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A deliver a gold necklace to B on sale or return basis it is agreed between A and B that property is not to pass to B till he has paid price to necklace. Without paying price B sells the necklace to C. Does C get a good title to the necklace?
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A deliver a gold necklace to B on sale or return basis it is agreed be...
Introduction:

In this scenario, A delivers a gold necklace to B on a sale or return basis, with the agreement that the property will not pass to B until he has paid the price for the necklace. However, before B pays the price, he sells the necklace to C. The question is whether C obtains a good title to the necklace.

Analysis:

To determine whether C gets a good title to the necklace, we need to consider the concept of "good faith purchaser for value without notice" and the rules governing the transfer of title.

1. Good Faith Purchaser:

A good faith purchaser is someone who acquires property without any knowledge of defects in the seller's title or any other circumstances that would cast doubt on the validity of the transaction. To establish that C is a good faith purchaser, we need to examine whether C had any notice or knowledge of the agreement between A and B.

2. Sale or Return Agreement:

In the given scenario, A and B had a sale or return agreement, which means that the property would not pass to B until he paid the price for the necklace. This condition implies that B did not have the authority to sell the necklace to C without fulfilling the payment obligation.

3. Passing of Property:

The passing of property refers to the transfer of ownership rights from the seller to the buyer. In this case, the property was not intended to pass to B until the payment was made. As B sold the necklace to C before fulfilling the payment obligation, the property did not pass to B.

Conclusion:

Based on the analysis above, it can be concluded that C does not obtain a good title to the necklace. This is because C cannot be considered a good faith purchaser for value without notice. C had knowledge or notice of the sale or return agreement between A and B, and therefore, C cannot claim ownership rights to the necklace.

Summary:

In summary, C does not acquire a good title to the gold necklace as he was aware of the sale or return agreement between A and B. The property did not pass to B before the sale to C occurred, and C cannot be considered a good faith purchaser without notice. Therefore, A retains ownership rights to the necklace, and C's purchase from B does not confer valid ownership.
Community Answer
A deliver a gold necklace to B on sale or return basis it is agreed be...
No he didn't get good title bcoz B is not the real owner
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A deliver a gold necklace to B on sale or return basis it is agreed between A and B that property is not to pass to B till he has paid price to necklace. Without paying price B sells the necklace to C. Does C get a good title to the necklace?
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A deliver a gold necklace to B on sale or return basis it is agreed between A and B that property is not to pass to B till he has paid price to necklace. Without paying price B sells the necklace to C. Does C get a good title to the necklace? for CA Foundation 2024 is part of CA Foundation preparation. The Question and answers have been prepared according to the CA Foundation exam syllabus. Information about A deliver a gold necklace to B on sale or return basis it is agreed between A and B that property is not to pass to B till he has paid price to necklace. Without paying price B sells the necklace to C. Does C get a good title to the necklace? covers all topics & solutions for CA Foundation 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for A deliver a gold necklace to B on sale or return basis it is agreed between A and B that property is not to pass to B till he has paid price to necklace. Without paying price B sells the necklace to C. Does C get a good title to the necklace?.
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