Lloyd's Maritime and Commercial Law Quarterly
THE PROPRIETARY CONSEQUENCES OF AN EXCESS DELIVERY
S agrees to sell a quantity of goods to B. S delivers an excess quantity to B. When does property pass in all or part of the goods?
Deliveries of too much or too little are not uncommon. Such mistakes were once costly because, where the contract was an entire one, the buyer had an automatic right to reject.1 The buyer could use the fact of an over or under delivery as an excuse to escape from a bad bargain. Where an excess was delivered, the buyer’s right to reject was justified on the basis that the seller was attempting to impose an obligation on the buyer to select the contract amount from a larger quantity and thereby “seeks to impose a burden on the buyer which he is not entitled to impose”.2 The courts’ attention was therefore directed towards assessing the personal obligations of the parties and, in particular, whether the seller had done what he had promised.3 Consequently, the courts would consider whether the discrepancy was de minimis, and could therefore be ignored.4 The seller might also plead that custom or the contract itself provided for a degree of latitude in performance.5 The buyer’s right to reject has now been restricted by changes to the Sale of Goods Act. It is provided that a commercial buyer should not reject the contract goods where the excess or shortfall is so slight that it would be unreasonable to reject.6 The uncertainty created by this reform is unsatisfactory; in practice, however, it may well encourage traders down the road of negotiation and deal making.
But what are the proprietary consequences where a seller delivers 600 tons of wheat rather than 500 tons as promised? A determination of this question will be necessary where either party to the transaction becomes insolvent. In turning to consider the provisions of the Sale of Goods Act 1979, it is vital to appreciate the distinction between contract and conveyance.7 Section 30(2)(3) explicitly deals with the consequences of an excess delivery but only in the context of the parties’ contractual rights and duties: the buyer can elect to reject8 or to take just the quantity ordered or to take the whole delivery, paying for the excess at the contract rate.
1. Sale of Goods Act 1979 (hereafter “SGA 1979”), s. 30(1)(2).
2. Shipton, Anderson & Co. v. Weil Bros & Co. [1912] 1 K.B. 574, 577, per Lush, J. See further Hart v. Mills (1846) 15 M. & W. 85, 87, per Alderson, B.; Levy v. Green (1859) 1 El. & El. 969, 975, per Bramwell, B.; Rylands v. Kreitman (1865) 19 C.B. (N.S.) 351, 358, per Erle, C.J.
3. Tamvaco v. Lucas (1859) 1 E. & E. 581.
4. As in Shipton, Anderson & Co. v. Weil Bros & Co. [1912] 1 K.B. 574, where Lush, J., noted, at 578, that the seller did not expect payment for the excess delivery of 551b. In Wilensko Slaski Towarzystwo Drewno v. Fenwick & Co. (West Hartlepool) Ltd [1938] 3 All E.R. 429, it was suggested by Lewis, J., at 433, that this fact influenced Lush, J., in concluding that the variation was de minimis.
5. Payne and Routh v. Lillico & Sons (1920) 36 T.L.R. 569; Rapalli v. K. L. Take Ltd
[1958] 2 Lloyd’s Rep. 469; Harland and Wolff Ltd v. J. Burstall & Co. (1901) 84 L.T. 324.
6. SGA 1979, s. 30(2A), as amended by the Sale and Supply of Goods Act 1994. The burden of proof is placed upon the seller, ibid., s. 30(2B).
7. On the distinction between contract and conveyance in Roman law, see B. Nicholas, Roman Law (Oxford, 1975), 103 et seq., 178 et seq. This underlines the division between rights in personam (concerned with relations between persons) and rights in rem (asserting a relationship between a person and a thing): see Nicholas, ibid., 100.
8. Subject to SGA 1979, s. 30(2A), discussed above.
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