PERISHED GOODS AND THE SALE OF GOODS ACT 1979, s. 6
v. Grovedale Coolstores (1994) Ltd
The Sale of Goods Act 1979, s. 6, provides for the situation where, without the knowledge of the seller, the specific goods which he has agreed to sell have “perished” at the date of contract. Although the term “perished” now sounds somewhat archaic, it nevertheless conveys accurately the essential requirement that the goods must have been in existence rather than never having existed at all and that, at least, they have been “destroyed”. Section 6 provides succinctly for an automatic outcome in such an event:
Where there is a contract for the sale of specific goods, and the goods without the knowledge of the seller have perished at the time when the contract is made, the contract is void.
The section has always courted controversy as to whether it is based upon a concept of impossibility of performance because of a lack of subject-matter, the rules of common mistake or the idea that the existence of the goods is an implied condition precedent to the operation of the contract, a failure of the condition thus rendering the contract void. In any event, a ruling that the contract is void may often be just where the goods have ceased to exist
at the date of agreement, thus freeing the seller from his obligation to deliver the goods and the buyer from his duty to pay the price. Although there may still be misgivings regarding the conceptual foundations of the section, it is suggested that Chalmers, the draftsman of the Sale of Goods Act 1893, originally envisaged that perished goods would comprise primarily those which had ceased to exist at the date of contract, meaning that delivery was impossible, or goods which were so ravaged that their essential nature had changed, meaning that delivery was futile.
The Sale of Goods Act 1979, s. 7, the counterpart of s. 6, provides for the situation where goods perish after contract but before risk or property in the goods has passed to the buyer and it thus encapsulates a rudimentary notion of frustration. Section 7 is also concise in prescribing the consequences where goods have perished after contract:
Where there is an agreement to sell specific goods and subsequently the goods, without any fault on the part of the seller or buyer, perish before the risk passes to the buyer, the agreement is avoided.
At the date of the Sale of Goods Act 1893, the decisions in Couturier
clearly loomed large as exemplars for ss 6 and 7 respectively. It will
1. (1856) 5 H.L. Cas 673.
2. (1876) 1 Q.B.D. 258.
CASE AND COMMENT
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