F.O.R. sale contracts: property and transit risk pass on delivery to the railway, and interest may follow unpaid price

In an f.o.r. Jodhpur sale contract, property in the tents and the transit risk passed to the buyer when the goods were loaded into railway wagons for dispatch, because delivery to the carrier without reservation completed unconditional appropriation to the contract. The buyer was therefore liable for the price of the short-delivered quantity. The note also states that, where the unpaid sale price remained withheld for a substantial period and no contrary stipulation existed, reasonable interest could be awarded from the date the amount became payable. Interest on the unpaid price was allowed at 6 per cent per annum for the relevant period, together with costs.

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Issues: (i) Whether, under an f.o.r. Jodhpur contract, property in the goods and the risk of transit passed to the buyer upon loading of the tents in railway wagons at Jodhpur; (ii) whether the seller was entitled to interest on the unpaid price of the short-delivered tents.

Issue (i): Whether, under an f.o.r. Jodhpur contract, property in the goods and the risk of transit passed to the buyer upon loading of the tents in railway wagons at Jodhpur.

Analysis: The contract required delivery f.o.r. Jodhpur, and the goods were loaded at Jodhpur for dispatch to the consignee. On the terms of sale, the seller's obligation ended with loading for rail dispatch, and the property was unconditionally appropriated to the contract when the goods were delivered to the carrier without any reservation of disposal. In such a case, the risk follows the property and does not remain with the seller until actual receipt at destination.

Conclusion: The property in the tents and the transit risk passed to the buyer at Jodhpur, and the buyer was liable for the price of the short-delivered quantity.

Issue (ii): Whether the seller was entitled to interest on the unpaid price of the short-delivered tents.

Analysis: The price of the short-delivered tents was withheld for a substantial period after delivery, and in the absence of a contract to the contrary, interest on the unpaid price could be awarded from the date the price became payable. The Court applied the statutory discretion to grant reasonable interest on the amount due.

Conclusion: Interest on the unpaid price was payable at 6 per cent per annum for the relevant period, and the seller's claim for interest succeeded.

Final Conclusion: The appeal succeeded, the concurrent findings against the appellant on liability were set aside, and the appellant obtained a decree for the price of the short-delivered tents together with interest and costs.

Ratio Decidendi: In an f.o.r. contract, property and risk ordinarily pass to the buyer on delivery of the goods to the railway for dispatch, and the court may award reasonable interest on an unpaid sale price in the absence of a contrary contractual stipulation.

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