In relation to GOODS, because of the Sale of Goods Act 1979, there will be an identifiable instant at which the ownership or right of property in the goods passes from seller to buyer. The importance of ascertaining the precise time lies not only in questions of risk but also in cases of insolvency where the destination of the goods to a trustee in bankruptcy, receiver or liquidator can leave the other party to the transaction only with the right to rank for a dividend as a general creditor. The Act provides that property passes when it is intended to pass, i.e. the traditio, or physical transfer, required by the CIVIL LAW is not required. Property does not pass in UNASCERTAINED GOODS. If the parties' intention cannot be determined, certain rules are laid down to resolve the matter.

Rule 1: where there is an unconditional contract for the sale of SPE- CIFIC GOODS in a DELIVERABLE STATE, the property in the goods passes

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to the buyer when the contract is made; it is immaterial whether the time of payment or the time of delivery, or both, be postponed. Thus, in the case of a sale in a shop to a customer of an item identified in the shop, property will pass when the contract is formed.

Rule 2: where there is a contract for the sale of specific goods and the seller is bound to do something to the goods for the purpose of putting them into a deliverable state, the property does not pass until the thing is done and the buyer has notice that it has been done. The requirement for notice is important if the rules relating to risk are considered. As risk normally passes with property, this notice would have the effect of transferring property to the buyer, who then should consider insuring the goods, even although they are outwith his possession.

Rule 3: where there is a contract for specific goods in a deliverable state but the seller is bound to weigh, measure, test or do some other act or thing with reference to the goods for the purpose of ascertain- ing the price, the property does not pass until this has been done and the buyer has notice that it has been done.

It is important to distinguish Rule 3 from Rule 2. Rule 2 refers to goods that are not in a deliverable state whereas Rule 3 refers to goods that are in a deliverable state.

Rule 4: when goods are delivered to the buyer on approval, or on sale or return, or other similar terms, the property in the goods passes to the buyer:

(a) when he signifies his approval or acceptance to the seller or does any other act adopting the transaction;

(b) if he does not signify his approval or acceptance to the seller but retains the goods without giving notice of rejection, then, if a time has been fixed for the return of the goods, on the expiration of that time, and, if no time has been fixed, on the expiration of a reasonable time.

Rule 5: this rule does not apply to specific goods but to goods that at the time the contract was made were unascertained. Where there is a contract for the sale of UNASCERTAINED or FUTURE GOODS by descrip- tion and goods of that description and in a deliverable state are unconditionally appropriated to the contract, either by the seller with the assent of the buyer or by the buyer with the assent of the seller, the property in the goods then passes to the buyer; the assent

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may be express or implied, and may be given either before or after the appropriation is made. Where, in pursuance of a contract, the seller delivers the goods to the buyer or to a carrier or other bailee or custodier (whether named by the buyer or not) for the purpose of transmission to the buyer and does not reserve the right of disposal, he will be taken to have unconditionally appropriated the goods to the contract. This complicated rule is illustrated by Pignataro v. Gilroy [1919] 1 KB 459, in which there was a contract for the sale of 140 bags of rice. A delivery order was given for 125 bags to allow the buyer to collect goods from a wharf. The seller said that the other 15 could be collected at the seller's own warehouse in Long Acre. When the buyer went to collect the 15 bags, it was found that they had been stolen. The court held that the seller had appropriated the goods to the contract with the implied assent of the buyer, so property had passed to the buyer and was at the buyer's risk.

• special destination
• special relationship
• specificatio
• specific goods
• specific implement
• specific issue order
• specific performance
• speculative fee
• Speluncean explorers' case
• spent
• spes successionis
• sponsiones ludicrae
• sports law
• spousal support
• spouse
• spuilzie
• STABEX
• Staff of Government Division
• stale
• stamp duty
• standard form contract
• standard of proof
• standard security
• Star Chamber
• stare decisis