Business Law 2.docx

Assignment 2 To: ma’am Asma By: Talha Khalil 16811554:002 Contract of sale of goods: The Sale of Goods’ Act, 1930, extends to whole of Pakistan. Since it is federal law, therefore it is followed in all parts of Pakistan. It relates to moveable goods, such as, fan, book, table, chair, car etc. All goods, which are moveable, can be carried out from one place to another. Where the transfer of goods takes place in a way of sale, there the Sale of Goods Act, 1930, applies. There are many ways whereby contract of sale can be made. They may either be verbal, written, or implied. Purchase of pen for Rs. 50/- is a verbal contract. Everything is not written. If a person gives me Rs. 50/- and takes my pen and I accept price of pen, is called implied contract. I purchase a book, take it to home, open and find some papers missing or binding is out of order I may return it to get my money back or replace it. Merchantable quality must contain its commercial value. Perished items have no commercial value like perish milk. Seller and buyers are bound to follow rights and obligations, which are provided in contract. Rights and duties either provided or not in any contract, the Sale of Goods Act, 1930, applies in all circumstances. Contract of pledge may take place verbally and if breach of contract is committed, it can be sued. Pawnee has right to sell the goods of pawner in order to recover his credit and expenses for the proceeding of sale. This right even is not provided in contract but Contract Act, which is a statue, gives him such right. Formation of sale of goods contract has two kinds, contract of sale and agreement to sell. Where a sale proceeds happens immediately and goods are delivered at once that is called contract of sale. Where transfer of goods takes place in future time, which is subject matter, is called agreement to sell. After compliance, agreement to sell is converted into contract of sale.

Transfer of property: Transfer of property defined. In the following sections 'Transfer of Property' means and act by which a living person conveys property, in present or in future, to one or more other living persons, or to himself, [or to himself] and one or more other living persons: and 'to transfer property' is to perform such act. In this section 'living person' includes a company or association or body of individuals, whether incorporated or not, but both in herein contained shall affect any law for the time being in force relating to transfer of property to or by companies, associations or besides of individuals

Performance of contract of sale.

Performance of contract is delivery of goods. If seller fulfills all the terms and conditions of sale agreement and delivers goods to buyer as contractual responsibility. It is duty of buyer that he should accept the goods delivered to him. There may be concurrent sale, means delivery of goods and receipt of payment takes place in a time. In this instance there is no breach of contract. But in many cases, breach of contract may take place like in instances of credit sale, advance sale, sale in installments. If contract is silent regarding criteria of breach, then S. 32 will apply. Seller is duty bound to deliver goods as provided in mutual agreement. Where agreement is silent whether where the goods are to be supplied, buyer has to inform to seller whether where delivery of goods be made. If place of delivery of goods is part of contract, then seller is bound to deliver goods at the requisite place. In contrast, seller is not bound to deliver goods as buyer wishes, he is responsible up to the extent of his premises. Buyer cannot appoint another point to deliver goods other than agreed.

Unpaid seller: Unpaid seller: Unpaid seller is a person who has sold goods but buyer has failed to pay him price of goods. If bill of exchange or other negotiable instruments dishonors, it also amounts unpaid selling. Goods sold on credit are not covered under this section. The seller of goods is deemed to be an “unpaid seller” within the meaning of this Act: a.

When the whole of the price has not been paid or tendered.

b. When a Bill of Exchange or other negotiable instrument has been received as conditional payment and the condition on which it was received has not been fulfilled by reason of the dishonor of the instrument otherwise. In case of contract of sale, this situation does not arise, because contract is performed at spot. Passing of goods takes place, property is transferred, title is transferred, possession is transferred, and consideration or price of goods sold is received on spot. Since the performance of contract takes place, so matter of unpaid seller does not take place, and he is converted into paid seller. A sells goods to B, at Rs. 15,000/- A passes on the goods to B along-with transfer of goods, title, and possession. In result of such transfer B pays Rs. 15,000/- to A. This is a contract of sale so unpaid seller is not created. But if B pays Rs. 5,000/- and withholds Rs. 10,000/- due to reasons unknown, it creates unpaid seller.