PROTECTING THE RIGHTS OF THE BONA-FIDE PURCHASER FOR VALUE

Abstract

This study examines the role of the Sale of Goods Law (SGL) in safeguarding the rights of bonafide purchasers for value (BFPV) and emphasizes the necessity of such protections. Using the doctrinal legal research methodology, this study investigates the legal principles, statutes, and judicial precedents that shape the legal framework surrounding BFPV. A comparative analysis of BFPV under property law and commercial law reveals a stark contrast in the burden of due diligence imposed on purchasers. Under property law, purchasers are expected to conduct thorough due diligence, whereas commercial transactions primarily require purchasers to pay valuable consideration and act in good faith, even in cases of negligence. Furthermore, exceptions to the nemo dat quod non habet principle, as enshrined in the SGL, provide additional protections for BFPV, ensuring transactional security amidst uncertainties in verifying the legitimacy of sellers' titles. This study concludes that these statutory exceptions and legal safeguards are crucial in mitigating risks associated with commercial transactions and facilitating equitable trade.