Rules as to Delivery (Section 33)

Section 33 of the Sale of Goods Act, 1930 defines what counts as a delivery under the Act. The section is short — one sentence — but it is the conceptual hinge on which the seller's whole performance obligation turns. Read with the definition of "delivery" in Section 2(2) of the Act, and with the cluster of default rules in Sections 34 to 40, Section 33 supplies the doctrine of how possession is transferred in a contract of sale: by the manual handing over of the goods, by the transfer of a symbol that represents them, or by a change in the legal character in which the present holder retains them.

The threshold proposition is that delivery is voluntary transfer of possession. Section 2(2) defines "delivery" as voluntary transfer of possession from one person to another. A taking of possession by force, or by fraud, is not a delivery. Equally, an involuntary parting with possession — for example, possession lost by a thief — is not delivery, because the transferor has not consented. Section 33 builds on that definition by setting out three vehicles through which the parties may give effect to a voluntary transfer. The chapter sits within the wider performance architecture: by the time the parties are working out delivery, the agreement has been framed under the rules on the contract of sale and the subject-matter has been categorised under existing, future, specific and ascertained goods; the question whether property has passed before delivery is governed by Sections 18 to 25 on the transfer of property between seller and buyer.

Statutory anchor — Section 33

The text of Section 33 reads:

Three propositions emerge. First, delivery is whatever the parties agree shall be treated as delivery — the section accommodates contractual stipulation. Second, delivery is whatever has the effect of putting the goods in the buyer's possession, or in the possession of his agent — the section accommodates the practical reality that possession may pass without the buyer himself being present. Third, the test is one of effect, not of form: whatever produces the effect of placing the goods in the buyer's control is a delivery, regardless of whether the seller hands them over himself or arranges for a third party to hold them on the buyer's behalf.

The provision is not couched as an exhaustive code. It is permissive. Section 33 sits with Sections 34 (effect of part delivery), 35 (buyer's duty to apply for delivery), 36 (rules as to delivery — place, time, attornment, tender, expenses), 37 (delivery of wrong quantity), 38 (instalment deliveries), 39 (delivery to a carrier or wharfinger) and 40 (deterioration during transit) to form the working architecture of delivery. The wider framing of the seller's and buyer's duties under Section 31 and the performance chapter is presupposed.

The three modes of delivery

Section 33 is most usefully read as a three-mode taxonomy. The classification is doctrinal rather than statutory, but it captures the entire field of practice and is the framework that examiners assume.

Actual delivery

Actual delivery — also called physical delivery — is the literal handing over of the goods themselves by the seller to the buyer. The hallmark is a change in the actual control of the goods from one person to another. If the seller hands a book to the buyer, the goods are in the buyer's hands; the delivery is actual. If the seller wraps a parcel and hands it across the counter, the parcel is in the buyer's possession; the delivery is actual. The leading proposition follows from Section 2(2): if the actual control of the goods does not change from one person to another, there is no delivery. A seller who agrees to deliver a piece of machinery and lets the buyer take it away has effected actual delivery; a seller who merely lets the buyer inspect the machinery without taking it has not.

Symbolic delivery

Symbolic delivery is the transfer of a symbol that represents the goods, the symbol being something which gives the buyer the means of taking control of the goods. The classic instances are the transfer of the key of the warehouse in which the goods are stored, the endorsement and delivery of a bill of lading covering the goods, and the transfer of a railway receipt or other document of title. The symbol is treated by the law as a substitute for the goods because it operates to put the goods at the buyer's disposal.

The bill of lading is the textbook illustration. By the transfer of a bill of lading, there is deemed to be a delivery of the goods even without any acknowledgement by the carrier that he holds the goods on the buyer's behalf. The reason is doctrinal — the bill of lading is the document of title, and its transfer is the delivery of the goods themselves. A delivery order, by contrast, does not have the same character. Merely giving a delivery order to the buyer does not amount to a delivery of the goods; the buyer must present the order to the holder, and the holder must accept it, before delivery is complete.

Constructive delivery

Constructive delivery — sometimes called fictitious delivery, or delivery by attornment or acknowledgement — involves no change in the actual custody of the goods at all. What changes is the legal character in which the holder of the goods retains them. The most familiar instance is where the seller is in possession of the goods and agrees to hold them on behalf of the buyer. The seller continues to have custody of the goods, but his legal character has changed: he was the owner, he is now a bailee. The seller has "attorned" to the buyer, and the goods are deemed to have been delivered to the buyer.

The conditions of valid attornment are familiar from the law of bailment. There must be (i) goods identifiable at the time of attornment, (ii) consent by the holder to hold them on the new principal's behalf, and (iii) consent by the new principal to receive them. Where any of these elements is missing, there is no delivery. Section 36(3) gives this principle statutory form for the case where the goods are with a third party at the time of contract — there is no delivery by the seller to the buyer unless and until the third party acknowledges to the buyer that he holds the goods on the buyer's behalf. The consent of all three persons — the seller, the buyer and the third party — is essential.

The leading authority is Godts v. Rose (1855) 17 CB 229. The seller had directed his warehouseman to hold the goods on the buyer's behalf, but the buyer had not consented. The court held that there was no delivery: the seller's instruction to the warehouseman, without the buyer's concurrence, was insufficient to convert the warehouseman into the buyer's bailee. The case is the foundation of the rule that constructive delivery requires tripartite assent.

A subtlety follows. Symbolic delivery — by transfer of a document of title — does not require an acknowledgement by the carrier or holder, because the document carries with it the right to demand the goods. Constructive delivery — by attornment without a document of title — does require acknowledgement, because there is no document doing the work of substitution. The student should keep the two cases distinct and remember that the bill of lading is the textbook example of the first, while the warehouseman's attornment is the textbook example of the second.

Section 34 — effect of part delivery

Section 34 supplies a partner rule:

The two limbs distinguish two different intentions. Where part delivery is in progress of the delivery of the whole, it counts as a delivery of the whole for the purpose of passing the property. Where part delivery is intended as severance — to deliver only that part — it does not. The leading authority is Hammond v. Anderson (1803) 1 B&P NR 69. The buyer, intending to take delivery, got the whole of the goods weighed but, because of his transport arrangements, took away only a part. The delivery of the part operated as a delivery of the whole, with the result that the buyer would bear the loss if the undelivered remainder were destroyed.

The reverse case is Bunnery v. Poyntz (1833) 4 B&Ad 568. On the sale of a stock of hay, the buyer was permitted to cut and remove a part of the stock; the permission related only to that part, and there was no delivery of the whole. The leading Indian application is Mitchell Reid & Co. v. Buldeo Das ILR (1887) 15 Cal 1, where there was a sale of four bales of goods to be paid for on delivery, and the buyer received one bale and paid for it but refused to receive the other three on a quality complaint. The delivery of one bale did not amount to delivery of all four, and the seller's remedy was for breach of contract rather than for the price.

A further illustration is the textbook example of A selling 50 maunds of rice to B. The rice remains in A's warehouse. After the sale, B sells 10 maunds to C, and A, at B's desire, sends the 10 maunds to C. This does not have the legal effect of a delivery of the whole 50 maunds to B. The intent was severance for delivery to C; the remaining 40 maunds remain undelivered. Section 34 is therefore a rule of construction — it tells the court what to make of part delivery, and the burden of proving severance is on the party asserting it.

Section 35 — buyer's duty to apply for delivery

Section 35 places the first move on the buyer:

The buyer cannot complain of non-delivery without showing demand and refusal. The duty is residual — it can be varied by an express stipulation that the seller must despatch the goods as soon as they are ready, in which case the buyer's application is dispensed with. The provision is also an aspect of the wider principle of readiness and willingness in the contract of sale as worked out under Section 32. The buyer's application is one of the ways in which his readiness to accept and pay is communicated to the seller.

Section 36 — rules as to delivery

Section 36 collects five default rules, which together govern the manner in which delivery is to be effected when the contract is silent.

Section 36(1) — place of delivery

If the contract does not indicate the place of delivery, the place is fixed by the statutory default:

1. In a sale of specific goods, the place of delivery is the place where the goods are at the time of sale.
2. In an agreement to sell, the place of delivery is the place where the goods are at the time of the agreement to sell.
3. In the case of future goods which are yet to be manufactured or produced, the place of delivery is the place at which they are manufactured or produced.

The default is sometimes inconvenient — it may require the buyer to fetch the goods — but it is statutory and operates unless displaced by contract. The leading illustration is Galbraith & Grant Ltd. v. Block (1922) 2 KB 475. Where the goods had to be delivered at the buyer's place, the seller was held to be discharged by delivery to a respectable-looking person at that place even though it later turned out that the person was not authorised to take delivery. The rule protects sellers from the impossible task of identifying the buyer's authorised representative at every doorway.

Section 36(2) — time for delivery

Where the seller is bound to send the goods to the buyer but no time for sending them is fixed, the seller is bound to send them within a reasonable time. Failure to do so is a breach, and the breach is not excused by subsequent supervening events such as war or government order — even if those events would have prevented delivery, the breach was already complete when reasonable time expired. The proposition is one that examiners regularly test, because it shows the asymmetry between fault-based default and frustration.

Where the contract states that the goods will be delivered "as and when required", a request for delivery is a condition precedent to the seller's obligation. The buyer cannot, however, wait indefinitely; he must require delivery within a reasonable time, failing which the seller may rescind on previous notice giving the buyer a reasonable time to pay for and take delivery. The doctrine is one of mutual good faith — the seller is not made to keep stock indefinitely, and the buyer is not made to fetch on a moment's call.

Section 36(3) — delivery by attornment

Section 36(3) supplies the statutory form of constructive delivery where goods are with a third party at the time of contract. There is no delivery by the seller to the buyer unless and until that third party acknowledges to the buyer that he holds the goods on his behalf. The provision is a particular case of the general doctrine of attornment, and is the rule applied in Godts v. Rose. The acknowledgement need not be in any particular form, but it must be communicated to the buyer and must be unequivocal — a tentative or conditional acknowledgement will not do.

Section 36(4) — time for tender of delivery

The seller must tender at a reasonable hour and the buyer must demand at a reasonable hour. What is reasonable is a question of fact in each case — it varies with the trade, the article and the circumstances. The implicit rule is that neither party can be required to perform at an inconvenient time, and a tender outside reasonable hours is no tender at all. The point matters when the buyer alleges non-delivery: the seller's defence may be that he tendered at a reasonable hour and the buyer was not there to receive.

Section 36(5) — expenses of delivery

Unless otherwise agreed, the expenses of and incidental to putting the goods into a deliverable state are borne by the seller. The default makes commercial sense: putting the goods into a deliverable state is an aspect of the seller's duty to deliver. The contract may shift the burden — for example, by stipulating that packing or carriage expenses are for the buyer's account — and where it does, the express terms control. In silent contracts, the seller bears the cost.

Section 37 — delivery of wrong quantity

Section 37 lays down the buyer's options where the seller delivers the wrong quantity. The provision is the buyer-side enforcement mechanism for the duty in Section 31; it is also one of the most heavily examined sections in the Act because the three sub-rules (short, excess, mixed) each carry distinct remedies.

1. Short delivery. If the seller supplies less than he contracted to sell, the buyer has a right to reject the goods. If the buyer accepts the goods so delivered, he must pay at the contract rate, but he does not lose his right to sue for damages for the short delivery. The right to reject is, however, subject to the maxim de minimis non curat lex — slight deficiencies must be overlooked: Dhudhia Forest Coop. Ltd. v. Mohd. Saiyed (1980) 21 Guj LR 272.
2. Excess delivery. Where the seller delivers a quantity larger than he contracted to sell, the buyer may accept the contract quantity and reject the rest, or reject the whole, or accept the whole. If he accepts the whole, he must pay at the contract rate. The right is to reject the goods, not to cancel the contract — the seller may again supply the contract quantity within time: Vilas Udyog Ltd. v. Prag Vanaspati Products AIR 1975 Guj 112. Where the excess is so small as to be negligible and the seller does not bill the buyer for it, the buyer may not reject.
3. Mixed delivery. Where the seller delivers the contract goods mixed with goods of a different description not included in the contract, the buyer may accept the contract goods and reject the rest, or reject the whole. The strict rule is illustrated by Moore & Co. v. Landauer & Co. (1921) 2 KB 519 — the contract was for 3,000 tins of canned fruit packed in cases each containing 30 tins; about half the cases tendered contained 24 tins each. The buyer was held entitled to reject the whole, even though the total number of tins was correct; description includes packing where packing forms part of identification.

Section 37 is read with the implied condition under Section 15 on sale by description: in both cases, the rule is that the buyer is entitled to receive what he bargained for. Section 37 deals with quantity; Section 15 deals with description. Where the two overlap — as in Moore v. Landauer, where the packing was part of the description — the buyer's right of rejection is at its strongest. The classification of the broken term as a condition rather than a warranty is supplied by Section 12 on the distinction between conditions and warranties; the remedies on rejection of price-paid goods are set out in the chapter on suits for breach of contract.

Section 38 — instalment deliveries

Section 38(1) lays down a default that is heavily examined: unless otherwise agreed, the buyer of goods is not bound to accept delivery thereof by instalments. Where the contract provides for instalment deliveries, Section 38(2) makes the question whether breach in respect of one instalment is a repudiation of the whole contract, or a severable breach giving rise only to a claim for compensation, a question of fact in each case, depending on the terms of the contract and the circumstances. Two factors govern the answer: the quantitative proportion the breach bears to the whole contract, and the degree of probability of repetition. The full unfolding of Section 38 is treated in the chapter on performance of contract — delivery and acceptance; the relevant authorities are Mersey Steel Co. v. Naylor & Co. (1884) 9 AC 434, Maple Flock Co. Ltd. v. Universal Furniture Products Ltd. (1934) 1 KB 148, Motilal v. The Netha Coop. Spinning Mills Ltd. AIR 1975 AP 169 and Vishnu Sugar Mills v. Rameshwar Jute Mills AIR 1970 Pat 323.

Section 39 — delivery to a carrier or wharfinger

Section 39(1) provides that, where the seller is authorised or required to send the goods to the buyer, delivery to a carrier or wharfinger is prima facie deemed to be a delivery to the buyer. The provision is the bridge between the seller's possession and the buyer's possession in distance contracts. It is also the trigger that ends the seller's lien and starts the right of stoppage in transit, on which the chapter on the rights of the unpaid seller is built. Where the carrier is the agent or servant of the seller himself, delivery to such a carrier may not amount to delivery to the buyer.

Section 39(2) imposes a duty on the seller to make a contract with the carrier that is reasonable having regard to the nature of the goods and the circumstances of the case. If the seller fails to do so and the goods are lost or damaged in transit or while with the wharfinger, the buyer may decline to treat the delivery to the carrier as a delivery to himself, or hold the seller in damages. Young v. Hobson (1949) 65 TLR 365 illustrates the rule — sellers contracted to despatch electric engines by rail; instead of sending them at railway risk they sent them at owner's risk; the engines were damaged in transit; the contract of carriage was held unreasonable, and the buyers were entitled to reject. Section 39(3) requires the seller, where the goods are sent by sea transit and insurance is usual, to give the buyer such notice as will enable him to insure; failing notice, the goods are at the seller's risk during sea transit.

Section 40 — deterioration during transit

Section 40 closes the cluster. Where the seller agrees to deliver the goods at his own risk at a place other than that where they are when sold, the buyer must, unless otherwise agreed, take any risk of deterioration in the goods necessarily incident to the course of transit. The seller's risk-bearing is not stretched to cover ordinary wear and tear in transit. The leading authority is Bull v. Robinson (1854) 10 Ex 342 — hoop iron sent from Staffordshire to Liverpool, clean and bright at despatch but rusted on arrival; the seller was held not liable, the deterioration being incident to the course of transit.

An "unusual risk", however, is not necessarily incident to transit and falls on the seller. A manufacturer who contracts to deliver a manufactured article at a distant place must stand the risk of any extraordinary or unusual deterioration. In the case of perishable goods consigned to a distance, the rule is sharper: the goods must not only be merchantable when despatched but must remain merchantable during transit and for a reasonable time thereafter. Beer v. Walker (1877) 46 LJQB 677 — rabbits sound on despatch from London were unfit for human food on arrival at Brighton; the buyer was entitled to reject. Section 40 must therefore be read with the implied condition of merchantable quality, on which the chapter on implied conditions under Sections 14 to 17 is built.

Bharat Cooking Coal and the public-undertaking line

Three further authorities deserve mention because they apply the Section 33 cluster in commercial settings. The Supreme Court in Carlos Federspiel & Co. v. Charles Twigg & Co. (1957) 1 Lloyd's Rep 240, while strictly a Section 23 case on appropriation, illustrates the difference between the moment property passes and the moment delivery is effected — the goods may be appropriated and yet not delivered, and Section 33 has to do its work even after Section 23 has done its work. The Indian decision in Aron v. Comptoir Wegimont (1921) 3 KB 435 deals with the seller's duty under Section 39 — the contract was on c.i.f. terms and the seller's duty to ship within the contracted period was held to be a part of the description of the goods, with breach of the shipment date entitling the buyer to reject.

For Indian conditions, the High Court decisions on jute, coal and steel supply contracts have repeatedly applied Section 36(1) and Section 39(1) to allocate risk and place between PSU buyers and their suppliers. The principle that runs through these cases is that the contractual stipulations, however formal, are read against the residual rules in Section 36, and any deviation from those rules must be expressly written.

Distinction — delivery and acceptance

The chapter on Section 33 must be kept distinct from the parallel chapter on acceptance. Delivery, under Section 33, is the seller's act of putting the goods into the buyer's possession, whether actually, symbolically or constructively. Acceptance, under Section 42, is the buyer's act — by intimation, by an act inconsistent with the seller's ownership, or by retention beyond reasonable time without rejection. The two acts may coincide in time but they are conceptually separate. The buyer's right of rejection survives delivery; it dies on acceptance. The interplay is at the heart of cases such as Hardy & Co. v. Hillerns & Fowler (1923) 2 KB 490 and Chao v. British Traders & Shippers Ltd. (1954) 1 All ER 779, both treated in the performance chapter.

Distinction — delivery and tender

The further distinction between delivery and tender repays study. Tender is the offer of delivery — the seller's act of presenting the goods or making them available — but tender does not, by itself, transfer possession. Delivery requires acceptance of the tender or an act that has the effect of putting the goods in the buyer's possession. Where the buyer wrongfully refuses to accept a proper tender, the seller's remedy is under Section 44 — he may sue for damages for the buyer's neglect or refusal to take delivery, and recover reasonable charges for the care and custody of the goods. The seller's duty to deliver is satisfied by a proper tender; the buyer's failure to accept does not undo the tender's legal effect.

Symbolic delivery and the bill of lading line

The bill of lading deserves its own paragraph because it is a special vehicle of symbolic delivery. The bill is a triple instrument — it is a receipt for the goods, a contract of carriage, and a document of title. As a document of title, its endorsement and delivery transfers the right to demand the goods from the carrier. Transfer of the bill is therefore a delivery of the goods, even though the goods themselves remain at sea. The principle is foundational to international trade contracts on c.i.f. terms, and the c.i.f. seller's duty is performed by tender of the documents — bill of lading, invoice and insurance policy — rather than by tender of the goods.

By contrast, a delivery order is not a document of title at common law. A delivery order is the seller's instruction to the holder of the goods to deliver them to the buyer, and it operates as delivery only when the holder acknowledges and attorns to the buyer. The student should keep the two distinct: bill of lading is symbolic delivery in itself; delivery order is symbolic only after the warehouseman's acknowledgement, which is constructive delivery in operation.

Exam-angle distinctions

Three distinctions are worth carrying into the examination hall.

1. Section 33 and Section 2(2). Section 2(2) defines delivery as voluntary transfer of possession; Section 33 supplies the modes by which that voluntary transfer can be effected. The two must be read together — a transfer that is involuntary is not a delivery, however symbolic or constructive in form.
2. Symbolic and constructive delivery. Symbolic delivery transfers a document of title; constructive delivery effects a change in the legal character of the holder. A bill of lading endorsement is the first; a warehouseman's attornment is the second. The first does not require an acknowledgement by the carrier; the second requires acknowledgement by the third party.
3. Section 36(1) and Section 36(3). Section 36(1) supplies the default rule on the place of delivery. Section 36(3) supplies the rule for goods with a third party at the time of contract. The two operate together: where the goods are with a third party, the place of delivery is normally the warehouse where the goods are, but no delivery occurs there until the warehouseman acknowledges to the buyer that he holds the goods on the buyer's behalf.

A fourth distinction — between the rule on quantity in Section 37 and the rule on description in Section 15 — is treated above. A fifth, between delivery to the buyer (Section 33) and delivery to a carrier (Section 39), is the gateway into the unpaid-seller chapter and is addressed in the chapter on stoppage in transit under Sections 50 to 52.

Putting the cluster together

Section 33 of the Act is the doctrinal hinge of the delivery chapter. It defines the modes by which possession is transferred, and it leaves the parties free to agree on whatever shall be treated as a delivery, provided the agreement actually has the effect of putting the goods in the buyer's possession. The cluster of Sections 34 to 40 then supplies the residual rules — part delivery, application by the buyer, place and time, attornment, tender, expenses, wrong quantity, instalments, delivery to carrier, deterioration in transit. Each rule operates as a default, displaceable by express agreement; the discipline of the chapter is that the express terms of the contract always come first, and the statutory rules step in only when the contract is silent.

Read with the buyer's right of examination under Section 41, the buyer's three modes of acceptance under Section 42, and the buyer's right not to return rejected goods under Section 43, the cluster forms the operating manual for the close of every contract of sale. The next chapter on the unpaid seller and the rights conferred by Section 45 and Section 46 picks up the story when the buyer fails to pay despite a proper tender, and the chapters on the right of lien under Sections 47 to 49 and on stoppage in transit complete the post-default architecture. Read in sequence, the four chapters cover the entire post-formation life of a contract of sale, with Section 33 sitting at the gateway.

Frequently asked questions

What are the three modes of delivery recognised under Section 33 of the Sale of Goods Act?

Section 33 recognises three modes of delivery: actual, symbolic and constructive. Actual delivery is the manual handing over of the goods themselves; symbolic delivery is the transfer of a symbol that represents the goods, such as the key of a warehouse, a bill of lading or a railway receipt; constructive delivery — also called fictitious delivery or delivery by attornment — involves no change in actual custody but a change in the legal character in which the holder retains the goods. The three together exhaust the practical field, and the test in every case is whether the act has the effect of putting the goods in the buyer's possession.

Does merely giving a delivery order to the buyer amount to delivery under Section 33?

No. Merely giving a delivery order to the buyer does not amount to delivery of the goods. A delivery order is an instruction to the holder of the goods to deliver them to the buyer, and it operates as delivery only when the holder acknowledges the buyer and attorns to him — that is the rule in Section 36(3). By contrast, transfer of a bill of lading is itself a symbolic delivery and no further acknowledgement by the carrier is required, because the bill of lading is a document of title. Godts v. Rose (1855) 17 CB 229 is the leading authority on the requirement of tripartite acknowledgement.

What is the place of delivery if the contract of sale is silent under Section 36(1)?

Section 36(1) supplies a three-way default. In a sale of specific goods, the place of delivery is the place where the goods are at the time of sale. In an agreement to sell, it is the place where the goods are at the time of the agreement to sell. In the case of future goods which are yet to be manufactured or produced, it is the place at which they are manufactured or produced. The default is statutory and applies unless displaced by contract. Galbraith and Grant Ltd. v. Block (1922) 2 KB 475 added that delivery at the buyer's place to a respectable-looking person discharges the seller.

When does part delivery operate as delivery of the whole under Section 34?

Section 34 distinguishes between part delivery in progress of the delivery of the whole, which counts as delivery of the whole, and part delivery with intention of severance, which does not. Hammond v. Anderson (1803) 1 B&P NR 69 illustrates the first — the buyer got the whole weighed but took only a part, and the part operated as a delivery of the whole. Bunnery v. Poyntz (1833) 4 B&Ad 568 illustrates the second — permission to cut and remove a part of a haystack related only to the part. The dividing line is the parties' intention, and the burden is on the party asserting severance.

What is the seller's duty under Section 39 when sending goods by carrier?

Section 39 imposes three duties. Section 39(1) makes delivery to a carrier or wharfinger prima facie delivery to the buyer. Section 39(2) requires the seller to make with the carrier a contract of carriage that is reasonable having regard to the nature of the goods and the circumstances of the case; failing this, the buyer may decline the delivery to the carrier or hold the seller in damages, as in Young v. Hobson (1949) 65 TLR 365. Section 39(3) requires the seller, where goods are sent by sea transit and insurance is usual, to give such notice as will enable the buyer to insure; failing notice, the goods are at the seller's risk during sea transit.