Thursday, February 6, 2020

Commercial Law Coursework (question is given on order instruction)

Commercial Law (question is given on order instruction) - Coursework Example f title clause which is the most fundamental one whereby the seller reserves tile to the goods that are delivered to the possession of the buyer as held in Romalpa case. This case combined both retention of title clause as well as bailment relationship between parties. In Clough Mills Ltd v Martin 2 ,there is no problem in this type of clause unless it seeks to retain equitable or beneficial ownership. In Re Bond Worth 3 , the court held that the title had already passed to buyer since it was not possible to retain equitable title although the buyer later granted back to the seller equitable charges which however was held void for want of registration. It shows that simple RoT clause is not suitable where goods sold are to be resold or manufactured into new ones. (2) The second category of clause is â€Å"all moneys clause† as an alternative to serve the purpose of retention of title until all debts of the buyer are paid to the seller rather than until payment of the purchase price as was affirmed in Armour v Thyssen 4 (3) Third category is â€Å"products clause† that aims at retaining or rather vesting title in the products made out of the goods originally supplied. But difficulty with this clause is that it serves to create as security for the goods originally purchased but becomes ineffective in the absence of registration. (4) Fourth category is â€Å"proceeds â€Å"or â€Å"tracing clause† that aims at acquiring proprietary interest in the proceeds of further sales of the buyer. This is again an ineffective clause as held in Romlpa case. Since the proceeds clause purports to create a fiduciary relationship between the parties, it requires to be registered and therefore courts have held them as registrable and as void for not having been registered. However, Romalpa case became a milestone on the law of retention of title as it held a conditional sale agreement valid even in the conditions of sold goods having been consumed or resold and the further appeal also upheld

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