Question 1 - Sale of Goods A. The Sale of Goods Act 1908

Running head: COMMERCIAL LAW
Commercial Law
Name of the Student
Name of the University
Author Note

1COMMERCIAL LAW
Question 1 - Sale of Goods
A.
The purpose of the Sale of Goods Act, 1908 is to govern the transactions that involves the
sale relating to goods. It mandates the sellers of commodities to ensure the quality of the
product that they are selling and contains laws to that effect. It also mentions the rights and
the duties that are imposed on the sellers and the buyers of commodities.
B.
i. In this instant situation, the contract involving the sale of the shed between Lisa
and Paul has been laid down in a written form. Section 2 of this Act renders a
contract of sale to be a contract for sale of goods when the contract has been
created under section 3 of this Act and satisfies all the requirements of section 5.
ii. The ownership with respect to property does not pass on to the buyer before the
payment has been made or the delivery has been effected. Under section 20 of the
Act the ownership does not pass on to the buyer because of any changes that has
been effected by the seller in the goods to make it deliverable where the buyer does
not have any knowledge of the same. Therefore, the ownership of the shed does
not pass on to Paul for the window being fixed unknowing to Paul.
iii. Under section 22 of the Act, the responsibility of the property belongs to the seller
when the transfer is yet to be effected. In this situation, the goods based on which
the contract for sale has been entered into has been destroyed owing to an accident
and both the parties did not contributed to such an accident. Hence, the contract
become void under section 9.

2COMMERCIAL LAW
C.
In the present situation, the subject-matter of the sale has been destroyed by the fire to
which neither the buyer nor the seller have contributed. Such a contract will be rendered void
under section 9. As the delivery of the goods has not been effected before the fire, the
ownership of the goods does not pass on to the buyer and remains with Samantha. Therefore,
Samantha will be liable for the losses that has been incurred with the destruction of the table
in fire.
D.
Section 15 of the Act requires the goods that has been sold, to match the description that
has been presented during formation of the contract. Section 16 of the Act requires the seller
of the goods to ensure the fitness and the quality of the goods thus sold in accordance with
the description. In the given situation, the description of the goods in the advertisement
mentions the subject-matter of sale to be Amphitrite Soybean Oil, but Jo has been delivered
with lubricating oil. This does not matches the description of the goods that has been
advertised for and upon which the decision of the customer to buy was depending upon.
Hence, Jo will be justified in rejecting the oil.
E.
i. In the instant situation, an agreement has been made to sale the carpet and a
payment has been made to that effect but the delivery of the goods has yet not
being effected. In the event of any destruction of the goods in an accident where
neither the seller nor the buyer has been at fault, the loss will be mitigated by the
seller as the goods remains in his custody. Moreover, section 9 of the Act renders
the sale to be void as the subject matter of the sale has been destroyed. Again, as

3COMMERCIAL LAW
the payment has already been made, the seller is supposed to reimburse the amount
to the buyer as the contract for sale has been rendered void.
ii. Under section 20 of the Act the ownership does not pass on to Charles because of
any changes that has been effected by the seller in the goods to make it deliverable
and the payment being made does not make the contract for sale to be complete
unless the delivery has been made. Hence, the loss due to the fire needs to be borne
by the seller and not the Charles. Moreover, the seller needs to reimburse the
payment made to Charles.
iii. In this situation, the music system has been destroyed owing to which the contract
for sale has become void under section 9 of the Act. This implies the loss to be
borne by the seller but in this case the music system was lying in the custody of Pat
and the common law does not extend the law of frustration to suppress the doctrine
of unjust enrichment. Hence, Pat will be required to pay $5000 to Rick Jones
Electrical Ltd, which is the cost of the music system.
Question 2 - Consumer Guarantees
a.
The Consumer Guarantees Act of 1993 has been enacted as a replacement for the
previously prevalent Sale of Goods Act 1908. This Act has been enacted with a view to
provide protection to the interests of the consumers buying goods or obtaining services. This
Act requires the seller to ensure the quality of the goods being sold to match the description
that has made the purchaser to buy the same. This Act also requires the seller to ensure the
fitness of the goods for the purpose for which the purchase has been made and this Act also
covers the online sale of goods. However, goods purchased for personal use are only covered