Risk, property and bulk goods in international sales

This article deals with the sale of goods out of an identified bulk, where the buyer has paid for the contractual quantity to which it is entitled without the goods yet having been separated from that bulk. Critical attention will be paid to section 20A of the Sale of Goods Act 1979, with particular reference to the question whether any shrinkage in the bulk should be rateably apportioned between seller and buyer in those instances where the seller retains a property interest in that bulk. The argument developed below is that any shrinkage in the bulk should be rateably apportioned and not charged first against the seller. The view that the Law Commission intended the seller first to bear the loss is not clearly borne out either in the Law Commission’s report or in the ensuing legislation and is also lacking in commercial common sense. Attention will also be paid to the time when rights in a bulk accrue and to the impact of section 20B on these rights