A summary regarding the rules on transfer of property. Provides a clear and simple summary of default rules on the passing of property. Case law and examples are provided.
- Signifies title or ownership
- Property rights in ordinary sense – binds parties to transaction and all third parties.
Passing of property
- S. 17(1) – property will be passed when the parties intend it to be passed.
- S. 17(2) – in determining the intention of parties, court will look into the terms of the
contract, the conduct of the parties and the circumstances of the case.
Applies to both ascertained and unascertained goods.
Passing of property in specific goods
- S. 18 – rules regarding the passing of property
The property will be passed according to the rules until there is intention of the
parties to the contrary.
If there is contrary intention of the parties shown after the passing of
property in accordance to the rule, the intention shall be of no effect.
Dennant v Skinner and Collom [1948] 2 KB 164
Rule 1 – in an unconditional contract for the sale of specific goods which are in a
deliverable state, the property in the goods passes to the buyer when the
contract is made.
Unconditional – contract not subject to a condition precedent or
subsequent.
o Condition precedent can be implied.
Payment is normally required before delivery in a
supermarket.
Specific goods
o S. 61 – goods identified and agreed upon at the time of a contract of
sale is made.
o Future goods can never be specific.
May be specific in relation to the doctrine of frustration.
o Difficulties arise when general descriptive words are used.
Kursell v Timber Operators & Contractors Ltd [1927] 1 KB
298 – all trees in a forest conforming to certain
measurements at a particular date.
a. Property in trees had not passed because the goods
were not sufficiently identified.
Joseph Reid Pty Ltd v Schultz (1949) SR (NSW) 231 – all
marketable hardwood timber on a site was a sale of specific
goods.
Deliverable state
o S. 61(5) – when the goods are in such a state that the buyer would
be bound to take delivery of them.
Covers situation where the goods could not be said in a
deliverable state physically buy the buyer had agreed to take
delivery as they stood.
Buyer is not bound to take delivery of defective goods but it
does not exclude defective goods.
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