Sale of Goods Act Section 38 — Instalment deliveries

CHAPTER IV PERFORMANCE OF THE CONTRACT

Commercial / Corporate

Summary

Sub-section (1) says that unless the buyer and seller have agreed otherwise, the buyer does not have to accept goods that are delivered in instalments. In other words, the buyer can insist on receiving the entire delivery at once unless the contract specifically allows for part deliveries.

Sub-section (2) deals with contracts where goods are meant to be delivered in fixed instalments, with each instalment paid for separately. If the seller fails to deliver one or more instalments, or delivers them defectively, or if the buyer refuses to take delivery or pay for one or more instalments, then whether that failure amounts to a complete cancellation of the whole contract depends on the specific terms of the contract and the surrounding circumstances. In each case, the question is whether the breach is serious enough to treat the entire contract as ended, or whether it is only a partial breach that allows the affected party to claim compensation but does not give them the right to cancel the whole contract.

Official Text

(1) Unless otherwise agreed, the buyer of goods is not bound to accept delivery thereof by instalments.

(2) Where there is a contract for the sale of goods to be delivered by stated instalments which are to be separately paid for, and the seller makes no delivery or defective delivery in respect of one or more instalments, or the buyer neglects or refuses to take delivery of or pay for one or more instalments, it is a question in each case depending on the terms of the contract and the circumstances of the case, whether the breach of contract is a repudiation of the whole contract, or whether it is a severable breach giving rise to a claim for compensation, but not to a right to treat the whole contract as repudiated.