delivered
to him.
Existing or future goods
4. Goods sold under a contract shall be
either existing goods or future goods.
Existing goods under this section shall
refer to goods which are owned or possessed
by the seller. And future goods shall refer
to goods which shall be manufactured or
acquired by the seller after entering into
the contract.
Price
5. The price as regards a contract for
sale shall be the price fixed in the contract
or the price determined in a manner agreed
in the contract.
6. Parties to a contract may agree that
the price be determined by a third party.
Implied Terms
7. Where no expressive provision is made
in the contract that the goods are sold
in pursuance of the right of the seller
to sell the goods and a contrary provision
does not appear in the contract, it shall
be implied that the seller has the right
to sell the goods in question. The right
of the seller to sell the goods at the time
of agreement to sell shall be considered
valid if the ownership in the goods transfers
to the buyer.
Transfer of ownership
8. The ownership in the goods shall transfer
to the buyer at such time determined in
accordance with the contract.
Fitness for purpose
9. Goods sold under a contract shall be
considered reasonably fit for a particular
purpose where such purpose has been made
known to the seller by the buyer.
Right to retain property of goods
10. The seller has the right to retain
the goods until the fulfilment of the terms
of the contract or part thereof. In such
event the ownership of the goods shall not
pass to the buyer until such terms are fulfilled.
Risk
11. Unless otherwise agreed, regardless
of whether the property has been transferred
or not, any risks inherit in the goods shall
be deemed to have passed from the seller
to the buyer at the time of the transfer
of ownership of the goods. In this section
risk shall mean the risk of any undesirable
consequences which may result from the ownership
of the goods being transferred.
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Duty of both parties
12. The duty of the seller is to deliver
the goods in accordance with the terms of
the contract. Similarly the duty of the
buyer is to accept the goods and pay its
price in accordance with the terms of the
contract.
Rules of delivery of goods
13. Unless otherwise agreed:-
(a) Delivery of the goods and payment of
the price shall be concurrent conditions.
(b) Place where the goods are delivered
is the place where the seller conducts his
business.
(c) The buyer is not bound to accept any
goods delivered by instalments.
Delivery of wrong quantity or defective
goods
14 (a) The buyer is not bound to accept
any quantity of goods delivered by the seller
more than or less than the amount for which
the buyer contracted to buy.
(b) Where the seller delivers to the buyer
a quantity of goods less than the amount
for which the buyer contracted to buy and
if the buyer accepts them, the buyer shall
pay for them at the proportional rate to
the agreed price.
(c) Where the seller delivers to the buyer
a quantity of goods more than the amount
for which the buyer contracted to buy, the
buyer may accept the quantity of goods for
which he contracted. Where the buyer accepts
the whole of the goods so delivered, he
shall pay for them at the rate proportional
to the agreed price.
(d) Where the seller delivers to the buyer
the goods included in the contract together
with goods not included in the contract,
the buyer may accept the goods which are
in accordance with the contract and reject
the rest or may reject the whole.
(e) In the event of any defect in goods,
the buyer may reject the goods provided
such defect occurred prior to delivery from
the seller to the buyer.
Legal acceptance of the goods
15. The buyer is deemed to have legally
accepted the goods if the buyer acts in
any of the following ways.
(a) Where the buyer communicates to the
seller his acceptance of the goods.
(b) Where the buyer retains in his possession
the goods for reasonable period without
communicating his rejection of the goods
to the seller.
(c) When the goods have been delivered
to the buyer and the buyer does any act
which affects the ownership of the seller.
Right to rescind sale
16. Unless otherwise agreed, either party
shall have the right to rescind the sale
of goods provided that the seller and the
buyer have not parted subsequent to the
conclusion of the sale.
Rights of unpaid seller
17. Notwithstanding that the ownership
of the goods is to transfer to the buyer
in accordance with the provisions of this
Act the seller, to whom the price of the
goods has not been paid to, shall have the
following rights.
(a) In the event he is in possession of
the goods, the legal right to retain them
until payment of the price thereof.
(b) The right of resale to a third party.
Lien on the goods
18.
(a) The seller has the right of exercising
a lien under the following circumstances.
(i) Where the seller has not received credit.
(ii) Where the goods have been sold on
credit and the term of credit has expired.
(iii) Where the buyer becomes insolvent.
(b) The seller loses his right of lien
where the buyer or his agent has obtained
possession of the goods in accordance with
this Act or the seller has waived his right
thereof.
Sale to third party
19.
(a) The seller shall resell the goods upon
occurrence of any of the following circumstances.
(i) Where the goods are perishable in nature.
(ii) Failure on the part of the buyer to
settle payment of the price within a reasonable
period after the buyer has been given notice
of the intention to resell the goods.
(iii) Where it has been stipulated that
upon breach of the contract by the buyer
the seller is entitled to resell the goods
to a third party, the buyer is in breach
of the contract.
(b) In the event the seller suffers damage
as a result of the breach of contract by
the buyer the seller may claim damages in
respect thereof.
Suit for price
20. Where the buyer neglects to pay for
the goods or refuses to pay the price thereof
the seller may file suit to recover the
price.
Buyer’s remedy for breach
of contract
21.
(a) Where the seller neglects to deliver
the goods or refuses to make delivery thereof,
the buyer may file suit to seek damages
in relation to the loss suffered by the
buyer.
(b) Damages under sub-section (a) of this
section shall be the difference in value
between the agreed price and the market
price of the goods at the time specified
in the contract as regards delivery, or
the difference in value between the agreed
price and the expenses incurred by the buyer
in acquiring similar goods from a third
party.
22. Unless otherwise defined in this Act:-
(a) Goods shall include all kinds of movable
property other than money.
(b) “Seller” shall mean a person
who sells or agrees to sell.
(c) “Buyer” shall mean a person
who buys or agrees to buy.
(d) Delivery shall mean the voluntary transfer
of possession from one person to another.
Delivery shall include transfer of possession
effected by delivery made hand to hand or
carrying or sending through a third party.
(e) “Credit” shall mean a document
issued in a transaction concerning sale
of goods that contains a promise to pay
within a specified period.
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