Indian Oil Case Study

1064 Words 4 Pages
I- INTRODUCTION
Over the years, the commercial law regulating sale of goods and, subsequently, transfer of property had significantly evolved. Indeed, a topical subject brought before judicial courts have been the validity of retention of title clause (ROT), which namely gives the right to the seller to retain title in the property of unpaid goods that had physically passed to the buyer . This latest clause has been legitimate in Aluminium Industrie Vaassen B.V v Romalpa Aluminium , where a supplier was able to recover, before debtors, unpaid goods from an insolvent receiver because there was a contractual provision reserving its ownership until he was fully paid. Concretely, this decision was an enormous gain for the seller’s position because
…show more content…
In fact, when the goods have been delivered only for a storage purpose, there is no intention that the property passes to the keeper so “the mixed bulk will be owned in common by the contributors […] in proportion to the amount of [their] contribution . This conclusion has been confirmed in Indian Oil Company Ltd v Greenstone Shipping to the situation where oils of an original owner were wrongfully and irreversibly mixed with other oils of the same nature since they were still identifiable as a part of the mixed bulk owned in common . However, when goods of different kinds and from various owners are wrongly blended in a way that they are transformed in a new product, the original owner will still be able to trace its property even it its identify has changed. For example, in Glencore, blended bulk made of different grade of oils was also owned in common by the contributor in proportion of their contribution. As innocent parties, contributors were also entitled to recover damages from the wrongdoer. In brief, as discuss above, when tangible property is mixed so as to form a bulk, the rights of the original owners will always vary depending upon the intention of the parties and whether the property can be divided between them …show more content…
While the first condition is mostly interpreted from the contract, the second condition regarding the identity is always a question of facts. Reflecting the jurisprudence, goods are held to lose their identity when they are subject to a form of processing in the course of manufacture . Otherwise, the case Hendy Lennox (Industrial Engines) Ltd v Grahame Puttick Ltd was an exceptional case where it was still possible to identify an engine incorporated in a larger machine since it was possible to separate them without damaging the others goods . Above all, when the buyer wrongfully mixed seller’s goods in the process of manufacturing, the court held that, provided that he can identity its whole property or a substantial part of it, he would be able to claim ownership over the new commodity . Thus, unless it is possible to distinguish or divided the new product between others innocent sellers, he will be entitled to claim property over the whole new commodity based on principle of accession . Under this approach, even if the seller is well protected against wrongful mixing or utilisation of its goods, there is a risk about the identification of the original goods into the new

Related Documents