Based on the case, we would like to advice Bon that he should not sued Chan for return back his car. This case can explain based on the exception to Nemo Dat Rule which is Sale by Mercantile Agent that categorised under Section 27 of Sales of Good Acts 1957. Section 27- Sale by Mercantile Agent give out the definition which is a mercantile agent deals in possession of goods or of a document of titles to the goods with the consent of owner, acting in ordinary course of business to lead the buyer can get a good title of the goods (Grade Stack 2015). Sale by Mercantile Agent also provides that buyers act in good faith and has not notice that the seller has no authority to sell (Grade Stack 2015). This explanation can imply in condition when Chan buys the car with John.
Bon has passed his properties which are his car and documents to John and ask John to help him sold the car. Meanwhile, Chan is purchased in good faith because as a buyer, Chan does not know that John is not the car’s owner but just a second hand car sales man. Chan buys the car with John with a good title since he does not notice that John has lack of authority to sell the car for below RM 50000. Sale by Mercantile Agent has state that possession of goods must be with consent of owner (Grade Stack 2015). This definition can use to oppose the action of John which he sell Bon’s car for RM 45000 although Bon told him not sell below RM 50000. Bon can sue John to get back his money since John disappears with money. This is because although Bon has passed his car and document’s ownership to John and ask John to help him sell his car, John did not in possession of the car properly. This means that John did not put possession of car with consent of Bon when John sells the car to Chan for price RM 45000 although Bon told John not sell his car below RM50000.
This also means that John did not fulfil the ownership of the car with the agreement of Bon. Bon should go after John to get back his money.For this case, Chan Enterprise cannot claim the lcd television back from Elsa. This is because this case is put under Nemo Dat Rule which states that who do not have the right of ownership when purchasing from someone it can be rebut of any ownership title in order to protect the right of ownership. (Hariharan, 2017)However, under the Sales of Goods Acts 1957 there are exceptions to this Nemo Dat Rule where the buyer buys in good faith without notice that the seller is not the owner and he has paid for the goods, it is unfair to him when it is noticed that the seller does not have a good title.
(LawTeacher, 2013) In this case, the condition can be applied to Section 30 (2) – Sale by Buyer in possession which the buyer sells to another buyer. The rule can be an exhibit by Newtons of Wembley Ltd versus Williams where the innocent buyer has either agreed or purchase the goods obtains possession of goods or document of title with consent of the seller. (LawTeacher, 2013) The buyer sells or transfers the goods or title to a subsequent buyer who buy in good faith of any sale or other disposition to any person will convey a good title and without notice the original seller’s rights to the goods. The subsequent buyer obtains a good title. But if the second buyer buys with knowledge, he/she will not get a good title. (National Employers, 1990)In this case, Chan Enterprise first sells the lcd television set to Ben 1st buyer. The title of the goods have passed to Ben, Ben then sells the lcd television to Elsa – 2nd buyer. Under this exception, Elsa will get a good title because Elsa bought the lcd television in good faith and without knowledge of this fact.
Therefore Chan Enterprise cannot claim from Elsa as Elsa has a good title on the lcd television.
