(b) Discuss the main exceptions to the Nemo dat rule

  • Estoppel: under section 23 (1) of the Act, if the true owner of the goods, holds out some other person as owner and third parties deal with the person as owner, the true owner is stopped from denying the sellers authority to sell and the purchase acquires a good
  • Sale of factor or mercantile agent: this is an agent who is entrusted with possession of goods and who sells in his own name. If a mercantile agent in possession of the principals goods sells them to a third party in the ordinarily course of business and the third party takes the goods in good faith for value without notice he acquires a good
  • Resale by seller is possession: under sec 26(1) of the Sale of Goods Act, if a seller who has already sold goods but retains their possession resells them to a bonafide purchaser who takes them in good faith for value without notice, of the previous the sale, he acquires a good
  • Sale of buyer in possession: under sec 26 (2) of the Act, if a person who has agreed to buy goods obtain their possession or documents of title before ownership passes to him and as a consequence he sells to a bonafide purchaser who takes in good faith without notice of the original sellers Lien he acquires a good
  • Sale under voidable title: under sec. 24 of the Act, if sellers title is voidable, but he sells the goods to a bonafide purchaser before the title is avoided and the purchaser takes in good faith for value without notice of the sellers defective title, the purchases acquires a good title. As was the case in Phillip V.
  • Sale under statutory power: A sale made in exercise of a power conferred by statute, passes a good title. For example:
    • Sale by a liquidator under the Companies
    • Sale under the Disposal of Uncollected Goods
    • Sale by a charge or mortgagee under the Registered Land Act.
  • Sale under common law power: A sale made in exercise of a power conferred by the common law passes a good title for example sale by an agent of necessity or by a pledge.
  • Sale by court order: A sale made pursuant to an order made by a court of competent jurisdiction passes a good title
  • Sale in Market Overt: market overt means “open, public and legally constituted market.” This oldest exception to Nemo dat but does not apply in Kenya. At common law, buyers in market overt acquired a good title even in relation to stolen goods provided that:
    • The buyer took them in good faith without notice of any defect in title and
    • The sale took place in public



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