QUESTION:

P agreed to buy 100 barrels of widget oil, which was stored in a large tank at D's depot. The tank contained a total of 10,000 barrels of widget oil. Before separating and barrelling P's oil, the equivalent of 1,000 barrels of oil leaked from D's tank. D then refused to deliver to P, claiming that the 1,000 barrels that leaked included her 100 barrels and that she would have to bear the loss. When P refused to pay, D wishes to sue her for the price. Discuss.

1) ISSUE:

-The ownership of the oil

-Has ownership of the oil passed to P?

2) PRINCIPLE:

- The sales passes to the buyer when goods of in a deliverable state

3) CASE:

Healy v Howlett & Son [1917] 1 kb 337

4) APPLICATION

- The goods are not in a deliverable state

5) CONCLUSION:

-Ownership of the oil has not yet passed to P

-P should not bear the loss