Project Contract Ii Sem 4

S.S.
JAIN SUBODH LAW COLLEGE
CASE STUDY ON FORSYTHE INT. LTD VS SILVER SHIPPING CO. LTD.
AND ORS (1994) ALL ER 851
2017-2018
CONTRACT II
SUBMITTED BY : SUBMITTED TO :
NAME : GAURAV KUMAR SHARMA MR ZEESHAN HASHMI
CLASS : B.A. L.L.B. IInd yr. IVTH semester
SECTION : B
ROLL NO : 9
CASE STUDY ON
FORSYTHE INT. LTD
VS
SILVER SHIPPING CO.
LTD.
AND ORS (1994) ALL
ER 851
DECLARATION
I, Gaurav kumar Sharma, do hereby declare that, this dissertation titled " CASE STUDY ON FORSYTHE
INT. LTD VS SILVER SHIPPING CO. LTD. AND ORS (1994) ALL ER 851 " is an outcome of the
research conducted by me under the guidance of Prof. MR ZEESHAN HASHMI (Asst. Prof. of law) at S.S.
Jain Subodh Law College in fulfillment for the award of the degree of B.A.L.L.B. at the University of
Rajasthan .
I also declare that, this work is original , except where assistance from other sources has been taken and
necessary acknowledgements for the same have been made at appropriate places. I further declare that, this
work has not been submitted either in whole or in part , for any degree or equivalent in any other institution.
Date: 12-05-2018
Place: Jaipur
Name of Student: Gaurav kumar Sharma
(i)
ACKNOWLEDGEMENT
I acknowledge with profundity, my obligation to almighty god and my parents for giving me the grace to
accomplish my work, without which this project would not have been possible.
I express my heartfelt gratitude to my respected faculty, Prof.MR ZEESHAN HASHMI (asst. prof. of law)
for providing me with valuable suggestions to complete this dissertation.
I am especially grateful to all my faculty members at SS Jain Subodh Law College who have helped me
imbibe the basic research and writing skills.
Lastly, I take upon myself, the drawbacks and limitations of this study, if any.
Date: 12-05-2018
Place: Jaipur
Name of Student: Gaurav kumar Sharma
(ii)
CERTIFICATE
Certified that the project work on the topic “CASE STUDY ON FORSYTHE INT. LTD VS SILVER
SHIPPING CO. LTD. AND ORS (1994) ALL ER 851” submitted by GAURAV KUMAR SHARMA
for the partial fulfillment of the degree B.A. L.L.B IVTH semester offered by the S.S. Jain Subodh Law
College during the academic year 2017-2018 is an original work carried out by the student under my
supervision and this work has not formed the basis for the award of any degree, diploma, or such other titles.
Prof. MR ZEESHAN HASHMI
Asst. prof. of law
S.S. Jain Subodh Law College
(iii)
TABLE OF CONTENTS
SR. NO. TOPIC
1. INTRODUCTION
2. ABOUT CASE AS PER AVAILABLE OF MATTER
(iv)
INTRODUCTION
Disposition by Buyer in Possession after Sale When a buyer agrees to buy goods with the seller and takes
possession of the goods or the papers of title with consent of the seller, he may transfer a good title to a third
buyer acting in good faith. In this circumstance, if the buyer in the first transaction does not acquire a good
title, he may pass a good title to a third owner. The bulk of the transaction must happen in good faith and
without having knowledge of the defect of the title by both the buyer and the seller.
Section 30(2) of the SOGA 1957 has provided:
Where a person, having bought or agreed to buy goods, obtains, with the consent of the seller, possession of
the goods or the documents of title to the goods, the delivery or transfer by that person or by a mercantile
agent acting for him of the goods or documents of title under any sale, pledge, or other disposition thereof to
any person receiving the same in good faith and without notice of any lien or other right of the original seller
in respect of the goods shall have effect as if such lien or right did not exist.
The first buyer must be in possession of the goods or papers of title to the goods at the time of the sale to
the second buyer. Constructive possession is sufficient where a seller delivers the goods direct to the second
buyer on the basis of the request of the first buyer and is regarded as constructive possession. Here, it is
noted that the consent of the seller for the possession of the goods taken by the first buyer may be obtained
by fraud or other vitiating factors but that vitiating factor will not vitiate the consent and the removal of the
consent will have no effect on the second buyer unless he in fact knows about it.
ABOUT CASE
Disposition by buyer in possession after sale was described in the case Forsythe International (UK) Ltd v
Silver Shipping Co Ltd and others; The Saetta.
In this case, the plaintiff, Forsythe International (UK) Ltd claimed from the first defendants, Silver Shipping
Co Ltd, the charterers of the vessel Saetta, and the second defendants, Petroglobe International Ltd, the
owners of the vessel, damages for conversion of bunkers supplied to the first defendants on 4 April 1991.
The first defendant also counterclaimed damages against the plaintiff for wrongful arrest of the vessel. In
this case, the plaintiff contracted with the first defendant to supply bunkers for a vessel which was on a time
charter from the owners.
The charter party provided by clause 53 that the second defendant would pay for certain quantities of
bunkers on delivery and about the same quantities and same prices would apply on redelivery and by clause
15 that the first defendant shall on redelivery whether it occurred at the end of the charter period or on an
earlier termination accept and pay for all bunkers on board. Before the expiry of the charter the vessel was
withdrawn by the first defendant from the second defendant for non-payment of hire. At the time of the
withdrawal of the vessel it was carrying bunkers for which the plaintiffs had not been paid. The plaintiffs
brought an action against the second defendant claiming, under a retention of title clause in the contract for
the supply of bunkers, the price of the bunkers supplied to the second defendant, and also against the first
defendant, who had assumed possession of the bunkers when the charter was terminated, claiming that they
had converted the bunkers when they had consumed them after termination of the charter. It was accepted
that property in the bunkers had not passed to the second defendant as they had not paid for them and that
therefore any assumption of ownership by the first defendant would be a conversion.
However, the first defendant contended that any conversion occurred at the date of termination of the charter
party, at which time they acquired a good title to the bunkers by virtue of section 25(1) of the Sale of Goods
Act 1979, which provided that a buyer in possession of goods with the consent of the seller could confer a
good title by delivery or transfer to any person receiving them in good faith without notice of any lien or
other right of an original seller, since
(i) the second defendant had agreed to buy the bunkers from, and obtained possession with the
consent of, the plaintiffs,
(ii) termination of the charter party resulted in delivery or transfer of the bunkers by the second
defendant to the first defendant and
(iii) the first defendant had received the bunkers in good faith without notice of any lien or other
right of the plaintiffs in respect of the bunkers. In this case the judgment was for the plaintiff and
the counterclaim raised by the first defendant was dismissed by the court.
BIBLIOGRAPHY
 https://www.researchgate.net/publication/272407206_TRANSFER_OF_TITLE
(v)

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S.S.

JAIN SUBODH LAW COLLEGE

CASE STUDY ON FORSYTHE INT. LTD VS SILVER SHIPPING CO. LTD.

AND ORS (1994) ALL ER 851

NAME : GAURAV KUMAR SHARMA MR ZEESHAN HASHMI

CLASS : B.A. L.L.B. IInd yr. IVTH semester

Name of Student: Gaurav kumar Sharma

Name of Student: Gaurav kumar Sharma

Prof. MR ZEESHAN HASHMI

Asst. prof. of law

S.S. Jain Subodh Law College

SR. NO. TOPIC

Section 30(2) of the SOGA 1957 has provided:

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