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- Facts
- D sells P 120,000 gallons
- Part of 200,000 gallons in a
store belonging to 3rd party
- P obtained delivery order,
3rd party accepted
- P decides to leave spirit in
tank for some time. Spirit went bad
- Property in goods had not
yet passed (goods had not been ascertained)
- Holding
- CA says risk had passed to
buyer
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- Shows that
the BoL only becomes a K once it has been put into the hands of a
consignee or endorsee WHO DID NOT NEGOTIATE THE CARRIAGE K AS SHIPPER.
- P exporter wished to ship
consignment of oranges from Spain to London. Wanted them there before 12/1
to avoid taxes.
- Carriage K contained express
clause vessel would sail direct to London.
- However, oranges shipped on
vessel containing cargo bound for Antwerp.
- BoL for oranges contained a
"liberty to deviate" clause
- Vessel did not arrive until
12/4, cost in taxes and market drop in oranges
- P succeeded in action against
carrier for damages for breach of carriage K
- Would have been very
different had P sold goods to a buyer while goods were in transit and
transferred BoL to new consignee. BoL would have contained "liberty
to deviate" clause
- Undertaking
to ship directly to London held to override a clause in BOL permitting
deviation
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- Delay in notice of readiness
of vessel
- In commercial Ks, time
stipulations will usually be treated as conditions
- Even small delay will give
innocent party right to terminate
- Strict construction is done
in the interest of certainty for commercial men
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Right to partial rejection
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- Difficult
distinction between words which "describe goods" (§13) and words
which merely relate to quality or condition of goods (no §13; The Bow
Ceder [1980] 2 Lloyd's Rep 601)
- Ashington Piggeries v.
Christopher Hill
- Common sense test
- Would men in the market say
this is what buyer bargained for?
- Sellers should have foreseen
poisonous milk may have been fed to mink
- Common §13 descriptions
- Places of shipment and
discharge
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- merchantable quality became
satisfactory quality
- §14 (2A)
- For quality, court
considers what is reasonable in circumstances of particular case
- Aswan v. Lupdine: plastic nails stacked by buyer in 60
C. Not suitable for this. Buyer
can't say goods were not of merchantable quality if seller did not know
he would use them for improper purpose.
- Price is relevant criterion
for determining whether goods are of satisfactory quality
- §14 (2B) (e)
- Durability is part of
satisfactory quality
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- Goods must match any sample
by which they were/are sold
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- If breach of 13,14,15 so
slight it would be unreasonable to reject, then not breach of condition
but rather breach of warranty
- Courts effectively take Hong
Kong Fir innominate term approach
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- shows difference between an arbiter view
and judge view
- Tins packed 30 to a case v.
packed 24
- Arbiter says no diff in
value
- CA says buyers entitled to
reject entire consignment under Sec 13
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- Shipping cargo of rape seed
to Dunkirk
- "liberty clause" in
original carriage K allowing shipowner to "call at any ports in any
order"
- Sailed to Glasgow first, lost
in bad weather
- Endorsee bound by written
terms of the K. Not allowed to
bring in parole evidence of a verbal agreement between shipper and
carrier.
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- When you find out goods were
non-conforming at time of shipment (even though already paid against
conforming docs) can either reject goods (but then risk having no goods or
money) or accept goods and sue for breach of warranty damages
- D's supplier fraudulently
altered BOL for date goods were shipped
- Month of shipment is part of
description of goods
- Buyer accepted goods but was
not able to resell them due to market drop
- Both goods (month
description) and docs (fraud) are nonconforming
- Devlin:
- Ds not responsible for fraud
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- Carrier not permitted to go
to anticipated port of discharge
- Seller v. buyer over who has
to pay to get goods from new port to intended port
- HOL says this is not a cif K,
its an arrival k, thus seller has obligation to ensure goods arrive at
discharge point
- Lord Porter said main issue
was whether buyers meant to pay for docs representing the goods or
delivery of goods themselves
- Agreement referred to
seller's duty to account for landed weight on ship's arrival at Antwerp.
Thus this was an arrival k
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When
bill of lading is sold to subsequent consignee, we say there is an implied
mutual exchange of promises between the consignee and the carrier
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