Question

Melissa and Maui purchased a brand new house. They are both very excited about decorating the interior and the exterior of the house. Melissa plans to have everything colour coordinated. To match the navy blue wall paint, she orders navy blue ceramic vinyl floor tiles from Ceramic Tiles Fiji (CTF). Melissa placed an order for one hundred 30cm by 30cm navy blue ceramic vinyl square tiles. In order to process Melissa’s order, CTF required upfront payment of the entire contract sum of $7,000.00. Melissa attends to the payments on 3 May 2017. The terms of the agreement stipulates: “that the order will be processed within two weeks from the date of the receipt of full payment. That the tiles will be delivered within two weeks from the date of receipt of full payment. It also states that the purchaser has to exclusively engage the services of Delivery Fiji for the delivery of tiles.” Melissa feels it is quite unfair that they have to engage the services of Delivery Fiji and pay them a hefty sum of $100.00 for a very small distance. Melissa wanted to make her own arrangement for delivery at a much cheaper rate, however CTF objected to the same. On 30th May at about 9am some orders (tiles) were ready for delivery. These tiles were for three different buyers and one of them was Melissa. The other two buyers included one Smith and one Misha. The Delivery Fiji delivery truck was required to attend to the loading of the tiles at 9.30am. The tiles were packed in boxes and left at the delivery area at 9.05 am with the respective buyer’s initials and were ready to be transported to the buyers. Melissa’s navy blue tiles were packed in a navy blue box and the box was marked with letter “M” on top. There was another light blue box which had tiles for a different buyer Smith but it was unmarked. A purple box contained tiles for Misha and the box was marked with letter “M” on top. All boxes were coloured differently corresponding to the colour of the tiles in the box. Unbeknown to CTF at about 9.30 am, an intruder went into its delivery area and loaded one navy blue carton of tile and drove away. At that time the security officer of CTF who was supposed to be at the delivery area was out in the parking space attending to a relative. 20 Delivery Fiji truck reached CTF’s delivery area at 9.50am to take delivery of all tiles. The attending staff loaded the tiles in the delivery truck. They were provided with a list by CTF which had the three buyers’ addresses written in different coloured ink (light blue, navy blues and purple) corresponding to the colour of the carton of tile. Delivery Fiji mistakenly delivers the purple coloured carton to Melissa’s residence. Melissa acknowledges receipt by signing the delivery docket. The delivery docket had a clause which exempted Delivery Fiji from all forms of liabilities once the goods were safely delivered to its destination and the same was acknowledged. Melissa opened the box after two weeks when the tile layer arrived at her place to lay the tile and, to her dismay the tiles were not what she had ordered and expected it to be. It was not ceramic navy blue vinyl tiles instead it was plain light blue tiles. Melisa now wishes to return the tiles to CTF and claim her money and damages. CTF is disputing this by stating that the return of the sale period ended after 3 days from the date of delivery. Melissa further argues that they received a different order altogether and that CTF breached their agreement. CTF argues that the property and risk passed to Melissa once the tiles were packed and left at the delivery area. Melissa seeks to sue CTF and Delivery Fiji. CTF convenes a discussion with Delivery Fiji in this respect and finds out that only two boxes were loaded for delivery by them on that day. CTF carries out an investigation and the CCTV footage reveals that one box was stolen from their delivery area on 30 May at about 9.30am. Nevertheless they still insist that they are not liable to Melissa in anyway. Meanwhile Smith was declared a bankrupt on 2 May, 2017. Delivery Fiji had delivered the tiles to the address provided by CTF for Smith. Smith had made an instalment of $3,000.00 and he was supposed to pay the remaining balance of $5,000.00 to CTF upon receipt of the goods. CTF is demanding remaining payment from Smith. CTF argues that the property and the risk passed to Smith once the tiles were packed and left at the delivery area. Meanwhile Misha did not receive anything and she had paid $4,000.00 as deposit and was supposed to pay the remaining balance of $5,000.00 to CTF upon receipt of the goods.Write written submission addressing the following matters: 1. Did the property and the risk indeed pass to Melissa, Smith and Misha once the goods were left at CTF’s delivery area? 2. What remedies are available for Melissa and Misha? 3. Is Delivery Fiji liable to Melissa, Smith or Misha? 4. What remedies and defences will Delivery Fiji advance in its favour?5. What arguments will CTF advance in its favour to dispute the various allegations against them? 6. Can CTF be exempted from all liabilities or are they liable to the buyers for their loss. 7. What is Smith’s position in this respect taking into consideration his insolvency? 8. Are CTF and Delivery Fiji engaged in deceptive and misleading commercial practice?

Answer 1

The questioned case study can be answered using various aspects of the sale of goods law.

Part 1 : According to sale of goods law, the property in goods (title, property and risks) passes to the buyer once, the goods are handed over or delivered to the buyer. It does not mean that the goods in transit that have left the seller's premises belong to the buyer. Therefore, in the given case the goods although they left the CTF premises still belong to CTF and the title, property and risks are not passed to Melissa, Smith and Misha. But, since the goods are delivered to Melissa and Smith and they have acknowledged the receipt, the goods now belong to melissa and smith.

Part 2 : According to sale of goods law,? if a contract of sale is breached, either party can sue the other and claim the damages as awarded by the court. In the given case Misha, can claim a refund of her deposit as it is clear that her order could not be completed on time due to non availability of goods. On the other hand Melissa would have a difficult time as she is rightful owner of the goods now.