Transfer of Title / Nemo Dot Quod Non Habet
This means No person can pass a better title than what he has.
The object of the maxim Nemo Dot Quod Non Habet is to protect the property from mishandling. The owner of the property is entitled to transfer his title. A person, who is not the owner of the property, is not entitled to sell it.
As per Sec. 27, no one can sell the goods and convey a better title thereof unless he is the owner. Therefore when the goods are sold by a person who is not the owner thereof and who does not sell them under the authority or without the consent of the owner, the buyer acquires no better title than the seller had.
The exceptions are:
1. Estoppels by owner: – This states that unless the owner of the goods is by his conduct precluded from denying the sellers authority to sell gives the right to a third person to sell a property not of his own by estoppels of the owner.
E.g. A son sells his mothers jewellery in presence of his mother who does not object to the sale. The buyer gets a good title due to estoppels by mother.
2. Sale by mercantile agent:-provides that where a sale by a mercantile agent on behalf of the owner is valid.
E.g. A share broker obtains the signature of the share-holder on original share certificates and sells them on behalf of the share-holder. Here the broker is the mercantile agent.
3. Sale by one of joint owners:- The third exception to the maxim, Nemo Dot Quod Non Habet lays down that if one of the several joint owners of goods has the sole possession of them by permission of the co-owners, the property in the goods is transferred to any person to any person who buys them of such joint owners in good faith and has not at the time of the contract of sale notice that the seller has no authority to sell.
E.g. A, B and C are joint owners of a horse. A who is in sole possession of it, sells it to X who purchases it in good faith. The sale is valid. B and C cannot claim the horse back.
4. Sale by a person in possession under voidable contract: – When the seller of the goods has obtained possession thereof under a voidable contract (a contract involving coercion or undue influence or fraud results in a voidable contract) but the contract has not been rescinded at the time of sale, the buyer acquires a good title to the goods, provided he buys them in good faith and without notice of the sellers defect of title.
5. Seller in possession after sale: A person having sold the goods, continues to be in possession of the goods or document of title to the goods, the delivery or transfer by that person of the goods or document of title under any sale or pledge to any person receiving the same in good faith and without notice of previous sale shall have the same effect as if the person making the delivery or transfer were expressly authorized by the owner of the goods to make the same.
E.g. A, a seller sells some goods to Z, a buyer. Z keeps the stock of goods with A for some time due to lack of warehouse facility. A sells the same goods to another buyer, X. The buyer, X gets a good title. Z has a legal remedy against A for the recovery of the price paid and damages if any.
6. Buyer in possession: Under a contract of sale of goods, a buyer is allowed to take the possession of the goods even though he has to pay the price for it.
Eg. A purchases certain goods from B by issuing a cheque and takes the delivery of the goods from B. A, thereafter sells the goods to C. B has a right to claim for the price of the goods and damages from A. However, C gets a bona fide title on the goods.
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