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SUPREME COURT CONSIDERS SALE OF GOODS ACT 1979

In the case of PST Energy 7 Shipping LLC v.  OW Bunker Malta Ltd [2016] UKSC 23. Shipowners order and consumed some marine fuel bunkers. Title had not passed to the vendor. The shipowners argued that the operation of Sections 2 and 49 of the Sale of Goods Act 1979 (“the ACt”) meant that the vendors could not sue for the price or damages for failure to pay because the vendors were unable to give title.

The Supreme Court held, unanimously that the contract was not a contract of sale within the meaning of Section 2 of the Act because it was contemplated that the fuel would be consumed without title having passed. The Court further said that if the contract had been one of sale, it would have overruled the Court of Appeal decision in FG Wilson (Engineering) Ltd v. JW Holt & Co Ltd [2014] 1 WLR 2365 and held that Section 49 of the Act did not provide a complete code as to when the price of goods may be recovered by action.

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