“No seller of goods and give to the buyer a better title than he himself has”. Explain this rule. Are there any exceptions to this rule?

Rule: No Seller Can Give to the Buyer a Better Title Than He Himself Has

This rule is a fundamental principle of the law of sale of goods, and it means that when a seller sells goods to a buyer, the seller cannot transfer a better title (ownership) to the buyer than the seller himself possesses. In simpler terms, if the seller does not have the legal right to sell the goods (e.g., the goods are stolen or subject to a lien), then the buyer does not acquire a valid title to the goods.

Explanation of the Rule:

• Ownership Rights: Ownership (title) of goods can only be transferred by someone who has the legal right to do so. If the seller does not own the goods or has an incomplete or defective title, the buyer cannot acquire full ownership rights.
• Voidable Contracts: If the seller's title is defective but not void (e.g., the goods are subject to a lien that can be discharged), the contract is voidable at the option of the buyer. The buyer can choose to affirm the contract and acquire the goods or rescind the contract and return the goods.
• Risk of Loss: If the buyer receives goods with defective title and later loses them (e.g., they are repossessed by the true owner), the loss falls on the buyer, not the seller, unless the seller is at fault (e.g., the seller knowingly sold stolen goods).

Exceptions to the Rule:

1. Sale by Estoppel: If the true owner of goods (A) allows another person (B) to hold themselves out as the owner and sell the goods to a third party (C), then A is estopped (prevented) from denying C's title to the goods. This is known as a sale by estoppel.

2. Sale under Voidable Title: If a seller sells goods under a voidable title (e.g., the seller is a thief but the true owner has not yet discovered the theft), the buyer acquires a good title to the goods if they buy them in good faith and without notice of the defect in the seller's title.

3. Sale under Mercantile Agent: A mercantile agent is a person who, in the customary course of business, has authority either to sell goods or to consign goods for the purpose of sale. If a mercantile agent sells goods with the consent of the owner, the buyer acquires a good title to the goods even if the agent exceeds their authority, provided that the buyer acts in good faith and without notice of the agent's lack of authority.

Conclusion:

In conclusion, the rule that no seller can give to the buyer a better title than he himself has is a fundamental principle of the law of sale of goods. It ensures that buyers acquire valid title to goods and protects them from purchasing goods with defective title. While there are exceptions to this rule, such as sales by estoppel, sales under voidable title, and sales by mercantile agents, these exceptions are limited and do not undermine the general rule. It is essential for buyers to be aware of these principles when entering into transactions involving the sale of goods.