Contract and Commercial Law Act 2017

Sale of goods - Formation of contract - Subject matter of contract

128: Contract void if goods perish before sale but after agreement to sell

You could also call this:

“Agreement cancelled if item is destroyed before you receive it”

If you agree to buy a specific item, but that item is destroyed before you receive it, and it’s not your fault or the seller’s fault, the agreement becomes invalid. This means that neither you nor the seller have to follow through with the sale. For example, if you agree to buy a painting, but the painting is accidentally destroyed in a fire before you can get it, the agreement is no longer valid. This rule doesn’t apply to agreements about general types of items, only to agreements about specific items. It’s important to know that in this situation, special rules about contracts that can’t be completed don’t apply.

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View the original legislation for this page at https://legislation.govt.nz/act/public/1986/0120/latest/link.aspx?id=DLM6844316.


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127: Contract void if goods have perished at time when contract is made, or

"The deal is off if the stuff you're buying is already gone when you agree to buy it"


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Part 3 Sale of goods
Formation of contract: Subject matter of contract

128Contract void if goods perish before sale but after agreement to sell

  1. This section applies if there is an agreement to sell specific goods and, subsequently, the goods, without any fault on the part of the seller or the buyer, perish before the risk passes to the buyer.

  2. The agreement becomes void when the goods perish.

  3. See section 69 (which provides that subpart 4 of Part 2 (frustrated contracts) does not apply to a contract to which subsection (1) applies).

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