Question 2 (b)

New fridge sold for cash and an old fridge: a contract of sale?

5 marks

Time to write
About 10 minutes

From an older CBCS paper

Question

Question 2 (b) · 5 marks

Mohan agrees to sell Gopal a new fridge for Rs. 30,000/-, payable partly in cash and partly by exchange of an old fridge. Is it a valid contract?

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

10 minfor 5 marks

Read from the question

  • Is it a…?A case problem: state the rule and its section, apply it to these facts, then answer in one line (yes or no, and why).

Write it in this order

  1. Read the facts; underline who did what, and the exact question 1 min
  2. 1 Price partly in money, partly in kind; barter distinguished 3 marks 5 min
  3. 2 Application and conclusion 2 marks 3 min
  4. Check: section named, answer stated in one line 1 min

Short on time? Trim steps 1 and 2 evenly rather than skip one: each is capped at its own marks.

Try it first. About 10 minutes for 5 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.

Provision.

  • Contract of sale: under section 4(1) of the Sale of Goods Act, 1930, a contract of sale of goods is one by which the seller transfers, or agrees to transfer, the property in goods to the buyer for a price.
  • Price: price means the money consideration for a sale of goods (s. 2(10)); without a price in money there is no contract of sale.
  • Mixed consideration: the price must be in money, not in kind, but nothing prevents the consideration from being partly in money and partly in kind.
  • Barter distinguished: where goods are exchanged only for goods, with no money price, the deal is a barter, not a sale; a transfer for a definite price payable partly in goods and partly in cash is held to be a sale.

Application. Mohan agrees to sell a new fridge to Gopal for Rs. 30,000/-, payable partly in cash and partly by exchange of an old fridge. The price is fixed in money (Rs. 30,000/-); only the way of paying part of it is by handing over the old fridge. The consideration is therefore partly money and partly goods, which does not turn the deal into a barter.

Conclusion. It is a valid contract of sale of goods.

Where the 5 marks sit

#ComponentMarks
1Price partly in money, partly in kind; barter distinguished3
2Application and conclusion2
Total5
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