2019 ZB Q8

To what extent did the addition of ss.20A and 20B to the SGA address the shortcomings previously
highlighted in the common law (case law – starting from Re Wait) ?

Problem with s.20A and S.20B

Tom Burns:
Where there is a shortfall and the seller is insolvent, leaving the last co-onwer with the burden of
absorbing the losses, there is no statutory provision to spread the burden more evenly between
among the co-owner
Law Commission 3 suggestion
1. Prorata apportionment of goods to be administrated by a office holder in insolvency of the
seller
2. Statutory monetary adjustment scheme between co-owning buyer
3. Give the court wide discretionary power to make equitable adjustment
Drawback
- It will be difficult to administer, expensive to operate and could cause uncertainty among
the trading community
- Practical difficulties for the court and uncertainty for the traders if the courts were left to
decide the complex issues of equitable apportionment of losses
Conclusion
- attempt to achieve perfect justice among co-owning buyers in cases of shortfall on
insolvency would be likely to do more harm than good and indeed [could] imperil the whole
reform