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Report No. 61

1D.5. No 'sale' in such circumstances in England.-

It is necessary to mention here that, in England, it was held in Graff v. Evans, (1882) 8 QBD 373., that a transaction whereby a member of a club acquired liquor which was the property of the club was not sale but merely transfer of special property. This case was decided eleven years before the English Act relating to the sale of goods was passed in 1893. The basis of the decision was that the transaction was a release of the rights of the other members to the "purchaser". It might have been thought,1 therefore, that when section 1(1) of the Sale of Goods Act specifically enacted (in 1893) that-

"There may be a contract of sale between one part owner and another,"

the basis of Graff v. Evans had ceased to be valid. It may be noted that the Indian Sale of Goods Act has a similar provision.2 But in Davies v. Burnett,4 a Divisional Court followed the earlier case, and the Sale of Goods Act was not even referred to. A well-known writer has stated3 that "this view of the law has now been accepted for so long that it is unlikely to be upset by a higher court."

The English cases mostly relate to licensing.4 But the point to be noted is, that the provision in the Sale of Goods Act as to "part owner" has not come in their way. The position in this respect, as was observed in an Australian case,5 is simply that "a part of the common property is appropriated to the separate use of the members, and he makes a corresponding contribution from his separate property to the common fund." The question must, of course, always be as to the meaning of the word "sale" or "sell" in the particular statute which comes under consideration. If no reason is seen for giving the word an extended meaning, one would think it perfectly correct to say that an ordinary unincorporated members' club does not "sell", in the true sense, liquor which a member obtains from the common store on payment of money to the common fund.

1. Atiyah Sale of Goods (1966), p. 9.

2. Section 4(1), Indian Sale of Goods Act.

3. Davies v. Burnett, (1902) 1 KB 666.

4. For a review of cases, see Trebanag Club v. Macdonald, (194*) 1 All FR 454.

5. Watson v. J.&A.G. Johnson Ltd., (1936) 55 CLR 63 (70) (per Dixon, J.).



Certain Problems connected with Powers of the States to Levy a Tax on the Sale of Goods and with the Central Sales Tax Act, 1956 Back




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