Sale of Goods Act Section 23 — Sale of unascertained goods and appropriation

CHAPTER III EFFECTS OF THE CONTRACT — Transfer of property as between seller and buyer

Commercial / Corporate

Summary

Sub-section (1) covers contracts for the sale of unascertained or future goods that are described in the contract. If goods matching that description and in a deliverable state are unconditionally set aside for the contract, either by the seller with the buyer's agreement or by the buyer with the seller's agreement, ownership of the goods passes to the buyer at that moment. The agreement can be express or implied, and it can be given before or after the goods are set aside.

Sub-section (2) deals with delivery for transmission. If the seller delivers the goods to the buyer, or to a carrier or other bailee for sending to the buyer, and does not keep the right to control the goods, the seller is treated as having unconditionally set aside the goods for the contract. This applies even if the carrier or bailee was not named by the buyer.

Official Text

(1) Where there is a contract for the sale of unascertained or future goods by description 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 thereupon passes to the buyer. Such assent may be express or implied, and may by given either before or after the appropriation is made Delivery to carrier.—

(2) Where, in pursuance of the contract, the seller delivers the goods to the buyer or to a carrier or other bailee (whether named by the buyer or not) for the purpose of transmission to the buyer, and does not reserve the right of disposal, he is deemed to have unconditionally appropriated the goods to the contract.