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Sale of Goods
Applicable Laws
Definition of ‘Goods’
The Contract of Sale
Agreement to Sell
Formation of the Contract
Terms of the Contract
Transfer of Property
Transfer of Title
Performance of the Contract
Remedies for Breach
Consumer Protection Legislation
Business Law All Rights Reserved
© Oxford Fajar Sdn. Bhd. (008974-T) 2010 Ch9: 3
APPLICABLE LAWS
classifications of goods:
1. Existing 4. Unascertained
2. Future 5. Ascertained
3. Specific
goods which form the subject of a contract of sale
may either be existing goods or future goods –
section 6 of SOGA 1957
existing goods – goods already owned or possessed
by the seller, and may be either specified or agreed
upon at the time a contract of sale is made
Business Law All Rights Reserved
© Oxford Fajar Sdn. Bhd. (008974-T) 2010 Ch9: 6
DEFINITION OF ‘GOODS’ (cont.)
Formation
a contract of sale is made by an offer to buy or sell
goods at a price and by the acceptance of such an
offer – section 5(1), SOGA 1957
the contract may provide for the immediate delivery
of the goods or the immediate payment of the price
or both
delivery or payment may even be by instalments –
section 5(1), SOGA 1957
price – the money consideration for the sale of
goods
Business Law All Rights Reserved
© Oxford Fajar Sdn. Bhd. (008974-T) 2010 Ch9: 10
FORMATION OF THE CONTRACT
(cont.)
Formalities
a contract of sale may be made in writing or by word
of mouth, or partly in writing and partly by word of
mouth, or may be implied from the conduct of the
parties – section 5(2), SOGA 1957
Price
may be fixed in the following manner:
1. It may be fixed by the contract
2. It may be left to be fixed in a manner agreed in
the contract
Business Law All Rights Reserved
© Oxford Fajar Sdn. Bhd. (008974-T) 2010 Ch9: 11
FORMATION OF THE CONTRACT
(cont.)
3. It may be determined by the course of dealing
between the parties
4. Where the price is not determined in any one of
the aforesaid ways, the buyer must pay a
reasonable price
what is a reasonable price is a question of fact
dependent on the circumstances of each particular
case – section 9, SOGA 1957
Capacity to Contract
the legal principles and the law on contract
governing capacity in ordinary contract law apply to
contracts of sale
Business Law All Rights Reserved
© Oxford Fajar Sdn. Bhd. (008974-T) 2010 Ch9: 12
TERMS OF THE CONTRACT
Stipulation as to Time
unless a different intention appears from the terms
of the contract, stipulations as to time of payment
are not deemed to be of the essence with respect to
the contract of sale – section 11, SOGA 1957
whether any other stipulation as to time (e.g. time for
delivery) is of the essence of the contract or not
depends on the terms of the contract – section 11,
SOGA 1957
1. Estoppel
where the owner by his conduct makes it appear to the
buyer that the person who sells the goods has his authority
to do so and the buyer relies on that conduct, the buyer
obtains a good title because the owner is precluded by his
conduct from denying the seller’s authority to sell – section
27, SOGA 1957
Case: Sykt Batu Sinar Sdn Bhd & Ors v UMBC
Finance Bhd [1990] 3 MLJ 468
5. Instalment Delivery
unless agreed by the parties, the buyer is not bound to
accept delivery by instalments
Acceptance
performance of the contract and transfer of
ownership
unless otherwise agreed, when the seller delivers
the goods to the buyer, the seller is bound when
requested by the buyer to allow the buyer a
reasonable opportunity of examining the goods in
order to ascertain whether they conform to the
contract
Lien
the unpaid seller of goods who still possesses them
is entitled to retain possession of them until payment
or tender of the price in any of the following events:
1. The goods have been sold without any stipulation
as to credit
2. The goods have been sold on credit, but the term
of credit has expired
3. The buyer becomes insolvent
Stoppage in Transit
when the buyer of goods becomes insolvent and the
unpaid seller has parted with the possession of the
goods, the seller has the right of stopping them in
transit so long as the goods are in the course of
transit. This means that the seller may resume
possession of the goods and retain them until
payment or tender of the price
Applicable Laws
Definition of ‘Goods’
The Contract of Sale
Agreement to Sell
Formation of the Contract
Terms of the Contract
Transfer of Property
Transfer of Title
Performance of the Contract
Remedies for Breach
Consumer Protection Legislation
Business Law All Rights Reserved
© Oxford Fajar Sdn. Bhd. (008974-T) 2010 Ch9: 85