Performance of the Contract

Delivery of Goods:

Definition>

Section 2 (2) defines delivery as voluntary transfer of possession of goods from one person to another. Section 33 further states that delivery may be made by doing anything which has the effect of putting the goods in possession of the buyer or of a person authorized to hold them on his behalf. Delivery of goods may be actual or symbolic.

1) Actual delivery: Handing over of the goods by the seller to the buyer is called actual delivery
2) Symbolic or constructive delivery: Putting the buyer in possession of goods by doing such act which amounts to handing over the goods. Handing over of documents related to the goods like bill of lading, railway receipt etc constitutes symbolic or constructive delivery.

Rules:

1) Delivery and payment: It is the duty of the seller to deliver the goods and of buyer to accept and pay for them in accordance with the terms of the contract of sale. Delivery of the goods by the seller and payment of the price by the buyer are concurrent conditions.

The seller shall be ready and willing to give possession of the goods to the buyer in exchange for the price and the buyer shall be ready and willing to pay the price in exchange for possession of the goods (Sec 32). However, seller and buyer may agree otherwise.

It should be noted that the seller need not be the owner of the goods. To constitute delivery to the buyer, he himself may not be in actual possession of the goods.

2) Delivery to be made to buyer: Delivery of goods sold may be made by doing anything which the parties agree shall be treated as delivery or which has the effect of putting the goods in the possession of the buyer, or of any person authorized to hold them on his behalf (Sec 31)

Illustrations:

1) B in England orders 100 bales of cotton from A, in Bombay, and sends his own ship to Bombay for the cotton. The putting of cotton onboard the ship is delivery to B.
2) A sells to B certain specific goods which are locked up in a godown. A gives B the key of the godown in order that he may get the goods. This is delivery to B.

3) Part delivery: Delivery of part of the goods, in progress of delivery of the whole amounts to delivery of the whole, if there is no intention of severing of such part from the whole (Sec 34).

Illustrations:

1) A orders a cargo to be shipped to himself. On arrival of the cargo, captain delivers part of the cargo to A in progress of delivery of the whole. This is delivery of the whole of the cargo.
2) A ordered the wharfinger to deliver the goods to the buyer. The buyer weighted and took part of the goods. This constituted delivery of the whole.

4) Buyer to apply for delivery: Seller of goods is not bound to deliver the goods until the buyer applies for delivery thereof (Sec

5) Mode of delivery: Mode of delivery depends on the contract between the parties. Whether it is for the buyer to take possession of the goods or for the seller to send them to the buyer is a question depending in each case on the contract, express or implied, between the parties [Sec 36 (1)]

6) Place of delivery: Apart from such a contract:
i) goods sold are to be delivered at the place at which they are at the time of sale.
ii) goods agreed to be sold are to be delivered at the place at which they are at the time of the agreement to sell.
iii) goods not then in existence are to be delivered at the place at which they are manufactured or produced [Sec 36 (1)]

7) Time of delivery: where no time for sending the goods is fixed the seller is bound to send them within a reasonable time [sec 35 (2)]. It implies that where time is fixed, the seller must send the goods in time. If the delivery is to be done as and when required, demand for delivery must be made within a reasonable time.

8) Demand at reasonable hour: Demand for or tender of delivery must be made at a reasonable hour. What is a reasonable hour is a question of fact [sec36 (4)]

9) Goods in possession of third person: Where the goods at the time of sale are in possession of a third person, delivery to the buyer is only effected when such third person acknowledges to the buyer that he holds the goods on his behalf [Sec 36 (3)]

10) Expenses: Expenses of and incidental to delivery are as a general rule to be borne by the seller. The parties may however agree otherwise [Sec 36 (5)]

11) Installment delivery: Buyer of goods is not bound to accept delivery thereof by installments unless otherwise agreed [sec 38(1)]. An agreement for delivery by installments is made either:

1) expressly or 2) inferred from circumstances or nature of the contract or 3) from the conduct of the parties.

12) Goods delivered a distant place: (Sec 40) Where the seller of goods agrees to deliver the goods at his own risk at a place other than that where they are when sold, the buyer shall nevertheless unless otherwise agreed, take any risk of deterioration in the goods necessarily incidental to the course of transit. The necessary deterioration of merchantable quality of goods is on the buyer, even if the seller agrees to deliver the goods at his own risk.

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