#17368 - Monetary Remedies - Shipping and International Trade

MONETARY REMEDIES

S.G.A. ss. 37, 49–53

Seller’s Monetary Remedies

S37 – Buyer’s liability for not taking delivery of the goods

(1)When the seller is ready and willing to deliver the goods, and requests the buyer to take delivery, and the buyer does not within a reasonable time after such request take delivery of the goods, he is liable to the seller for any loss occasioned by his neglect or refusal to take delivery, and also for a reasonable charge for the care and custody of the goods.

(2)Nothing in this section affects the rights of the seller where the neglect or refusal of the buyer to take delivery amounts to a repudiation of the contract.

S49 – Action for Price

NOTE: S49(2) is the one exception to the rule that price isn’t payable until property passes -> although there may be others (see Res Cogitans) -> S49(2) is also unlikely to apply in a CIF context, where it’s usually payment against documents

(1)Where, under a contract of sale, the property in the goods has passed to the buyer and he wrongfully neglects or refuses to pay for the goods according to the terms of the contract, the seller may maintain an action against him for the price of the goods.

(2)Where, under a contract of sale, the price is payable on a day certain irrespective of delivery and the buyer wrongfully neglects or refuses to pay such price, the seller may maintain an action for the price, although the property in the goods has not passed and the goods have not been appropriated to the contract.

S50 – Damages for non-acceptance

(1)Where the buyer wrongfully neglects or refuses to accept and pay for the goods, the seller may maintain an action against him for damages for non-acceptance.

(2)The measure of damages is the estimated loss directly and naturally resulting, in the ordinary course of events, from the buyer’s breach of contract.

(3)Where there is an available market for the goods in question the measure of damages is prima facie to be ascertained by the difference between the contract price and the market or current price at the time or times when the goods ought to have been accepted or (if no time was fixed for acceptance) at the time of the refusal to accept.

Buyer’s Monetary Remedies

S51 – Damages for non-delivery

(parallels S50)

(1)Where the seller wrongfully neglects or refuses to deliver the goods to the buyer, the buyer may maintain an action against the seller for damages for non-delivery.

(2)The measure of damages is the estimated loss directly and naturally resulting, in the ordinary course of events, from the seller’s breach of contract.

(3)Where there is an available market for the goods in question the measure of damages is prima facie to be ascertained by the difference between the contract price and the market or current price of the goods at the time or times when they ought to have been delivered or (if no time was fixed) at the time of the refusal to deliver.

S52 – Specific performance

NOTE: only applies to specific or ascertained goods

(1)In any action for breach of contract to deliver specific or ascertained goods the court may, if it thinks fit, on the plaintiff’s application, by its judgment or decree direct that the contract shall be performed specifically, without giving the defendant the option of retaining the goods on payment of damages.

(2)The plaintiff’s application may be made at any time before judgment or decree.

(3)The judgment or decree may be unconditional, or on such terms and conditions as to damages, payment of the price and otherwise as seem just to the court.

S53 – Remedy for breach of warranty

(1)Where there is a breach of warranty by the seller, or where the buyer elects (or is compelled) to treat any breach of a condition on the part of the seller as a breach of warranty, the buyer is not by reason only of such breach of warranty entitled to reject the goods; but he may—

(a)set up against the seller the breach of warranty in diminution or extinction of the price, or

(b)maintain an action against the seller for damages for the breach of warranty.

(2)The measure of damages for breach of warranty is the estimated loss directly and naturally resulting, in the ordinary course of events, from the breach of warranty.

(3)In the case of breach of warranty of quality such loss is prima facie the difference between the value of the goods at the time of delivery to the buyer and the value they would have had if they had fulfilled the warranty.

(4)The fact that the buyer has set up the breach of warranty in diminution or extinction of the price does not prevent him from maintaining an action for the same breach of warranty if he has suffered further damage.

S49(1) Action for Price does not arise if property has not passed to buyer

Stein Forbes v. County Tailoring (1916) 115 L.T. 215

Facts (from Napier v Dexters)

• the facts were that a large quantity of sheepskins had been shipped and that the documents in the case which were formal documents, such as a bill of lading-here apparently there was no bill of lading at all but a mere mate's receipt-were in the hands of bankers, and in those circumstances, particularly as so far as I am aware the sheepskins were not perishable goods, I am not at all surprised that the Judge had no difficulty in coming to a decision that it was quite plain that the seller or his banker reserved the jus disponendi (right of disposal)

• Three lots of sheepskins, buyers refused to take delivery of third

Colley v. Overseas Exporters [1921] 3 K.B. 302

Facts

• Unascertained goods were sold f.o.b.

• The seller sent them to the port of shipment, but, owing to the failure of the buyer to name an effective ship, he was prevented from putting them on board

  • The defendants instructed the plaintiff to consign the goods to the Alexandra Dock Station at Liverpool, c/o Daniel Maccabe, Ld., shipping agents, for shipment on board steamship Kenuta .

  • The plaintiff duly dispatched the goods to the station named on February 3, 1921, but unfortunately the Kenuta was withdrawn from service by her owners, and four other vessels which were in turn substituted by the defendants for the Kenuta were all prevented from one cause or another from taking the plaintiff's belting on board, with the result that after the goods had been lying at the dock station for more than two months they were still not shipped

• Plaintiff sellers brought an action for the price

Held (McCardie J)

• 1) There can be no action for price until property has passed

  • “In my opinion (subject to what I say hereafter as to estoppel) no action will lie for the price of goods until the property has passed, save only in the special cases provided for by s. 49, subs. 2. This seems plain both on the code and on common law principle. I have searched in vain for authority to the contrary. A clear distinction exists between cases where the default of the buyer has occurred after the property has passed and cases where that default has been before the property has passed.”

  • Although NOTE: s49(2) was only in the old SGA, appears to not be in the SGA 1979

• 2) Seemed to reaffirm Benjamin’s: in such cases the seller can only rely on a special action for damages for non-acceptance

  • “And the learned editor adds: “Where the property has not passed, the seller's claim must, as a general rule, be special for damages for non-acceptance.””

• 3) Otherwise, every action for damages for repudiatory breach in sale of goods could be converted into an action for price

  • “Here the substantial allegation against the defendants is that their default prevented the plaintiff from passing the property and so entitling him to the price. Just the same default however would, in substance, have been committed if the defendants had repudiated the contract before the goods had been sent from Sheffield. So too every buyer who refuses to take delivery of unascertained goods and thereby prevents the transference of property in them from the seller commits a similar default. It the ingenious contention of Mr. Willes were correct it would be difficult to imagine a case of sale of goods, even though unascertained, to which Mackay v. Dick would not apply”

• 4) There is an exception for estoppel: if the Ds represent that property has passed to them, and the Cs rely on this to their detriment, the Ds are estopped from denying it

  • However, no evidence of this in the present case

  • “If therefore the defendants in this case represented to the plaintiffs facts showing that the property in the goods had passed to them, and if also the plaintiff had believed that representation and had acted upon it to his damage, then the defendants would, I conceive, be estopped from denying that the property had passed to them and that the price was therefore payable to the plaintiff: see Knights v. Wiffen .

  • I am satisfied that there is no estoppel on the facts and documents here before me.”

  • “The defendants made no misrepresentation of fact. The plaintiff has not acted on any statement or relied on any misleading conduct of the defendants”

Napier v. Dexters (1926) 26 Ll. L. Rep. 62, 184

Notes

• Case about “pushing property in”

• In this case, seller essentially wanted to argue that they hadn’t reserved any right of disposal, thereby pushing property into the buyers hands so they could bring an action for price!

  • But, as Burrows points out, it seems possible for the seller to push property away, it seems difficult to imagine the seller pushing property in, since a common intention is required for property to be transferred

• In this case, the sellers did not actually manage to...