Contract for the sale of goods
Defined by s.2(1) SGA as: ‘a contract by which the seller transfers or agrees to transfer the
property in goods to the buyer for a money consideration, called the price’.
- Contract: same meaning as in contract: offer, acceptance, consideration and an
intention to create a legal relationship.
- Property: means ownership.
- Goods: defined in in s.61(1) as including ‘all personal chattels other than things in action
and money’
- A personal chattel is something physical.
- Land and houses are real property not chattels.
- Industrial growing crops and things attached to or forming part of the land which are
agreed to be severed before sale or under the contract of sale are deemed to be goods.
- A thing is action is an intangible right enforceable by legal action. Has no intrinsic value.
Its value derives from the right to sue in respect of it. E.g. cheques, shares and
copyrights.
Southwark Council v IBM UK Ltd 2011: the case considered whether the sale of software is a
contract of sale of goods. Contract stipulated that title, copyright and all other proprietary
rights in the software remained vested in the manufacturer. The purchaser merely had a license
to use it. Held: no transfer of property in goods.
Akenhead J stated (obiter) that software could be goods for the purposes of the SGA.
St Albans City and District Council v International Computers Ltd: Sir Ian Glidewell said that it
is necessary to distinguish between the program and the disk carrying the program. However, it
seems from the decision in Southwark that is is important to examine the contractual terms
pursuant to which the customer acquires the software.
Sales and agreement to sell
- Where under a contract of sale the property in the goods is transferred from the seller
to the buyer, the contract is called in the act a ‘sale’ s2(4).
- Where the transfer of the property is to take place at a future time or subject to some
condition to be fulfilled later, it is called an ‘agreement to sell’ s.2(5). An agreement to
sell becomes a sale when the time elapses or the condition is fulfilled s.2(6).
Defined by s.2(1) SGA as: ‘a contract by which the seller transfers or agrees to transfer the
property in goods to the buyer for a money consideration, called the price’.
- Contract: same meaning as in contract: offer, acceptance, consideration and an
intention to create a legal relationship.
- Property: means ownership.
- Goods: defined in in s.61(1) as including ‘all personal chattels other than things in action
and money’
- A personal chattel is something physical.
- Land and houses are real property not chattels.
- Industrial growing crops and things attached to or forming part of the land which are
agreed to be severed before sale or under the contract of sale are deemed to be goods.
- A thing is action is an intangible right enforceable by legal action. Has no intrinsic value.
Its value derives from the right to sue in respect of it. E.g. cheques, shares and
copyrights.
Southwark Council v IBM UK Ltd 2011: the case considered whether the sale of software is a
contract of sale of goods. Contract stipulated that title, copyright and all other proprietary
rights in the software remained vested in the manufacturer. The purchaser merely had a license
to use it. Held: no transfer of property in goods.
Akenhead J stated (obiter) that software could be goods for the purposes of the SGA.
St Albans City and District Council v International Computers Ltd: Sir Ian Glidewell said that it
is necessary to distinguish between the program and the disk carrying the program. However, it
seems from the decision in Southwark that is is important to examine the contractual terms
pursuant to which the customer acquires the software.
Sales and agreement to sell
- Where under a contract of sale the property in the goods is transferred from the seller
to the buyer, the contract is called in the act a ‘sale’ s2(4).
- Where the transfer of the property is to take place at a future time or subject to some
condition to be fulfilled later, it is called an ‘agreement to sell’ s.2(5). An agreement to
sell becomes a sale when the time elapses or the condition is fulfilled s.2(6).
