The plaintiff sold a quantity of resin to the defendant for use in the manufacture of chipboard. The contract contained a reservation of title clause, but both parties contemplated that the resin would be used in the process of production before it had been paid for, as indeed occurred. All those involved in that case treated the contract as one for the sale of goods and therefore as governed by the Sale of Goods Act.
Held: Bridge LJ described the contract as ‘essentially one of sale and purchase, subject only to the reservation of title clause, whatever its effect may have been.’ However, he rejected the sellers’ argument that the contract was simply one of bailment. The only question for decision was whether the supplier had obtained title to the chipboard into which the resin had been incorporated. The court held that it had not.
The resin ceased to exist when it was incorporated into the new product and property in it ceased to exist at the same time, because it is not possible to own something that does not exist
Citations:
[1981] 1 Ch 25, [1979] 3 WLR 672, (1979) 123 SJ 688, [1979] 3 All ER 961, [1980] 1 Lloyds Rep 160
Statutes:
Jurisdiction:
England and Wales
Cited by:
Cited – PST Energy 7 Shipping Llc Product Shipping and Trading SA v OW Bunker Malta Ltd and Others CA 22-Oct-2015
The oil owners had contracted for its transport with OWBM aboard Res Cogitans under standard terms which would allow the captain to use the oil for navigation before transfer of the title in the oil. The court was now asked whether the agreement . .
Cited – PST Energy 7 Shipping Llc and Another v OW Bunker Malta Ltd and Another SC 11-May-2016
Parties had entered into a bunker supply contract which contained a retention of title clause in favour of the supplier. It purported to allow the buyer to use the goods before title came to be passed.
Held: The owner’s appeal failed. It did . .
Lists of cited by and citing cases may be incomplete.
Contract
Updated: 18 May 2022; Ref: scu.617853
