EcoGreen Garden Centre Inc.will pay $2400 for the two tons of organic fertilizer it ordered for delivery in March.The fertilizer is to be packaged in 20 kg bags and then packed onto two separate one-ton pallets for shipment.In this instance,what rule under sale of goods legislation will dictate when title to the goods passes to EcoGreen?

Question

Quizplus · Accepted Answer

Rule 2, also known as the "shipment contract" rule, states that title to the goods passes to the buyer at the time of shipment, meaning when the goods are delivered to the carrier for transportation. In this case, the fertilizer will be packed onto pallets for shipment, indicating that the contract is a shipment contract. Therefore, once the goods are loaded onto the carrier, title to the fertilizer will pass to EcoGreen.