Question on: JAMB Commerce - 2012
Yahaya bought a piece of furniture on a credit sale agreement from Ahmed and resold it to Ali before all installments were made .The court upheld that Ahmed could not recover possession of the items from Ali. The reason for the judgement was because
A
ownership was transfered on completeion of installment
B
ownership was transfered on delivery
C
Yahaya could not pass title to a third party
D
Ali was still indebted to Yahaya
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Correct Option: B
The court's decision that Ahmed couldn't recover the furniture from Ali is based on the principle of transfer of ownership.
- Credit sale agreement: In a credit sale, the ownership of the goods transfers to the buyer (Yahaya) upon delivery, even though the full payment is not yet made.
- Resale to Ali: Since Yahaya had ownership, he could legally sell the furniture to Ali.
- Ali's position: Ali, as a subsequent buyer, acquired good title to the furniture from Yahaya, regardless of whether Yahaya had completed his installment payments to Ahmed. This is because the ownership had already been transferred to Yahaya upon delivery.
- Ahmed's recourse: Ahmed's recourse is against Yahaya for the outstanding payments, not against Ali for
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