Under the proviso to section 27 of the Sale of Goods Act, 1930, which statement is incorrect about a…
The proviso to section 27 can give a buyer good title when a mercantile agent possesses the goods or their documents of title with the owner’s consent and sells in the…
Choose your answer
Under the proviso to section 27 of the Sale of Goods Act, 1930, which statement is incorrect about a sale by a mercantile agent such as an auctioneer?
Answer and explanation
Correct answer B
The proviso to section 27 can give a buyer good title when a mercantile agent possesses the goods or their documents of title with the owner’s consent and sells in the ordinary course of business as a mercantile agent. The buyer must act in good faith and have no notice, when the contract is made, that the agent lacks authority.
Option feedback
Option A
Incorrect (this is a valid requirement). Under the Proviso to Section 27 of the Sale of Goods Act, 1930, the mercantile agent must be in possession of the goods or documents of title with the consent of the owner.
Option B
The relevant capacity is mercantile agent. Acting as the owner is not a requirement.
Option C
Incorrect (this is a valid requirement). Under the Proviso to Section 27, the buyer must act in good faith.
Option D
The buyer must have no notice of the agent’s lack of authority at the time of the contract.
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