SALE OF GOODS ACT 1957

Sale of Goods LAWS OF MALAYSIA REPRINT Act 382 SALE OF GOODS ACT 1957 Incorporating all amendments up to 1 January 2006 PUBLISHED BY THE COMMISSIONER OF LAW REVISION, MALAYSIA UNDER THE AUTHORITY OF THE REVISION OF LAWS ACT 1968 IN COLLABORATION WITH PERCETAKAN NASIONAL MALAYSIA BHD 2006 1 2 SALE OF GOODS ACT 1957 First enacted … ... ... ... ... … 1957 (F.M. Ord. No. 1 of 1957) Revised 1989 (Act 382 w.e.f. 21 September 1989) … … … … … ... … PREVIOUS REPRINT First Reprint ... ... ... ... ... 2001 3 LAWS OF MALAYSIA Act 382 SALE OF GOODS ACT 1957 ARRANGEMENT OF SECTIONS CHAPTER I PRELIMINARY Section 1. Short title and application 2. Interpretation 3. Application of Contracts Act 1950 CHAPTER II FORMATION OF THE CONTRACT Contract of sale 4. Sale and agreement to sell Formalities of the contract 5. Contract of how sale made Subject Matter of Contract 6. Existing or future goods 7. Goods perishing before making of contract 8. Goods perishing before sale but after agreement to sell The price 9. Ascertainment of price 10. Agreement to sell at valuation Laws of Malaysia 4 ACT 382 Conditions and warranties Section 11. Stipulations as to time 12. Condition and warranty 13. When condition to be treated as warranty 14. Implied undertaking as to tittle, etc. 15. Sale by description 16. Implied condition as to quality or fitness 17. Sale by sample CHAPTER III EFFECTS OF THE CONTRACT Transfer of property as between seller and buyer 18. Goods must be ascertained 19. Property passes when intended to pass 20. Specific goods in a deliverable state 21. Specific goods to be put into a deliverable state 22. Specific goods in a deliverable state when the seller has to do anything thereto in order to ascertain price 23. Sale of unascertained goods and appropriation 24. Goods sent on approval or “on sale or return” 25. Reservation of right of disposal 26. Risk prima facie passes with property 27. Sale by person not the owner 28. Sale by one of joint owners 29. Sale by person in possession under voidable contract 30. Seller or buyer in possession after sale CHAPTER IV PERFORMANCE OF THE CONTRACT 31. Duties of seller and buyer 32. Payment and delivery are concurrent conditions 33. Delivery Sale of Goods Section 34. Effect of part delivery 35. Buyer to apply for delivery 36. Rules as to delivery 37. Delivery of wrong quantity 38. Instalment deliveries 39. Delivery to carrier or wharfinger 40. Risk where goods are delivered at distant place 41. Buyer's right of examining the goods 42. Acceptance 43. Buyer not bound to return rejected goods 44. Liability of buyer for neglecting or refusing delivery of goods CHAPTER V RIGHTS OF UNPAID SELLER AGAINST THE GOODS 45. Unpaid seller defined 46. Unpaid seller’s rights Unpaid seller’s lien 47. Seller’s lien 48. Part delivery 49. Termination of lien Stoppage in transit 50. Right of stoppage in transit 51. Duration of transit 52. How stoppage in transit is effected Transfer by buyer and seller 53. Effect of sub-sale or pledge by buyer 54. Sale not generally rescinded by lien stoppage in transit 5 Laws of Malaysia 6 CHAPTER VI SUITS FOR BREACH OF THE CONTRACT Section 55. Suit for price 56. Damages for non-acceptance 57. Damages for non-delivery 58. Specific performance 59. Remedy for breach of warranty 60. Repudiation of contract before due date 61. Interest by way of damages and special damages CHAPTER VII MISCELLANEOUS 62. Exclusion of implied terms and conditions 63. Reasonable time a question of fact 64. Savings ACT 382 Sale of Goods 7 LAWS OF MALAYSIA Act 382 SALE OF GOODS ACT 1957 An Act relating to the sale of goods. [Federal Territory, Johore, Kedah, Kelantan, Negeri Sembilan, Pahang, Perak, Perlis, Selangor and Terengganu —23 April 1957, Malacca and Penang—23 February 1990] CHAPTER I PRELIMINARY Short title and application 1. (1) This Act may be cited as the Sale of Goods Act 1957. (2) This Act shall apply to the States of *Penisular Malaysia. Interpretation 2. In this Act, unless the context otherwise requires— “buyer” means a person who buys or agrees to buy goods; “delivery” means voluntary transfer of possession from one person to another; goods are said to be in a “deliverable state” when they are in such state that the buyer would under the contract be bound to take delivery of them; “document of title to goods” includes a bill of lading, dock warrant, warehouse keeper’s certificate, wharfinger’s certificate, railway receipt, warrant or order for delivery of goods and any other document used in the ordinary course of business as proof of the possession or control of goods, or authorizing or purporting to authorize, either by endorsement or by delivery, the possessor of the document to transfer or receive goods thereby represented; *NOTE—All references to “West Malaysia” shall be construed as reference to “Peninsular Malaysia” –see the Interpretation (Amendment) Act 1997 [Act A996], subsection 5(2). 8 Laws of Malaysia ACT 382 “fault” means wrongful act or default; “future goods” means goods to be manufacture or produced or acquired by the seller after the making of the contract of sale; “goods” means every kind of movable property other than actionable claims and money; and includes stock and shares, growing crops, grass and things attached to or forming part of the land which are agreed to be severed before sale or under the contract of sale; a person is said to be “insolvent” who has ceased to pay his debts in the ordinary course of business, or cannot pay his debts as they become due, whether he has committed an act of bankruptcy or not; “mercantile agent” means a mercantile agent having in the customary course of business as such agent authority either to sell goods, or to consign goods for the purposes of sale, or to buy goods, or to raise money on the security of goods; “price” means the money consideration for a sale of goods; “property” means the general property in goods, and not merely a special property; “quality of goods” includes their state or condition; “seller” means a person who sells or agrees to sell goods; “specific goods” means goods identified and agreed upon at the time a contract of sale is made; and any expression used but not defined in this Act which is defined in the Contracts Act 1950 [Act 136], shall have the meaning assigned to it in that Act. Application of Contracts Act 1950 3. The Contracts Act 1950, in so far as they are not inconsistent with the express provisions of this Act shall continue to apply to contracts for the sale of goods. Sale of Goods 9 CHAPTER II FORMATION OF THE CONTRACT Contract of sale Sale and agreement to sell 4. (1) A contract of sale of goods is a contract whereby the seller transfers or agrees to transfer the property in goods to the buyer for a price. There may be a contract of sale between one partowner and another. (2) A contract of sale may be absolute or conditional. (3) Where under a contract of sale the property in the goods is transferred from the seller to the buyer, the contract is called a sale, but where the transfer of the property in the goods is to take place at a future time or subject to some condition thereafter to be fulfilled, the contract is called an agreement to sell. (4) An agreement to sell becomes a sale when the time elapses or the conditions are fulfilled subject to which the property in the goods is to be transferred. Formalities of the contract Contract of how sale made 5. (1) A contract of sale is made by an offer to buy or sell goods for a price and the acceptance of such offer. The contract may provide for the immediate delivery of the goods or immediate payment of the price or both, for the delivery or payment by instalments, or that the delivery or payment or both shall be postponed. (2) Subject to any law for the time being in force, a contract of sale may be made writing or by word of mouth, or partly in writing and partly by word of mouth or may be implied from the conduct of the parties. 10 Laws of Malaysia ACT 382 Subject matter of contract Existing or future goods 6. (1) The goods which form the subject of a contract of sale may be either existing goods, owned or possessed by the seller, or future goods. (2) There may be a contract for the sale of goods the acquisition of which by the seller depends upon a contingency which may or may not happen. (3) Where by a contract of sale the seller purports to effect a present sale of future goods, the contract operates as an agreement to sell the goods. Goods perishing before making of contract 7. Where there is a contract for the sale of specific goods, the contract is void if the goods without the knowledge of the seller have, at the time when the contract was made, perished or become so damaged as no longer to answer to their description in the contract. Goods perishing before sale but after agreement to sell 8. Where is an agreement to sell specific goods, and subsequently the good, without any fault on the part of the seller or buyer, perish, or become so damaged as no longer to answer to their description in the agreement, before the risk passes to the buyer, the agreement is thereby avoided. The price Ascertainment of price 9. (1) The price in a contract of sale may be fixed by the contract or may be left to be fixed in manner thereby agreed or may be determined by the course of dealing between the parties. Sale of Goods 11 (2) Where the price is not determined in accordance with the foregoing provisions, the buyer shall pay the seller a reasonable price. What is a reasonable price is a question of fact dependent on the circumstances of each particular case. Agreement to sell at valuation 10. (1) Where there is an agreement to sell goods on the terms that the price is to be fixed by the valuation of a third party and such third party cannot or does not make such valuation, the agreement is thereby avoided: Provided that if the goods or any part thereof have been delivered to, and appropriated by, the buyer, he shall pay a reasonable price therefor. (2) Where such third party is prevented from making the valuation by the fault of the seller or buyer, the party not in fault may maintain a suit for damages against the party in fault. Conditions and warranties Stipulations as to time 11. Unless a different intention appears from the terms of the contract, stipulations as to time of payment are not deemed to be of the essence of the contract of sale. Whether any other stipulation as to time is of the essence of the contract or not depends on the terms of the contract. Condition and warranty 12. (1) A stipulation in a contract of sale with reference to goods which are the subject thereof may be a condition or warranty. (2) A condition is a stipulation essential to the main purpose of the contract, the breach of which gives rise to a right to treat the contract as repudiated. (3) A warranty is a stipulation collateral to the main purpose of the contract, the breach of which gives rise to a claim for damages but not to a right to reject the goods and treat the contract as repudiated. 12 Laws of Malaysia ACT 382 (4) Whether a stipulation in a contract of sale is a condition or a warranty depends in each case on the construction of the contract. The stipulation may be a condition, though called a warranty in the contract. When condition to be treated as warranty 13. (1) Where a contract of sale is subject to any condition to be fulfilled by the seller the buyer may waive the condition or elect to treat the breach of the condition as a breach of warranty and not as a ground for treating the contract as repudiated. (2) Where a contract of sale is not severable and the buyer has accepted the goods or part thereof, or where the contract is for specific goods the property in which has passed to the buyer, the breach of any c