CA Foundation Paper 2 - Business Law Chapter 3: The Sale of Goods Act, 1930 Flashcards

Vocabulary flashcards covering core definitions, legal maxims, classification of goods, conditions, warranties, and rights of unpaid sellers under The Sale of Goods Act, 1930.

Buyer

A person who buys or agrees to buy goods [Section 2(1)].

Seller

A person who sells or agrees to sell goods [Section 2(13)].

Goods

Every kind of movable property other than actionable claims and money; including 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 [Section 2(7)].

Actionable Claim

A claim or debt that can be enforced only by legal action or suit, typically involving a right to a future benefit or payment that is not secured by physical possession.

Specific Goods

Goods identified and agreed upon at the time a contract of sale is made [Section 2(14)].

Ascertained Goods

Goods identified in accordance with the agreement after the contract of sale is made.

Unascertained Goods

Goods that are not specifically identified or ascertained at the time of making the contract, and are indicated or defined only by description or sample.

Future Goods

Goods to be manufactured, produced, or acquired by the seller after making the contract of sale [Section 2(6)].

Contingent Goods

Goods the acquisition of which by the seller depends upon an uncertain contingency or event.

Delivery

Voluntary transfer of possession from one person to another [Section 2(2)].

Actual Delivery

Delivery taking place when the seller physically transfers possession of goods to the buyer or a person authorized to hold them on the buyer's behalf.

Constructive Delivery

Delivery effected without any change in the custody or actual possession of the goods, such as delivery by attornment or acknowledgment.

Symbolic Delivery

Delivery of a thing in token of a transfer of something else, such as handing over warehouse keys or documents of title.

Deliverable State

A condition of goods where the buyer would, under the contract, be bound to take delivery of them [Section 2(3)].

Document of Title to Goods

A document used in the ordinary course of business as proof of the possession or control of goods, authorizing the possessor to transfer or receive goods represented thereby [Section 2(4)].

Mercantile Agent

An agent having in the customary course of business authority either to sell goods, consign goods for sale, buy goods, or raise money on the security of goods [Section 2(9)].

Property

Ownership or general property rights in goods, as distinguished from merely a special property [Section 2(11)].

Insolvent

A person who has ceased to pay his debts in the ordinary course of business, or cannot pay his debts as they become due, whether an act of insolvency has been committed or not.

Price

The money consideration for a sale of goods [Section 2(10)].

Contract of Sale

A contract whereby the seller transfers or agrees to transfer the property in goods to the buyer for a price [Section 4(1)].

Sale

A contract of sale where the ownership of goods is immediately transferred from the seller to the buyer.

Agreement to Sell

A contract of sale where the transfer of ownership in goods is set to take place at a future time or subject to some condition to be fulfilled thereafter.

Stipulation

A representation forming part of the contract of sale that affects the contract.

Condition

A stipulation essential to the main purpose of the contract, the breach of which gives rise to a right to treat the contract as repudiated [Section 12(2)].

Warranty

A stipulation collateral to the main purpose of the contract, the breach of which gives rise to a claim for damages but not to a right to reject the goods [Section 12(3)].

Caveat Emptor

A legal rule meaning 'let the buyer beware', holding that it is the duty of the buyer to satisfy himself regarding the quality and fitness of goods before purchase.

Merchantable Quality

Quality and condition of goods such that a person of ordinary prudence would accept them as goods of that description [Section 16(2)].

Wholesomeness

An implied condition in the case of eatables and provisions that the goods shall be fit for human consumption.

Warranty as to Undisturbed Possession

An implied warranty that the buyer shall have and enjoy quiet possession of the goods [Section 14(b)].

Warranty as to Non-existence of Encumbrances

An implied warranty that the goods shall be free from any charge or encumbrance in favor of any third party not declared or known to the buyer [Section 14(c)].

Appropriation of Goods

Selection of goods with the intention of using them in the performance of the contract, made with mutual consent of buyer and seller [Section 23].

Nemo Dat Quod Non Habet

A legal Latin maxim meaning 'no one can give what he has not got', stating that a buyer cannot acquire a better title to goods than the seller possesses [Section 27].

Unpaid Seller

A seller of goods to whom the whole of the price has not been paid or tendered, or where a conditional payment by negotiable instrument has been dishonored [Section 45(1)].

Seller's Lien

The right of an unpaid seller in possession of goods to retain possession until payment or tender of the price [Section 47].

Right of Stoppage in Transit

The right of an unpaid seller who has parted with possession of goods to stop them while in transit and regain possession upon the buyer becoming insolvent [Section 50].

Auction Sale

A mode of selling property publicly by inviting competitive bids and selling to the highest bidder [Section 64].

Reserve Price

The minimum price fixed by the seller below which an item cannot be sold at an auction sale.