Lloyd's Maritime and Commercial Law Quarterly
SALE OF GOODS FORMING PART OF A BULK: PROPOSALS FOR REFORM
Law Com. No. 215; Scot. Law. Com. No. 145
In July 1993 the Law Commissions published a Report1 proposing reform to the rule in the Sale of Goods Act 1979, s. 16, that a person who agrees to buy part of an identified bulk acquires no property interest until the goods to be delivered are ascertained. The Report seems to have been motivated by the same concerns which prompted the passing of the Carriage of Goods by Sea Act 1992—that the law is out of step with commercial practice2, that other legal systems deal better than English law with this particular problem3 and that, as a result, traders might take their legal business away from London. A short (three clause) Draft Bill is appended to the Report. Trading in goods stored or carried in bulk has increased significantly in
1. Law Com. No. 215; Scot. Law Com. No. 145: Sale of Goods Forming Part of Bulk (1993) (hereafter “the Report”).
2. A leading oil company stated in the Report: “Of course, many buyers and sellers are either ignorant of these legal problems, or ignore them, so that much commerce is proceeded as if the transfer of title to part of a bulk were possible; and one of the strongest arguments for changing the law is the fact that the law is now lagging so far behind the commercial requirement of the day”, (para. 3.3).
3. Following a comparative analysis, the Commissions found that foreign jurisdictions break down into three broad categories: those with rules similar to the U.K.; those which require delivery to transfer property—though symbolic delivery by using documents of title would allow property to pass in goods forming part of a bulk; and finally those with express provision for the passing of property in goods forming part of an identified bulk whereby the buyer becomes an owner in common. The Commissions’ proposals most closely resemble this last approach with some important variations.
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