Although the seller is under a duty to deliver the goods, this obligation might not be as straightforward as it might first appear.

Critically evaluate the seller’s duty to deliver the goods in respect of sales to consumer and non-consumer buyers.

Answer

This answer tests your understanding of the meaning of ‘delivery’ for the purposes of the SGA 1979 and CRA 2015. A good way to answer this question is to start with non-consumer buyers and then explain the rules pertaining to consumer buyers: the former is dealt with in the SGA while the latter is covered in the CRA.

You should point out in your introduction that the word ‘delivery’ has a specific legal meaning which is different from the colloquial meaning when the grocer delivers your groceries.

A good introduction will explain that s 27 SGA provides that it is the duty of the seller to deliver the goods, and of the buyer to accept and pay for them, in accordance with the terms of the contract of sale. Further, s 28 SGA provides that, unless it is otherwise agreed, delivery of the goods and payment of the price are concurrent conditions. This means that the seller must be ready and willing to give possession of the goods to the buyer in exchange for the price and the buyer must be ready and willing to pay the price in exchange for possession of the goods. You should point out that s 28 only requires the seller to be ready and willing to give possession of the goods to the buyer and the buyer to be ready and willing to pay the price in exchange for possession. There is no requirement for the seller actually to tender delivery before he becomes entitled to sue the buyer for the price or for damages, provided he can show that the buyer would have refused to accept the goods if delivery had been tendered. All the seller needs to do in such circumstances is to show that he was ready and willing to give possession (Levey & Co v Goldberg [1922] 1 KB 688).

‘Delivery’ is defined in s 61(1) SGA and means the “voluntary transfer of possession from one person to another”.

It is important to explain in your answer that the definition of ‘delivery’ is rather misleading as it does not require the seller to hand over the goods to the buyer (although in many cases this is what happens). In the case of hire-purchase, for example, the buyer will already have possession of the goods at the time he exercises his option to purchase them at the end of the term of hire. ‘Delivery’ is satisfied because of the different capacity in which the buyer now possesses the goods. Initially, he possessed the goods in the capacity of hirer but when he exercises his option to purchase, he possesses them as owner. Conversely, goods may be ‘delivered’ even though the seller retains possession, provided, as above, the capacity in which he is in possession changes. This would occur, for example, in a typical hire purchase ‘triangle’ where the seller sells the goods to the finance company but delivers them directly to the customer. The goods in this example are never physically delivered to the finance company yet are deemed to have been delivered for the purpose of s 27 SGA.

A further example of delivery is where the seller hands over control of the goods, for example, by handing over the keys to the premises where they are held. In this example, although actual delivery does not occur, control of the goods is transferred to the buyer which satisfies the legal definition of delivery.

You must also explain in your answer that as s 29 makes clear, unless otherwise agreed, it is not the seller’s responsibility to convey the goods to the buyer, but it is for the buyer to collect them.

Your answer should then discuss the time of delivery by reference to s 29(3) SGA which provides that in cases where the seller is bound to send the goods to the buyer, but no time for sending them has been agreed, the seller is bound to send them within a reasonable time. Good answers will go on to explain that where the goods at the time of sale are in the possession of a third party, there is no delivery by the seller to the buyer unless the third party acknowledges to the buyer that he holds the goods on his behalf (s 29(4) SGA).

You should also mention s 29(6) SGA which provides that unless otherwise agreed, the expenses of and incidental to putting the goods into a deliverable state must be borne by the seller.

You should then explain some of the cases and other issues that arise with delivery. For example:

• the position when delivery is made to a rogue who then disappears with the goods. You should explain cases such as Galbraith and Grant Ltd v Block [1922] 2 KB 155 and Computer 2000 Distribution Ltd v ICM Computer Solutions Plc [2004] EWCA Civ 1634.
• whether time is of the essence with respect to delivery (Hartley v Hymans [1920] 3 KB 475.
• the position where the time for delivery is not met (the buyer is entitled to sue for non-delivery and, if he wishes, treat the contract as repudiated)
• the position where the buyer chooses not to repudiate the contract but instead allows an additional specified time for delivery (Charles Rickards Ltd v Oppenheim [1950] 1 KB 616).
• where the seller delivers the wrong quantity of the goods (ss 30(1), 30(2) and 30(3) SGA). Ensure that your answer considers the position where the buyer does not deal as a consumer (s 30(2A) SGA) and also the principle noted in Shipton Anderson & Co v Weil Bros & Co [1912] 1 KB 574 in respect of buyers attempting to reject an entire consignment of goods for a slight breach in the quantity of goods delivered.
• the position of delivery by instalments (s 31(1) SGA).
• the position of delivery made to a carrier (s 32(1) SGA).

Having explained the rules relating to non-consumer buyers, you should then move on to discuss those relating to consumer buyers under the CRA 2015. Reference should be made to ss 28(2)–(4) of that Act which provides that unless the trader and the consumer have agreed otherwise, the contract is to be treated as including a term that the trader must deliver the goods to the consumer. ‘Delivery’, for the purposes of the CRA 2015, means the “voluntary transfer of possession from one person to another” (CRA 2015, s 59). Further, unless there is an agreed time or period, the contract is to be treated as including a term that the trader must deliver the goods without undue delay, and in any event, not more than 30 days after the day on which the contract is entered into (s 28(3)). For these purposes, an agreed time or period means a time or period agreed by the trader and the consumer for delivery of the goods and if there is an obligation to deliver the goods at the time the contract is entered into, that time counts as the agreed time (s 28(4)).

Where the trader delivers a quantity of goods less than he contracted to supply, the consumer may choose to reject them or to accept them. If the consumer chooses the latter, he must pay for them at the contract rate (s 25(1)).

Conversely, where the trader delivers a quantity of goods larger than he contracted to supply, the consumer may choose to accept only the contracted quantity and reject the remainder, or he may choose to reject the entirety of the goods (s 25(2)). If the consumer decides to accept all of the goods, he must pay for them at the contract rate (s 25(3)).

With regard to instalments, s 26(1) makes it plain that the consumer is not bound to accept delivery of the goods by instalments unless agreed between the consumer and the trader.