A contract of sale of goods is a legally binding agreement between two parties, the seller and the buyer, whereby the seller agrees to transfer the ownership of goods to the buyer for a price. The goods must be movable property, which means that they can be physically moved from one place to another.
Here are some of the features of a contract of sale of goods:
- Bilateral contract: A contract of sale of goods is a bilateral contract, which means that both parties to the contract have obligations to each other. The seller has the obligation to deliver the goods and the buyer has the obligation to pay the price.
- Goods: The subject matter of a contract of sale of goods must be goods. Goods are movable property, which means that they can be physically moved from one place to another.
- Price: There must be a price for the goods. The price can be fixed or it can be agreed upon at a later date.
- Transfer of ownership: The seller must transfer the ownership of the goods to the buyer. This means that the buyer becomes the legal owner of the goods.
- Risk of loss: The risk of loss of the goods passes to the buyer when the goods are delivered to the buyer or to a person authorized to receive them on the buyer’s behalf.
- Warranties: The seller may make warranties about the goods. A warranty is a promise made by the seller about the quality or performance of the goods.
- Conditions: The seller may also make conditions about the goods. A condition is a fundamental term of the contract, the breach of which entitles the buyer to terminate the contract and sue for damages.
Here are some MCQs on the features of a contract of sale of goods:
- Which of the following is not a feature of a contract of sale of goods?
- Bilateral contract.
- Goods.
- Price.
- Risk of loss.
- The answer is (d). Risk of loss is not a feature of a contract of sale of goods. It is a consequence of the transfer of ownership.
- A seller agrees to sell a car to a buyer for $10,000. The buyer takes delivery of the car but refuses to pay the price. Can the seller sue the buyer for breach of contract?
- Yes, the seller can sue the buyer for breach of contract.
- No, the seller cannot sue the buyer because the buyer has not accepted the goods.
- The answer is (a). The buyer has accepted the goods by taking delivery of them. The buyer is therefore liable to pay the price.
- A seller agrees to sell a car to a buyer. The buyer takes delivery of the car and drives it away. The car breaks down a few days later. Can the buyer sue the seller for breach of warranty?
- Yes, the buyer can sue the seller for breach of warranty.
- No, the buyer cannot sue the seller because the car was not defective when it was delivered.
- The answer is (a). The seller made a warranty about the quality of the car. The car breaking down a few days later is a breach of this warranty.