res perit domino
Under s.26 of the Sale of Goods Act, 1930, unless otherwise agreed, the goods remain at the seller's risk until property in them passes to the buyer; once property passes, they are at the buyer's risk whether or not delivery has been made. So risk follows ownership, not possession.
Two exceptions are built in: where delivery is delayed through the fault of either party, the goods are at the risk of the party at fault for any loss that would not otherwise have occurred; and the duties of a party as bailee of the goods are not affected. The parties can agree that risk passes at a different time from property, as is common in CIF and FOB contracts.
Example
Property in the specific car had passed on signing, so when it was destroyed in the seller's garage the loss fell on the buyer, res perit domino.
In Indian law
- Section 26, Sale of Goods Act, 1930
See also
sale of goods · res extincta · caveat emptor · bailment