216 Chapter 7The Sale of Goods Act 1979
In Car and Universal Finance Co Ltd vCaldwell (1965)the Court of Appeal held that in
the case of a contract made voidable by a fraudulent misrepresentation the contract is
avoided if the seller does some act which shows a definite intention not to be bound by the
contract. In the case this was done by telling the police and the AA to look out for the car
obtained by the fraudulent misrepresentation. Unfortunately, the Court of Appeal refused
to say whether or not the contract would have been avoided in this way if the misrepresen-
tation had not been fraudulent.
When a contract is voidable but it is avoided before the car is sold on, the final buyer will
not get title under s. 23. However, he should then see if s. 25, considered below, might pass
title to him.
It should be noticed that if the rogue had been a thief who just stole the car then he would
never have had any title at all, and so could not have passed on any title at all. Therefore,
the owner would always get the car back. (See Rowland vDivall, p. 78.)
Figure 7.10 gives an overview of s. 23.Sale by a seller in possession (s. 24 SGA)
Section 24 provides that if a seller sells goods to one buyer, but keeps possession of the
goods, and then sells the same goods to a second buyer, who takes delivery of the goods,
then the second buyer will get ownership of the goods.
This is an exception to the nemo datrule whenever, as is commonly the case, the first
buyer would have got ownership of the goods as soon as the contract was made.
The first buyer can of course sue the seller for damages for selling his goods.was worthless. Before the owner discovered this, the rogue sold the car to the defendant,
who bought the car in good faith.
HeldThe defendant had a complete title to the car as he had bought it before the owner
rescinded the contract with the rogue.Figure 7.10An overview of section 23