CT 2.4B IMPLIED TERMS (TITLE)
This can be seen as a manifestation of the maxim; Nemo dat quad non habet (you cannot give what you do not have).
Section 12(1) of the act provides that unless a contrary intention appears, there is an implied condition that the seller has the right to sell goods or shall have the right to sell when the property is to pass. This section imposes a strict liability on the seller.
This provision does not mean that the seller must be the owner of goods. It simply means that the seller should have the right to sell the goods without legal constraint otherwise, he has breached a condition which entitles the buyer to repudiate-Niblett V. Confectioners Materials co, the claimant bought 1000 tins of “Nissly” milk from the defendant. They could not sell the milk because it was infringing on the trademark of Nestle. The claimants sued alleging that the defendant had no right to sell the 1,000 tins of Nissly milk to them in the first place. Their suit succeeded. In Rowland V. Divall, the defendant unlawfully sold a car belonging to a third party to the plaintiff who had to return it to the third party. The court held that there was a breach of Section 12(1). The effect of such breach gives the buyer power to rescind the contract for total failure of consideration. In Akoshile V. Ogidan the plaintiff innocently bought a stolen car from the defendant. After convicting the thief, the car was taken from the plaintiff. The court held that the defendant was in breach of Section 12(1) and the plaintiff was entitled to recover the purchase price he had paid. See also Hollins V. Fowler.
The constraint must be legal. In Udekwu V. Abosie, the plaintiff bought a car from the defendant and customs officers seized it alleging that it’s import duty had not been paid. He then sued under Section 12 (title and quiet possession). The court held that failure to pay import duty on the car did not vitiate the seller’s title and that the act of the customs officers was wrongful. Thus, the defendant was NOT in breach of Section 12.
Section 61 lists the exceptions to the nemo dat quad non habet rule.