Definition and formation of contract for sales of movables
2.1. Definition, formation, and other related issues in the contract for sales of movables
In discussing contract for the sale of goods definition, formation and other related issues will be discussed. In defining law of sales first a comparative analysis will be made with reference to different definitions forwarded by different scholars and different legal systems. The definition of law of sales in the Ethiopian civil code will be presented. Accordingly the general definition of law of sales will be discussed compared with the definition of the term under the Ethiopian law of sales and with each element of the term. Upon successful completion of the chapter on the formation of contract of sales, you are expected to:
- forward different definitions of contract of sale
- pinpoint the distinguishing features of the definitions
- define contract of sales in the civil code
- analyze the terms in the definition of sale in the civil code
- analyze the definition of sales in light with the definition of contract of the general contract provisions
- List the elements for the formation of contract in general
- state the elements for the formation of contract of sale
- analyze the elements for the formation of contract in general and contract of sale
- state the peculiar elements for the formation of contract of sale
- be able to give grounded legal advice as to whether there is valid contract of sales
2.1.1 General definition of contract of sales
So far there is no universally accepted definition of sales contract. The definition of sales contract differs from legal system to legal system. The Roman law which is considered to be the origin of civil law legal system, for example, defined sales as “a contract by which one person becomes bound to deliver a subject to another with the view of transferring the property in consideration of money” this definition seems to include the basic elements. Accordingly sales contract shall be
- a contract
- include a thing as a subject of sale
- consideration expressed in money
- deliver with the purpose of transferring ownership
According, to the Roman law in the absence of the elements, the existence of sales contract is questioned. The French law being similar with the Roman law has also defined sales verbally as: “Sale is a contract by which the one binds himself to deliver a thing and the other to pay for it” Even though this definition has incorporated the three elements that is one party, obligation to deliver a thing and obligation to pay for it, obligation of transferring ownership is for example excluded.
The Napoleon code, which reproduces the traditional meaning under Article 1582 and 1603, shows that the render obligates him to deliver the thing and warrant it. Although the definition doesn’t clearly show transfer of ownership and who the render is, Roman times don not have such obligation; the obligation of the render to transfer ownership can be inferred from Article 1599. Hence transfer of ownership is an element of the meaning of sales in the napoleon code unlike the French one.
The German code on the other hand clearly includes the obligation to deliver the thing and procure ownership under Article 433. There seems to be difference in the definition of the Napoleon code and German code in clearly stipulating the obligation to deliver.
The uniform sales act termed sale of goods as “agreement whereby the seller transfers the property in the goods to the buyer for a consideration called the price”. It is not untrue to assert that the requirements of sales of goods in the modern common law have been enshrined under this definition. The uniform commercial code also defines sales as consisting of passing of title from the seller to the buyer. Thus, it is worth noting that neither delivery nor payment is necessary in contract of sale of goods in present sales.
Normally an agreement to sale and contract of sale are different in that agreement to sell does not include conveyance while contract of sale includes conveyance as an intrinsic element of its. In an agreement to sale, the contracting parties agree to sell a certain thing for specified price without making delivery an element of their contract.
Sales contract is generally defined as a “contract whereby one person who is called the render, obligates himself to transfer to another the ownership of a thing, while the other who is the buyer, obligates himself to pay to him its value in money”. This definition seems to give the idea of modern sale.