PERFORMANCE OF CONTRACT

PERFORMANCE OF CONTRACT
~ Performance of contract and sale
means as regard the seller delivery of
the goods to the buyer and as regards
the buyer acceptance of the delivery
of the goods and payment for them,
in accordance with the terms of the
contract of sale. (Sec. 31)

PERFORMANCE OF CONTRACT
A

contract of sale always involves

reciprocal promises.

The

seller promising to deliver the goods

and the buyer promising to pay for them.

Both

the parties must live up to their end

of the bargain in the contract.

DELIVERY OF GOODS
DELIVERY

MEANS- Voluntary transfer of

possession of goods form one person to
another [Sec. 2(2)].
Types of delivery
1 Actual
2 Symbolic
3 Constructive

ACTUAL DELIVERY

Where

the goods are headed over by the

seller to the buyer or his duly authorized
agent, the delivery is said to be actual.

Delivery

of goods may also be made by

doing anything which has the effect of
putting the goods in the possession of
buyers.(Sec. 33)

SYMBOLIC DELIVERY

Where

the goods are bulky and incapable

of actual delivery.

Ex.-

haystack in a meadow

CONSTRUCTIVE DELIVERY

Where

a third person who is in possession

of the goods of the seller at the time of
sale acknowledges to the buyer that he
holds the goods on his behalf.

Ex.

A sales to B ten bags of wheat lying

in Cs godown. A gives an order to C
asking him to transfer the goods to B.

RUELS AS TO DELIVERY OF GOODS

1)

Mode of delivery (sec. 33)

Delivery should have the effect of putting the

goods in the possession of the buyer. Delivery
may be ACTUAL, SYMBOLIC OR
CONSTRUCTIVE.
2)

Delivery and Payment (sec. 32)

Delivery of goods and payment of price must

be according to the term of contract.
Delivery and payment are concurrent condition.

RUELS AS TO DELIVERY OF GOODS

3)

Effect of part delivery (sec. 34)

A delivery of part of the goods in progress of

the delivery of the whole has the same effect
for the purpose of passing the property in such
goods as a delivery of the whole.
Ex. - S sold certain goods to B. B received and
paid for a certain part of it.

4)

Buyer to apply for delivery (sec. 35)

Seller of goods is not bound to delivery the

goods until the buyer applies for delivery.

RULES AS TO DELIVERY OF GOODS

5)

Place of delivery (sec. 36 (1))

6)

Time of Delivery (sec. 36 (2))

The goods must be delivered at a place during

business hours on a working day as specified in the
contract.
If place is not specified the goods sold are to be
delivered at the place at which they are at the time
of sale.
The seller is bound to send the goods to the buyer
within a reasonable time if no time for sending is
fixed.
What is reasonable is a question of fact.

RUELS AS TO DELIVERY OF GOODS

7)

Goods in possession of third party

When at the time of sale the goods are with the

third party, there is no delivery by the seller to
the buyer until such third party acknowledges
to the buyer that he holds them on his behalf.
8) Cost of delivery
Unless otherwise agreed all expenses of and
incidental to making of delivery are borne by
the seller but all expenses of obtaining are
borne by the buyer.(Sec. 36(5))

RULES AS TO DELIVERY OF GOODS

9)

The delivery of quantity of goods

contracted for should be strictly according
to the terms of the contract. A defective
delivery entitles the buyer to reject the
goods.
1. delivery of goods less than contracted for .
[sec 37(1)]
2. delivery of goods in excess of quantity
contracted for.[sec 37(2)]

RULES AS TO DELIVERY OF GOODS

Eg:

A places order with B to supply 25

bottles of syrup.
Case 1. B sends 20 . A can return the whole or
he can accept it . in this case he have to pay as
per contract rate for the accepted goods.
Case 2. B sends 30. A can reject the whole or
he may accept the 25 and reject the rest. If he
accepts 30 he must pay for them at contract
rate.

RULES AS TO DELIVERY OF GOODS

The right to reject the goods is not
equivalent to the right to cancel the
contract. In case the buyer rejects the
seller may tender again the contract and
the buyer is bound to accept the same.

RULES AS TO DELIVERY OF GOODS

3. Delivery of goods contracted for mixed with
other goods.[sec 37(3)].
eg: A contracts with B to buy 100 tons of cane
sugar . A delivers B 75 tons of cane sugar and
25 tons of beet sugar.

RULES AS TO DELIVERY OF GOODS

Instalment

deliveries[sec38]:
Unless otherwise specified the
seller is not entitled to deliver the goods by
instalment and if he does so, the buyer is not
bound to accept the goods [sec38(1)].
There can be contract for sales of
goods in instalment. If seller fails to deliver
or makes defective delivery depending on the
terms of contract there can be a claim for
compensation [sec38(2)].

RULES AS TO DELIVERY OF GOODS

Delivery

to a carrier [sec 39]:

In observance of contract of sale,
goods are delivered to carrier for the
purpose of transmission to
buyer[sec39(1)].
The seller has to enter in to contract
with carrier on behalf of buyer for safe
transmission.[sec39(2)]

RULES AS TO DELIVERY OF GOODS

Unless

otherwise agreed, when goods are

sent by seller to buyer through route
involving sea transit, the seller must
inform the buyer in time to get the goods
insured otherwise the goods will be at the
sellers risk during sea transit[sec39(3)]

Acceptance of delivery
Receipt

of goods by the buyer does not

necessarily result in acceptance of goods
by him under, and in performance of the
contract of sale.Acceptance is something
more than mere receipt or taking
possession of goods by the buyer.It means
the final assent by the buyer that he has
received the goods under , and in
performance of the contract of sale.

 If

he wrongfully refuses to accept the goods

under the contract,he is liable for
damages.
The buyer is deemed to have accepted the
goods1.When he intimates to the seller that he
has accepted the goods.
2.When the goods have been delivered to
him and he does any act in relation to them
which is inconsistent with the ownership of the
seller as,for instance,where
he(a) re-sells the goods,or(b) uses the goods in

a manner proper only for the owner,or (c)

Makes some alteration in the goods(sec 42)
Eg:P sold Barley to B by sample. B resold
the Barley to X.When the Barley was
delivered to B,he inspected a sample of it
and sent on to X. X rejected it as not
being according to the sample. B also
claimed to be entitled to reject the
Barley.Held Bs act in inspecting the

Sample and then sending Barley to X was

An acceptance and he could not afterwards
Reject it.
3.When after the lapse of the reasonable
time, he retains goods without intimation
To the seller that he has rejected them.

Buyers Liability for rejecting,

neglecting or refusing delivery
Buyers

liability in case of rejection of

goods. Unless otherwise agreed, where
goods are delivered to the buyer and he
rejects them, he is not bound to return
them to the seller. It is sufficient if he
intimates to the seller that he has rejected
the goods. If the seller refuses to take
away the goods, the buyer becomes the
bailee of the goods and may charge for
keeping them.

Cont
Buyers

liability for neglecting or refusing

delivery of goods. 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 -

Cont
a)
b)

Any loss occasioned by his neglect or

refusal to take delivery, and
A reasonable charge for the care and
custody of the goods.
Where the neglect or refusal of the
buyer to take delivery amounts to
repudiation of the contract, the seller
may sue for price and for damages.