Classification of Goods
The goods may be classified into following categories:
Existing goods are the goods, which are owned and possessed by the seller at the time of sale. Existing goods may be of three types;
- Specific Goods
- The goods, which are identified and agreed upon by the parties at the time of contract of sale.
- It should be noted that the goods must be both identified and agreed upon.
- Unascertained Goods:
- These are the goods, are not identified and agreed upon at the time of the contract of sale.
- These goods are merely described by the parties at the time of contract of sale.
- Ascertained Goods:
- There are the goods, which are identified after the formation of contract of sale. When the un-ascertained goods are identified and agreed upon by the parties, the goods are known as ascertained goods.
- Future goods are those goods, which do not exist at the time of the contract of sale.
- These goods are to be manufactured or acquired by the seller after the making of the contract of sale.
- Future goods cannot be sold, but there can only be an agreement to sell.
Example: A, a manufacturer agrees to sell 5 tables and 50 chairs to B at Rs.10,000. B agrees to purchase it. However, tables and chairs are yet to manufactured by A.
To Know the difference between sale and agreement to sell click here
- It is a kind of future goods.
- It is goods, the acquisition of which is contingent upon the happening or non –happening of an uncertain event.
Example: A agrees to sell the goods loaded on the ship “Titanic”, which is coming from London to Bombay. The ship may or may not arrive. So, these goods will be called as contingent goods.
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Difference between Future Goods and Contingent Goods
|Basis||Futures Goods||Contingent Goods|
|1. Meaning||Goods that are yet to be manufactured produced or acquired by the Seller after making contract of sale.||Goods, the acquisition of which by the Seller depends upon a contingency, which may or may not happen.|
|2. Element of uncertainty||Acquisition of Future Goods does not depend upon and uncertainty.||The procurement of Contingent Goods is dependent upon an uncertain event.|
|3. Scope||Future Goods do not include contingent Goods because of the element of certainty.||They are wider in scope, it includes future Goods.|
|4. Effect of Contract||Where by a contract of Sale, the Seller purports to effect a present sale of future Goods, the contract operates as an “agreement to sell” the Goods[Sec.6(3)]||There may be a “Contract for Sale” of Goods, the acquisition of which by the Seller depends upon a contingency which may or may not happen [Sec.6 (2)]|
|5. Example||B agrees to buy the entire crop of wheat that would yield in S’s farm, at the rate of Rs.1000 per quintal.||A agrees to sell to B a certain painting only if C, its present owner, sells it to him. The sale is contingent upon the sale by C.|