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New Zealand law explained for everyone

Contract and Commercial Law Act 2017

Sale of goods - Effects of contract - Transfer of title

149: Sale by person who is not owner

You could also call this:

“When someone sells something they don't own, you might not get to keep it”

When someone sells goods that they don’t own, and they don’t have permission from the real owner to sell them, you need to be careful. If you buy these goods, you won’t get better ownership rights than the person who sold them to you. This means if the seller didn’t have the right to sell the goods, you might not legally own them either.

There’s an exception to this rule. If the real owner of the goods did something that made it seem like the seller had permission to sell, then you might be able to keep the goods you bought.

There are other rules that can change how this works. These include special laws that let someone who looks like the owner sell goods as if they really owned them. There are also special legal powers and court orders that can affect how goods are sold.

The Personal Property Securities Act 1999 can also help you get good ownership of goods you buy in some situations.

Remember, these rules are part of a bigger set of laws about buying and selling goods, so there might be other things to consider too.

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View the original legislation for this page at https://legislation.govt.nz/act/public/1986/0120/latest/link.aspx?id=DLM6844345.

Topics:
Business > Fair trading Money and consumer rights > Consumer protection
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Part 3 Sale of goods
Effects of contract: Transfer of title

149Sale by person who is not owner

  1. This section applies if goods are sold by a person who—

  2. is not the owner of the goods; and
    1. does not sell the goods under the authority or with the consent of the owner.

      1. The buyer acquires no better title to the goods than the seller had, unless the owner of the goods is by the owner’s conduct precluded from denying the seller’s authority to sell.

      2. Subsection (2) is subject to the rest of this Part.

      3. Subparts 1 to 6 do not affect—

      4. subparts 2 to 4 of Part 5 or any other enactment enabling the apparent owner of goods to dispose of the goods as if that person were the true owner of the goods:
        1. the validity of a contract of sale under a special common law or statutory power of sale, or under the order of a court of competent jurisdiction:
          1. the provisions of the Personal Property Securities Act 1999 that enable a purchaser of goods to acquire good title to the goods.

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