Delivery To a Carrier

The term ‘carrier’ means an agency to whom the goods are delivered for the purpose of transmission to the buyer. The carrier may be railways, shipping company, road transport agency or airways. Delivery of goods to a carrier, whether named by the buyer or not, operates prime facie as a delivery of goods to the buyer. You have learnt in Section 23(2) that in case of sale of unascertained goods, when the goods are delivered to the carrier, it amounts to appropriation of goods. When goods are unconditionally delivered to the carrier, it amounts to the delivery to the buyer.

Section 39(1) of the Sale of Goods Act provides that where, in pursuance of a contract of sale, the seller is authorised or required to send the goods to the buyer, delivery of goods to a carrier for the purpose of transmission to the buyer or to a wharfinger for safe custody, is prima facie, deemed to be a delivery of the goods to the buyer. If we read this Section along with Section 25(i), we can state that where the seller without reserving the right of disposal, delivers the goods to the carrier, the property in goods passes to the buyer. Here the carrier is treated as the agent of the buyer. For example, A of Delhi sells certain goods to B of Kolkata. A sends the goods by railway and the railway receipt is taken in the name of B. Here the property in goods passes when the goods were delivered to the railway.

But it must be noted that where it is agreed, that the goods are to be delivered at a particular place, for example, at the buyer’s godown, then the delivery of goods to a carrier does not amount to a delivery of the goods to the buyer.

It should further be noted that merely by delivering the goods to the carrier, the seller’s duty is not over. Section 30(2) provides that unless otherwise authorised by the buyer, the seller must make a reasonable contract with the carrier or wharfinger, for the safe carriage of goods. It should be noted that this contract, shall be made on behalf of the buyer. If the seller fails to take such precautions (as are necessary and reasonable) and the goods are lost or damaged in course of transit in whilst in the custody of the wharfinger, the buyer may decline to treat the delivery to the carrier or wharfinger as a delivery to himself, or may hold the seller responsible for damages.

Sometimes, the goods are sent by sea transit wherein it is quite usual to insure the goods. In such cases the seller should give to the buyer such notice as shall enable him to insure the goods. If the seller fails to give such notice and the goods are not insured, the goods will be deemed to be at the risk of the seller. The duty of giving notice to the buyer arises only where the goods are to be insured by the buyer. In CIF (cost, insurance and freight) contracts, the sale price includes insurance, here the seller is required to insure the goods. But in FOB (free on board) contracts when goods are delivered on board the ship, the liability of the seller comes to an end. In such cases, the buyer must be given a notice so that he can get the goods insured.

Mayank Rai

Hi, My name is Mayank Rai. I found that Blogging is an easiest way to share your knowledge with everyone & learn something new from there.

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