THE NATURE OF TRANSFER OF RISK IN SALE OF GOODS CONTRACTS - A CRITICAL ANALYSIS
The transfer of risk in the contract of sale is a question of great practical significance because of its potential for harsh consequences that has intrigued numerous jurists, judges and practitioners since the Roman Period. As a consequence of attracting so much attention, different theories about it have been developed and it is clear that there is more than one approach to the problem. This article critically examines the nature of transfer of risk in sale of goods contract with particular focus on the provisions of sections 20, 6, 7, 31, 32 and 33 of Sale of Goods Act of 1979, it also briefly discusses the provisions of other International Trade Laws. Legal conclusion shall be drawn based on our analysis and recommendation made based on empirical facts deduced from varied legal systems. The article recommends that to avoid confusion and conflict on the transfer of risk in sale of goods contracts of international dimension, INCOTERMS should be used by the contracting parties. For domestic trade disputes, the amended version of the Sale of Goods Act of 1979 may be adopted to clarify the position of the contracting parties regarding transfer of risk but this should only be an interim measure pending the enactment of a contemporary fit-for-purpose Sale of Goods Act.