Indian Law and the Passing of Property in the Goods - Term Paper Example

Download file to see previous pages Given the differences in legal systems of various countries, it becomes tedious for businessmen to negotiate international sales contracts and settle any disputes that may arise from such sales contracts because dilemmas arise as to which country’s law should be applied. This is a major drawback to international trade because sellers and buyers hail from different countries and trade is characterized by low levels of trust among parties. Therefore, the rate at which international sales contracts are formed is lowered.

Passing property in the goods from the seller to the buyer in international trade is extremely crucial because it plays a significant role in determining the outcome in terms of risk, ability to pass a good title, security of payment, and the right to sue. It enables sellers and buyers to understand the different terms of sale (Hinkelman, 2008, p, 297). In addition, international sales are normally associated with problems related to the passing of property, especially in determining whether the goods can be treated as security for payment of the goods’ price (Kaul, 2005). Therefore, it is important to know how and when property in the goods passes to the buyer.

This essay discusses the relevant international conventions affecting the passing of property in international trade to determine whether there can be an optimal model regulating the passing of property in international trade. Concerning relevant international conventions, the essay discusses the law on the passage of property of the goods from the seller to the buyer in international sales contracts, as applied in Germany, Australia Denmark, India, and Hong Kong. The essay discusses the application of the English law of passing of property, which is an ideal case showing that it is possible to have an optimal model regulating the passing of property in international trade and provides recommendations for the unification of law on the passage of property in international trade.

Indian Law and the Passing of Property in the Goods
In India, property in the goods does not pass to the buyer until the goods have been delivered. This is contrary to the case in England where the recent introduction of section 20-A provides conditions for the passing of property in the goods in sale contracts. The English Sales of Goods Act 1979, 20-A provides that upon payment of the price, the property in unascertained goods may pass (Debattista, 1995). This means that the buyer gets an undivided share to become an owner-in-common of such goods (Baskind, 2013, p, 40; Rose, 2013, p, 87; Todd, 2013, p, 311; Kidner & Carr, 2003, p, 147).

It has to be noted that in such a case, the interest of the buyer is proportional, relative to the interests of other owners-in-common. The Sales of Goods Act also provides that property in good is to pass when the seller and the buyer intend it to pass (Campell, 2009, p, 2290; Pathak, 2007, p, 547; Mann & Roberts, 2013, p, 357). It is, therefore, the discretion of the seller and the buyer to decide when the property in the goods is to pass, subject to the goods being ascertained (Kaul, 2005). ...Download file to see next pages Read More