Skip to content

CA Foundation · Business Laws · The Sale of Goods Act, 1930

Ritu sells her own old scooter to Sameer, openly saying it is sold 'as is'. Later it emerges that the scooter had been stolen by a previous owner and the true owner reclaims it from Sameer. Which statement is correct?

Sameer can repudiate the contract and recover the price. Every sale carries an implied condition that the seller has the right to sell the goods. Ritu had no title to the stolen scooter, and selling it as is or being second-hand does not remove this condition.

  1. ARitu is not liable because the scooter was sold as is
  2. BSameer can only claim damages for breach of warranty
  3. CSameer can treat the contract as repudiated and recover the price paid, because there is an implied condition that the seller has the right to sellCorrect
  4. DSameer has no remedy as caveat emptor applies to second-hand goods

Explanation

In a contract of sale there is an implied condition that the seller has a right to sell the goods. Ritu had no title, so this condition is breached. Selling 'as is' does not remove it, and caveat emptor does not cover defects in title. Sameer may repudiate and recover the price.

Did you get it right without looking?

One question tells you little. A timed set on The Sale of Goods Act, 1930 shows your real accuracy, how long you take and where you lose marks.

Practise The Sale of Goods Act, 1930Free diagnostic mock

More The Sale of Goods Act, 1930 questions