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Consequently, Owners could not escape paying for the bunkers by arguing that the Sellers had failed to transfer property in the bunkers to them, which property the Sellers did not have as they had not paid their own suppliers.
Such failure, in a contract of sale strictly speaking, was said by Owners to defeat a claim by Sellers for the price of goods delivered. Owners relied on FG Wilson v John Holt (the “Caterpillar” case – fn. 1. Due to precedent it was not open to Sellers to contest this point in the Courts below.
This point was, however, open before the Supreme Court, which decided that – had the contract in this case been one of sale - Sellers would have had a good claim for the price notwithstanding that property had not passed as (a) risk had passed to the Owners, and (b) the contract allowed the bunkers to be destroyed by use for Owners’ commercial benefit.
(2) suggested (without saying so) that the exception in s.49(2) may have applied in any event. This allows the price to be recovered without property passing, if “the price is payable on a day certain irrespective of delivery” – provided the seller is ready and able to deliver goods and property in them. Lord Mance noted that some judges had expressed the view that “price payable on a day certain” included a situation where the price was payable within 30 days of the invoice.
Footnote 1: F G Wilson (Engineering) Ltd v John Holt & Co (Liverpool) Ltd [2013] EWCA Civ 1232
