Essential elements for a Contract of sale

By Koushambi Sengupta

A contract of sale of goods results by an offer made by one party followed by its acceptance by the other party. 

A contract of sale of goods can be defined as a contract where offers for transfer or rather agrees to transfer the property in goods to the buyer for a consideration, mostly, a price by money.

The following are some of the very essential conditions required for a contract of sale of goods.

A. Two parties- The first and foremost essential for a contract of sale of goods is that the contract must be between at least two people. There should be a buyer and a seller since one cannot purchase its own goods.  However, there is an exception to the said essential. A person may buy his own goods. In cases where a person's goods are sold in execution of a decree passed by a Court, such person may purchase his goods himself in order to prevent from transfer of ownership to anybody else.

Such an exception was found in the Moore vs Singer Manufacturing Co. (1904), 1 K.B. 820 ( C.A.) case.

B. Transfer of property- In this case, property refers to ownership. Transfer of property of goods is another very essential characteristics necessary for the contract of sale of goods. Even according to the definition of a contract of sale, it is essential for the seller to transfer or agree to transfer the property in goods to the buyer. Here the property is usually referred to as the general property in goods and not necessarily the 'special property'. 

For instance, in the case of bailment of goods for the purpose of repairing,  the bailee has some special interest in the goods bailed only to the extent of the labor charges. 

C. Goods- Goods is always the subject matter in contract with the sale of goods. Here, goods mean all sorts of movable property except actionable claims and money. It also includes stock and shares, growing crops, grass, anything attached to or probably forming a part of the land, which are agreed to be separated before the sale or under the contract of sale.

Thus within the definition of goods, goodwill, trademarks, copyrights, patent rights, water, gas, electricity, and many more are included. 

D. Price- A contract of sale of goods is incomplete without consideration, mostly in the form of money.  Even if goods are sold partly for goods and partly for money, the contract is a contract for the sale of goods. This was found in Aldridge vs Johnson (1858), 7 E. & B, 885 cases. 

 This article does not intend to hurt the sentiments of any individual, community, sect, or religion, etcetera. This article is based purely on the author’s personal opinion and views in the exercise of the Fundamental Rights guaranteed under Article 19(1)(A) and other related laws being enforced in India for the time being.