Wonka Bunkers Limited (Wonka) is a company engaged in selling fuel oil for ships. Wonka entered into a contract with a shipping company, Oceanic Shipping Limited (Oceanic) to sell it 200 metric tons of fuel oil. The fuel oil was to be delivered to the ship of the shipping company, ‘Hispaniola’. The contract incorporated the standard contract terms of the seller. The contract was titled ‘sale contract for Fuel Oil’. The contract was silent as to when the ownership will transfer to the buyer. The payment term stated: ‘Buyer will pay within 15 days of delivery of the goods.’

On August 1, Wonka pumped in 200 Metric Tons of fuel oil in the fuel tank of ‘Hispaniola’. The ship started using the fuel soon after the delivery was over, and Wonka pulled out the filling hosepipe. On August 5, Oceanic Shipping filed for insolvency. Wonka apprehended that it would not get paid the price. Wonka emailed to Oceanic Shipping : ‘We continue to be the owner of the fuel oil supplied to you and demand restoration of our property to us. Our tanker is coming, and you are required to give it access to the ship to pump out our fuel oil.’ Oceanic Shipping company responded: ‘The fuel oil is our property. You can claim the price but not have the fuel oil restored to you.’ The parties are in dispute whether Wonka has transferred the ownership in the fuel oil to Oceanic Shipping .

Question

Wonka Bunkers Limited (Wonka) is a company engaged in selling fuel oil for ships.  Wonka  entered into a contract with a shipping company,  Oceanic Shipping Limited (Oceanic)  to sell it 200 metric tons of fuel oil. The fuel oil was to be delivered to the ship of the shipping company, ‘Hispaniola’. The contract incorporated the standard contract terms of the seller. The contract was titled ‘sale contract for Fuel Oil’. The contract was silent as to when the ownership will transfer to the buyer. The payment term stated: ‘Buyer will pay within 15 days of delivery of the goods.’  
   
 On August 1, Wonka pumped in 200 Metric Tons of fuel oil in the fuel tank of ‘Hispaniola’. The ship started using the fuel soon after the delivery was over, and Wonka pulled out the filling hosepipe. On August 5,  Oceanic Shipping  filed for insolvency. Wonka apprehended that it would not get paid the price. Wonka emailed to Oceanic  Shipping : ‘We continue to be the owner of the fuel oil supplied to you and demand restoration of our property to us. Our tanker is coming, and you are required to give it access to the ship to pump out our fuel oil.’  Oceanic Shipping  company responded: ‘The fuel oil is our property. You can claim the price but not have the fuel oil restored to you.’ The parties are in dispute whether Wonka has transferred the ownership in the fuel oil to Oceanic  Shipping .

Accepted Answer

Wonka transferred ownership in the fuel oil when it delivered the fuel oil by pumping it in the tanks of the ship. This is because when seller pumped in 200 Metric Tons in the tanks of the ship, the fuel oil got ascertained and committed to the contract.

Answer

When seller pumped in 200 Metric Tons in the tanks of the ship, the fuel oil got ascertained and committed to the contract. But Wonka’s transferring ownership in the fuel oil is determined only when it delivered the fuel oil by separating it first and then pumping it in the tanks of the ship.

Answer

The contract provides that the buyer must pay within 15 days of the delivery of the goods. As the buyer has not paid for the fuel oil, the ownership in the fuel oil continues to be with the seller.

Answer

Oceanic Shipping has appropriated the ownership in the part of the fuel oil it has used by consuming and making it non-existent. The remaining unused fuel oil in the tanks of the ship continues to be the property of the seller.

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Wonka Bunkers Limited (Wonka) is a company engaged in selling fuel oil for ships...

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