Part 2 Chapter 3

The Passage of Title, Delivery

and Payment

Contents

1â Introduction

This chapter considers the issues surrounding the passage of property and risk in goods and the various rules that dictate when the title to the goods moves from the seller to the buyer, a factor that becomes crucial when determining who owns the goods if one of the parties becomes insolvent or the goods are damaged. Allied to this, the chapter also looks at the related topics of the delivery of and payment for goods.

Section 2 provides a background to the topic of the passage of property to goods and the related issue of the passage of risk which dictates who will have to bear the loss if the goods are damaged or destroyed.

Section 3 looks in detail at the rules relating to the passage of property to goods and the statutory rules that exist to determine when the title will pass if the contracting parties have not expressly agreed the matter in the contract. In particular, it looks at Sale of Goods Act 1979, section 17; the section 18 rules; section 19 on reservation of title clauses; and undivided shares in a bulk.

Section 4 considers the passage of risk to the goods and the relationship between the passage of property and the passage of risk.

Section 5 looks at the nemo dat exceptions, i.e., those situations in which a seller of goods who has no title to them can nonetheless pass a valid title to those goods to an innocent third party buyer. In particular, it looks at several