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Risk passes with property under sale of goods ordinance of Sri Lanka

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It is about risk passes with property under Sale of goods contract and how it dealt by Sale of goods Ordinance of Sri Lanka

Published in: Law

Risk passes with property under sale of goods ordinance of Sri Lanka

  1. 1. Risk passes with property
  2. 2. •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.
  3. 3. Sec 23 of Sale of goods Ordinance 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 not.
  4. 4. 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.
  5. 5. • 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 bad. • Held: The buyer was to bear the risk. Sec 23 (2) Demby v. Bardon(1949)
  6. 6. Sec 23(3) 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. Sec 33 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.
  7. 7. Thank You

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