Key Point
- Under rule 2 of section 18 SGA 1979, deliverable state does not refer to completeness of the good but whether there is nothing more to be done to enable thing to be delivered
Facts
- D agreed to buy from C a horizontal condensing engine, which at the time was bolted to the floor.
- Engine had to be broken into parts to be transported by rail.
- It was damaged by C when it was lifted from its fixings and put on to a truck.
- D refused to pay for the engine and C sued.
Issue
- The issue was whether the title to the engine had passed to D, such that the contract was completed and D was liable for the purchase price.
- This in turn depended on whether the engine was in a deliverable state under Rule 1 of section 18 SGA 1863 (now SGA 1979), or whether C was bound to do something which it had not done to the goods under rule 2 of section 18 SGA 1863.
Held (Court of Appeal)
- C’s claim was rejected, title to the engine had not passed.
- Bankes, Scrutton and Atkin L.JJ: C was bound to do something, which they had not done, for the purpose of putting the engine into a deliverable state
- Bankes and Atkin L.JJ.: on the further ground that the circumstances showed an intention that the property should not pass until the engine was placed in safety on rail in London.
Bankes LJ
- Considering the risk and expense involved in dismantling and moving the engine, the proper inference to be drawn is that property was not to pass until the engine was safely placed on rail in London.
- C contended that property is in a deliverable state where it is complete in itself and nothing more needs to be done to make it an engine or cart and rule 1 applies
- In any event, the engine is not in a “deliverable state”: does not depend upon mere completeness of the subject matter in all its parts, but on the actual state of the goods at the date of the contract and the state in which they are to be delivered by the terms of the contract.
- Where the vendors have to expend as much trouble and as much money as the appellants had to expend before this engine could be placed on rail, I cannot think that the subject matter can be said to be in a deliverable state
Scutton LJ
- I find it impossible to apply SGA s 62 defining “deliverable state” to mean “a state in which the buyer is bound to take delivery” of the goods to this case: work needs to be done by the seller in the present case to dismantle of the engine to put it in a deliverable state.
Atkin LJ
- Property was not to pass until the engine was on rail in the circumstances of this case.
- In any event, Rule 1 does not apply since it is not in a deliverable state being attached to the ground; Rule 2 does apply as the vendors were bound to do something to the engine for the purpose of putting it into a deliverable state
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