Question 3 OR (b)

Delivery and its modes; mercantile agent selling below the reserve price

6 marks

Time to write
About 12 minutes

From an older CBCS paper

Question

Question 3 OR (b) · 6 marks

  1. Define the expression “Delivery of Goods”. State the different modes by which goods may be effectively delivered.

  2. X, the owner of a car, hands the car over to Y, a mercantile agent, and instructs him to sell it subject to a reserve price of ₹ 8 lac. Y sells the car to Z for ₹ 7 lac and misappropriates the money. Z buys the car in good faith. Will Z acquire a good title to the car ?

Reworded from the university paper; the task is the same. The original paper belongs to the University of Delhi. See DU's question bank.

Before you write

Read off the question and its marks

12 minfor 6 marks

Read from the question

  • Will Z acquire…?A case problem: state the rule and its section, apply it to these facts, then answer in one line (yes or no, and why).
  • (i)–(ii)2 items, each marked on its own: give each its share.

Write it in this order

The parts stand alone: start with the one you are surest of.

  1. Read the facts; underline who did what, and the exact question 1 min
  2. 1 (i) Delivery and its modes 3 marks 5 min
  3. 2 (ii) Sale by a mercantile agent 3 marks 5 min
  4. Check: section named, answer stated in one line 1 min

Short on time? A few lines on every part beat a full answer to one: each part is capped at its own marks.

Try it first. About 12 minutes for 6 marks. Write it out, then open the solution.

Solution

Hover or tap a marked figure, like 72,000, to see how it is made and where else it appears.

(i) Delivery of goods. Delivery means the voluntary transfer of possession of the goods from one person to another. It may be made in any of three ways:

  1. Actual delivery: the goods are physically delivered to the buyer;
  2. Constructive delivery: a person in possession of the goods acknowledges to the buyer that he holds them on the buyer's behalf; and
  3. Symbolic delivery: something is delivered in token of a transfer of the goods, such as the key of the godown in which they lie.

(ii) Z's title. Under the Sale of Goods Act, 1930, where a mercantile agent is, with the owner's consent, in possession of the goods or documents of title to them, a sale made by him in the ordinary course of business as a mercantile agent passes a good title to the buyer, provided the buyer acts in good faith and has no notice that the agent has no authority to sell (proviso to s. 27). Y was in possession of the car with X's consent and sold it as a mercantile agent; Z bought in good faith. Z gets a good title, even though Y disobeyed the reserve price of ₹ 8 lac and misappropriated the money; X's remedy is against Y.

Where the 6 marks sit

#ComponentMarks
1(i) Delivery and its modes3
2(ii) Sale by a mercantile agent3
Total6
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