Title of the case: Rowland v. Divall [1923] 2 K.B. 500.

Summary of fact:
Rowland bought a motor-car from Divall and used it for four months. Divall had no
title to the car, and consequently Rowland had to surrender it to the true owner.
Rowland sued to recover the total purchase price he had paid to Divall.

Issue:
1. Whether there is a breach of condition?
2. Whether the buyer is entitled to recover the total purchase price?

Decision:
It was held that there is a breach of implied condition as to title by the seller and
therefore the buyer is entitled to recover the purchase price in full, notwithstanding
that he used the car for four months.

Reasoning:
There was a breach of condition. Consequently the buyer can repudiate the contract
and reject the goods. But in this case the car was already taken by the real owner;
hence no question of rejection of goods arises. Therefore, the buyer can repudiate the
contract by taking back the full purchase money as damages due to the breach of
condition. The consideration had totally failed on the part of the seller. The use of the
car that he had had was no part of the consideration that he had contracted for, which
was the property in and lawful possession of the car, whereas what he got was an
unlawful which exposed him to the risk of an action at the suit of the true owner.

1.

2. Facts of the case

3. [INTHECOURTOFAPPEAL]

4.

5. ROWLAND

6. v.
 7. DIVALL
8.

9. [1922.R.2746.]

10.SaleofGoodsImpliedConditionthatVendorhasaRighttoSell
BreachofUserofGoodsbyBuyerTotalFailureofConsideration
RecoveryBackofPrice.

The claimant, a car dealer, bought a car from the defendant for
334. He painted the car and put it in his showroom and sold it to a
customer for 400. Two months later the car was impounded by the
police as it had been stolen. It was then returned to the original
owner. Both the claimant and defendant were unaware that the car
had been stolen. The claimant returned the 400 to the customer
and brought a claim against the defendant under the Sale of Goods
Act.

Held:

The defendant did not have the right to sell the goods as he did not
obtain good title from the thief. Ownership remained with the
original owner. The defendant had 2 months use of the car which he
did not have to pay for and the claimant was not entitled to any
compensation for the work carried out on the car.

11. Principle of Law dealt in the case

12. SaleofGoodsImpliedConditionthatVendorhasaRighttoSell
BreachofUserofGoodsbyBuyerTotalFailureofConsideration
RecoveryBackofPrice.

Atkin LJ said: It seems to me that in this case there has been a total failure of
consideration, that is to say that the buyer has not got any part of that for
which he paid the purchase money. He paid the money in order that he might
get the property, and he has not got it. It is true that the seller delivered to
him the de facto possession, but the seller had not got the right to possession
and consequently could not give it to the buyer. . There can be no sale at all of
goods which the seller has no right to sell. The whole object of a sale is to
transfer property from one person to another . . can it make any difference
that the buyer had used the car before he found out that there was a breach
of the condition? To my mind it makes no difference at all. The buyer accepted
the car in the representation of the seller that he had a right to sell it, and in
as much as the seller had no such right he is not entitled to say that the buyer
has enjoyed a benefit under the contract. In fact the buyer has not received
any part of that which he contracted to receive, namely the property and right
to possession and that being so there has been a total failure of
consideration.

13. Impact of the case on business

14. thelawhasimposedmoreresponsibilityonthesellerwhichwillbeableto
protectallbuyers,because,nowadays,themodernlawhasprovedthat
buyershasbecomemoreandmoredriventorelyonthehonesty,skilland
judgmentoftheseller.Inmanysituations,therulescontainedintheact
onlyapplywherethepartieshavefailedtomakeexpressarrangementsas
totheirobligations.

15. Further developments in the area if any

16. Reference to similar cases (with a brief synopsis) would be appreciated