Essential Characteristics of Sale of Goods
1. Two parties: There should be two parties namely the buyer and seller. Incase the students of a Hostel take meals in a mess run by them , there is no contract of sale because the student are undivided joined owners, who are running the mess on cooperative basis. An undivided join owners must be distinguished from a ‘part-owner’ who is a join owner with divisible share.
2. Transfer of Property: ‘Property’ here means ‘ownership’. Transfer of property in the goods is another essential of a contract of sales of goods. A mere transfer of possession of the goods cannot be termed as sale. To constitute a contract of sale the seller must either transfer or agree to transfer the property in the goods to the buyer. Further, the term ‘property,’ as used in the Sale of Goods Act, means ‘general property’ in goods as distinguished from ‘special property’
3. Goods: The subject-matter of the contract of sale must be ‘goods’ According to Section 2(7) “goods means every kind of movable property other than actionable claims and money; and includes stock and shares, growing crops, grass, and things attached to or forming part of the land which are agreed to be severed before sale or under the contract of sale.” Goodwill, trade marks, copyrights, patents right, water, gas, electricity,, decree of a court of law, are all regarded as goods. In the case of land the grass which forms part of land have to be separated from the land. Thus where trees sold so that they could be cut out and separated from the land and then taken away by the buyer, it was held that there was a contract for sale of movable property or goods (Kursell vs Timber Operators & Contractors Ltd.). But contracts for sale of things ‘forming part of the land itself’ are not contracts for sale of goods.
4. Price: The consideration for a contract of sale must be money consideration called the ‘price .’ If goods are sold or exchanged for other goods, the transaction is barter, governed by the Transfer of Property Act and not a sale of goods under this Act. But if goods are sold partly for goods and partly for money, the contract is one of sale (Aldridge vs Johnson).
5. Includes both a ‘sale’ and ‘an agreement to sell.’ The term ‘contract of sale’ is a generic term and includes both a ‘sale’ and an ‘agreement to sell’ [as is clear from the definition of the term as per Section 4(1) given carlier ].
6. Sale: Where under a contract of sale the property in the goods is immediately transferred at the time of making the contract from the seller to the buyer, the contract is called a ‘sale’ [Sec. 4(3)]. It refers to an ‘absolute sale’, e.g. an outright sale on a counter in a shop. There is immediate conveyance of the ownership and mostly of the subject matter of the sale as well (delivery may also be given in future), It is an executed contract.
1. Two parties: There should be two parties namely the buyer and seller. Incase the students of a Hostel take meals in a mess run by them , there is no contract of sale because the student are undivided joined owners, who are running the mess on cooperative basis. An undivided join owners must be distinguished from a ‘part-owner’ who is a join owner with divisible share.
2. Transfer of Property: ‘Property’ here means ‘ownership’. Transfer of property in the goods is another essential of a contract of sales of goods. A mere transfer of possession of the goods cannot be termed as sale. To constitute a contract of sale the seller must either transfer or agree to transfer the property in the goods to the buyer. Further, the term ‘property,’ as used in the Sale of Goods Act, means ‘general property’ in goods as distinguished from ‘special property’
3. Goods: The subject-matter of the contract of sale must be ‘goods’ According to Section 2(7) “goods means every kind of movable property other than actionable claims and money; and includes stock and shares, growing crops, grass, and things attached to or forming part of the land which are agreed to be severed before sale or under the contract of sale.” Goodwill, trade marks, copyrights, patents right, water, gas, electricity,, decree of a court of law, are all regarded as goods. In the case of land the grass which forms part of land have to be separated from the land. Thus where trees sold so that they could be cut out and separated from the land and then taken away by the buyer, it was held that there was a contract for sale of movable property or goods (Kursell vs Timber Operators & Contractors Ltd.). But contracts for sale of things ‘forming part of the land itself’ are not contracts for sale of goods.
4. Price: The consideration for a contract of sale must be money consideration called the ‘price .’ If goods are sold or exchanged for other goods, the transaction is barter, governed by the Transfer of Property Act and not a sale of goods under this Act. But if goods are sold partly for goods and partly for money, the contract is one of sale (Aldridge vs Johnson).
5. Includes both a ‘sale’ and ‘an agreement to sell.’ The term ‘contract of sale’ is a generic term and includes both a ‘sale’ and an ‘agreement to sell’ [as is clear from the definition of the term as per Section 4(1) given carlier ].
6. Sale: Where under a contract of sale the property in the goods is immediately transferred at the time of making the contract from the seller to the buyer, the contract is called a ‘sale’ [Sec. 4(3)]. It refers to an ‘absolute sale’, e.g. an outright sale on a counter in a shop. There is immediate conveyance of the ownership and mostly of the subject matter of the sale as well (delivery may also be given in future), It is an executed contract.
Essential Characteristics of Sale of Goods
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