Risk passes with property under sale of goods ordinance of Sri Lanka
Risk passes with
•The party who has property in the goods takes the risk of
any damage in them.
•If property has passed to the buyer under the contract,
then he must take the risk of anything happening to them,
even if happening before he takes possession.
Sec 23 of Sale of goods
Risk prima facie passes with property
• Sec 23(1) Unless otherwise agreed, the goods remain at the
seller’s risk until the property therein is transferred to the buyer,
• But when the property therein is transferred to the buyer, the
goods are at the buyer’s risk whether delivery has been made or
Mitchinson v. Otaihape Farmer’ Meat
and Produce Co Ltd (1920)
• The buyer selected 280 sheep from a flock of 1100. These were
put into a separate pen. Property thereby passed to the buyer.
Later that day, sheep were destroyed by fire.
• Held: The buyer had to pay the price the risk had passed to him
with the property.
• However, when delivery has been delayed through the fault of either buyer or
seller the goods are at the risk of the party in fault as regards any loss which
might not have occurred but for such fault.
• Where the delivery of the goods is delayed by the fault of one of the parties, the
party bears the risk in relation to any loss arising because of such fault.
• The buyer was at fault in not taking apple juice at agreed times. The juice went
• Held: The buyer was to bear the risk.
Sec 23 (2)
Demby v. Bardon(1949)
This section does not affect the duties or liabilities of either seller or buyer as a
bailee of the goods of the other party
Sec 32 (3)
Where delivery involves a sea journey, the goods remain at the risk of the seller
unless he gives the buyer reasonable notice to allow him to insure those goods.
Where delivery is to place other than where they are sold, and the seller agrees to
deliver at his own risk, the buyer still has to accept the risk of any loss which is
incidental to the journey.