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A gives a gold chain to B on sale or return basis and B gives it to C on sale or return basis. C loses the gold chain. Who shall bear the loss?
- a)A, the real owner
- b)B
- c)C
- d)None of the above
Correct answer is option 'B'. Can you explain this answer?
Most Upvoted Answer
A gives a gold chain to B on sale or return basis and B gives it to C ...
A gave the chain to B for sale or return. They came into a contract. As there contract is not completed and B handed over the chain to C. So the second contract is void till the first one completed. Thats why B is liable for the loss.
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A gives a gold chain to B on sale or return basis and B gives it to C ...
Explanation:
The person who shall bear the loss in this situation is B, the person who gave the gold chain to C on a sale or return basis. This is because B is the immediate party responsible for the loss of the gold chain.
Reasoning:
To understand why B bears the loss, we need to analyze the concept of sale or return basis and the legal implications associated with it.
Sale or Return Basis:
When a transaction is conducted on a sale or return basis, it means that the ownership of the goods is transferred from the seller to the buyer, but the buyer has the option to return the goods if they are unsatisfied or unable to sell them. In this case, A initially gave the gold chain to B on a sale or return basis.
Transfer of Ownership:
When A gave the gold chain to B on a sale or return basis, the ownership of the gold chain was transferred from A to B. B became the legal owner of the gold chain.
B's Responsibility:
When B further gave the gold chain to C on a sale or return basis, the ownership of the gold chain was again transferred, this time from B to C. However, B remains responsible for the gold chain until C either purchases it or returns it. This means that if C loses the gold chain, B is the one who bears the loss.
Legal Implication:
According to the principle of 'caveat emptor' or 'buyer beware', the buyer (in this case, C) is responsible for any loss or damage to the goods once they have taken possession of them. However, since B was the legal owner of the gold chain at the time it was lost, B is the one who bears the loss.
Therefore, the correct answer is option 'B' - B bears the loss.
The person who shall bear the loss in this situation is B, the person who gave the gold chain to C on a sale or return basis. This is because B is the immediate party responsible for the loss of the gold chain.
Reasoning:
To understand why B bears the loss, we need to analyze the concept of sale or return basis and the legal implications associated with it.
Sale or Return Basis:
When a transaction is conducted on a sale or return basis, it means that the ownership of the goods is transferred from the seller to the buyer, but the buyer has the option to return the goods if they are unsatisfied or unable to sell them. In this case, A initially gave the gold chain to B on a sale or return basis.
Transfer of Ownership:
When A gave the gold chain to B on a sale or return basis, the ownership of the gold chain was transferred from A to B. B became the legal owner of the gold chain.
B's Responsibility:
When B further gave the gold chain to C on a sale or return basis, the ownership of the gold chain was again transferred, this time from B to C. However, B remains responsible for the gold chain until C either purchases it or returns it. This means that if C loses the gold chain, B is the one who bears the loss.
Legal Implication:
According to the principle of 'caveat emptor' or 'buyer beware', the buyer (in this case, C) is responsible for any loss or damage to the goods once they have taken possession of them. However, since B was the legal owner of the gold chain at the time it was lost, B is the one who bears the loss.
Therefore, the correct answer is option 'B' - B bears the loss.
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A gives a gold chain to B on sale or return basis and B gives it to C on sale or return basis. C loses the gold chain. Who shall bear the loss?a)A, the real ownerb)Bc)Cd)None of the aboveCorrect answer is option 'B'. Can you explain this answer?
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