Transfer of property

1. TRANSFER OF PROPERTY

2. Introduction
According to the Transfer of
Property Act 1882,
“Transfer of Property“ means an act by
which a person conveys property to one or
more persons. The act of transfer may be
done in the present or for the future. The
person may include an individual, company
or association or body of individuals, and any
kind of property may be transferred, including
the transfer of immovable property.

3. Transfer of property
 Sale is the first step in the “
TRANSFER OF PROPERTY IN
GOODS “ by the seller to the buyer.
 The Phrase “ TRANSFER OF
PROPERTY IN GOODS “ means
Transfer of ownership of the Goods
from one person to another.

4. Transfer of property(contd..)
 Property in Goods is different from
Possession of Goods.
 Possession of Goods refers to the
custody over the Goods whereas
Property in Goods means ownership
over the Goods.

5. Importance of transfer of
property
 Risk follows ownership
 if property has passed to the buyer,
he becomes the owner of the goods
and then the risk of destruction,
damage or loss.
 Action against third parties
 if goods are damaged by action of
third parties, only owner of goods can
take the action.

6. Importance of transfer of
property(contd..)
 Suit for price
Seller become entitled to recover price
of goods only when property in goods
has passed to buyer.
 Insolvency
If the ownership has passed to buyer
and buyer became insolvent, buyer’s
official receiver can take possession of
goods or vice versa...

7. Time when property passes
 1)Specific or ascertained goods.
 2)Unascertained goods.

8. Specific or ascertained goods
Goods that are existing at the time of
contract of sale and it is identified and
agreed upon time of sale.
Section 19 of Sale of Goods Act
provides “Where there s a contract for
sale of specific or ascertained
goods,the property in them is
transferred to buyer at such time as
the parties to contract intend to be
transferred”.

9. Rules as regards ascertaining
goods (sec.20-24)
 1)Passing of property at time of
contract
When there is a unconditional contract
for the sale of goods in a deliverable
state, The property in goods passes to
buyer when contract is made. The
payment of price of delivery does not
prevent property in goods passing at
once.

10. Passing of property delayed beyond
date of contract
 Goods not in deliverable state
 Something has to be done by the
seller to put them in a deliverable
state, property passes only when
such thing is done, and the buyer
has notice thereof.

11. Passing of property delayed
beyond date of contract(contd..)
 When price of goods to be
ascertained by weighing or
measurement
Where there is a contractor for the sale
of specific goods in a deliverable state
but seller is bound to weigh, test or do
some other thing with reference to them,
for ascertaining the price, the property
does not pass till such act or thing is
done and the buyer has notice of
it.(sec.22).

12. Unascertained or future goods
(sec.23)
 There is a contract for the sale of
unascertained goods, property in the
goods in not transferred to the buyer
unless and until the goods are
ascertained.(sec18).
 Process of ascertainment involves
separating, weighing, measuring,
counting.

13. Unascertained or future
goods(contd..)
 Sale “On Approval” or Sale or
Return” basis
Where goods are delivered to the
buyer ‘on approval’ or on ‘Sale or
return’ or similar terms, the property
passes to the buyer:

14. Unascertained or future
goods(contd..)
 Essentials of valid appropriation
1.The appropriation must be of goods
answering contract description.
2.The appropriation must be intentional.
3.The appropriation must be made either
by seller with the assent of buyer or
by the buyer with the assent of seller.
4.The appropriation must be unconditional.

15. Unascertained or future
goods(contd..)
 Delivery to carrier[sec.23(2)].
Delivery to a carrier without reserving
the right of disposal is a delivery to the
buyer
and the property passes at once at a
time of delivery to the carrier.
 Reservation of right of
disposal(sec.25)
Reserving a right to dispose of the
goods until certain conditions(like
payment of price) are fulfilled.

16. Transfer of title by Non-owners
(sec.27-30)
 Transfer of title by Non-owners
(sec.27-30)
 The general rule is that only the
owner of goods can transfer a good
title. No one can give better title than
he himself has. This rule is expressed
by the maxim “Nemo dat quod non
habet,” which mean “that no one can
give what he himself has not.”

17. Exception of the rule
 Sale by mercantile agent.(sec.27)
It as an agent having in the customary
course of business as such agent
authority either to sell goods for the
purpose of sale, or to buy goods, or to
raise money on the security of goods.

18. Exception of the rule(contd..)
 Sale by a joint-owner.(sec.28)
Several joint owners of goods has the
sole possession thereof, with the
consent of the others, any purchaser
from such person, for value without
notice at the time, of the seller’s want
of authority to sell, acquire a good title
thereof against the other joint owners.

19. Exception of the rule(contd..)
 Sale by a person in possession
under a voidable contract(sec.29)
A person who has obtained
possession of goods under a contract
which is voidable on the ground of
fraud, misrepresentation, coercion, or
undue influence, can convey a good
title, provided the sale takes place
before the voidable contract is

20. Exception of the rule(contd..)
 Sale by a seller in possession of
goods after sale.(sec.30)
A seller having sold goods, continues in
possession thereof or title to the goods,
the transfer by such person or by a
mercantile agent acting for such person,
of the same, by way of sale will pass a
good title to the transferee, if such latter
person has acted in good faith and
without notice of the previous sale.

21. Exception of the rule(contd..)
 Sale by buyer in possession of
goods.(sec.30(2))
A person having bought or agreed to buy
obtains, with the consent of the seller,
possession of the goods or of the
documents of title to the goods. The
delivery of such person, of the goods or
documents, pledge or other disposition
thereof will be valid and effective, if the
person receiving the same, acted
bonafide and without notice of the
seller’s lien, if any.

22. Exception of the rule(contd..)
 Sale by an unpaid seller.(sec.54(3))
An unpaid of goods who has
exercised his right of the lien or
stoppage in transit can, even though
the ownership in them has passed to
the buyer, resell the goods and convey
a valid to another buyer, though no
notice of re-seller has been given to
the original buyer.