Property law: My rights as an owner of goods

PQ engine → has someone interefered with the goods, who can sue, and for what

1. What property rights exist for each person identify:

• who owns the goods (title)

• who is in possession at the time (possession = control + intent to exclude, judged as social fact)

• who has RIP

2. Classify the conduct and choose the tort, argue alternative

• Trespass

• conversion

• Detinue

• Reversionary injury

• breach of bailment

3. check the defences and exceptions

• ministerial acts: a carrier or warehouse keeper, merely changes the position of the goods in good faith(Hollins)

• qualified refusal: reasonable detention by someone doubtful of title (Blackburn J)

• consent/authoirty: from the owner

• a finder: who never elected to take possession is not a bailee

Bailment PQ engine

1. is there a bailment

• knowingly and willingly in possession of goods belonging to another (palmer)

• no contract, deliver or consent from the bailor is needed

• It covers finders who take possession, “constructive” bailees who assume responsibility (perkins), and sub bailees (Pioneer;Morris)

2. what type of bailment

• at will (bailor keeps RIP)

• for a term (Bailee has RIP only)

• for reward or gratuituous → duty of care is effectively the same (conway)

3. Duty and breach

• The duty: take all reasonable and proper care, means care a careful, vigilant person would take of their own chattel of that kind in those circumstances (conway)

• onus: the bailor proves only the bailment and the loss or damage. Onus then shifts to the bailee to prove: (a) it took all reasonable precautions; or (b) the loss would have occured anyway

• what is reasonable care → depends on the value of goods, how tempting they are, foreseeable intruders, practicality, and industy practice (conway;skyway)

4. Exclusion clauses

• incorporation: clause part of term of bailment?

• construction: clasues are read strictly and contra profernetem, ambiguity favours bailor (perkins)

5. sub bailment

• sub bailee who voluntarily takes possession knowing that someone other than their bailor has an interest owes bailee duties directly to the owner (Pioneer; Morris; Gilchrist watt)

• owner is bound by the terms of the sub-bailment to which it expressly, impliedly or ostensibly consented (pioneer)

6. Remedies against 3rd parties

• the bailee in possession can sue for the full value and must account to the bailor for nay excess (the winkfield)

• the bailor can sue: in trespass if at will (possess via bailee); in conversion if bailment is at will, or if the bailee acted repugnantly which revives RIP

• Otherwise only in reversionary injury

• ailor can also sue the bailee for breach of bailment

7. PPSA check: hire purchase and leases of goods over 1 year are SI under PPSA → priority and title Q then turn on PPSA

Sale of goods PQ engine

1. is it a contract of sale → s 120

• seller transfers, or agrees to transfer property in goods for a money price

• “goods” (s 119) includes movables, animals, crops and fixtures to be severed, and software. It excludes money and things in action

2. sale or agreement to sell? (ss 122-123)

• sale: property passes under contract

• Agreement to sell: property passes at a future time or on a condition → becomes a sale once that time or condition is met

• before property passes, buyer only has contractual rights

3. When does property pass

• if the goods are unascertained, property cannot pass until they are ascertained (s 143)

• for specific or ascertained goods, property passes when the parties intend it to (s 144), judged by the contract terms, the parties conduct and the circumstances (isaac)

• if there is no contrary intention, apply the s 146 rules → 5 rules (s 145)

• payment and delivery are not required for property to pass, under s 157 they are concurrent conditions unless otherwise agreed

4. Risk → did the goods perish or get damaged mid transaction

• s 127: the contract is void if specific goods had already perished when the contract was made, without the sellers knowledge

• s 128: an agreement to sell specific goods become void if the goods perish before risk passes, without fault by either party

• perished means so altered in nature that the goods arre no longer what was contracted for, and can no longer serve intended use (oldfield)

• otherwise, apply s 148: risk passes with property unless otherwise agreed. → if delivery was delayed through a partys fault, that party bears the risk of loss caused by delay, → a party holding the others goods still owes bailee duties

5. Title → did the seller own the goods?

• the general rule (s 149): a buyer gets no better title than the seller had → exceptions exist

• double sale checklist: 1. has property already passed to buyer? if not there is no nemo dat problem: buyer 1 has only a contract claim. 2. if it has, does s 153 save buyer 2?

• A buyer who loses out can sue the seller for breach of the s 135 implied condition of the right to sell, and for quiet possession

6. remedies: the owner can sue in conversion or detinue against whoever deals with the goods

what is needed to sue in trespass

possession at the time, plus a direct (voluntary) and unlawful interference (no consent)

Is an innocent tow operator liable in trespass

yes → Wilson v BNP → trespass punishes voluntary actions, not blameworthiness

can an owner out of poessession sue in trespass

no (penfolds), except a bailor at will, who possesses through the bailee

can a thief sue in trespass

yes, against third parties

what kinds of trespass damages are available

• compensatory

• consequential

• vindicatory (thurston) → note trespass is actionable per se

what standing do you need to sue in conversion

RIP

what are the three kuwait elements of conversion

1. Inconsistent with the owners rights

2. deliberate

3. an extensive encroachment that excludes the owner, cf lesser acts of interference (trespass, negligence)

is mere retention of goods conversion

• no, it needs adverse detention with an intent to keep

• demand and refusal is the usual proof

what is Blackburn J’s exception (Hollins v Fowler)

• Good faith ministerial acts that merely change the goods position, it never covers acts intended merely to pass property

• railway workers

how are conversion damages measured

• value at the date of conversion, plus consequential loss

• title passes to D

what does detinue give you that conversion doesnt

possible specific return (unique goods), and damages valued at date of judgement

what are the elements of detinue

• RIP

• demanded return

• unlawful refusal

is every refusal unlawful (detinue)

no, a reasonable qualified refusal to check title is permitted

when does accession apply

only where practically necessary → minor chattle cannot be removed without injury to the whole

how do you identify the principal chattel

not simply by value. With piece by piece additions, the core item is principal (McKeown)

what allowance does an improver get

Wrongdoers get none; an innocent improver may get “fair and just allowance” as seen in McKeown

What is palmers definition of bailment

Knowingly and willingly in possession of anothers goods

does bailment need a contract, delivery or consent

No

Does a finder automatically become a bailee

Only if they elect to take possession

what made the hospital a bailee in perkins

The ring became its sole responsibility on the patients death (constructive bailment)

what is the standard of care (bailment DOC)

the care a careful person would take of their own chattel of that kind. The same for reward for gratuitous bailments.

who bears the onus of proof (bailment)

• The bailor proves loss/damage

• The bailee must disprove fault (took all reasonable precautions) or causation (would of happened no matter what?)

why was the dealer liable in conway

• Keys left for fire safety made theft easier

• there was no alarm (not reasonable precautions) → open show room, high desire

• and it could not show the loss would of happened anyway

why was the storage yard liable in Conway

• A fee was paid, reasonable care was expected at all times, there was no fence

• A bailor cannot be taken to have accepted visible defects in the premises

• the parties can vary the duty by contract (skyway)

How do you approach an exclusion clause (bailment)

1. Was it incorporated

2. On a strict, contra proferntem construction, does it cover the loss

• contra proferentem construction is a rule of contractual construction (interpretation) providing that if a clause is genuinely ambiguous, it is construed against the party who drafted or put forward the term, and in favour of the other party.

• Seen in perkins, the exclusion clause only applied to living patients, did not extend to the deceased.

when is a bailment at will

when no term or purpose is fixed, the bailor keeps RIP

What revives the Bailors RIP

a repugnant act bu the bailee (sale, disguise, misdelivery, using good for unauthorised purpose)

when does a sub bailee owe the owner duties

when it took possession with notice that someone other than the bailor has an interest (Pioneer; Morris; Gilchrest watt)

when is the owner bound by the sub bailment terms

when it expressly, impliedly or ostensibly consented to them (pioneer)

what can the bailee recover from a wrongdoer

• the full value, accounting to the bailor for any surplus (the winkfield)

How can a bailor for a fixed term sue a third party

Only for reversionary injury, which requires actual, permanent damage (HSBC Rail)

What PPSA point applies to bailments

hire purchase and leases over 1 year are SI; the PPSA governs priority and title

What is nemo dat

you cannot give what you do not have (title), non owner transferee gets bare possession

what does possession mean

• physical control plus a intent to exclude others, judged as a social fact

• 
  

if someone is exercising dominion over goods is this likely to contribute to dominion

• "exercising dominion" means. It means dealing with goods as if you were the owner: asserting control over them in a way that denies or overrides the true owner's rights. → yes likely to be a conversion

• Fouldes v Willoughby. A ferry operator put the plaintiff's horses off the ferry onshore during a dispute. That was a trespass, because he moved them without consent. It was not a conversion, because he wasn't asserting any right to the horses as his own. He just didn't want them on his boat, so there was no intention to exercise dominion.

if there is successive conversions who can be liable

Each dealer in the chain (kuwait) → also seen in Hollins could of been any dealer → went after Hollins (most money)

what are the possible exceptions to a conversion discussed Hollins

• Ministerial acts in good faith (merely moving goods) → carriers, warehousemen

• finder or custodian (good faith) that comes into possesison

• Qualified refusal (refusing to handover while doubtful about title, for purpose of checking it)

• Denial of title alone → there must be deprivation also

What is the key authority for the bailees DOC standard

Conway → take all reasonable and proper care, meaning the care and diligence a careful, vigilant person would exercise in keeping their own chattel of the like character in like circumstances

• the same whether the bailment is gratuitous or for reward

explain the onus of proof in bailment

1. Bailor proves only the loss or damage

2. the bailee must then prove either:

• 1. no fault: it took all reasonable precautions; or

• 2. no causation: the loss would have happened even with proper precautions

what is the scope of the bailee duty

covers all possible risks: Thieves, fire (conway)

what are 3 ways a bailment arises

1. One person is knowingly and willingly in possession of goods belonging to another (Palmer) → extends to sub bailment, only need to know of the true owner existence, not who they are → can arise without a contract, dlivery, or bailors consent

2. Finders → who elect to take the goods into possession become a bailee, a person who merely comes across goods does not

3. Constructive bailment (perkins) → person becomes bailee where they assume responsibility for goods that have become their sole responsibility, even without a express acceptance → hospital holding deceased patients belongings

who can the bailee sue, who can the bailor sue

1. Bailee in possession can sue:

• in trespass or conversion against anyone

• for the full value of the loss, against a wrongdoer, possession is title (winkfield)

• bailee must account to bailor for any surplus

2. Bailor sues:

• Trespass (if at will → then bailor and bailee possess simultaneously) → note not possible merely on RIP

• Conversion: if the bailment is at will, or if RIP revived by bailee repugnant act

• Detinue: against bailee on refusal after demand, or where bailment has ended

• Breach of bailment against bailee

• reversionary injury: for when bailor has neither possession nor RIP

what circumstances must exist for bailor to claim reversionary injury

• actual permanent damage to the reversion

• permanent means the harm that will continue indefintely unless something is done about it (HSBC)

• a mere taking or detention, or damage repaired during the term at no cost to bailor is not enough (HSBC)

Does “goods” include money

No, and it excludes things in action too (s 119)

what is the difference between a sale and an agreement to sell

• in a sale, property passes under the contract,

• agreement to sell, it passes later or on a condition (s 123)

what is the rule for unascertained goods

no property passes until they are ascertained ( s 143)

what governs passing of property in specific or ascertained goods

Property passes when the parties intend it to, from the terms, conduct and circumstances → (s 144)

what is rule 1 → (determining intention - sale of goods)

elements: unconditional contract, specific goods, deliverable state

• property passes at contract, regardless of payment or felivery

what is rule 2 → (determining intention - sale of goods)

elements: the seller must make the goods deliverable (fulfill a condition e.g ice tray in fridge)

• property passes once done and the buyer has notice

what is rule 3 → (determining intention - sale of goods)

elements: the seller must weigh or measure to fix the price (determining the price)

• property passes once done and buyer has notice

rule 4 → (determining intention - sale of goods)

elements: approval or sale or return

• property passes on approval, or when the buyer keeps the goods beyond the fixed or reasonable time without rejecting them

Rule 5 → (determining intention - sale of goods)

Elements: Unascertained or future goods

• property passes on unconditional appropriation of goods (made ascertained); and in a deliverable state; with the other partys assent

• Delivery to a carrier, without reserving the right of disposal counts as appropriation

→ unconditonally appropriated is like tagging the good “sold to charlize” and putting it on to the delivery truck is appropriation

→ assent is basiclaly just agreement, often inferred “just send it to me”

The shortcut: handing the goods to a carrier (a courier or delivery company) for delivery to the buyer counts as unconditional appropriation, as long as the seller hasn't reserved the right of disposal. So ownership usually passes when the goods are dispatched. The seller "reserves the right of disposal" by, for example, sending them to its own order, or saying ownership passes only on payment.

when did property pass in isaac

on acceptance for slaughter, as the latest at weighing

→ the kill report terms were not in the contract

→ property in the leg passed upon delivery as they could not be refused (unconditional)

what is the default rule on risk

• risk passes with property (s 148),

• a party at fault for delay bears the risk

what does s 127 do (risk)

makes the contract void if specific goods had already perished at contract, without the sellers knowledge

what does s 128 do (risk)

makes an agreement to sell specific goods void if they perish, without fault, before risk passes

what does “perish” mean

the goods are no longer the thing contracted for, or cant serve their intended use (oldfield)

what is the nemo dat rule

a buyer gets no better title than the seller had (s 149)

what remedy does a buyer who gets no title have

a claim against the seller under s 135, person rights against seller (right to sell, quiet possession) → no rights against third party as not property rights

what are the elements of s 153 (possession after sale)

• the seller sold

• the seller continues or is in possession

• the seller delivers to C

• C acts in good faith without notice

what limit does mitchell v jones put on s 153

it does not apply once the goods are delivered and then held back as a bailee

what are the elements of s 297 (Mercantile agent)

• A mercantile agent

• in possession with the owners consent

• a sale in the ordinary course of business

• the buyer in good faith without notice

is consent presumed for the purposes of s 297

yes (s 300(b))

what happens if the goods are subject to a perfected PPSA interest

Buyer. is deemed to have notice (s 298)

does withdrawing consent defeat the buyer

• no unless the buyer has notice → s 299

what is the double sale checklist

1. First ask whether property has passed to buyer 1, if not buyer 1 only has a contract claim against seller

2. if it had, check s 153

relevant authority and statute for determining express or inferred intention of property passing

• Isaac → meat processor, holding unpaid farmer livestock, farmers relied on retention of title clause printed on kill report sent after slaughter → property passed on acceptance on acceptance for slaughter

• parties conduct showed an intention for property to pass: weddel had full control, processed and marketed meat, paid a fixed price; the farmers exercised no ownership

• leg buy contracts, where there was no right to reject , property passed on delivery

→ key section in CCLA part 3 sale of goods → s 144

order of analysis for sale of goods

1. specific or ascertained goods (s 119)

• if the goods are unascertained, stop (s 143). Go to rule 5, look for appropriation.

2. Express or infered intention (s 144) → isaac look at the contract terms, conduct, circumstances

3. if intention is unclear, apply s 146 (via s 145) → s 146 containts the 5 rules.

→ Property passes when intended to (144)

→ risk passes with property (148)

order of anysis for risk and perished goods

1. specific goods perished before the contract? (127) → if yes contract is void, provided the seller did not know

• e.g seen in Rednell → table potatotes has becoem unfit for consumption

2. An agreement to sell specific goods, which perished after contract but before risk passed, without fault (128) → the agreement is void

• s 128 only applies to agreements to sell, not to sales where property and therefore risk has already passed

3. otherwise the contract stands, and s 148 allocates the loss, covers damage that falls short of perishing

• risk passes with property

• party at fault for delayed delivery bears loss caused by delay

• party holding goods still owes bailee duties

what are 3 exceptions to nemo dat (title the buyer gets)

• normally if non owner, buyer gets bare possession, true owner can sue the buyer in conversion (hollins) or detinue → the buyers remedy is against the seller under s 135 (implied condition of the right to sell, and the warranties of quiet possession, an dfreedom from undisclosued charges, may be worhtless if seller has no money)

1. Exception: estoppel by owners conduct (s 149(2)): the owner conduct created the appearence that the seller had authority to sell

2. Exception: seller in possession after sale (s 153): 4 elements, A sold to B, A continues or is in possession, A or a mercantile agent acting for A delivers or transfers the goods under a sale, pledge, or other disposition to C, C receives them in good faith, and without notice of the sale to B

• Limit to exception 2 → Mitchell v Jones: this section applies only while A remains in possession as a seller. (so A continuin gin possession after sale but before delivery, or A not having possession at the first sale then later acquiring it), once property has passed to B sale is complete, A later possession is as a bailee

• Double sale checklist when applying exception 2 (s 153): 1. property passed to buyer? if not seller still owns good, buyer 2 wins on ordinary principles, buyer 1 only contractual claim. 2. if property did pass does s 153 apply

3. Mercantile agent (CCLA Part 5, subpart 2, ss 296-300):

• 1. the seller is a mercantile agent: in the ordinary course of its business as an agent, it has authority to sell (s 296) → note it need not be the owners agent, and it can be occasional agency (Ron McDonald)

2. it is in possession of the goods or documents of title with the owners consent

• possession may be through others, consent is presumed unless contrary evidence, consent given for another purpose e.g repair still counts

3. the sale, pledge or disposition is made in the ordinary course of business as a mercantile agent

4. the taker acts in good faith and without notice of the lack of authotiy - s 297

→ effect: the disposition is as valid as if expressly authorised so buyer gets title

→ limits to exception 3: goods subject to PPSA SI, taker is deemd to have notice, and withdrawl or exprity of the owners consent does not defeat the buyer, unless buyer had notice of it

CCLA 2017, part 3 sale of goods key statute → s 119

• s 119: goods (broad, but excludes money and things in action), specific goods (identified and agreed on at the time of the contract), deliverable state (state in which buyer is bound to take delivery)

CCLA 2017, part 3 sale of goods key statute → s 122

s 122: "A contract of sale may be absolute or conditional."

• absolute = a sale

• conditional = agreement to sell

CCLA 2017, part 3 sale of goods key statute → s 143

for unascertained goods, no property passes until they are ascertained

CCLA 2017, part 3 sale of goods key statute → s 144

for specific or ascertained goods, property passes when parties intended, look at the terms, conduct and circumstnaces

CCLA 2017, part 3 sale of goods key statute → s 145

unless a diferent intention appears (ambiguous intention), apply s 146 rules

CCLA 2017, part 3 sale of goods key statute → s 146

5 rules for determining intention/property passing

CCLA 2017, part 3 sale of goods key statute → s 148

risk passes with property, unless otherwise agreed.

→ delayed delivery, cause bears the risk

→ bailee duties unaffected

CCLA 2017, part 3 sale of goods key statute → s 149

nemo dat: selling without authoity passes no better title, unless the owners conduct precludes denial of the sllers authority (estoppell by owner conduct) → subject to court powers of sale, and to PPSA

CCLA 2017, part 3 sale of goods key statute → s 153

seller in possession after sale

CCLA 2017, part 3 sale of goods key statute → s 157

payment and delivery are concurrent conditions unless otherwise agreed,

CCLA (contract and commercial law act) 2017, part 5 subpart 2 (mercantile agents) → s 296

Mercantile agent = agent with authority, in ordinary course of business as agent, to sell, consign for sale, buy on the security of goods, documents of title include bills of lading…, possession includes goods held by another for the agent or under its control

CCLA (contract and commercial law act) 2017, part 5 subpart 2 (mercantile agents) → s 297

A mercantile agent is in possession with the owners consent, acting in ordinary course of business, makes a sale, pledge, or disposition that is valid as if authorised → IF the taker acts in good faith without notice (bona fide)

CCLA (contract and commercial law act) 2017, part 5 subpart 2 (mercantile agents) → s 298

goods subject to perfected PPSA SI, takerr deemed to have notice

CCLA (contract and commercial law act) 2017, part 5 subpart 2 (mercantile agents) → s 299

withdrawal or expiry of consent does not invalidate the disposition, unless taker had notice of it

CCLA (contract and commercial law act) 2017, part 5 subpart 2 (mercantile agents) → s 300

owner consent is presumed, even if possession obtanied for other purpose

Ron McDonald case bried

• car owned by McDonald came into possession of a dealer (A&J) who sold it to jim boyd motors (which acted in good faith) and left it with A&J for repairs.

• McDonald later came back into possession and sold it to a third party

• Jim boyd got good title under s 297. McDonald later sale was a conversion

• A&J was a mercantile agent, did not need to be McDonals agent, sold in course of its ordinary business (despite occasional)