Contract and Commercial Law Act 2017

1: Title
This Act is the Contract and Commercial Law Act 2017.
2: Commencement
This Act comes into force immediately after the expiry of the 6-month period that starts on the date of Royal assent.
1: Preliminary provisions
3: Purpose
The purpose of this Act is to re-enact, in an up-to-date and accessible form, certain legislation relating to—
a: contracts; and
b: the sale of goods; and
c: electronic transactions; and
d: the carriage of goods; and
e: various other commercial matters, including mercantile agents and bills of lading.
4: Revision Act
1: This is a revision Act for the purposes of section 35
2: Schedule 2 section 31(2)(i)
3: The Acts or parts of Acts revised by this Act are specified in section 345
4: Schedule 3
5: Overview of this Act
Preliminary matters
1: Part 1 Contracts
2: Part 2
a: contractual privity (provisions that permit a person who is not a party to a deed or contract to enforce a promise made in it for the benefit of that person) ( see subpart 1
b: contractual mistakes ( see subpart 2
c: contractual remedies (in particular, provisions relating to damages for misrepresentation and to cancellation) ( see subpart 3
d: frustrated contracts ( see subpart 4
e: illegal contracts ( see subpart 5
f: contracts entered into by minors (persons under the age of 18 years) ( see subpart 6
g: certain stipulations in contracts not being of the essence of contracts ( see subpart 7 Sale of goods
3: Part 3
a: the formation of a contract of sale ( see sections 120 to 130
b: conditions and warranties (for example, implied conditions or warranties as to quality or fitness for a particular purpose) ( see sections 131 to 142
c: when ownership of the goods is transferred ( see subpart 2
d: the duties of the seller and the buyer and the delivery of the goods ( see subpart 3
e: the rights of an unpaid seller ( see subpart 4
f: remedies for a breach of a contract, including a remedy for a breach of warranty ( see subpart 5
g: supplementary matters, including an exclusion where the Consumer Guarantees Act 1993 see subpart 6
h: giving effect to the United Nations Convention on Contracts for the International Sale of Goods ( see subpart 7 Electronic transactions
4: Part 4
a: improving certainty in relation to electronic information and electronic communications ( see subpart 2
b: how legal requirements apply to electronic transactions (for example, requirements to give information in writing and to provide access to information) ( see subpart 3 Other commercial matters
5: Part 5
a: the liability of carriers for the loss of or damage to goods carried within New Zealand ( see subpart 1
b: mercantile agents ( see subpart 2
c: bills of lading and other shipping documents ( see subpart 3
d: a power for a shipowner to enter and land goods, and liens for freight ( see subpart 4
e: the enforcement of a lien for work done ( see subpart 5 Miscellaneous provisions
6: Part 6
7: This section is only a guide to the general scheme and effect of this Act.
6: Transitional, savings, and related provisions
The transitional, savings, and related provisions set out in Schedule 1
7: Status of examples
1: An example used in this Act is only illustrative of the provisions to which it relates. It does not limit those provisions.
2: If an example and a provision to which it relates are inconsistent, the provision prevails.
8: Act binds the Crown
1: This Act binds the Crown.
2: However, the following do not bind the Crown:
a: subpart 2
b: subpart 4 1944 No 20 s 4(2) s 5(2) Schedule 1 s 3 s 4 s 3 s 3 s 4 s 3 s 3 s 7
2: Contracts legislation
9: Interpretation
1: In this Part, unless the context otherwise requires,— court
a: means, in relation to any matter, the court, tribunal, or arbitral tribunal by or before which the matter falls to be determined; but
b: in subpart 6 section 85 disposition
a: a conveyance, transfer, assignment, settlement, delivery, payment, or other alienation of property, whether at law or in equity:
b: the creation of a trust:
c: the grant or creation of any lease, mortgage, charge, servitude, licence, power, or other right, estate, or interest in or over any property, whether at law or in equity:
d: the release, discharge, surrender, forfeiture, or abandonment, at law or in equity, of any debt, contract, or thing in action, or of any right, power, estate, or interest in or over any property:
e: the exercise of a general power of appointment in favour of any person other than the donee of the power:
f: a transaction that a person enters into with intent to diminish, directly or indirectly, the value of the person’s own estate and to increase the value of the estate of any other person.
2: For the purpose of paragraph (d) of the definition of disposition, a debt, contract, or thing in action, or a right, power, estate, or interest in or over any property, must be treated as having been released or surrendered when it has become irrecoverable or unenforceable through the lapse of time. 1944 No 20 s 2 ss 2 6(2) ss 2 8(3) s 2 s 2
1: Contractual privity
10: Purpose
The purpose of this subpart is to permit a person who is not a party to a deed or contract to enforce a promise made in it for the benefit of that person. 1982 No 132 Long Title
11: Interpretation
In this subpart, unless the context otherwise requires,— beneficiary section 12 benefit
a: any advantage; and
b: any immunity; and
c: any limitation or other qualification of—
i: an obligation to which a person (other than a party to the deed or contract) is or may be subject; or
ii: a right to which a person (other than a party to the deed or contract) is or may be entitled; and
d: any extension or other improvement of a right or rights to which a person (other than a party to the deed or contract) is or may be entitled contract
a: made by deed or in writing, orally, or partly in writing and partly orally; or
b: implied by law promisee section 12
a: a party to the deed or contract; and
b: a person to whom the promise is made or given promisor section 12
a: a party to the deed or contract; and
b: a person by whom the promise is made or given. 1982 No 132 s 2
12: Deed or contract for benefit of person who is not party to deed or contract
1: This section applies to a promise contained in a deed or contract that confers, or purports to confer, a benefit on a person, designated by name, description, or reference to a class, who is not a party to the deed or contract.
2: The promisor is under an obligation, enforceable by the beneficiary, to perform the promise.
3: This section applies whether or not the person referred to in subsection (1) is in existence when the deed or contract is made. 1982 No 132 s 4
13: Section 12 does not apply if no intention to create obligation enforceable by beneficiary
Section 12 1982 No 132 s 4
14: Variation or discharge of promise may require beneficiary’s consent
1: A promise to which section 12
a: the position of the beneficiary has been materially altered by the reliance of the beneficiary or any other person on the promise; or
b: the beneficiary has obtained against the promisor judgment on the promise; or
c: the beneficiary has obtained against the promisor the award of an arbitral tribunal on a submission that relates to the promise.
2: Subsection (1)(a) applies whether or not the beneficiary or other person has knowledge of the precise terms of the promise.
3: For the purposes of subsection (1)(b) and (c),—
a: an award of an arbitral tribunal or a judgment must be treated as having been obtained when it is pronounced even if—
i: some act, matter, or thing needs to be done to record or perfect it; or
ii: on application to a court or on appeal, it is varied:
b: if an award of an arbitral tribunal or a judgment is set aside on application to a court or on appeal, the award or judgment must be treated as having never been obtained.
4: This section is subject to sections 15 16 1982 No 132 s 5
15: Variation or discharge by agreement or in accordance with express provision
Nothing in this subpart prevents a promise to which section 12
a: by agreement between the parties to the deed or contract and the beneficiary; or
b: by any party or parties to the deed or contract if—
i: the deed or contract contained, when the promise was made, an express provision to that effect; and
ii: the provision is known to the beneficiary (whether or not the beneficiary has knowledge of the precise terms of the provision); and
iii: the beneficiary had not materially altered the beneficiary’s position in reliance on the promise before the provision became known to the beneficiary; and
iv: the variation or discharge is in accordance with the provision. 1982 No 132 s 6
16: Court may authorise variation or discharge
1: This section applies if—
a: the variation or discharge of a promise or an obligation is prevented by section 14(1)(a)
b: it is uncertain whether the variation or discharge of a promise or an obligation is prevented by section 14(1)(a)
2: A court may, on application by the promisor or promisee and if it is just and practicable to do so, make an order authorising the variation or discharge of the promise or obligation or both.
3: The order may be made on the terms and conditions that the court thinks fit.
4: Subsection (5) applies if a court—
a: makes an order under this section; and
b: is satisfied that the beneficiary has been injuriously affected by the reliance of the beneficiary or any other person on the promise or obligation.
5: The court must make it a condition of the order that the promisor pay to the beneficiary, by way of compensation, the sum that the court thinks just. 1982 No 132 s 7
17: Enforcement by beneficiary
1: The obligation imposed on a promisor by section 12
2: Relief in respect of the promise may not be refused on the ground—
a: that the beneficiary is not a party to the deed or contract in which the promise is contained; or
b: that, as against the promisor, the beneficiary is a volunteer.
3: In subsection (2), relief 1982 No 132 s 8
18: Availability of defences
1: This section applies only if, in a proceeding brought in a court, a claim is made in reliance on this subpart by a beneficiary against a promisor.
2: The promisor has available, by way of defence, counterclaim, set-off, or otherwise, any matter that would have been available to the promisor—
a: if the beneficiary had been a party to the deed or contract in which the promise is contained; or
b: if—
i: the beneficiary were the promisee; and
ii: the promise to which the proceeding relates had been made for the benefit of the promisee; and
iii: the proceeding had been brought by the promisee.
3: However, a set-off or counterclaim against the promisee is available under subsection (2) against the beneficiary only if the subject matter of the set-off or counterclaim arises out of, or in connection with, the deed or contract in which the promise is contained.
4: In a counterclaim brought under subsection (2) or (3) against a beneficiary,—
a: the beneficiary is not liable on the counterclaim, unless the beneficiary elects, with full knowledge of the counterclaim, to proceed with the beneficiary’s claim against the promisor; and
b: if the beneficiary so elects to proceed, the beneficiary’s liability on the counterclaim may not exceed the value of the benefit conferred on the beneficiary by the promise.
5: Subsections (2) and (3) are subject to subsection (4). 1982 No 132 s 9
19: This subpart does not apply to promises, contracts, or deeds governed by foreign law
This subpart does not apply to any promise, contract, or deed, or any part of a promise, contract, or deed, that is governed by a law other than New Zealand law. 1982 No 132 s 13A
20: Savings
Nothing in this subpart limits or affects—
a: any right or remedy that exists or is available apart from this subpart; or
b: subpart 2
c: the law of agency; or
d: the law of trusts. 1982 No 132 s 14(1)
2: Contractual mistakes
21: Purpose of this subpart
1: The purpose of this subpart is to mitigate the arbitrary effects of mistakes on contracts by giving courts appropriate powers to grant relief in the circumstances mentioned in section 24
2: These powers—
a: are in addition to, and not in substitution for, existing powers to grant relief in respect of matters other than mistakes; and
b: must not be exercised in a way that prejudices the general security of contractual relationships. 1977 No 54 s 4
22: This subpart to be code
1: This subpart has effect in place of the rules of the common law and of equity governing the circumstances in which relief may be granted, on the grounds of mistake, to—
a: a party to a contract; or
b: a person claiming through or under a party to a contract.
2: Subsection (1) applies except as otherwise expressly provided in this subpart.
3: Nothing in this subpart affects—
a: the doctrine of non est factum
b: the law relating to the rectification of contracts:
c: the law relating to undue influence, fraud, breach of fiduciary duty, or misrepresentation, whether fraudulent or innocent:
d: subpart 4
e: subpart 5
f: sections 74A 74B
4: Nothing in this subpart deprives a court of the power to exercise its discretion to withhold a decree of specific performance in any case. 1977 No 54 s 5
23: Interpretation
1: In this subpart, unless the context otherwise requires, mistake
2: For the purposes of this subpart, a mistake in the interpretation of a document is a mistake of law.
3: Subsection (2)—
a: does not limit the meaning of the term mistake of law; but
b: is subject to section 25
4: There is a contract for the purposes of this subpart where a contract would have come into existence but for circumstances of the kind described in section 24(1)(a) 1977 No 54 s 2
24: Relief may be granted if mistake by one party is known to another party or is common or mutual
1: A court may grant relief under section 28
a: in entering into the contract,—
i: the party was influenced in the party’s decision to enter into the contract by a mistake that was material to that party, and the existence of the mistake was known to the other party or to 1 or more of the other parties to the contract; or
ii: all the parties to the contract were influenced in their respective decisions to enter into the contract by the same mistake; or
iii: the party and at least 1 other party were each influenced in their respective decisions to enter into the contract by a different mistake about the same matter of fact or of law; and
b: the mistake or mistakes resulted, at the time of the contract,—
i: in a substantially unequal exchange of values; or
ii: in a benefit being conferred, or an obligation being imposed or included, that was, in all the circumstances, a benefit or an obligation substantially disproportionate to the consideration for the benefit or obligation; and
c: in a case where the contract expressly or by implication provides for the risk of mistakes, the party seeking relief (or the party through or under whom relief is sought) is not obliged by a term of the contract to assume the risk that that party’s belief about the matter in question might be mistaken.
2: The relief may be granted in the course of any proceeding or on application made for the purpose.
3: For the purposes of subsection (1)(a)(i) and (iii), the other party or other parties must not be a party or parties who have substantially the same interest under the contract as the party seeking relief. 1977 No 54 s 6(1)
25: Mistake does not include mistake in interpretation of contract
1: For the purposes of relief under section 28
2: This section applies whether or not an application for relief is made. Example
A person ( A A mistakenly thinks that the offer does not affect A’s personal liability. A has made a mistake in the interpretation of the contract. The mistake cannot form the basis of an application for relief under section 28. 1977 No 54 s 6(2)(a)
26: Decision to enter into contract not influenced by mistake if party aware of it
1: For the purposes of relief under section 28
2: This section applies whether or not an application for relief is made. 1977 No 54 s 6(2)(b)
27: Mistake caused by party seeking relief
The extent to which the party seeking relief (or the party through or under whom relief is sought) caused the mistake is one of the considerations that must be taken into account by the court in deciding whether to grant relief under section 28 1977 No 54 s 7(2)
28: Nature of relief
1: If, under sections 24 to 26
2: In particular, but without limiting subsection (1), the court may do 1 or more of the following things:
a: declare the contract to be valid and subsisting in whole or in part or for any particular purpose:
b: cancel the contract:
c: grant relief by way of variation of the contract:
d: grant relief by way of restitution or compensation.
3: The court may, by an order made under this section,—
a: vest the whole or any part of any relevant property in a party; or
b: direct a party to transfer or assign the whole or any part of any relevant property to any other party; or
c: direct a party to deliver the whole or any part of the possession of any relevant property to any other party.
4: In subsection (3),— party relevant property
5: An order may be made on the terms and conditions that the court thinks fit. 1977 No 54 s 7(3)
29: Court may grant relief to person claiming through or under party
If, under sections 24 to 26 1977 No 54 s 7(1)
30: Persons who may apply
An application for relief under section 28
a: any person to whom the court may grant that relief; or
b: any other person if it is material for the person to know whether relief under section 28 1977 No 54 s 7(4)
31: Rights of third persons not affected
1: Nothing in an order made under this subpart invalidates a disposition of property referred to in subsection (2) if the person to whom the disposition was made—
a: was not a party to the mistaken contract; and
b: had not, at the time of the disposition, notice that the property was the subject of, or the whole or part of the consideration for, a mistaken contract; and
c: otherwise acted in good faith.
2: The dispositions are—
a: a disposition of property by a party to a mistaken contract for valuable consideration:
b: a disposition of property made by or through a person who became entitled to the property under a disposition to which paragraph (a) applies.
3: Nothing in an order made under this subpart affects subpart 5
4: In this section, mistaken contract section 24(1)(a)
5: See section 9 1977 No 54 s 8
32: This subpart does not apply to contracts governed by foreign law
This subpart does not apply to any contract, or any part of any contract, that is governed by a law other than New Zealand law. 1977 No 54 s 11A
3: Contractual remedies
33: Meaning of cancel
In this subpart, unless the context otherwise requires, cancel sections 36 to 40 1979 No 11 s 2
34: Remedy provided in contract
If a contract expressly provides for a remedy for misrepresentation, repudiation, or breach of contract, or makes express provision for any of the other matters to which sections 35 to 49 1979 No 11 s 5 Damages for misrepresentation
35: Damages for misrepresentation
1: If a party to a contract ( A B
a: A is entitled to damages from B in the same manner and to the same extent as if the representation were a term of the contract that has been breached; and
b: A is not, in the case of a fraudulent misrepresentation, or of an innocent misrepresentation made negligently, entitled to damages from B for deceit or negligence in respect of the misrepresentation.
2: Subsection (1) applies to contracts for the sale of goods—
a: despite sections 197 201(2)
b: subject to section 34 1979 No 11 s 6 Cancellation
36: Party may cancel contract if another party repudiates it
1: A party to a contract may cancel the contract if, by words or conduct, another party ( B
a: perform B’s obligations under the contract; or
b: complete the performance of B’s obligations under the contract.
2: This section is subject to the rest of this subpart. 1979 No 11 s 7(2)
37: Party may cancel contract if induced to enter into it by misrepresentation or if term is or will be breached
1: A party to a contract may cancel it if—
a: the party has been induced to enter into it by a misrepresentation, whether innocent or fraudulent, made by or on behalf of another party to the contract; or
b: a term in the contract is breached by another party to the contract; or
c: it is clear that a term in the contract will be breached by another party to the contract.
2: If subsection (1)(a), (b), or (c) applies, a party may exercise the right to cancel the contract if, and only if,—
a: the parties have expressly or impliedly agreed that the truth of the representation or, as the case may require, the performance of the term is essential to the cancelling party; or
b: the effect of the misrepresentation or breach of the contract is, or, in the case of an anticipated breach, will be,—
i: substantially to reduce the benefit of the contract to the cancelling party; or
ii: substantially to increase the burden of the cancelling party under the contract; or
iii: in relation to the cancelling party, to make the benefit or burden of the contract substantially different from that represented or contracted for.
3: Subsection (1) is subject to the rest of this subpart, but does not limit section 36 1979 No 11 s 7(3)
38: No cancellation if contract is affirmed
A party is not entitled to cancel the contract if, with full knowledge of the repudiation, misrepresentation, or breach, the party has affirmed the contract. 1979 No 11 s 7(5)
39: Parties with substantially same interest
1: A party who has substantially the same interest under the contract as the party whose act constitutes the repudiation, misrepresentation, or breach may cancel the contract only with the leave of the court.
2: The court may, on application made for the purpose, grant leave under subsection (1) if it is satisfied that it is just to do so.
3: The leave may be granted on the terms and conditions that the court thinks fit. 1979 No 11 s 7(6)
40: Sections 36 to 39 have effect in place of rules of common law and of equity
1: Sections 36 to 39
2: This section applies except as otherwise expressly provided in this subpart. 1979 No 11 s 7(1)
41: When cancellation may take effect
1: The cancellation of a contract by a party does not take effect—
a: before the time at which the cancellation is made known to the other party; or
b: before the time at which the party cancelling the contract shows, by some clear means that is reasonable in the circumstances, an intention to cancel the contract, if—
i: it is not reasonably practicable for the cancelling party to communicate with the other party; or
ii: the other party cannot reasonably expect to receive notice of the cancellation because of that other party’s conduct in relation to the contract.
2: The cancellation may be made known by words or by conduct showing an intention to cancel, or both. It is not necessary to use any particular form of words, so long as the intention to cancel is made known. 1979 No 11 s 8(1), (2)
42: Effect of cancellation
1: When a contract is cancelled, the following provisions apply:
a: to the extent that the contract remains unperformed at the time of the cancellation, no party is obliged or entitled to perform it further:
b: to the extent that the contract has been performed at the time of the cancellation, no party is, by reason only of the cancellation, divested of any property transferred or money paid under the contract.
2: This section is subject to the rest of this subpart.
3: Nothing in this section affects the right of a party to recover damages for a misrepresentation or the repudiation or breach of the contract by another party. 1979 No 11 s 8(3), (4) Power of court to grant relief
43: Power of court to grant relief
1: When a contract is cancelled by any party, the court may, if it is just and practicable to do so, make an order or orders granting relief under this section.
2: The relief may be granted in the course of any proceeding or on application made for the purpose.
3: An order under this section may—
a: direct a party to pay to any other party the sum that the court thinks just (subject to section 35
b: direct a party to do or refrain from doing, in relation to any other party, any act or thing that the court thinks just:
c: vest the whole or any part of any relevant property in a party:
d: direct a party to transfer or assign the whole or any part of any relevant property to any other party:
e: direct a party to deliver the whole or any part of the possession of any relevant property to any other party.
4: In subsection (3),— party relevant property 1979 No 11 s 9(1)
44: Order for relief may be subject to terms and conditions
1: An order under section 43
2: However, a term or condition must not have the effect of preventing a claim for damages by any party. 1979 No 11 s 9(3)
45: Matters court must have regard to
In considering whether to make an order under section 43
a: the terms of the contract; and
b: the extent to which any party to the contract was or would have been able to perform it in whole or in part; and
c: any expenditure incurred by a party in, or for the purpose of, performing the contract; and
d: the value, in the court’s opinion, of any work or services performed by a party in, or for the purpose of, performing the contract; and
e: any benefit or advantage obtained by a party because of anything done by another party in, or for the purpose of, performing the contract; and
f: any other matters that the court thinks proper. 1979 No 11 s 9(4)
46: Protection of purchaser of property in good faith and for valuable consideration
No order may be made under section 43(3)(c) to (e) 1979 No 11 s 9(5)
47: Party who has altered position
1: No order may be made under section 43
2: This section applies whether the party altered the party’s position before or after the cancellation of the contract. 1979 No 11 s 9(6)
48: Persons who may apply
An application for relief under section 43
a: a party to the contract; or
b: a person claiming through or under a party to the contract; or
c: any other person if it is material for the person to know whether relief under section 43 1979 No 11 s 9(7)
49: Recovery of damages
1: A party to a contract is not prevented by the cancellation of the contract, or by the granting of relief under section 43
2: However, the value of any relief granted under section 43
3: Subsection (1) is subject to sections 34 35 50 to 53
4: Any sum ordered to be paid by a party to the contract to any other party to the contract under section 43(3) 1979 No 11 s 10 Provisions purporting to prevent court inquiry
50: Statement, promise, or undertaking during negotiations
1: This section applies if a contract, or any other document, contains a provision purporting to prevent a court from inquiring into or determining the question of—
a: whether a statement, promise, or undertaking was made or given, either in words or by conduct, in connection with or in the course of negotiations leading to the making of the contract; or
b: whether, if it was so made or given, it constituted a representation or a term of the contract; or
c: whether, if it was a representation, it was relied on.
2: The court is not, in any proceeding in relation to the contract, prevented by the provision from inquiring into and determining any question referred to in subsection (1) unless the court considers that it is fair and reasonable that the provision should be conclusive between the parties, having regard to the matters specified in subsection (3).
3: The matters are all the circumstances of the case, including—
a: the subject matter and value of the transaction; and
b: the respective bargaining strengths of the parties; and
c: whether any party was represented or advised by a lawyer at the time of the negotiations or at any other relevant time. 1979 No 11 s 4(1)
51: Authority for making or giving statement, promise, or undertaking
1: This section applies if a contract, or any other document, contains a provision purporting to prevent a court from inquiring into or determining the question of whether, in respect of any statement, promise, or undertaking made or given by any person, that person had the actual or ostensible authority of a party to make or give it.
2: The court is not, in any proceeding in relation to the contract, prevented by the provision from inquiring into and determining the question. 1979 No 11 s 4(2)
52: Contracts for sale of goods
Despite sections 197 201(2) sections 50 51 1979 No 11 s 4(3)
53: Proceeding before Disputes Tribunal
In any proceeding properly before the Disputes Tribunal, sections 50 to 52 section 18(7) 1979 No 11 s 4(4) Assignees
54: Remedies enforceable by or against assignee
1: If a contract, or the benefit or burden of a contract, is assigned, the remedies of damages and cancellation are enforceable by or against the assignee (except to the extent that it is otherwise provided in the assigned contract).
2: This section is subject to sections 55 to 57 1979 No 11 s 11(1)
55: Damages may not exceed value of performance of assigned contract
1: The assignee is not liable in damages, whether by way of set-off, counterclaim, or otherwise, for a sum exceeding the value of the performance of the assigned contract to which the assignee is entitled because of the assignment.
2: This section applies except to the extent that it is otherwise agreed by the assignee or provided in the assigned contract. 1979 No 11 s 11(2)
56: Assignee indemnified by assignor
1: The assignee is entitled to be indemnified by the assignor against any loss suffered by the assignee and arising out of—
a: any term of the assigned contract that was not disclosed to the assignee before or at the time of the assignment; or
b: any misrepresentation that was not so disclosed.
2: This section applies unless it is otherwise agreed between the assignor and the assignee. 1979 No 11 s 11(3)
57: Other provisions relating to assignees
1: Sections 54 to 56
a: in the case of a mortgage of land, subpart 8
b: in the case of a contract for the supply of goods or services to a consumer, section 46
2: Nothing in sections 54 to 56 1979 No 11 s 11(4) Miscellaneous provisions
58: This subpart does not apply to contracts governed by foreign law
This subpart does not apply to any contract, or any part of any contract, that is governed by a law other than New Zealand law. 1979 No 11 s 14A
59: Savings
1: Nothing in this subpart affects—
a: the law relating to specific performance or injunction:
b: the law relating to mistake, duress, or undue influence:
c: the doctrine of non est factum
d: subpart 4
e: Part 3
f: sections 253 to 260
g: the Consumer Guarantees Act 1993
h: any other enactment to the extent that it prescribes or governs terms of contracts or remedies available in respect of contracts, or governs the enforcement of contracts.
2: Subsection (1) applies except as provided in sections 35(2) 52 1979 No 11 s 15
4: Frustrated contracts
60: Application
1: Sections 61 to 66
a: a contract governed by New Zealand law has become impossible to perform or has been otherwise frustrated; and
b: the parties to the contract have for that reason been discharged from the further performance of the contract.
2: Subsection (1) and sections 61 to 66 sections 67 to 69
3: In this subpart, time of discharge 1944 No 20 s 3(1) Money paid or payable
61: Money paid may be recovered and money payable ceases to be payable
1: All money paid to a party ( A
2: All money payable to a party under the contract before the time of discharge ceases to be payable. 1944 No 20 s 3(2)
62: Court may allow party who has incurred expenses to retain or recover money
1: This section applies if the party to whom the money was paid or payable under the contract incurred expenses before the time of discharge in, or for the purpose of, performing the contract.
2: The court may, if it considers it just to do so having regard to all the circumstances, allow the party to retain or recover the whole or any part of the money that was paid or payable.
3: However, the amount to be retained or recovered must not exceed the expenses that were incurred. 1944 No 20 s 3(2) Other valuable benefits
63: Sum may be recovered if party has obtained valuable benefit
1: This section applies if—
a: a party to the contract ( A
b: the benefit was obtained because of anything done by another party to the contract ( B
2: B may recover from A the sum (if any) that the court considers just.
3: For the purposes of subsection (2), the court must have regard to all the circumstances and, in particular,—
a: the amount of any expenses incurred before the time of discharge by A in, or for the purpose of, performing the contract, including any money paid or payable by A to any other party under the contract and retained or recoverable by that party under section 62
b: the effect, in relation to the benefit, of the circumstances that gave rise to the frustration of the contract.
4: The sum that is recoverable must not exceed the value of the benefit to A.
5: In this section and section 64 benefit section 61 1944 No 20 s 3(3)
64: Benefit may be treated as being obtained
1: For the purposes of section 63 C A
2: Subsection (1) applies whether or not C is a party to the contract. 1944 No 20 s 3(6) Expenses
65: Estimates of expenses
1: For the purposes of sections 61 to 64
a: overhead expenses; and
b: any work or services performed by that party.
2: Subsection (1) does not limit sections 61 to 64 1944 No 20 s 3(4) Insurance
66: Money payable under contract of insurance
1: This section applies when a court considers whether an amount ought to be recovered or retained under sections 61 to 64
2: The court must not take into account any money that has become payable to the party under a contract of insurance if the money is payable because of the circumstances that gave rise to the frustration of the contract.
3: Subsection (2) does not apply if there was an obligation to insure that was imposed by an express term of the frustrated contract or by or under any enactment. 1944 No 20 s 3(5) Other provisions relating to application
67: Court must give effect to provision in contract
1: This section applies if a contract to which this subpart applies contains a provision that, on the true construction of the contract, is—
a: intended to have effect in the event of circumstances arising that operate, or would but for the provision operate, to frustrate the contract; or
b: intended to have effect whether those circumstances arise or not.
2: The court must—
a: give effect to the provision; and
b: give effect to sections 60 to 66 1944 No 20 s 4(3)
68: Court must treat performed part of contract that can be properly severed as separate contract
1: This section applies if—
a: the court considers that a part of a contract to which this subpart applies can properly be severed from the remainder of the contract; and
b: that part of the contract was—
i: wholly performed before the time of discharge; or
ii: wholly performed before the time of discharge except for the payment, in respect of that part of the contract, of money that is or can be ascertained under the contract.
2: The court must treat—
a: the part of the contract described in subsection (1) as if it—
i: were a separate contract; and
ii: had not been frustrated; and
b: sections 60 to 66 1944 No 20 s 4(4)
69: This subpart does not apply in certain circumstances
This subpart does not apply to—
a: a contract for the carriage of goods by sea or a charter party (except a time charter party or a charter party by way of demise); or
b: a contract of insurance, except as provided by section 66
c: a contract to which section 128 1944 No 20 s 4(5)
5: Illegal contracts
70: Interpretation
In this subpart, unless the context otherwise requires,— enactment
a: means any provision of any legislation
b: includes any provision of any notice, consent, approval, or direction that is given by any person under a power conferred by any legislation property
a: means land, money, goods, things in action, goodwill, and every valuable thing, whether real or personal, and whether situated in New Zealand or elsewhere; and
b: includes obligations, easements, and every description of estate, interest, and profit, present or future, vested or contingent, arising out of or incidental to property. 1970 No 129 s 2 Section 70 enactment amended 28 October 2021 section 3 Secondary Legislation Act 2021 Section 70 enactment amended 28 October 2021 section 3 Secondary Legislation Act 2021
71: Illegal contract defined
1: In this subpart, illegal contract
a: means a contract governed by New Zealand law that is illegal at law or in equity, whether the illegality arises from the creation or the performance of the contract; and
b: includes a contract that contains an illegal provision, whether that provision is severable or not. Examples
A contract under which the parties agree to the commission of a serious crime. A contract under which one party agrees to pay money to a witness to a crime in return for the witness withholding information from the police and the courts. A contract to use improper influence to affect the award of a public honour.
2: This section is subject to section 72 1970 No 129 s 3
72: Breach of enactment
A contract lawfully entered into does not become illegal or unenforceable by any party because its performance is in breach of an enactment, unless the enactment expressly so provides or its object clearly so requires. Example
Certain traffic regulations require a car to have a current warrant of fitness when it is sold. A person sells a car without a warrant of fitness in breach of the regulations. The object of the regulations relates to promoting safety rather than protecting consumers. The contract is not an illegal contract. Upholding the contract does not frustrate the object of the regulations. 1970 No 129 s 5 Illegal contracts have no effect
73: Illegal contracts have no effect
1: Every illegal contract is of no effect.
2: No person is entitled to any property under a disposition made by or under an illegal contract.
3: This section and section 74
a: despite any rule of law or equity to the contrary; but
b: subject to the provisions of this subpart and of any other enactment. 1970 No 129 s 6(1)
74: Protection of persons who acquire property in good faith and without notice
1: Nothing in section 73
a: was not a party to the illegal contract; and
b: had not, at the time of the disposition, notice that the property was the subject of, or the whole or any part of the consideration for, an illegal contract; and
c: otherwise acted in good faith.
2: The dispositions are—
a: a disposition of property by a party to an illegal contract for valuable consideration:
b: a disposition of property made by or through a person who became entitled to the property under a disposition to which paragraph (a) applies.
3: See section 9 1970 No 129 s 6(1) Court may grant relief
75: Who may be granted relief
Relief under section 76
a: a party to an illegal contract; or
b: a party to a contract who is disqualified from enforcing it because of the commission of an illegal act in the course of its performance; or
c: a person claiming through or under a party referred to in paragraph (a) or (b). 1970 No 129 s 7(1)
76: Court may grant relief
1: The court may grant to a person referred to in section 75
a: restitution; or
b: compensation; or
c: variation of the contract; or
d: validation of the contract in whole or in part or for any particular purpose.
2: The relief may be granted in the course of any proceeding or on application made for the purpose.
3: Subsection (1) and section 75
a: despite sections 73 74
b: subject to the express provisions of any other enactment.
4: The court may, by an order made under this section,—
a: vest the whole or any part of any relevant property in a party; or
b: direct a party to transfer or assign the whole or any part of any relevant property to any other party; or
c: direct a party to deliver the whole or any part of the possession of any relevant property to any other party.
5: In subsection (4),— party relevant property 1970 No 129 s 7(1)
77: Order may be subject to terms and conditions
An order under section 76 1970 No 129 s 7(6)
78: Matters court must have regard to
In considering whether to grant relief under section 76
a: the conduct of the parties; and
b: in the case of a breach of an enactment, the object of the enactment and the gravity of the penalty expressly provided for any breach of the enactment; and
c: any other matters that the court thinks proper. 1970 No 129 s 7(3)
79: Court must not grant relief if not in public interest
The court must not grant relief under section 76 1970 No 129 s 7(3)
80: Person acting with knowledge of facts or law giving rise to illegality
1: The court may make an order under section 76
2: However, the court must take that knowledge into account in exercising its discretion under section 76 1970 No 129 s 7(4)
81: Persons who may apply
An application for relief under section 76
a: any person to whom the court may grant relief under that section; or
b: any other person if it is material for the person to know whether relief will be granted under that section. 1970 No 129 s 7(2)
82: Restriction on granting relief otherwise than in accordance with this subpart
1: No court may, in respect of an illegal contract, grant relief to a person otherwise than in accordance with this subpart.
2: This section is subject to the express provisions of any other enactment. 1970 No 129 s 7(7) Restraints of trade
83: Restraints of trade
1: The court may, if a provision of a contract constitutes an unreasonable restraint of trade,—
a: delete the provision and give effect to the contract as amended; or
b: modify the provision so that, at the time the contract was entered into, the provision as modified would have been reasonable, and give effect to the contract as modified; or
c: decline to enforce the contract if the deletion or modification of the provision would so alter the bargain between the parties that it would be unreasonable to allow the contract to stand.
2: The court may modify a provision even if the modification cannot be effected by deleting words from the provision. 1970 No 129 s 8
84: Law relating to restraint of trade and to ouster of jurisdiction not affected
1: Nothing in this subpart affects the law relating to contracts, or provisions of contracts,—
a: that are in restraint of trade; or
b: that purport to oust the jurisdiction of any court, whether or not that court is a court within the meaning of this subpart.
2: This section applies except as provided in section 83 1970 No 129 s 11(1)
6: Minors’ contracts
85: Interpretation
In this subpart, unless the context otherwise requires,— court section 113 section 114 minor full age property
a: means land, money, goods, things in action, goodwill, and every valuable thing, whether real or personal, and whether situated in New Zealand or elsewhere; and
b: includes obligations, easements, and every description of estate, interest, and profit, present or future, vested or contingent, arising out of or incidental to property. 1969 No 41 s 2 Contractual capacity of minors
86: Contracts unenforceable against minors but otherwise have effect
1: Every contract entered into by a minor is unenforceable against the minor but otherwise has effect as if the minor were of full age.
2: Subsection (1) does not apply to a contract to which section 92(1)
3: This section is subject to sections 87 to 91 1969 No 41 s 6(1)
87: Court may inquire into fairness and reasonableness of contract
1: The court may, in the course of any proceeding or on application made for the purpose, inquire into the fairness and reasonableness of a contract to which section 86
2: Sections 88 and 89 1969 No 41 s 6(2)
88: Court orders where contract was fair and reasonable
The court may, if it finds under section 87
a: enforce the contract against the minor:
b: declare that the contract is binding on the minor, whether in whole or in part:
c: make an order allowing the other parties to the contract, on the conditions that the court thinks just, to cancel the contract:
d: make an order for compensation or restitution of property under section 95 1969 No 41 s 6(2)(a)
89: Court orders where contract was not fair and reasonable
The court may, if it finds under section 87
a: cancel the contract:
b: make an order allowing the minor, on the conditions that the court thinks just, to cancel the contract:
c: make an order for compensation or restitution of property under section 95 1969 No 41 s 6(2)(b)
90: Matters court must have regard to
In exercising its discretion under sections 87 to 89
a: the circumstances surrounding the making of the contract:
b: the subject matter and nature of the contract:
c: in the case of a contract relating to property, the nature and the value of the property:
d: the age and the means (if any) of the minor:
e: all other relevant circumstances. 1969 No 41 s 6(3)
91: Further provisions relating to application of sections 86 to 90
1: Nothing in sections 86 to 90
a: a contract approved by the District Court under section 98
b: the compromise or settlement of any claim for money or damages made by or on behalf of a minor (whether alone or in conjunction with any other person).
2: 1969 No 41 s 6(4) Section 91(2) repealed 30 January 2021 section 161 Trusts Act 2019 Special rules for contracts of service and life insurance contracts
92: Contracts of service and life insurance contracts have effect as if minor were of full age
1: The following contracts have effect as if the minor were of full age:
a: a contract of service entered into by a minor:
b: a contract entered into under section 66B
2: This section is subject to sections 93 94 1969 No 41 s 5(1)
93: Court may make orders about unconscionable, harsh, or oppressive contract of service or life insurance contract
1: This section applies if the court is satisfied in respect of a contract to which section 92
a: the consideration for a minor’s promise or act was so inadequate as to be unconscionable; or
b: any provision of the contract that imposes an obligation on a party to the contract who was a minor was harsh or oppressive.
2: The court—
a: may, in the course of any proceeding or on application made for the purpose, cancel the contract, decline to enforce the contract against the minor, or declare that the contract is unenforceable against the minor, whether in whole or in part; and
b: in any case may make an order for compensation or restitution of property under section 95
3: For the purposes of this section, the court may receive evidence of commercial practice in contracts of the same kind. 1969 No 41 s 5(2)
94: Sections 92 and 93 do not apply in certain circumstances
1: Nothing in section 92 93
a: a contract approved by the District Court under section 98
b: the compromise or settlement of any claim for money or damages made by or on behalf of a minor (whether alone or in conjunction with any other person).
2: Nothing in section 93 section 4A 1969 No 41 s 5(4) Compensation or restitution
95: Compensation or restitution
1: The court may grant relief by way of compensation or restitution of property that the court thinks just if it—
a: may exercise a power under sections 87 to 89
b: exercises a power under section 93
2: The relief may be granted to—
a: a party to the contract; or
b: a guarantor or indemnifier under a contract of guarantee or indemnity that relates to a contract to which section 86(1) 92(1)
c: a person claiming through or under or on behalf of a person referred to in paragraph (a) or (b).
3: The court may, by an order made under this section,—
a: vest the whole or any part of any relevant property in a party; or
b: direct a party to transfer or assign the whole or any part of any relevant property to any other party; or
c: direct a party to deliver the whole or any part of the possession of any relevant property to any other party.
4: In subsection (3),— party relevant property 1969 No 41 s 7 Other provisions relating to applications and orders
96: Applications under sections 87 to 89 or section 93
An application under sections 87 to 89 section 93
a: any person to whom the court may grant relief under section 95
b: any other person if it is material for the person to know whether the court will exercise the powers granted to it by sections 87 to 89 section 93 1969 No 41 s 8(1)
97: Terms and conditions of orders
An order under any of sections 87 to 89 93 95 1969 No 41 s 8(2) Entering into contract with District Court’s approval
98: Minor may enter into contract with approval of District Court
Every contract entered into by a minor has effect as if the minor were of full age if, before the contract is entered into by the minor, it is approved under this section by the District Court. 1969 No 41 s 9(1)
99: Persons who may apply
An application for approval under section 98
a: by the minor or any other person who will be a party to the proposed contract; or
b: by a guardian of the minor. 1969 No 41 s 9(2)
100: Referral of application
1: The court may refer an application under section 99
a: to a guardian of the minor; or
b: if the court considers it necessary for the purposes of the application, to—
i: a lawyer nominated by the court; or
ii: Public Trust; or
iii: the Māori Trustee; or
iv: any other person.
2: The court may make any order that it thinks fit for the payment of the reasonable costs and expenses of any person to whom the application is referred.
3: A person to whom an application is referred may—
a: file a report in the District Court that—
i: sets out the results of the person’s consideration and examination of the application; and
ii: makes the recommendations that the person thinks proper; and
b: appear and be heard at the hearing of the application.
4: A person to whom an application is referred is not required to consider or examine the application until the person’s reasonable costs and expenses have been paid or secured to the person’s satisfaction. 1969 No 41 s 9(3)
101: Contracts relating to property held on trust
The District Court must not approve a contract under section 98
a: the contract relates to property held on trust; and
b: the court considers that it would be more appropriate for an application to be made under section 124 125 130 1969 No 41 s 9(5) Section 101(b) amended 30 January 2021 section 161 Trusts Act 2019 Guarantees and indemnities
102: Guarantees and indemnities
1: Every contract of guarantee or indemnity by which a person (other than a minor) undertakes to accept liability if a minor fails to carry out his or her obligations under a contract is enforceable against that person (the surety
2: The liability is not affected by—
a: any other provision of this subpart; or
b: any order made under this subpart.
3: However, the liability of the minor to the surety and the surety’s right of subrogation against the minor may be affected by the other provisions of this subpart or by an order made under any of sections 87 to 89 93 95 1969 No 41 s 10 Compromise or settlement of claims by minors
103: Application
Sections 104 105 1969 No 41 s 12(1)
104: Claim that is not subject of proceeding
1: An agreement for the compromise or settlement of a claim is binding on the minor if—
a: the agreement was entered into by the minor, or on the minor’s behalf by a person who in the opinion of a specified court is a fit and proper person to do so; and
b: the claim is not the subject of a proceeding before any court in New Zealand; and
c: the agreement or a release of the claim is in writing and is approved by a specified court.
2: In this section, specified court
a: a court (other than the Disputes Tribunal) in which a proceeding could be taken to enforce the claim; or
b: in the case of a claim that could not be the subject of a proceeding in New Zealand, a court in which a proceeding could be taken to enforce a similar claim in New Zealand. 1969 No 41 s 12(1)(a)
105: Claim that has become subject of proceeding
1: If the claim has not been compromised or settled in accordance with section 104
2: Subsection (1) applies whenever the settlement, compromise, payment, or acceptance is entered into or made. 1969 No 41 s 12(1)(b)
106: Who may apply for approval
An application for the approval of the court under section 104 105
a: by or on behalf of the minor; or
b: by any other party to the agreement or proceeding. 1969 No 41 s 12(2)
107: Court may refuse or grant approval
The court may—
a: refuse an application for its approval under section 104 105
b: grant its approval—
i: unconditionally; or
ii: on or subject to the conditions and directions that it thinks fit, whether as to the terms of the agreement or of the compromise or settlement, or as to the amount, payment, securing, application, or protection of the money paid or to be paid, or otherwise. 1969 No 41 s 12(3) Court directed trust for minor
108: Money or damages to be held on trust
1: In this section, money or damages
a: any money or damages awarded to a minor in any cause or matter; or
b: any money to which a minor is entitled under an agreement, a compromise, or a settlement approved under section 104 105
2: If the court directs that the whole or any part of any money or damages must be held on trust for the minor under this section by Public Trust or any other person,—
a: the amount must be invested and held by the trustee on trust—
i: to make a payment (if any) to the minor out of the income and capital of the amount that the court may specify; and
ii: to apply the income and capital of the amount, or so much of the income and capital that the trustee from time to time thinks fit, for or towards the maintenance or education (including past maintenance or education) or the advancement or benefit of the minor:
b: the minor has no power, either by himself or herself or in conjunction with any other person or persons, to terminate the trusts on which the amount is held or to modify or extinguish those trusts:
c: the interest of the minor in the income and capital of the amount may not, while it remains in the hands of the trustee,—
i: be alienated; or
ii: pass by bankruptcy; or
iii: be liable to be seized, sold, attached, or taken in execution by process of law.
3: Subsection (2)(a) to (c)—
a: applies except to the extent that the court directs any immediate payment from the money or damages or orders otherwise; and
b: is subject to any directions or conditions given or imposed by the court.
4: This section does not limit section 107 1969 No 41 s 12(4)
109: Payment on minor reaching 18 years or marrying or entering into civil union or de facto relationship
1: The balance of an amount that is held on trust for a minor’s benefit under section 108
a: reaching the age of 18 years; or
b: marrying or entering into a civil union or a de facto relationship before reaching the age of 18 years.
2: Subsection (1) applies except to the extent that the court may have ordered, before the payment is made, that the whole or any part of the amount must continue to be held on trust under section 108
3: Despite subsection (1), if the trustee has made an application, or received notice that an application has been made, to the court for an order referred to in subsection (2), the trustee must not make any payment under subsection (1) until the application has been disposed of. 1969 No 41 s 12(5) Other matters relating to sections 103 to 109
110: Sections 103 to 109 do not limit or affect certain other provisions
Nothing in sections 103 to 109
a: the Deaths by Accidents Compensation Act 1952
b: section 98
c: the Accident Compensation Act 2001
d: section 149(3A) 1969 No 41 s 12(8)
111: Variation of certain orders
1: The court may vary any order made by it—
a: under sections 103 to 109
b: in respect of a minor under Part 9A
2: Subsection (1) applies—
a: whether or not the order has already been varied under this section or section 13
b: to the extent that the order relates to the payment, investment, or application of money held on trust or to the income from that money. 1969 No 41 s 13(1)
112: Order may be made on court’s own motion or on application
An order under section 111
a: the minor; or
b: the trustee; or
c: any other person who provides proof of circumstances that, in the opinion of the court, make it proper that he or she should make the application. 1969 No 41 s 13(2) Jurisdiction
113: Jurisdiction of District Court
1: The District Court has jurisdiction to exercise any of the powers conferred by sections 86 to 95
a: the occasion for the exercise of the power arises in the course of any civil proceeding (other than an application made for the purposes of sections 87 to 89 section 93
b: the value of the consideration for the promise or act of any minor under the contract is not more than $350,000; or
c: the parties consent, in accordance with section 81
2: For the purposes of sections 86 to 89 sections 87 to 89 section 93 1969 No 41 s 14
114: Jurisdiction of Disputes Tribunal
1: The Disputes Tribunal established under the Disputes Tribunal Act 1988 sections 86 to 95
a: the occasion for the exercise of the power arises in the course of any proceeding properly before the Tribunal; and
b: the total amount for which an order of the Tribunal is sought does not exceed $30,000
2: An order of the Disputes Tribunal under section 95
a: require a person to pay an amount exceeding $30,000
b: declare that a person is not liable to any other person for an amount exceeding $30,000
c: vest any property that exceeds $30,000
d: direct the transfer, assignment, or delivery of possession of any property that exceeds $30,000
3: An order of the Disputes Tribunal that exceeds a restriction in subsection (2) is entirely of no effect.
4: 1969 No 41 s 14A Section 114(1)(b) amended 29 October 2019 section 340(2) Tribunals Powers and Procedures Legislation Act 2018 Section 114(2)(a) amended 29 October 2019 section 340(2) Tribunals Powers and Procedures Legislation Act 2018 Section 114(2)(b) amended 29 October 2019 section 340(2) Tribunals Powers and Procedures Legislation Act 2018 Section 114(2)(c) amended 29 October 2019 section 340(2) Tribunals Powers and Procedures Legislation Act 2018 Section 114(2)(d) amended 29 October 2019 section 340(2) Tribunals Powers and Procedures Legislation Act 2018 Section 114(4) repealed 29 October 2019 section 340(2) Tribunals Powers and Procedures Legislation Act 2018 Subpart to be code
115: This subpart to be code
1: This subpart has effect in place of the rules of the common law and of equity relating to—
a: the contractual capacity of minors; and
b: the effect, validity, avoidance, repudiation, and ratification of contracts entered into by minors; and
c: any contract of guarantee or indemnity in respect of contracts entered into by minors.
2: Nothing in this subpart limits or affects any provision of any other enactment under which a contract is made binding on a minor, and nothing in sections 86 to 94
3: Nothing in this subpart limits or affects the rule of law under which a minor is not liable in tort for procuring a contract by fraudulent representations as to his or her own age or any other matter.
4: However, the court must take a representation referred to in subsection (3) into account in deciding whether to exercise any of its powers under sections 87 to 89 section 93 95 1969 No 41 s 15(1) Agreements relating to trusts
116: Effect of this subpart on trust
1: Nothing in this subpart entitles—
a: a trustee to pay money or deliver property to a minor otherwise than in accordance with the terms of the trust:
b: a minor to enter into an agreement by which a trust is extinguished or the terms of a trust are varied.
2: Nothing in subsection (1) prevents any contract approved under section 98 117 1969 No 41 s 16(1)
117: Agreement to extinguish or vary trust may be approved
1: Every agreement entered into by a minor who is or has been married, in a civil union, or in a de facto relationship and under which a trust is extinguished or the terms of a trust are varied has effect as if the minor were of full age if, before the agreement is entered into by the minor, it is approved by the District Court.
2: An application to the District Court under this section may be made by—
a: the minor; or
b: any other person who will be a party to the proposed agreement; or
c: the trustee or trustees of the trust.
3: Sections 100 101 1969 No 41 s 16(2)–(4)
7: Stipulations not of essence of contracts
118: Stipulations not of essence of contracts
1: Stipulations in contracts as to time or otherwise that would not, before the relevant date, have been deemed to be or to have become the essence of such contracts in a court of equity must receive in all courts the same construction and effect as they would have received in equity before that date.
2: In subsection (1), relevant date Law Amendment Act 1882 1979 No 11 s 4A s 90
3: Sale of goods
119: Interpretation
1: In this Part, unless the context otherwise requires,— agreement to sell section 123 buyer contract of sale see section 123 deliverable state delivery document of title to goods
a: a bill of lading, a dock warrant, a warehouse keeper’s certificate, and a warrant or an order for the delivery of goods; and
b: any other document that—
i: is used in the ordinary course of business as proof of the possession or control of goods; or
ii: authorises or purports to authorise, either by endorsement or by delivery, the person who possesses the document to transfer or receive the goods represented by the document fault future goods section 126(1)(b) good faith goods
a: includes—
i: all kinds of movable personal property, including animals; and
ii: emblements, growing crops, and things attached to, or forming part of, the land that are agreed to be severed before sale or under the contract of sale; and
iii: computer software; but
b: does not include money or things in action insolvent mercantile agent section 296 perfected security interest section 17 plaintiff price section 120 property quality of goods right to claim sale see section 123 seller specific goods unpaid seller section 173 warranty writ of execution
2: A thing must be treated as having been done in good faith
3: A person must be treated as being insolvent
4: Goods are in a deliverable state
a: the goods are in a particular state; and
b: the buyer is bound under the contract to take delivery of the goods when they are in that state.
5: See also section 199 1908 No 168 ss 2 27(3)
1: Formation of contract
Contract of sale
120: Contract of sale of goods
A contract of sale of goods is a contract by which the seller transfers or agrees to transfer the property in goods to the buyer for a money consideration (the price 1908 No 168 s 3(1)
121: Contracts of sale may be between one part-owner and another
A contract of sale may be between one part-owner and another. 1908 No 168 s 3(2)
122: Contracts of sale may be absolute or conditional
A contract of sale may be absolute or conditional. 1908 No 168 s 3(3)
123: Sale and agreement to sell
1: A contract of sale is a sale
2: A contract of sale is an agreement to sell
3: An agreement to sell becomes a sale when the time for the transfer of the property to take place elapses or the condition or conditions of the transfer of the property are fulfilled. 1908 No 168 s 3(4)
124: Capacity to buy and sell
1: Capacity to buy and sell goods is regulated by the general law concerning capacity—
a: to contract; and
b: to transfer and acquire property.
2: However, if necessaries are sold and delivered to a person who because of mental incapacity or intoxication is incompetent to contract, he or she must pay a reasonable price for the goods.
3: In this section, necessaries
a: condition in life; and
b: actual requirements at the time of the sale and delivery. 1908 No 168 s 4 Contractual formalities
125: How contract of sale is made
1: A contract of sale may be—
a: made in writing (either with or without seal); or
b: made orally; or
c: made partly in writing and partly orally; or
d: implied from the conduct of the parties.
2: This section is subject to the provisions of this Act and of any other Act.
3: Nothing in this section affects the law relating to corporations. 1908 No 168 s 5 Subject matter of contract
126: Existing or future goods
1: The goods that form the subject of a contract of sale may be—
a: existing goods that are owned or possessed by the seller; or
b: goods that are to be manufactured or acquired by the seller after the contract of sale is made ( future goods
2: There may be a contract of sale where the acquisition of the goods by the seller depends on a contingency that may or may not happen.
3: A contract of sale operates as an agreement to sell if, by the contract, the seller purports to effect a present sale of future goods. 1908 No 168 s 7
127: Contract void if goods have perished at time when contract is made
A contract of sale for specific goods is void if the goods, without the seller’s knowledge, have perished at the time when the contract is made. Example
A person ( A B Without A’s knowledge, the potatoes, at the date of the contract, had become unfit for human consumption because of second growth. The contract between A and B is void. 1908 No 168 s 8
128: Contract 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 subpart 4 1908 No 168 s 9 s 4(5)(c) Price
129: Fixing contract price
1: The price in a contract of sale may be—
a: fixed by the contract; or
b: left to be fixed in a manner agreed in the contract; or
c: determined by the course of dealing between the parties.
2: The buyer must pay a reasonable price if the price is not determined in accordance with subsection (1). 1908 No 168 s 10(1)
130: Agreement to sell at valuation
1: An agreement to sell goods is void if—
a: the agreement is on the terms that the price is to be fixed by the valuation of a third party; and
b: the third party cannot or does not make the valuation.
2: However, if the goods or any part of the goods have been delivered to and appropriated by the buyer, the buyer must pay a reasonable price for the goods or that part of the goods.
3: If the third party is prevented from making the valuation by the fault of the seller or the buyer, the party not at fault has a right to claim damages against the party who is at fault. 1908 No 168 s 11 Conditions and warranties
131: Stipulations about time
1: Stipulations as to the time of payment are not of the essence of a contract of sale, unless a different intention appears from the terms of the contract.
2: Whether any other stipulation as to time is of the essence of the contract depends on the terms of the contract.
3: In a contract of sale, month 1908 No 168 s 12
132: Conditions and warranties
1: A breach of a condition in a contract of sale may give rise to a right to treat the contract as repudiated.
2: A breach of a warranty in a contract of sale may give rise to a claim for damages but not to a right to reject the goods and treat the contract as repudiated.
3: Whether a stipulation in a contract of sale is a condition or a warranty depends in each case on the construction of the contract.
4: A stipulation in a contract of sale may be a condition even if it is called a warranty in the contract. 1908 No 168 s 13(2)
133: Breach of condition to be fulfilled by seller
1: If a contract of sale is subject to a condition to be fulfilled by the seller, the buyer may waive the condition, or may elect to treat the breach of the condition as a breach of warranty, and not as a ground for treating the contract as repudiated.
2: If a contract of sale is not severable, and the buyer has accepted the goods or part of the goods, the breach of a condition to be fulfilled by the seller can be treated only as a breach of warranty, and not as a ground for rejecting the goods and treating the contract as repudiated, unless there is a term of the contract, express or implied, to that effect. 1908 No 168 s 13(1)
134: Impossibility or other excuse
Sections 132 133 1908 No 168 s 13(4)
135: Implied condition and warranties as to title and quiet possession
1: In a contract of sale there is—
a: an implied condition on the part of the seller that,—
i: in the case of a sale, the seller has a right to sell the goods; and
ii: in the case of an agreement to sell, the seller will have a right to sell the goods at the time when the property is to pass:
b: an implied warranty that the buyer will have and enjoy quiet possession of the goods:
c: an implied warranty that the goods are free from any charge or encumbrance in favour of any third party that is not declared or known to the buyer before or at the time when the contract is made.
2: The implied condition and warranties in subsection (1) apply unless the circumstances of the contract show a different intention. 1908 No 168 s 14
136: Sale by description
1: In a contract for the sale of goods by description, there is an implied condition that the goods will correspond to the description.
2: If the sale of goods is by sample as well as by description, it is not sufficient that the bulk of the goods corresponds to the sample if the goods do not also correspond to the description.
3: See section 142 1908 No 168 s 15
137: Implied conditions or warranties as to quality or fitness
1: There is no implied warranty or condition as to the quality or fitness for any particular purpose of goods supplied under a contract of sale except as set out in sections 138 to 141
2: This section and sections 138 to 141 1908 No 168 s 16
138: Implied condition that goods are reasonably fit for purpose
1: This section applies if—
a: the buyer, expressly or by implication, makes known to the seller the particular purpose for which the goods are required, so as to show that the buyer relies on the seller’s skill or judgement; and
b: the goods are of a description that it is in the course of the seller’s business to supply (whether or not the seller is the manufacturer).
2: There is an implied condition in the contract of sale that the goods are reasonably fit for the purpose referred to in subsection (1)(a).
3: However, in the case of a contract of sale for a specified article under its patent or other trade name, there is no implied condition that the article is fit for any particular purpose. 1908 No 168 s 16(a)
139: Implied condition that goods are of merchantable quality
1: There is an implied condition in a contract of sale that the goods are of merchantable quality if the goods are bought by description from a seller who deals in goods of that description (whether or not the seller is the manufacturer).
2: However, if the buyer has examined the goods, there is no implied condition with respect to defects that the examination ought to have revealed. 1908 No 168 s 16(b)
140: Implied warranty or condition by usage of trade
An implied warranty or condition as to quality or fitness for a particular purpose may be treated as being included in a contract of sale by the usage of trade. 1908 No 168 s 16(c)
141: Express warranty or condition
An express warranty or condition in a contract of sale does not negate a warranty or condition implied by this Part unless it is inconsistent with the implied warranty or condition. 1908 No 168 s 16(d) Sale by sample
142: Sale by sample
1: There is an implied condition in a contract of sale by sample—
a: that the bulk corresponds to the sample in quality; and
b: that the buyer will have a reasonable opportunity to compare the bulk to the sample; and
c: that the goods are free from any defect that makes them unmerchantable and that would not be apparent on reasonable examination of the sample.
2: A contract of sale is a contract of sale by sample 1908 No 168 s 17
2: Effects of contract
Transfer of property between seller and buyer
143: Goods must be ascertained
Under a contract for the sale of unascertained goods, no property in the goods is transferred to the buyer unless and until the goods are ascertained. Example
A person ( A Gold Suppliers Limited stores its gold in bulk without allocating it to individual buyers. While the gold is stored as part of an undifferentiated bulk, ownership of the gold coins does not pass to A. 1908 No 168 s 18
144: Property passes when intended to pass
1: Under a contract for the sale of specific or ascertained goods, the property in the goods is transferred to the buyer at the time that the parties to the contract intend it to be transferred.
2: For the purpose of ascertaining the intention of the parties, regard must be had to—
a: the terms of the contract; and
b: the conduct of the parties; and
c: the circumstances of the case. 1908 No 168 s 19
145: Ascertaining parties’ intention
Unless a different intention appears, the rules in section 146 1908 No 168 s 20
146: Rules for ascertaining parties’ intention
Rule 1
1: Under an unconditional contract for the sale of specific goods in a deliverable state, the property in the goods passes to the buyer when the contract is made.
2: For the purposes of subsection (1), it is immaterial whether the time of payment or the time of delivery, or both, is postponed. Rule 2
3: If there is a contract for the sale of specific goods, and the seller is bound to do something to the goods for the purpose of putting the goods into a deliverable state, the property in the goods does not pass to the buyer until—
a: the thing is done; and
b: the buyer has notice that the thing is done. Rule 3
4: If there is a contract for the sale of specific goods in a deliverable state, but the seller is bound to weigh, measure, test, or do some other act or thing with reference to the goods for the purpose of ascertaining the price, the property in the goods does not pass to the buyer until—
a: the act or thing is done; and
b: the buyer has notice that the act or thing is done. Rule 4
5: If goods are delivered to the buyer on approval, or on sale or return or other similar terms, the property in the goods passes to the buyer—
a: when the buyer indicates the buyer’s approval or acceptance to the seller, or does any other act adopting the transaction; or
b: if the buyer does not indicate the buyer’s approval or acceptance to the seller, but retains the goods without giving notice of rejection,—
i: when the time (if any) that is fixed for the return of the goods expires; or
ii: when a reasonable time expires (if no time has been fixed for the return of the goods). Rule 5
6: Subsection (7) applies if there is a contract of sale for unascertained or future goods by description.
7: The property in the goods passes to the buyer when goods of that description that are in a deliverable state are unconditionally appropriated to the contract, either by the seller with the assent of the buyer or by the buyer with the assent of the seller.
8: For the purposes of subsection (7),—
a: the assent may be expressed or implied and may be given either before or after the appropriation is made:
b: the seller must be treated as having unconditionally appropriated the goods to the contract if,—
i: in performing the contract, the seller delivers the goods to the buyer or to a carrier or other bailee (whether named by the buyer or not) for the purpose of transmission to the buyer; and
ii: the seller does not reserve the right of disposal. 1908 No 168 s 20
147: Reservation of right of disposal
1: If there is a contract of sale for specific goods or if goods are subsequently appropriated to the contract, the seller may, by the terms of the contract or appropriation, reserve the right of disposal of the goods until certain conditions are fulfilled.
2: If the seller reserves the right of disposal as referred to in subsection (1), the property in the goods does not pass to the buyer until the conditions imposed by the seller are fulfilled (despite the delivery of the goods to the buyer or to a carrier or other bailee for the purpose of transmission to the buyer).
3: The seller must be treated as having reserved the right of disposal (unless the contrary is proved) if the goods are shipped, and, by the bill of lading, the goods are deliverable to the order of the seller or the seller’s agent.
4: If the seller draws on the buyer for the price, and transmits the bill of exchange and bill of lading to the buyer together to secure acceptance or payment of the bill of exchange,—
a: the buyer must return the bill of lading if the buyer does not honour the bill of exchange; and
b: the property in the goods does not pass to the buyer if the buyer wrongfully retains the bill of lading. 1908 No 168 s 21
148: Risk passes with property unless otherwise agreed
1: Unless otherwise agreed,—
a: goods remain at the seller’s risk until the property in the goods is transferred to the buyer; but
b: when the property in the goods is transferred to the buyer, the goods are at the buyer’s risk (whether or not delivery has been made).
2: However, if delivery has been delayed through the fault of either the buyer or the seller, the goods are at the risk of the party at fault with respect to any loss that might not have occurred but for the fault.
3: This section does not affect the duties or liabilities of either the seller or the buyer as a bailee of the goods of the other party. 1908 No 168 s 22 Transfer of title
149: Sale by person who is not owner
1: This section applies if goods are sold by a person who—
a: is not the owner of the goods; and
b: does not sell the goods under the authority or with the consent of the owner.
2: 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.
3: Subsection (2) is subject to the rest of this Part.
4: Subparts 1 to 6
a: subparts 2 to 4
b: 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: Examples
A pawnbroker acting under section 63 of the Secondhand Dealers and Pawnbrokers Act 2004. A sale of goods seized under a warrant under section 172 of the District Court Act 2016.
c: the provisions of the Personal Property Securities Act 1999 1908 No 168 s 23
150: Market overt
The law relating to market overt does not apply in New Zealand. 1908 No 168 s 24
151: Sale under voidable title
1: This section applies if—
a: a seller of goods has a voidable title to the goods; but
b: the seller’s title has not become void at the time of the sale.
2: The buyer acquires a good title to the goods if the buyer buys the goods in good faith and without notice of the seller’s defect of title. 1908 No 168 s 25
152: Revesting of property in stolen goods on conviction of offender
1: The property in stolen goods revests in the person who was the owner of the goods (or that person’s personal representative) if the offender is convicted, despite any intermediate dealing with the goods.
2: Despite any other enactment, the property in goods obtained by fraud or other wrongful means that does not amount to theft does not revest in the person who was the owner of the goods (or that person’s personal representative) by reason only of the conviction of the offender. 1908 No 168 s 26
153: Seller in possession after sale
1: This section applies if—
a: a person ( A B
b: A continues or is in possession of the goods or of the documents of title to the goods; and
c: A, or a mercantile agent acting for A, delivers or transfers the goods or documents of title under any sale, pledge, or other disposition, or under any agreement for sale, pledge, or other disposition, to another person ( C
d: C receives the goods or documents in good faith and without notice of the previous sale to B.
2: The delivery or transfer to C has the same effect as if the person making the delivery or transfer were expressly authorised by the owner of the goods to make the delivery or transfer.
3: Subsection (2) does not apply to a delivery or transfer of goods or documents of title to the goods by a person who is, with the consent of the holder of a perfected security interest, in possession of the goods or documents of title to the goods. 1908 No 168 s 27(1)
154: Buyer in possession after sale
1: This section applies if—
a: a person ( A
b: A obtains, with the consent of the seller ( B
c: A, or a mercantile agent acting for A, delivers or transfers the goods or documents of title under any sale, pledge, or other disposition, or under any agreement for sale, pledge, or other disposition, to another person ( C
d: C receives the goods or documents in good faith and without notice of any lien or other right of B in respect of the goods.
2: The delivery or transfer to C has the same effect as if the person making the delivery or transfer were a mercantile agent in possession of the goods or documents of title with the consent of the owner.
3: See subpart 2
4: Subsection (2) does not apply to a delivery or transfer of goods or documents of title to the goods by a person who is, with the consent of the holder of a perfected security interest, in possession of the goods or documents of title to the goods. 1908 No 168 s 27(2)
155: Effect of writs of execution
1: A writ of execution against goods binds the property in the goods of the execution debtor from the time when the writ is delivered to the sheriff to be executed.
2: To record the time when a writ of execution is delivered, the sheriff must, without fee, on receiving the writ, endorse on the back of the writ the hour, day, month, and year when he or she received it.
3: However, no writ of execution prejudices the title to goods acquired by a person in good faith and for valuable consideration, unless, when the person acquired the person’s title, the person had notice that the writ (or any other writ under which the goods of the execution debtor might be seized or attached) had been delivered to, and remained unexecuted in the hands of, the sheriff.
4: In this section, sheriff 1908 No 168 s 28
3: Performance of contract
156: Duties of seller and buyer
The seller must deliver the goods, and the buyer must accept and pay for the goods, in accordance with the terms of the contract of sale. 1908 No 168 s 29
157: Payment and delivery are concurrent conditions
1: Delivery of the goods and payment of the price are concurrent conditions that apply as follows:
a: the seller must be ready and willing to give possession of the goods to the buyer in exchange for the price; and
b: the buyer must be ready and willing to pay the price in exchange for possession of the goods.
2: This section applies unless otherwise agreed. 1908 No 168 s 30 Rules about delivery
158: Determining whether buyer to take possession of goods or seller to send goods
Whether it is for the buyer to take possession of the goods or for the seller to send them to the buyer is a question depending in each case on the contract, express or implied, between the parties. 1908 No 168 s 31(1)
159: Place of delivery
1: Apart from a contract referred to in section 158
a: the seller’s place of business (if the seller has one); or
b: the seller’s residence (if the seller has no place of business).
2: However, if the contract is for the sale of specific goods that, to the knowledge of the parties when the contract is made, are in some other place, that place is the place of delivery rather than the place that applies under subsection (1). 1908 No 168 s 31(2)
160: Goods must be sent within reasonable time if no time is fixed
If, under the contract of sale, the seller must send the goods to the buyer but no time for sending them is fixed, the seller must send them within a reasonable time. 1908 No 168 s 31(3)
161: Goods in possession of third person
1: If the goods at the time of sale are in the possession of a third person ( A
2: However, sections 158 to 163 1908 No 168 s 31(4)
162: Demand or tender of delivery must be at reasonable hour
1: Demand or tender of delivery may be treated as having no effect unless made at a reasonable hour.
2: The question of what is a reasonable hour is a question of fact. 1908 No 168 s 31(5)
163: Seller must bear expenses of putting goods into deliverable state
1: The seller must bear the expenses of, and incidental to, putting the goods into a deliverable state.
2: This section applies unless otherwise agreed. 1908 No 168 s 31(6)
164: Delivery of wrong quantity or of mixed goods
1: The buyer may reject the goods if the seller delivers to the buyer a quantity of goods that is less than the seller contracted to sell, but if the buyer accepts those goods, the buyer must pay for the goods at the contract rate. Example
A person ( A B A delivers 3 000 lambs to B. However, 160 lambs have not been shorn and 150 have not been docked. B may reject the whole of the goods.
2: If the seller delivers to the buyer a quantity of goods larger than the seller contracted to sell, the buyer may—
a: accept the goods included in the contract and reject the rest; or
b: reject the whole of the goods; or
c: accept the whole of the goods (in which case the buyer must pay for the goods at the contract rate). Example
A person ( A B A delivers 15 barrels to B. B may— accept 10 barrels and reject 5; or reject all of the barrels; or accept all 15 barrels and pay $15,000.
3: If the seller delivers to the buyer the goods that the seller contracted to sell mixed with goods of a different description not included in the contract, the buyer may—
a: accept the goods that are in accordance with the contract and reject the rest; or
b: reject the whole of the goods.
4: This section is subject to any usage of trade, special agreement, or course of dealing between the parties. 1908 No 168 s 32
165: Buyer not bound to accept delivery by instalments
Unless otherwise agreed, the buyer of goods is not bound to accept delivery of the goods by instalments. 1908 No 168 s 33(1)
166: Instalment deliveries: breach of contract
1: This section applies if—
a: there is a contract for the sale of goods to be delivered by stated instalments, which are to be paid for separately; and
b: either or both of the following occur:
i: the seller makes defective deliveries in respect of 1 or more instalments:
ii: the buyer neglects or refuses to take delivery of, or pay for, 1 or more instalments.
2: Whether the breach of contract is a repudiation of the whole contract or whether it is a severable breach that gives rise to a claim for compensation but not to a right to treat the whole contract as repudiated depends on the terms of the contract and the circumstances of the case. 1908 No 168 s 33(2)
167: Delivery to carrier
1: If, under a contract of sale, the seller is authorised or required to send the goods to the buyer, delivery of the goods to a carrier, whether named by the buyer or not, for the purpose of transmission to the buyer must, unless the contrary is proved, be treated as being a delivery of the goods to the buyer.
2: The seller must, unless otherwise authorised by the buyer, make a contract with the carrier on behalf of the buyer that is reasonable, having regard to the nature of the goods and the other circumstances of the case.
3: The buyer has, against the seller, a right to claim damages, or may decline to treat the delivery to the carrier as a delivery to the buyer, if—
a: the seller does not comply with subsection (2); and
b: the goods are lost or damaged in the course of transit.
4: Unless otherwise agreed, if goods are sent by the seller to the buyer by a route involving sea transit, under circumstances in which it is usual to insure goods, the seller must give enough notice to the buyer to enable the buyer to insure the goods during the sea transit.
5: The goods must be treated as at the seller’s risk during the sea transit if the seller does not comply with subsection (4). 1908 No 168 s 34
168: Risk where goods are delivered at place other than place where goods are sold
1: This section applies if a seller of goods agrees to deliver the goods at the seller’s own risk at a place other than the place where the goods are when they are sold.
2: Unless otherwise agreed, the buyer must take any risk of deterioration in the goods that is necessarily incidental to the course of transit. 1908 No 168 s 35
169: Buyer’s right to examine goods
1: If goods are delivered to the buyer without the buyer previously examining them, the buyer is not treated as having accepted them unless and until the buyer has had a reasonable opportunity to examine them for the purpose of ascertaining whether they conform with the contract.
2: Unless otherwise agreed, when the seller tenders delivery of goods to the buyer, the seller must, on request, give the buyer a reasonable opportunity to examine the goods for the purpose of ascertaining whether the goods conform with the contract. 1908 No 168 s 36
170: Acceptance of goods
1: The buyer must be treated as having accepted the goods when—
a: the buyer indicates to the seller that the buyer has accepted the goods; or
b: the goods have been delivered to the buyer and the buyer does any act in relation to the goods that is inconsistent with the ownership of the seller; or
c: after a reasonable time has elapsed, the buyer retains the goods without indicating to the seller that the buyer has rejected the goods.
2: Subsection (1)(b) does not apply if section 169 1908 No 168 s 37
171: Buyer not bound to return rejected goods
1: This section applies if—
a: the buyer refuses to accept goods that have been delivered; and
b: the buyer has a right to refuse to accept the goods.
2: Unless otherwise agreed, the buyer is not bound to return the goods to the seller, and it is sufficient if the buyer indicates to the seller that the buyer refuses to accept the goods. 1908 No 168 s 38
172: Liability of buyer for neglecting or refusing to take delivery of goods
1: This section applies if—
a: the seller is ready and willing to deliver the goods; and
b: the seller requests that the buyer take delivery of the goods; and
c: the buyer does not, within a reasonable time after the request, take delivery of the goods.
2: The buyer is liable to the seller for—
a: any loss caused by the buyer’s neglect or refusal to take delivery of the goods; and
b: a reasonable charge for the care and custody of the goods.
3: However, nothing in this section affects the rights of the seller if the buyer’s neglect or refusal to take delivery of the goods amounts to a repudiation of the contract. 1908 No 168 s 39
4: Rights of unpaid seller against goods
173: Unpaid seller defined
1: A seller of goods must be treated as being an unpaid seller
a: if the whole of the price has not been paid or tendered:
b: if a bill of exchange or other negotiable instrument has been received as a conditional payment but the condition on which it was received has not been fulfilled because of the dishonour of the instrument or otherwise.
2: In this subpart, seller 1908 No 168 s 40
174: Unpaid seller's rights
1: An unpaid seller of goods has, by implication of law,—
a: a lien on the goods, or right to retain the goods for the price, while the seller is in possession of the goods:
b: if the buyer is insolvent, a right to stop the goods in transit after the seller has parted with the possession of the goods:
c: a right of resale, as limited by this Part.
2: Subsection (1) applies even though the property in the goods may have passed to the buyer.
3: Subsection (1) is subject to the rest of this Part and to the provisions of any Act.
4: If the property in goods has not passed to the buyer, the unpaid seller has, in addition to the seller’s other remedies, a right of withholding delivery similar to, and co-extensive with, the seller’s rights of lien and to stop the goods in transit where the property has passed to the buyer. 1908 No 168 s 41 Unpaid seller’s lien
175: Unpaid seller's lien
1: An unpaid seller of goods who is in possession of them may retain possession of them until payment or tender of the price if—
a: the goods have been sold without any stipulation as to credit:
b: the goods have been sold on credit, but the term of credit has expired:
c: the buyer becomes insolvent.
2: Subsection (1) is subject to the rest of this Part.
3: The seller may exercise the seller’s right of lien even if the seller is in possession of the goods as agent or bailee for the buyer. 1908 No 168 s 42
176: Part delivery
An unpaid seller of goods who has made part delivery of the goods may exercise the seller’s right of lien or retention on the remainder of the goods, unless the part delivery has been made under circumstances that show an agreement to waive the lien or right of retention. 1908 No 168 s 43
177: When unpaid seller loses lien
1: An unpaid seller of goods loses the seller’s lien or right of retention on the goods—
a: when the seller delivers the goods to a carrier or other bailee for the purpose of transmission to the buyer without reserving the right of disposal of the goods:
b: when the buyer or the buyer’s agent lawfully obtains possession of the goods:
c: by waiver of the lien or right of retention.
2: The unpaid seller of goods who has a lien or right of retention on the goods does not lose that lien or right just because the seller has obtained judgment for the price of the goods. 1908 No 168 s 44 Stopping goods in transit
178: Right to stop goods in transit
1: When a buyer of goods becomes insolvent, the unpaid seller who has parted with the possession of the goods has the right to stop them in transit.
2: The right in subsection (1) means that the seller may resume possession of the goods while they are in transit and may retain them until payment or tender of the price.
3: This section is subject to the rest of this Part. 1908 No 168 s 45
179: Duration of transit
1: Goods must be treated as being in transit from the time when the goods are delivered to a carrier by air, land, or water (or to any other bailee for the purpose of transmission to the buyer) until the buyer, or the buyer’s agent in that behalf, takes delivery of the goods from the carrier or other bailee.
2: The transit is at an end if the buyer, or the buyer’s agent in that behalf, obtains delivery of the goods before their arrival at the appointed destination.
3: The transit is at an end if, after the arrival of the goods at the appointed destination, the carrier or other bailee ( A
a: acknowledges to the buyer or the buyer’s agent that A holds the goods on the buyer’s or agent’s behalf; and
b: continues in possession of the goods as bailee for the buyer or the buyer’s agent.
4: For the purposes of subsection (3), it is immaterial that the buyer may have indicated a further destination for the goods.
5: The transit must be treated as ended if the carrier or other bailee wrongfully refuses to deliver the goods to the buyer or the buyer’s agent in that behalf.
6: The transit is not treated as ended if the goods are rejected by the buyer and the carrier or other bailee continues in possession of the goods (even if the seller has refused to receive the goods back). 1908 No 168 s 46(1)–(4)
180: Goods delivered to ship chartered by buyer
When goods are delivered to a ship chartered by a buyer, it is a question, depending on the circumstances of the particular case, as to whether the goods are in the possession of the master as a carrier or as agent to the buyer. 1908 No 168 s 46(5)
181: Part delivery
If part delivery of the goods has been made to the buyer, or the buyer’s agent in that behalf, the remainder of the goods may be stopped in transit, unless the part delivery has been made under circumstances that show an agreement to give up possession of all of the goods. 1908 No 168 s 46(7)
182: How right is exercised
An unpaid seller of goods may exercise the seller’s right to stop the goods in transit by—
a: taking actual possession of the goods; or
b: giving notice of the seller’s claim to the carrier or other bailee who has possession of the goods. 1908 No 168 s 47(1)
183: Notice of seller’s claim
1: The notice under section 182(b)
a: the person in actual possession of the goods ( A
b: A’s principal.
2: To be effective, a notice given to A’s principal must be given at a time and under circumstances that enable the principal, by exercising reasonable diligence, to communicate it to A in time to prevent a delivery to the buyer. 1908 No 168 s 47(1)
184: Redelivery of goods
1: When notice under section 182(b)
2: The expenses of the redelivery must be met by the seller. 1908 No 168 s 47(2) Resale by buyer or seller
185: Effect of subsale or pledge by buyer
1: An unpaid seller’s right of lien, retention, or stopping goods in transit is not affected by any sale or other disposition of the goods that the buyer may have made (unless the seller has assented to the sale or disposition).
2: This section is subject to the rest of this Part. 1908 No 168 s 48
186: Transfer of document of title to person in good faith and for valuable consideration
1: This section applies if—
a: a document of title to goods has been lawfully transferred to a person ( A
b: A transfers the document of title to a person ( B
2: Despite section 185
a: if the transfer referred to in subsection (1)(b) was by sale, the unpaid seller’s right of lien, retention, or stopping the goods in transit is defeated; and
b: if the transfer referred to in subsection (1)(b) was by pledge or other disposition for value, the unpaid seller’s right of lien, retention, or stopping the goods in transit may be exercised only subject to B’s rights. 1908 No 168 s 48
187: Sale not generally rescinded by lien or stopping goods in transit
1: A contract of sale is not rescinded merely by the exercise by an unpaid seller of the seller’s right of lien, retention, or stopping the goods in transit.
2: This section is subject to sections 188 to 190 1908 No 168 s 49(1)
188: Buyer’s title on resale
If an unpaid seller of goods who has exercised the seller’s right of lien, retention, or stopping the goods in transit resells the goods, the buyer acquires a good title to the goods as against the original buyer. 1908 No 168 s 49(2)
189: Resale in case of perishable goods or notice of intention to resell
1: This section applies if—
a: goods are of a perishable nature or an unpaid seller gives notice to the buyer of the seller’s intention to resell the goods; and
b: the buyer does not pay or tender the price within a reasonable time.
2: The unpaid seller may—
a: resell the goods; and
b: recover damages from the original buyer for any loss caused by the original buyer’s breach of contract. 1908 No 168 s 49(3)
190: Express power of sale
1: This section applies if a seller—
a: expressly reserves a right of resale in case the buyer should default; and
b: on the buyer defaulting, resells the goods.
2: The original contract of sale is rescinded (but this does not limit any right to claim damages that the seller may have). 1908 No 168 s 49(4)
5: Remedies for breach of contract
Remedies of seller
191: Claim for price
1: A seller has, against the buyer, a right to claim the price of the goods if,—
a: under the contract of sale, the property in the goods has passed to the buyer; and
b: the buyer wrongfully neglects or refuses to pay for the goods according to the terms of the contract.
2: If, under the contract of sale, the price is payable on a certain day irrespective of delivery, and the buyer wrongfully neglects or refuses to pay the price, the seller has, against the buyer, a right to claim for the price.
3: Subsection (2) applies even if the property in the goods has not passed and the goods have not been appropriated to the contract. 1908 No 168 s 50
192: Damages for non-acceptance
1: A seller has, against the buyer, a right to claim damages for non-acceptance of goods if the buyer wrongfully neglects or refuses to accept and pay for the goods.
2: The measure of damages is the estimated loss directly and naturally resulting, in the ordinary course of events, from the buyer’s breach of contract.
3: If there is an available market for the goods, the usual measure of damages is (unless the circumstances otherwise require) the difference between the contract price and the market or current price—
a: at the time or times when the goods ought to have been accepted; or
b: if no time was fixed for acceptance of the goods, at the time of the refusal to accept them. 1908 No 168 s 51 Remedies of buyer
193: Damages for non-delivery
1: The buyer has, against the seller, a right to claim damages for non-delivery if the seller wrongfully neglects or refuses to deliver the goods to the buyer.
2: The measure of damages is the estimated loss directly and naturally resulting, in the ordinary course of events, from the seller’s breach of contract.
3: If there is an available market for the goods, the usual measure of damages is (unless the circumstances otherwise require) the difference between the contract price and the market or current price—
a: at the time or times when the goods ought to have been delivered; or
b: if no time was fixed for delivery of the goods, at the time of the refusal to deliver them. 1908 No 168 s 52
194: Specific performance
1: The plaintiff in a proceeding for breach of contract to deliver specific or ascertained goods may, at any time before judgment, make an application for a direction under this section.
2: The court may, if it thinks fit, grant the application by directing that the contract be performed specifically, without giving the defendant the option of retaining the goods on payment of damages.
3: The judgment may be—
a: unconditional; or
b: on the terms and conditions as to damages, payment of the price, and otherwise that the court thinks just. 1908 No 168 s 53
195: Remedy for breach of warranty
1: This section applies if—
a: there is a breach of warranty by the seller; or
b: the buyer elects or is compelled to treat any breach of a condition on the part of the seller as a breach of warranty.
2: The buyer is not, by reason only of the breach of warranty, entitled to reject the goods.
3: However, the buyer—
a: may rely on the breach of warranty to obtain against the seller a reduction in, or the satisfaction of, the price; or
b: has, against the seller, a right to claim damages for the breach of warranty.
4: The measure of damages for breach of warranty is the estimated loss directly and naturally resulting, in the ordinary course of events, from the breach of warranty.
5: The loss for a breach of warranty of quality is (unless the circumstances otherwise require) usually the difference between the value of the goods at the time of delivery to the buyer and the value the goods would have had if the goods had complied with the warranty.
6: The fact that the buyer has relied on the breach of warranty to obtain a reduction in, or the satisfaction of, the price does not prevent the buyer from claiming damages for the same breach of warranty if the buyer has suffered further damage. 1908 No 168 s 54
196: Interest and special damages
Subparts 1 to 6
a: interest or special damages in any case where by law interest or special damages may be recoverable; or
b: money paid where the consideration for the payment of the money has failed. 1908 No 168 s 55
6: Supplementary matters
197: Exclusion of implied terms and conditions
If any right, duty, or liability would arise under a contract of sale by implication of law, it may be negatived or varied by—
a: express agreement; or
b: the course of dealing between the parties; or
c: usage, if the usage is such as to bind both parties to the contract. 1908 No 168 s 56
198: Exclusion where Consumer Guarantees Act 1993 applies
Nothing in any of sections 129 132 to 142 171 195 Consumer Guarantees Act 1993 1908 No 168 s 56A
199: Reasonable price and reasonable time are questions of fact
1: Where subparts 1 to 5
2: Where subparts 1 to 5 1908 No 168 ss 10(3) 57
200: Rights and duties enforceable by proceeding
Any right, duty, or liability declared by subparts 1 to 5 1908 No 168 s 58
201: Savings
1: The rules in bankruptcy relating to contracts of sale continue to apply despite anything in subparts 1 to 5
2: The rules of the common law, except to the extent that those rules are inconsistent with the express provisions of subparts 1 to 5
3: The provisions of subparts 1 to 5
4: Subparts 1 to 5 1908 No 168 s 60
7: United Nations Convention on Contracts for the International Sale of Goods
202: Purpose
The purpose of this subpart is to give effect to the provisions of the United Nations Convention on Contracts for the International Sale of Goods. 1994 No 60 Long Title
203: Interpretation
In this subpart, Convention Schedule 4 1994 No 60 s 2
204: Convention to have force of law
The provisions of the Convention have the force of law in New Zealand. 1994 No 60 s 4
205: Convention to be code
The provisions of the Convention, in relation to contracts to which the Convention applies, have effect in place of any other law of New Zealand that relates to contracts of sale of goods to the extent—
a: that the law is concerned with any matter that is governed by the Convention; and
b: that the application of the law is not expressly permitted by the Convention. 1994 No 60 s 5
206: Certificates about Contracting States
1: A certificate signed by the Secretary of Foreign Affairs and Trade, or by a Deputy Secretary of Foreign Affairs and Trade, in relation to the matters referred to in subsection (2) is conclusive evidence for all purposes of the matters stated in the certificate.
2: The matters are—
a: whether or not, in respect of any specified day or period, a State is a Contracting State; and
b: whether or not, in respect of any specified day or period, a declaration made under the Convention is effective in respect of a State and, if so, the contents of the declaration. 1994 No 60 s 6
4: Electronic transactions
1: Preliminary provisions
207: Purpose
The purpose of this Part is to facilitate the use of electronic technology by—
a: reducing uncertainty regarding—
i: the legal effect of information that is in electronic form or that is communicated by electronic means; and
ii: the time and place of dispatch and receipt of electronic communications; and
b: providing that certain paper-based legal requirements may be met by using electronic technology that is functionally equivalent to those legal requirements. 2002 No 35 s 3
208: Overview
In this Part,—
a: matters concerning the legal effect of information that is in electronic form or that is communicated by electronic means are set out in section 211
b: default rules about the time and place of dispatch and receipt of electronic communications are set out in sections 212 to 217
c: key provisions concerning the use of electronic technology to meet certain legal requirements are set out in sections 218 to 221
d: provisions that specify certain legal requirements that may be met by using electronic technology, and how they may be met, are set out in sections 222 to 236 2002 No 35 s 4
209: Interpretation
In this Part, unless the context otherwise requires,— data storage device electronic electronic communication electronic signature information information system section 213(2) legal requirement section 219(2) security interest
a: the form of the transaction; and
b: the identity of the person who has title to the property that is subject to the security interest transaction
a: a transaction of a non-commercial nature:
b: a single communication:
c: the outcome of multiple related communications. 2002 No 35 s 5 Section 209 security interest inserted 30 March 2025 section 42 Regulatory Systems (Economic Development) Amendment Act 2025
210: Further provision relating to interpretation
In interpreting this Part, reference may be made to—
a: the Model Law on Electronic Commerce adopted by the United Nations Commission on International Trade Law on 16 December 1996:
b: any document that relates to the Model Law that originates from the United Nations Commission on International Trade Law, or its working group for the preparation of the Model Law. 2002 No 35 s 6
2: Improving certainty in relation to electronic information and electronic communications
Validity
211: Validity of information
To avoid doubt, information is not denied legal effect solely because it—
a: is in electronic form or is in an electronic communication:
b: is referred to in an electronic communication that is intended to give rise to that legal effect. 2002 No 35 s 8 Default rules about dispatch and receipt of electronic communications
212: When default rules in sections 213 to 216 apply
Sections 213 to 216
a: the parties to the communication otherwise agree:
b: an enactment provides otherwise. 2002 No 35 s 9
213: Time of dispatch
1: An electronic communication is taken to be dispatched at the time the electronic communication first enters an information system outside the control of the originator.
2: For the purposes of this section and section 214 information system 2002 No 35 s 10
214: Time of receipt
An electronic communication is taken to be received,—
a: in the case of an addressee who has designated an information system for the purpose of receiving electronic communications, at the time the electronic communication enters that information system; or
b: in any other case, at the time the electronic communication comes to the attention of the addressee. 2002 No 35 s 11
215: Place of dispatch
An electronic communication is taken to be dispatched from—
a: the originator’s place of business; or
b: if the originator has more than 1 place of business,—
i: the place of business that has the closest relationship with the underlying transaction; or
ii: if there is no place of business to which subparagraph (i) applies, the originator's principal place of business; or
c: in the case of an originator who does not have a place of business, the originator's ordinary place of residence. 2002 No 35 s 12
216: Place of receipt
An electronic communication is taken to be received at—
a: the addressee's place of business; or
b: if the addressee has more than 1 place of business,—
i: the place of business that has the closest relationship with the underlying transaction; or
ii: if there is no place of business to which subparagraph (i) applies, the addressee's principal place of business; or
c: in the case of an addressee who does not have a place of business, the addressee's ordinary place of residence. 2002 No 35 s 13
217: Time of communication of acceptance of offer
1: For the purpose of the formation of a contract, an acceptance by electronic communication of an offer is taken to be communicated to the offeror at the time determined by section 214
2: Subsection (1) does not apply if—
a: the parties to the contract otherwise agree; or
b: an enactment provides otherwise. 2002 No 35 s 13A
3: Application of legal requirements to electronic transactions
Preliminary provisions
218: When subpart applies
1: This subpart applies to every enactment that is part of the law of New Zealand and that is passed either before or after the commencement of this Act.
2: However, this subpart does not apply to—
a: an enactment that requires information to be recorded, given, produced, or retained, a signature to be given, or a signature or seal to be witnessed—
i: in accordance with particular electronic technology requirements; or
ii: on a particular kind of data storage device; or
iii: by means of a particular kind of electronic communication:
b: the enactments specified in Part 1
c: the provisions of enactments specified in Part 2
d: the provisions of enactments that are described in Part 3
e: the provisions of enactments that are described in Part 4 Schedule 5
3: Despite subsection (2)(d), this subpart applies to a deed that creates a power of attorney in connection with a security interest. 2002 No 35 s 14(1), (2) Section 218(3) inserted 30 March 2025 section 43 Regulatory Systems (Economic Development) Amendment Act 2025
218A: Temporary modification relating to powers of attorney and outbreak of COVID-19
Section 218A repealed 30 June 2021 section 218D
218B: Period for which temporary modification applies
Section 218B repealed 30 June 2021 section 218D
218C: Requirements relating to orders made under section 218B
Section 218C repealed 30 June 2021 section 218D
218D: Repeal of temporary modification provisions
2021-07-01 Contract and Commercial Law Act 2017 Sections 218A to 218D are repealed. Section 218D repealed 30 June 2021
219: When legal requirement can be met by electronic means
1: A legal requirement can be met by electronic means if the applicable provisions in sections 222 to 236 section 239(1)
2: For the purposes of this subpart, legal requirement
a: means a requirement in an enactment to which this subpart applies; and
b: includes a provision in an enactment to which this subpart applies that provides consequences that depend on whether or not the provision is complied with. 2002 No 35 s 15
220: Consent to use of electronic technology
1: Nothing in this subpart requires a person to use, provide, or accept information in an electronic form without that person's consent.
2: For the purposes of this subpart,—
a: a person may consent to use, provide, or accept information in an electronic form subject to conditions regarding the form of the information or the means by which the information is produced, sent, received, processed, stored, or displayed:
b: consent may be inferred from a person's conduct.
3: Subsections (1) and (2)(a) are for the avoidance of doubt. 2002 No 35 s 16
221: When integrity of information maintained
For the purposes of this subpart, the integrity of information is maintained only if the information has remained complete and unaltered, except for the addition of any endorsement, or any immaterial change, that arises in the normal course of communication, storage, or display. 2002 No 35 s 17 Legal requirement: writing
222: Legal requirement that information be in writing
A legal requirement that information be in writing is met by information that is in electronic form if the information is readily accessible so as to be usable for subsequent reference. 2002 No 35 s 18
223: Legal requirement to record information in writing
A legal requirement that information be recorded in writing is met by recording the information in electronic form if the information is readily accessible so as to be usable for subsequent reference. 2002 No 35 s 19
224: Legal requirement to give information in writing
1: A legal requirement to give information in writing is met by giving the information in electronic form, whether by means of an electronic communication or otherwise, if—
a: the information is readily accessible so as to be usable for subsequent reference; and
b: the person to whom the information is required to be given consents to the information being given in electronic form and by means of an electronic communication, if applicable.
2: If subsection (1) applies, a legal requirement to provide multiple copies of the information to the same person at the same time is met by providing a single electronic version of the information.
3: Subsection (1) applies to a legal requirement to give information even if that information is required to be given in a specified manner, for example, by filing, sending, serving, delivering, lodging, or posting that information.
4: A legal requirement to give information includes, for example,—
a: making an application:
b: making or lodging a claim:
c: giving, sending, or serving a notification:
d: lodging a return:
e: making a request:
f: making a declaration:
g: lodging or issuing a certificate:
h: making, varying, or cancelling an election:
i: lodging an objection:
j: giving a statement of reasons. 2002 No 35 s 20
225: Legal requirements relating to layout and format of certain information and writing materials
1: In order to meet a legal requirement to which any of sections 222 to 224
2: In this section and section 239(1)(b)(ii) paper-based format requirement
a: a legal requirement relating to the format or layout of information:
b: a legal requirement relating to the materials to be used for writing information:
c: any similar legal requirement. 2002 No 35 s 21 Legal requirement: signatures
226: Legal requirement for signature
1: A legal requirement for a signature other than a witness's signature is met by means of an electronic signature if the electronic signature—
a: adequately identifies the signatory and adequately indicates the signatory's approval of the information to which the signature relates; and
b: is as reliable as is appropriate given the purpose for which, and the circumstances in which, the signature is required.
2: However, a legal requirement for a signature that relates to information legally required to be given to a person is met by means of an electronic signature only if that person consents to receiving the electronic signature. 2002 No 35 s 22
227: Legal requirement that signature or seal be witnessed
1: A legal requirement for a signature or a seal to be witnessed is met by means of a witness's electronic signature if,—
a: in the case of the witnessing of a signature, the signature to be witnessed is an electronic signature that complies with section 226
b: in the case of the witnessing of a signature or a seal, the electronic signature of the witness—
i: adequately identifies the witness and adequately indicates that the signature or seal has been witnessed; and
ii: is as reliable as is appropriate given the purpose for which, and the circumstances in which, the witness's signature is required.
2: However, a legal requirement for a signature or seal to be witnessed, if that signature or seal relates to information legally required to be given to a person, is met by means of a witness's electronic signature only if that person consents to receiving the witness's electronic signature. 2002 No 35 s 23
228: Presumption about reliability of electronic signatures
1: For the purposes of sections 226 227
a: the means of creating the electronic signature is linked to the signatory and to no other person; and
b: the means of creating the electronic signature was under the control of the signatory and of no other person; and
c: any alteration to the electronic signature made after the time of signing is detectable; and
d: where the purpose of the legal requirement for a signature is to provide assurance as to the integrity of the information to which it relates, any alteration made to that information after the time of signing is detectable.
2: Subsection (1) does not prevent any person from proving on other grounds or by other means that an electronic signature—
a: is as reliable as is appropriate; or
b: is not as reliable as is appropriate. 2002 No 35 s 24 Legal requirement: retention
229: Legal requirement to retain document or information that is in paper or other non-electronic form
1: A legal requirement to retain information that is in paper or any other non-electronic form is met by retaining an electronic form of the information if—
a: the electronic form provides a reliable means of assuring that the integrity of the information is maintained; and
b: the information is readily accessible so as to be usable for subsequent reference.
2: Subsection (1) applies to information that is a public record within the meaning of the Public Records Act 2005
3: To avoid doubt, if information is retained in electronic form in accordance with subsection (1), the paper or other non-electronic form of that information need not be retained. 2002 No 35 s 25
230: Legal requirement to retain information that is in electronic form
1: A legal requirement to retain information that is in electronic form is met by retaining the information—
a: in paper or any other non-electronic form if the form provides a reliable means of assuring that the integrity of the information is maintained; or
b: in electronic form if—
i: the electronic form provides a reliable means of assuring that the integrity of the information is maintained; and
ii: the information is readily accessible so as to be usable for subsequent reference.
2: This section is subject to section 231 2002 No 35 s 26
231: Extra conditions for electronic communications
In addition to the conditions specified in section 230
a: the person must also retain such information obtained by that person as enables the identification of—
i: the origin of the electronic communication; and
ii: the destination of the electronic communication; and
iii: the time when the electronic communication was sent and the time when it was received; and
b: the information referred to in paragraph (a) must be readily accessible so as to be usable for subsequent reference. 2002 No 35 s 27 Legal requirement: provision and production of, and access to, information
232: Legal requirement to provide or produce information that is in paper or other non-electronic form
A legal requirement to provide or produce information that is in paper or any other non-electronic form is met by providing or producing the information in electronic form, whether by means of an electronic communication or otherwise, if—
a: the form and means of the provision or production of the information reliably assures that the integrity of the information is maintained, given the purpose for which, and the circumstances in which, the information is required to be provided or produced; and
b: the information is readily accessible so as to be usable for subsequent reference; and
c: the person to whom the information is required to be provided or produced consents to the information being provided or produced in an electronic form and, if applicable, by means of an electronic communication. 2002 No 35 s 28
233: Legal requirement to provide or produce information that is in electronic form
A legal requirement to provide or produce information that is in electronic form is met by providing or producing the information—
a: in paper or any other non-electronic form, but, if the maintenance of the integrity of the information cannot be assured, the person who must provide or produce the information must—
i: notify that fact to every person to whom the information is required to be provided or produced; and
ii: if requested to do so, provide or produce the information in electronic form in accordance with paragraph (b); or
b: in electronic form, whether by means of an electronic communication or otherwise, if—
i: the form and means of the provision or production of the information reliably assure that the integrity of the information is maintained, given the purpose for which, and the circumstances in which, the information is required to be provided or produced; and
ii: the information is readily accessible so as to be usable for subsequent reference; and
iii: the person to whom the information is required to be provided or produced consents to the provision or production of the information in an electronic form and, if applicable, by means of an electronic communication. 2002 No 35 s 29
234: Legal requirement to provide access to information that is in paper or other non-electronic form
A legal requirement to provide access to information that is in paper or any other non-electronic form is met by providing access to the information in electronic form if—
a: the form and means of access to the information reliably assure that the integrity of the information is maintained, given the purpose for which, and the circumstances in which, access to the information is required to be provided; and
b: the person to whom access is required to be provided consents to accessing the information in that electronic form. 2002 No 35 s 30
235: Legal requirement to provide access to information that is in electronic form
A legal requirement to provide access to information that is in electronic form is met by providing access to the information—
a: in paper or any other non-electronic form, but, if the maintenance of the integrity of the information cannot be assured, the person who must provide access to the information must—
i: notify that fact to every person to whom access is required to be provided; and
ii: if requested to do so, provide access to the information in electronic form in accordance with paragraph (b); or
b: in electronic form, whether by means of an electronic communication or otherwise, if—
i: the form and means of access to the information reliably assure that the integrity of the information is maintained, given the purpose for which, and the circumstances in which, access to the information is required to be provided; and
ii: the person to whom access is required to be provided consents to accessing the information in that electronic form. 2002 No 35 s 31 Legal requirement: originals
236: Originals
A legal requirement to compare a document with an original document may be met by comparing that document with an electronic form of the original document if the electronic form reliably assures that the integrity of the document is maintained. 2002 No 35 s 32 Miscellaneous
237: Legal requirement relating to content of information
This subpart does not affect any legal requirement to the extent that the requirement relates to the content of information. 2002 No 35 s 33
238: Copyright
The copyright in a work is not infringed by either of the following acts if they are carried out for the purposes of meeting a legal requirement by electronic means:
a: the generation of an electronic form of a document:
b: the production of information by means of an electronic communication. 2002 No 35 s 34
239: Regulations and Order in Council to amend Schedule 5
1: The Governor-General may, by Order in Council, make regulations for all or any of the following purposes:
a: prescribing any conditions that must be complied with in order to meet a legal requirement by electronic means:
b: without limiting paragraph (a), prescribing 1 or more requirements that—
i: must be complied with in order to meet, by electronic means, a legal requirement to which any of sections 222 to 224
ii: apply instead of a paper-based format requirement:
c: if an enactment sets out a form that must be used for the purposes of meeting a legal requirement, prescribing an electronic form that may be substituted for the form set out in the enactment:
d: if an enactment provides for the time at which a legal requirement to provide information is to be treated as being satisfied where that information is provided by post or by any other non-electronic means, providing for the time at which the legal requirement is to be treated as being satisfied by an electronic communication.
2: The Governor-General may, by Order in Council, amend Schedule 5
3: The following are secondary legislation ( see Part 3
a: regulations under subsection (1):
b: an order under subsection (2).
4: An order under subsection (2) that makes an addition to Schedule 5 see subpart 3 2002 No 35 ss 14(3) 14A 36 The following table is small in size and has 3 columns that are grouped under the heading Legislation Act 2019 requirements for secondary legislation made under this section. Legislation Act 2019 requirements for secondary legislation made under this section Publication PCO must publish it on the legislation website and notify it in the Gazette LA19 s 69(1)(c) Presentation The Minister must present it to the House of Representatives LA19 s 114 cl 32(1)(a) Disallowance It may be disallowed by the House of Representatives LA19 ss 115 116 This note is not part of the Act. Section 239(3) replaced 28 October 2021 section 3 Secondary Legislation Act 2021 Section 239(4) inserted 28 October 2021 section 3 Secondary Legislation Act 2021
240: Authority to prescribe electronic forms and requirements for using electronic forms
1: A person who is authorised to prescribe a form under an enactment is authorised—
a: to prescribe an electronic form for the purposes of that enactment; and
b: to prescribe requirements in connection with the use of that electronic form, including requirements for its electronic signature.
2: Nothing in subsection (1) authorises a person to require the use of an electronic form under any enactment. 2002 No 35 s 37
240A: Temporary modification relating to powers of attorney and COVID-19
Section 240A repealed the close of 30 November 2022 section 240E
240B: Period for which temporary modification applies
Section 240B repealed the close of 30 November 2022 section 240E
240C: Order in Council may extend application period
Section 240C repealed the close of 30 November 2022 section 240E
240D: Order in Council may provide for modification to cease to apply
Section 240D repealed the close of 30 November 2022 section 240E
240E: Repeal of temporary modification provisions
2022-12-01 Contract and Commercial Law Act 2017 Sections 240A to 240E repealed. Section 240E repealed the close of 30 November 2022 section 240E
5: Other commercial matters
1: Carriage of goods
Overview
241: Overview
1: This subpart provides for the liability of carriers for the loss of or damage to goods carried within New Zealand as follows:
a: sections 242 to 247
b: sections 248 to 260
i: dividing contracts of carriage of goods into 4 kinds of contract for liability purposes (with the default position being that carriers have limited liability up to a statutory cap):
ii: determining when a carrier is responsible for goods for liability purposes:
iii: setting statutory caps and exclusions from liability:
c: sections 261 to 273
i: providing for the liability of actual carriers to contracting carriers and how that liability is apportioned between actual carriers ( see sections 261 to 265
ii: implying into every contract of carriage a statutory warranty by contracting parties as to the condition of the goods, including that the goods are fit to be carried and stored in accordance with the contract ( see section 273
d: sections 274 to 281
e: sections 282 to 292
f: sections 293 to 295
2: This section is only a guide to the general scheme and effect of this subpart. Application and effect of subpart
242: This subpart applies to carriage of goods by carrier under contract
1: This subpart applies to every carriage of goods performed or to be performed by a carrier under a contract.
2: Subsection (1) applies—
a: whether the carriage is by land, water, or air (or by more than 1 of those modes); and
b: whether or not the carriage is incidental to the carriage of passengers.
3: This section is subject to section 243 1979 No 43 s 5(1)
243: This subpart does not apply to international carriage, to postal services, or in certain other cases
1: This subpart does not apply to—
a: international carriage:
b: the carriage of letters by a postal operator, whether by the postal operator's agents or otherwise:
c: the carriage of goods by the New Zealand Defence Force or the Ministry of Defence, except for the purpose of providing a public service in New Zealand or elsewhere for payment:
d: any carriage by air that is performed as part of an air transport service for the carriage of passengers and is operated by any club that is affiliated with the Royal New Zealand Aero Club Incorporated (the club
i: the carriage is performed in an aircraft owned or hired by the club; and
ii: all persons carried on the aircraft, whether as crew or passengers, are members of the club with full rights of membership.
2: If an aircraft or a ship is engaged in both international carriage and other carriage of goods at the same time, subsection (1)(a) does not prevent this subpart applying to the carriage that is not international carriage.
3: If a passenger ( A
4: In this section,— letter section 2(1) payment postal operator section 2(1) 1979 No 43 ss 4(2) 5(3)–(4B)
244: Other remedies affected
Despite any rule of law to the contrary, a carrier is not liable in its capacity as a carrier, whether in tort or otherwise, and whether personally or vicariously, for the loss of or damage to any goods carried by the carrier except—
a: in accordance with the terms of the contract of carriage and the provisions of this subpart; or
b: where the carrier intentionally causes the loss or damage. 1979 No 43 s 6
245: Contracting out permitted for some matters
If the parties to a contract of carriage expressly provide for any matter to which any of the following sections apply, those sections have effect subject to the express terms:
a: if the contract is for carriage at owner’s risk or for carriage on declared terms, sections 257 258
b: sections 261 to 265
c: if the contract of carriage is between a contracting carrier and an actual carrier or between actual carriers, section 273
d: sections 274 to 281
e: sections 282 to 292 1979 No 43 ss 7 8(14) 17(3) Interpretation
246: Interpretation
In this subpart, unless the context otherwise requires,— actual carrier
a: in relation to the carriage of any goods, means every carrier who, at any material time, is or was in possession of the following for the purpose of performing the carriage, any stage of the carriage, or any incidental service:
i: the goods; or
ii: any container, package, pallet, item of baggage, or any other thing in or on which the goods are or were believed by the carrier to be; and
b: includes the contracting carrier if that person performs any part of the carriage carriage carrier
a: means a person who, in the ordinary course of the person’s business, carries or procures to be carried goods that are owned by any other person (whether or not the carriage is incidental to the carriage of passengers); and
b: except in sections 283 to 289 checked baggage contract of carriage contracting carrier contracting party court goods
a: means goods, baggage, and chattels of any description; and
b: includes—
i: animals and plants; and
ii: money, documents, and all other things of value hand baggage incidental service international carriage
a: in relation to the carriage of goods by air, means carriage in which, according to the contract of carriage and whether or not there is a break in the carriage or a transhipment,—
i: the place of departure is in the territory of one country and the place of destination is in the territory of another country; or
ii: the place of departure and the place of destination are both within the territory of a single country but there is an agreed stopping place within the territory of another country:
b: in relation to the carriage of goods by sea, means carriage from any port in New Zealand to any port outside New Zealand, or to any port in New Zealand from any port outside New Zealand, commencing when the goods are loaded onto a ship and ending when they are discharged from a ship loss passenger ship 1979 No 43 s 2
247: Meaning of unit of goods
1: In this subpart, unless the context otherwise requires, unit of goods unit
a: in relation to bulk cargo, means the customary freight unit; that is, the unit of bulk, weight, or measurement on which the freight for that type of cargo is customarily computed or adjusted (subject to subsection (2)):
b: in relation to goods contained in a container,—
i: means the container load of goods; and
ii: includes the container if the container is provided by the contracting party:
c: in relation to goods loaded on a pallet,—
i: means the pallet load of goods; and
ii: includes the pallet if the pallet is provided by the contracting party:
d: in relation to goods contained in a package that is not contained in a larger package or in a container, nor loaded on a pallet, means the package of goods:
e: in relation to goods that are unitised for the purposes of carriage in any manner not referred to in any of paragraphs (a) to (d) or in subsection (2), means that unit of goods:
f: in relation to goods (other than baggage) not referred to in any of paragraphs (a) to (e) or in subsection (2), means each item of the goods:
g: in relation to baggage, means each item of baggage.
2: For the purposes of subsection (1)(a), if the freight payable under a contract of carriage is computed or adjusted on a specified unit of bulk, weight, or measurement, references in this subpart to a unit of goods or unit must be treated, for the purposes of the carriage of goods under that contract, as references to that specified unit.
3: See also section 259(4) 1979 No 43 s 3(1) Kinds of contract of carriage and effect on liability of parties
248: Liability depends on kind of contract of carriage
1: For the purposes of this subpart, each contract of carriage is one of the following kinds, as determined by section 249
a: a contract for carriage at owner’s risk
b: a contract for carriage at declared value risk
c: a contract for carriage on declared terms
d: a contract for carriage at limited carrier’s risk
2: The liability of a carrier for loss or damage to goods under a contract of carriage is determined by the kind of contract as follows:
a: under a contract for carriage at owner’s risk, the carrier is not liable for the loss of or damage to any goods, except where the loss or damage is intentionally caused by the carrier:
b: under a contract for carriage at declared value risk, the carrier is liable for the loss of or damage to any goods up to an amount specified in the contract and otherwise in accordance with sections 256 to 260
c: under a contract for carriage on declared terms, the carrier is liable for the loss of or damage to any goods in accordance with the specific terms of the contract:
d: under a contract for carriage at limited carrier’s risk, the carrier is liable for the loss of or damage to any goods in accordance with sections 256 to 260
3: See section 259 1979 No 43 s 8(1)
249: Particular kind of contract of carriage is matter for agreement subject to meeting requirements for that kind
1: A contract of carriage is a particular kind of contract referred to in section 248
a: it uses the term for that kind of contract referred to in section 248(1)
b: it meets the requirements that apply to that kind of contract under sections 250 to 253
2: The kind of contract of carriage to be entered into in a particular case is a matter of agreement between the parties.
3: However,—
a: a contract of carriage that does not purport to be of a particular kind is a contract for carriage at limited carrier's risk:
b: a contract of carriage that purports to be of a particular kind but does not meet the requirements that apply to that kind under sections 250 to 253 1979 No 43 s 8(2)–(4)
250: Requirements for contract for carriage at owner's risk
1: A contract can be a contract for carriage at owner’s risk only if—
a: either—
i: the contract is in writing, is expressed to be at owner's risk, and is signed by the parties or their agents; or
ii: before, or at the time when, the goods are accepted for carriage, the contracting party or the party’s agent signs the following statement: These goods are to be carried at owner's risk. This means that the carrier will pay no compensation if the goods are lost or damaged, unless the carrier intentionally loses or damages them. ; and
b: the requirement in section 253
2: For the purposes of subsection (1)(a)(ii), the statement may be included in the consignment note or in any other document relating to the carriage, but in that case the statement must be prominent and must be separately signed by the contracting party or the party’s agent. 1979 No 43 s 8(5)
251: Requirements for contract for carriage at declared value risk
A contract can be a contract for carriage at declared value risk only if—
a: the contract is in writing; and
b: the requirement in section 253 1979 No 43 s 8(6)
252: Requirements for contract for carriage on declared terms
1: A contract can be a contract for carriage on declared terms only if the contract—
a: is freely negotiated between the parties; and
b: is in writing; and
c: is signed by the parties or their agents.
2: If, in any proceeding, the question of whether a contract of carriage was or was not freely negotiated is in issue, the court in determining that question must have regard to the following matters:
a: the respective bargaining strengths of the parties:
b: the course of dealing between the parties in respect of the particular transaction in question, and any other transactions between them:
c: the value of the transaction:
d: any extraordinary features of the goods to be carried or the route over which the goods are to be carried:
e: any other matters that the court considers may properly be taken into account.
3: Either party may bring evidence relating to any matter referred to in subsection (2). 1979 No 43 s 8(7)
253: Difference between amounts charged must be fair and reasonable for contract at owner’s risk or declared value risk
1: This section applies to a contract for carriage at owner’s risk or at declared value risk.
2: The difference in amount between the freight charged by the contracting carrier under the contract and the amount that the carrier would have charged for the same carriage at limited carrier's risk must be fair and reasonable.
3: For the purposes of determining when the difference is fair and reasonable,—
a: regard must be had to the difference in the risk actually undertaken by the carrier and the risk that the carrier would have undertaken if the carriage had been at limited carrier's risk; and
b: a rate of freight prescribed by or under any enactment for any mode of carriage pursuant to any kind of contract of carriage must be treated as being a fair and reasonable rate to charge for the carriage. 1979 No 43 s 8(9)
254: Contract between contracting carrier and actual carrier or between actual carriers
1: A contract of carriage between a contracting carrier and an actual carrier, or between actual carriers, may be of any kind, regardless of the kind of contract that subsists between the contracting carrier and the contracting party.
2: Sections 250 to 252 1979 No 43 s 8(11) Liability of contracting carriers
255: Application of sections 256 to 258
1: Sections 256 to 258
2: In relation to contracts for carriage at owner’s risk or to contracts for carriage on declared terms,—
a: section 256
b: sections 257 258 see section 245 1979 No 43 s 8(12)
256: Liability of contracting carrier
1: A contracting carrier is liable to the contracting party for the loss of or damage to any goods that occurs while the carrier is responsible for the goods under sections 257 258
2: This section is subject to sections 259 260 1979 No 43 s 9(1)
257: When responsibility for goods begins
1: The responsibility of the contracting carrier for goods begins when the goods are accepted for carriage in accordance with the contract.
2: However, the responsibility of a contracting carrier who contracts for the carriage of goods from a destination outside New Zealand to a destination in New Zealand begins when the international carriage of those goods ends. 1979 No 43 s 9(2)
258: When responsibility for goods ends
1: The responsibility of the contracting carrier for goods ends as follows:
a: if the goods are to be delivered to the consignee,—
i: when the goods are tendered to the consignee in accordance with the contract; or
ii: if any due freight has not been paid at or before the time the goods are to be tendered to the consignee in accordance with the contract, when the relevant carrier is capable of so tendering the goods and has given notice to that effect to a person liable to pay the unpaid amount of due freight ( but see
iii: if the relevant carrier does not know the whereabouts of the consignee when the carrier is capable of tendering the goods to the consignee in accordance with the contract, when the relevant carrier has taken reasonable steps to find the consignee and give notice to that effect to the consignee:
b: if the goods are to be collected by the consignee,—
i: when the goods are collected by the consignee; or
ii: on the expiry of the fifth day after the date on which the relevant carrier notifies the consignee that the goods are available for collection ( but see
iii: if the relevant carrier does not know the whereabouts of the consignee when the carrier is capable of tendering the goods to the consignee in accordance with the contract, when the relevant carrier has taken reasonable steps to find the consignee and give notice that the goods are available for collection to the consignee.
2: However, the responsibility of a contracting carrier who contracts for the carriage of goods to a destination outside New Zealand ends when the international carriage of those goods begins.
3: In this section,—
a: due freight
b: relevant carrier
c: notice is not effective for the purposes of subsection (1)(a)(ii) until it is received by a person liable to pay the due freight:
d: a day must be excluded for the purposes of subsection (1)(b)(ii) if it is a day on which the carrier's premises are not open for the collection of goods. 1979 No 43 s 9(3)–(6) Limits on carrier liability for contracts of carriage at limited carrier’s risk or declared value risk
259: Carrier’s liability limited to $2,000 for each unit of goods or to declared value
1: This section applies to contracts for carriage at limited carrier’s risk and to contracts for carriage at declared value risk, but not to contracts for carriage at owner’s risk or contracts for carriage on declared terms.
2: For the purposes of this subpart, the following are limited in amount in each case to the sum of $2,000 for each unit of goods lost or damaged or, in the case of a contract at declared value risk, the amount specified in the contract:
a: the liability of the contracting carrier to the contracting party:
b: the separate liability of any actual carrier to the contracting carrier:
c: the joint liability of any actual carriers (where there is more than 1) to the contracting carrier:
d: the joint and several liability of every successive carrier under a contract of successive carriage to which section 270
3: The limitation of amount specified in subsection (2) does not apply to—
a: any liability for the loss of or damage to any goods that is intentionally caused by the carrier; or
b: any liability arising out of the terms of the contract for damages other than for the loss of or damage to the goods; or
c: any liability arising out of the terms of the contract for damages that is consequential on the loss of or damage to the goods.
4: The reference to each unit of goods 1979 No 43 ss 3(2) 8(12), (13) 15
260: Carrier not liable in certain circumstances
1: This section applies to contracts for carriage at limited carrier’s risk and to contracts for carriage at declared value risk, but not to contracts for carriage at owner’s risk or contracts for carriage on declared terms.
2: A carrier is not liable for the loss of or damage to goods that occurs while the carrier is responsible for the goods under a contract of carriage to the extent that the carrier proves that the loss or damage resulted directly and without fault on the carrier’s part from—
a: inherent vice; or Example
Fish fillets are packed and carried in a ship. Bacteria in the fish fillets are activated by the temperature of the places through which the ship has to pass and the fish fillets are damaged. The bacteria in the fish fillets are an “inherent vice” in the goods. If the carrier can show that the carrier is without fault and that the damage to the fish fillets directly resulted from the bacteria, the carrier is not liable for the damage to the fish fillets.
b: any breach of either of the terms implied in the contract by section 273
c: seizure under legal process; or
d: saving or attempting to save life or property in peril.
3: This section applies despite any of the other provisions of this subpart. 1979 No 43 ss 8(12), (13) 14 Liability of actual carrier to contracting carrier
261: Application of provisions on liability of actual carrier to contracting carrier
1: Sections 262 to 265
2: However, those sections are subject to the rest of this subpart (including section 245 1979 No 43 s 10(1)
262: Liability where 1 actual carrier is involved
1: If 1 actual carrier is involved, that carrier is liable to the contracting carrier for the loss of or damage to any goods that occurs while the actual carrier is separately responsible for the goods.
2: Subsection (1) applies to the actual carrier—
a: subject to the terms of its contract with the contracting carrier:
b: whether or not the loss or damage is caused wholly or partly by the actual carrier. 1979 No 43 s 10(2)
263: Liability where more than 1 actual carrier is involved
1: If more than 1 actual carrier is involved,—
a: the actual carriers are jointly liable to the contracting carrier for the loss of or damage to any goods that occurs while the actual carriers are jointly responsible for the goods:
b: each actual carrier is separately liable to the contracting carrier for the loss of or damage to any goods that occurs while the actual carrier is separately responsible for the goods.
2: Subsection (1)(a) applies to the actual carriers—
a: subject to the terms of their respective contracts with the contracting carrier:
b: whether or not the loss or damage is caused wholly or partly by the actual carriers or any of them.
3: Subsection (1)(b) applies to an actual carrier—
a: subject to the terms of its contract with the contracting carrier:
b: whether or not the loss or damage is caused wholly or partly by the actual carrier.
4: An actual carrier is not liable under subsection (1)(a) if the actual carrier proves that the loss or damage did not occur while the actual carrier was separately responsible for the goods. 1979 No 43 s 10(3)
264: When actual carriers are jointly responsible or separately responsible for goods
1: For the purposes of section 263(1)(a) section 258(1)
2: For the purposes of sections 262 263
a: when they are tendered by the actual carrier to the next actual carrier in accordance with the contract of carriage; or
b: in the case of the last actual carrier, when the contracting carrier's responsibility ends under section 258(1) 1979 No 43 s 10(5)
265: Provisions relating to joint liability of actual carriers
1: For the purposes of section 263(1)(a)
2: For the purposes of this section,—
a: if the contracting carrier performs any part of the carriage, the amount of freight or other consideration payable to the contracting carrier is the difference between the total amount payable under the contract of carriage and the aggregate amount payable to the actual carriers:
b: if any actual carrier ( A B 1979 No 43 s 10(7)–(9) Other provisions relating to liability of carriers
266: Rights of contracting party where contracting carrier insolvent or cannot be found
1: This section applies if—
a: the contracting carrier is liable to the contracting party for the loss of or damage to any goods; and
b: the contracting carrier is insolvent or cannot with reasonable diligence be found.
2: Despite sections 261 to 265 section 263(1)(b)
3: If the contracting party brings any proceeding against an actual carrier in respect of any of those rights,—
a: the actual carrier has the same rights (if any) against the contracting party (including the right of set-off) as the actual carrier would have had under the contract if the proceeding had been brought against the actual carrier by the contracting carrier:
b: if judgment in the proceeding is awarded against the actual carrier, the judgment is an absolute bar to the bringing by the contracting carrier, or by any person claiming through the contracting carrier, of any proceeding to enforce the same right.
4: This section applies despite anything in the Companies Act 1993 Insolvency Act 2006 1979 No 43 s 11(1)
267: Liquidator or assignee in bankruptcy holds money on trust
1: If the liquidator or assignee in bankruptcy of an insolvent contracting carrier brings a proceeding against an actual carrier in respect of a right referred to in section 266(2)
a: for or towards the payment of the whole of the sum payable by the contracting carrier to the contracting party in respect of the loss of or damage to the goods:
b: subject to that payment, as an asset in liquidation or bankruptcy.
2: In this section, the relevant amount
3: This section applies despite anything in the Companies Act 1993 Insolvency Act 2006 1979 No 43 s 11(2) Liability of carriers for baggage
268: Special rules relating to liability of carrier in respect of baggage
1: A carrier is not liable in its capacity as a carrier with respect to baggage that is left in the carrier’s custody—
a: pending the carrier’s acceptance of it for carriage; or
b: pending its collection from the carrier after the completion of the carriage.
2: This subpart applies to the carriage of hand baggage and checked baggage, with all necessary modifications, as if that carriage were or were to be performed under a contract of carriage of goods.
3: However, nothing in any of sections 248 to 267 270 271
a: sections 257(2) 258(2)
b: sections 259 260 1979 No 43 s 12(1)–(3)
269: Other rules relating to hand baggage
1: A carrier is liable for the loss of or damage to any hand baggage that occurs while the passenger is on board the mode of transport or in the course of any of the operations of embarking or disembarking, if the loss or damage is caused wholly or partly by the negligence or wilful default of the carrier.
2: If, in respect of the loss of or damage to any hand baggage, the carrier proves that the loss or damage was contributed to by the negligence or wilful default of the passenger, the court may, under the Contributory Negligence Act 1947
3: Subsection (2) does not limit section 260 1979 No 43 s 12(4) Liability under contracts of successive carriage
270: Contracts of successive carriage by air
1: Nothing in sections 248 to 269 sections 259 260
2: The successive carriers under a contract of successive carriage are jointly and severally liable to the contracting party for the loss of or damage to any goods that occurs while the carriers are jointly responsible for the goods.
3: Subsection (2) applies whether or not the loss or damage is caused wholly or partly by the carriers or by any of them.
4: However, a successive carrier is not liable under subsection (2) if the successive carrier proves that the loss or damage did not occur while the successive carrier was separately responsible for the goods.
5: Subsections (2) to (4) are subject to the rest of this subpart.
6: In this section and section 271 contract of successive carriage
a: is or is to be performed by 2 or more carriers in successive stages; and
b: is regarded by the parties as a single operation successive carrier 1979 No 43 s 13(1)–(4)
271: When successive carriers are jointly responsible or separately responsible for goods
1: For the purposes of section 270 section 258(1)
2: Each successive carrier is separately responsible for the goods from the time when the goods are tendered to the successive carrier in accordance with the contract until the time—
a: when they are tendered by the successive carrier to the next successive carrier in accordance with the contract of carriage; or
b: in the case of the last successive carrier, when, if the contract were not a contract of successive carriage and the successive carrier were the contracting carrier, the carrier’s responsibility would have ended under section 258(1) 1979 No 43 s 13(5) Liability of employees
272: Liability of carrier’s employee
1: Every employee of a carrier who, in the course of the employee’s employment, intentionally causes the loss of or damage to any goods being carried by the carrier is liable to the owner of the goods for that loss or damage.
2: An employee of a carrier is not liable in his or her capacity as an employee, whether under this subpart or otherwise, to the owner of any goods being carried by the carrier for the loss of or damage to any of those goods.
3: Subsection (2) is subject to subsection (1). 1979 No 43 s 16 Warranty by contracting parties
273: Contracting party to warrant condition of goods and compliance with enactments
1: In every contract of carriage of goods there is implied on the part of the contracting party a term—
a: that, except as disclosed under subsection (2), the goods are fit to be carried and stored in accordance with the contract in the condition, and packed in the manner, in which the goods are tendered for carriage:
b: that, except as disclosed under subsection (2), the provisions of every other enactment (if any) that the contracting party is required to comply with and that relate to the consignment for carriage of the goods have been complied with.
2: If, before the goods are accepted for carriage, the contracting party notifies the contracting carrier or the first actual carrier of any material particular that would otherwise constitute a breach of either of the terms specified in subsection (1), the carrier may—
a: refuse to carry the goods; or
b: undertake to carry the goods subject to the reasonable terms and conditions that the carrier may require, having regard to the circumstances of the case.
3: This section applies, with all necessary modifications, to contracts of carriage between contracting carriers and actual carriers, and between actual carriers, subject to any express term in the contract ( see section 245 1979 No 43 s 17 Proceedings against carriers
274: Notice of claim against contracting carrier must be given within 30 days
1: No proceeding may be brought against a contracting carrier for damage to or partial loss of goods that occurs while the contracting carrier is responsible for the goods under this subpart unless written notice is given in accordance with this section.
2: The notice must—
a: give reasonable particulars of the alleged damage or partial loss; and
b: be given within 30 days after the date on which, in accordance with section 258
c: be given to the contracting carrier or (if the contract was not performed entirely by the contracting carrier) to—
i: the actual carrier or, as the case may require, the last actual carrier; and
ii: the contracting carrier, unless (where notice of the claim is to be given by the consignee) the consignee does not know the identity of the contracting carrier.
3: This section is subject to section 245 sections 276 277 1979 No 43 s 18(1)
275: Notice of claim against actual carrier must be given within 10 days
1: No proceeding may be brought by a contracting carrier against an actual carrier for damage to or partial loss of goods that occurs while the actual carrier is responsible for the goods under this subpart unless the contracting carrier, within 10 days after receiving notice of a claim under section 274
2: This section is subject to section 245 sections 276 277 1979 No 43 s 18(2)
276: No notice required if carrier is or ought to be aware of damage or loss or in case of fraud
A notice is not required to be given to a carrier under section 274 275
a: if it appears from all the circumstances of the case that the carrier is or ought to be aware of the damage or partial loss; or
b: in the case of fraud by the carrier. 1979 No 43 s 18(1)–(3)
277: Non-notified proceeding may be brought with carrier’s consent or leave of court
1: A carrier may consent to a proceeding being brought against the carrier even if a notice of the claim was not properly given.
2: If the carrier does not consent, an application may be made to the court, after notice to the carrier, for leave to bring the proceeding.
3: The application must be made before the expiry of the period set by section 278 279
4: On application being made to it, the court may, if it thinks it just to do so, grant leave to bring the proceeding against the carrier if the court considers that—
a: the failure to give notice was caused by mistake of fact or by mistake of any matter of law (other than the provisions of sections 274 to 276
b: the intended defendant was not materially prejudiced in that person’s defence or otherwise by the failure to give proper notice.
5: Leave may be granted on the terms and conditions that the court thinks fit. 1979 No 43 s 18(5)–(7)
278: Limitation on proceedings against carriers for loss of goods
1: No proceeding may be brought against a carrier for the loss of any goods that occurs while the carrier is responsible for the goods under this subpart after the expiry of a period of 12 months from the date on which the carriage should have been completed in accordance with the contract (the relevant date section 280
2: Subsection (1) does not apply in the case of fraud by the carrier.
3: This section is subject to sections 279 280 1979 No 43 s 19(1)
279: Limitation on proceedings against carriers for damage to or partial loss of goods
1: No proceeding may be brought against a carrier for damage to or partial loss of any goods that occurs while the carrier is responsible for the goods under this subpart after the expiry of a period of 12 months from—
a: the date on which notice is served on the carrier under section 274 275
b: if, under section 276(a) section 258
2: The date referred to in subsection (1)(a) or (b) is the relevant date section 280
3: Subsection (1) does not apply in the case of fraud by the carrier.
4: This section is subject to section 280 1979 No 43 s 19(2)
280: Proceeding may be brought after limitation period with carrier’s consent or leave of court
1: A carrier may consent to a proceeding being brought against the carrier even if the period specified in section 278 279
2: If the carrier does not consent, an application may be made to the court, after notice to the carrier, for leave to bring the proceeding.
3: The application must be made within 6 years after the relevant date referred to in section 278 279
4: On an application being made to it, the court may, if it thinks it just to do so, grant leave to bring the proceeding against the carrier if it considers that—
a: the delay in bringing the proceeding was caused by mistake of fact or by mistake of any matter of law (other than the provisions of section 278 279
b: the intended defendant was not materially prejudiced in that person’s defence or otherwise by the delay.
5: Leave may be granted on the terms and conditions that the court thinks fit. 1979 No 43 s 19(3)–(5)
281: Proceeding by consignee if not contracting party
1: A proceeding against a contracting carrier in respect of the loss of or damage to any goods that occurs while the carrier is responsible for the goods in accordance with section 256
2: Subsection (1) applies despite anything in this subpart or any rule of law to the contrary.
3: If the consignee brings a proceeding in accordance with subsection (1),—
a: the consignee must be treated as the contracting party and may sue and recover under the contract accordingly:
b: the contracting carrier may raise the same defences and make the same counterclaims as the contracting carrier would have been entitled to raise or make if the proceeding had been brought against the contracting carrier by the contracting party.
4: In this section, property section 119 1979 No 43 s 20 Rights of carriers
282: Contracting out permitted on rights of carriers
Sections 283 to 292 section 245 1979 No 43 s 7
283: Right to sue for freight
1: The right to sue for the recovery of freight payable under a contract of carriage arises,—
a: in the case of a contracting carrier, when the contracting carrier ceases to be responsible for the goods in accordance with section 258
b: in the case of an actual carrier, when the actual carrier ceases to be separately responsible for the goods in accordance with section 264(2)
2: Nothing in subsection (1) limits or affects the right of a carrier to refuse to accept any goods for carriage unless the freight is prepaid. 1979 No 43 s 21
284: Proceeding for recovery of freight
1: A proceeding for the recovery of freight may be brought against the consignee if—
a: the property in the goods has passed to the consignee; and
b: the consignee is not the contracting party.
2: Subsection (1) applies despite anything in this subpart or any rule of law to the contrary.
3: If the proceeding is brought against the consignee,—
a: the consignee must be treated as the contracting party and is liable for the payment of freight under the contract accordingly:
b: the consignee may raise the same defences and make the same counterclaims as the contracting party would have been entitled to raise or make if the proceeding had been brought against the contracting party. 1979 No 43 s 22
285: Carrier’s lien
1: The carrier is entitled to an active and particular lien over the goods from the time when, under section 283(1)
2: The lien may be exercised in accordance with sections 286 to 288
3: Nothing in this section or in sections 286 to 288
4: In this section and sections 286 to 288 owner section 284 recoverable expenses section 288(2)(b) sections 286 to 288 1979 No 43 s 23(1)
286: Notice of carrier’s claim
1: Every carrier claiming a lien over any goods under section 285(1)
2: The notice must—
a: specify the amount and particulars of the carrier’s claim; and
b: require the owner to pay or secure to the carrier the amount of the freight claimed and all recoverable expenses. 1979 No 43 s 23(3)
287: Carrier may store goods
1: Pending settlement of the claim referred to in section 286
a: may remove the goods to any suitable premises for storage; and
b: must notify the owner of the goods of the address of the premises; and
c: must take all reasonable steps to preserve the goods.
2: The premises must be reasonably convenient to enable the owner of the goods, or any other person entitled to the goods, to collect the goods on payment of all freight owing and recoverable expenses so far incurred. 1979 No 43 s 23(4)
288: Sale of goods by public auction
1: The carrier may sell the goods by public auction if, within 2 months after the date on which the carrier gives notice under section 286
2: From the proceeds of sale of the goods by public auction, the carrier may deduct—
a: the amount of freight owing to the carrier in respect of the carriage of the goods; and
b: all expenses reasonably incurred by the carrier in removing, preserving, and storing the goods pending settlement of the carrier’s claim, and in arranging and conducting the sale of the goods.
3: The carrier must pay the balance of the proceeds (if any) to the owner of the goods.
4: If the amount of the proceeds is less than the amount of freight owing to the carrier and all recoverable expenses, the deficiency is a debt due to the carrier by the owner of the goods. 1979 No 43 s 23(5)–(7)
289: Storage and disposal of unclaimed or rejected goods
1: This section applies if, under a contract of carriage,—
a: any goods are to be collected by the consignee and the goods are not collected by the consignee promptly after the responsibility of the contracting carrier for the goods ends under section 258
b: any goods are to be delivered to the consignee and the consignee—
i: cannot be found; or
ii: refuses to accept the goods (otherwise than because of any default by the carrier).
2: The carrier may remove the goods, at the consignee’s expense, to suitable premises for storage.
3: The carrier is entitled to an active and particular lien over the goods held by the carrier under this section.
4: The lien may be exercised in the same manner and to the same extent as if it were a lien to which section 285 sections 286 to 288
5: Despite subsections (1) to (4), the carrier must, before selling any goods to which this section applies, offer to carry the goods to, or to the order of, the consignor, and all costs must be met by the consignor. 1979 No 43 s 24
290: Disposal of perishable goods
1: This section applies if, at any time while any perishable goods are subject to a contract of carriage (including any time while the goods are held under sections 285 to 289
2: The carrier may—
a: sell the goods to the best advantage; or
b: if sale is not reasonably practicable, destroy or otherwise dispose of the goods.
3: Subsection (2) applies despite any of the other provisions of this subpart.
4: If the goods are sold, the carrier—
a: may deduct from the proceeds of sale—
i: the amount of freight or other consideration owing to the carrier in respect of the carriage of the goods; and
ii: all expenses reasonably incurred by the carrier in holding the goods and in arranging and conducting the sale; and
b: must pay the balance (if any) to the consignee.
5: If the goods are destroyed or otherwise disposed of, the expenses reasonably incurred by the carrier are recoverable by the carrier as a debt due from the contracting party. 1979 No 43 s 25
291: Disposal of dangerous goods
1: This section applies if, at any time while any goods are subject to a contract of carriage (including any time while the goods are held under sections 285 to 289
a: the goods are in, or are about to enter, a dangerous state; and
b: it is necessary to promptly destroy or otherwise dispose of the goods in order to avoid the threat of harm to any persons or property.
2: The carrier may promptly destroy or otherwise dispose of the goods.
3: Subsection (2) applies despite any of the other provisions of this subpart.
4: The reasonable expenses incurred by the carrier in destroying or otherwise disposing of the goods are recoverable by the carrier as a debt due from the contracting party. 1979 No 43 s 26
292: Liability of carrier extinguished in respect of sale or disposal of goods
1: This section applies if any goods are sold, destroyed, or otherwise disposed of in accordance with any of sections 285 to 291
2: Neither the contracting carrier nor any actual carrier is liable (whether under this subpart or otherwise) in respect of the sale, the destruction, or any other disposition of the goods.
3: However, the sale, the destruction, or any other disposition does not affect any liability for any loss or damage that had already occurred in respect of the goods before their sale, destruction, or other disposition.
4: This section applies despite any of the other provisions of this subpart. 1979 No 43 s 27 Miscellaneous provisions
293: Common carrier of goods abolished
1: A carrier is not under any duty or obligation to accept or carry goods that are offered to the carrier for carriage.
2: Subsection (1) applies despite any rule of law, but subject to the provisions of any enactment and of any contract entered into by the carrier.
3: Every reference in any other enactment to the liability of common carriers as such must be treated as a reference to the liability of carriers under this subpart. 1979 No 43 s 28
294: Proceedings against New Zealand agents of overseas carriers
A proceeding arising out of a contract of carriage may be brought in accordance with the provisions of this subpart against a New Zealand agent, whether acting under general or special authority, of an overseas contracting carrier if—
a: the contract is or is to be performed wholly or partly in New Zealand; and
b: the agent plays some part in relation to the contract. 1979 No 43 s 29
295: Certain other Acts not affected
1: Nothing in this subpart limits or affects any of the provisions of the Hazardous Substances and New Organisms Act 1996 Radiation Safety Act 2016
2: In any case where any of the provisions of this subpart are inconsistent with any of the provisions of any other enactment referred to in subsection (1), the provisions of that other enactment prevail. 1979 No 43 s 30
2: Mercantile agents
296: Interpretation
1: In this subpart, unless the context otherwise requires,— document of title
a: a bill of lading, a dock warrant, a warehouse keeper’s certificate, and a warrant or an order for the delivery of goods; and
b: any other document—
i: that is used in the ordinary course of business as proof of the possession or control of goods; or
ii: that authorises or purports to authorise, either by endorsement or by delivery, the possessor of the document to transfer or receive the goods represented by the document goods mercantile agent
a: sell goods; or
b: consign goods for the purpose of sale; or
c: buy goods; or
d: raise money on the security of goods pledge
a: an original advance; or
b: any further or continuing advance; or
c: any monetary liability.
2: A person ( A
a: are in A’s actual custody; or
b: are held by any other person subject to A’s control or for A or on A’s behalf. 1908 No 117 s 2 Sales, pledges, and other dispositions by mercantile agents
297: Sale, pledge, or other disposition by agent in possession with owner’s consent is valid
1: This section applies if a mercantile agent ( A B
2: A sale, a pledge, or any other disposition of the goods made by A, when acting in the ordinary course of business as a mercantile agent, is as valid as if A were expressly authorised by B to make the sale, pledge, or other disposition.
3: However, subsection (2) applies only if the person who takes the goods under the disposition—
a: acts in good faith; and
b: does not, at the time of the disposition, have notice that A has no authority to make the disposition.
4: Subsection (2) is subject to the rest of this subpart. Example
A person ( A Another person ( B A, when acting in the ordinary course of his business, sells B’s television to a consumer ( C C obtains good title to the television. 1908 No 117 s 3(1)
298: Buyer, etc, has notice of lack of authority if goods subject to perfected security interest
1: This section applies if—
a: a mercantile agent is, with the consent of the owner of goods, in possession of the goods or of documents of title to the goods; and
b: those goods are subject to a perfected security interest under the Personal Property Securities Act 1999
2: A person who takes the goods under a disposition made by the mercantile agent must be treated as having notice that the agent has no authority to make the disposition.
3: Subsection (2) does not apply if it is proved that the authority did exist. 1908 No 117 s 3(1A)
299: Effect of withdrawal or expiry of owner’s consent
1: This section applies if a mercantile agent has, with the consent of the owner of goods, been in possession of the goods or of the documents of title to the goods.
2: A sale, a pledge, or any other disposition that would have been valid if the consent of the owner had continued is valid despite the withdrawal or expiry of the consent.
3: However, subsection (2) applies only if the person who takes the goods under the disposition does not, at the time of the disposition, have notice that the consent has been withdrawn or has expired. 1908 No 117 s 3(2)
300: Provisions relating to consent
For the purposes of this subpart,—
a: possession of the documents of title to goods by a mercantile agent ( A
b: the consent of the owner is presumed in the absence of evidence to the contrary. 1908 No 117 s 3(3)
301: Effect of pledges of documents of title
A pledge of the documents of title to goods must be treated as being a pledge of the goods. 1908 No 117 s 4
302: Pledge of goods as security for existing debt or liability
If a mercantile agent pledges goods as security for a debt or liability due from the pledgor to the pledgee before the time of the pledge, the pledgee acquires no further right to the goods than could have been enforced by the pledgor at the time of the pledge. 1908 No 117 s 5
303: Rights acquired by exchange of goods or documents
1: The consideration necessary for the validity of a sale, a pledge, or any other disposition of goods for the purposes of this subpart may be—
a: a payment in cash; or
b: the delivery or transfer of—
i: other goods; or
ii: a document of title to other goods; or
iii: a negotiable security; or
c: any other valuable consideration.
2: However, if a mercantile agent pledges goods in consideration of the delivery or transfer of other goods, or of a document of title to other goods, or of a negotiable security, the pledgee acquires no right to or interest in the pledged goods in excess of the value of the goods, documents, or security when so delivered or transferred in exchange. 1908 No 117 s 6
304: Agreements through employees or other authorised persons
For the purposes of this subpart, an agreement made with a mercantile agent through an employee or any other person authorised in the ordinary course of business to make contracts of sale or pledge on the mercantile agent’s behalf must be treated as being an agreement with the mercantile agent. 1908 No 117 s 7
305: Consignee’s lien
1: This section applies if—
a: an owner of goods has—
i: given possession of the goods to another person ( A
ii: shipped the goods in the name of another person ( A
b: the consignee of the goods has not had notice that A is not the owner of the goods.
2: The consignee, in respect of advances made to or for the use of A, has the same lien on the goods as if A were the owner of the goods.
3: The consignee may transfer the lien to another person.
4: Nothing in this section limits or affects the validity of any sale, pledge, or other disposition by a mercantile agent. 1908 No 117 s 8
306: Effect of transfer of document of title to goods on vendor’s lien and right of stopping goods in transit
1: This section applies if—
a: a document of title to goods has been lawfully transferred to a person ( A
b: A transfers the document to a person who takes the document in good faith and for valuable consideration.
2: The transfer referred to in subsection (1)(b) has the same effect for defeating a vendor’s lien or right of stopping goods in transit as the transfer of a bill of lading has for defeating the right of stopping goods in transit.
3: This section is subject to section 186 1908 No 117 s 9 Miscellaneous provisions
307: Mode of transferring documents
For the purposes of this subpart, the transfer of a document may be by—
a: endorsement; or
b: delivery, if the document—
i: is by custom or by its express terms transferable by delivery; or
ii: makes the goods deliverable to the bearer. 1908 No 117 s 10
308: Saving of rights of true owner
1: This subpart does not—
a: authorise a mercantile agent to exceed or depart from the agent’s authority as between the agent and the agent’s principal; or
b: exempt the agent from any liability, civil or criminal, for exceeding or departing from that authority.
2: This subpart does not prevent the owner of goods from recovering the goods from a mercantile agent or a specified person at any time before the sale or pledge of the goods.
3: In subsection (2), specified person
a: in the case of a mercantile agent that is bankrupt, the Official Assignee (within the meaning of the Insolvency Act 2006
b: in the case of a mercantile agent in liquidation, the liquidator.
4: This subpart does not prevent the owner of goods pledged by a mercantile agent—
a: from having the right to redeem the goods at any time before the sale of the goods, on—
i: satisfying the claim for which the goods were pledged; and
ii: paying to the mercantile agent, if required by the agent, any money in respect of which the agent would by law be entitled to retain the goods or the documents of title to the goods (or any of those goods or documents) by way of lien as against the owner; or
b: from recovering from any person with whom the goods have been pledged any balance of money remaining in the person’s hands as the proceeds of the sale of the goods after deducting the amount of the person’s lien.
5: This subpart does not prevent the owner of goods sold by a mercantile agent from recovering from the buyer the price agreed to be paid for the goods, or any part of that price, subject to any right of set-off on the part of the buyer against the agent. 1908 No 117 s 11
309: Common law powers of mercantile agent
This subpart does not limit the powers that are exercisable by a mercantile agent independently of this subpart. Examples
Powers that are exercisable by a mercantile agent independently of this subpart include powers exercisable under the common law doctrines of ostensible authority and agency by estoppel. 1908 No 117 s 12
3: Bills of lading, sea waybills, and ship’s delivery orders
Application
310: Application of this subpart
1: This subpart applies to the following documents:
a: bills of lading:
b: sea waybills:
c: ship’s delivery orders.
2: To avoid doubt about the application of this subpart to navigable lakes and inland navigable waters of New Zealand, this subpart extends and applies to all parts of New Zealand to the extent that this subpart is applicable. 1908 No 117 ss 1(4) 13A(1)
311: This subpart applies without prejudice to application of Hague Rules
This subpart has effect without prejudice to the application, in relation to any case, of section 209 1908 No 117 s 13(7) Interpretation
312: Interpretation
1: In this subpart and subparts 2 4 bill of lading
a: does not include a document that is incapable of transfer either by endorsement or, as a bearer bill, by delivery without endorsement; but
b: subject to paragraph (a), includes a received for shipment bill of lading sea waybill
a: is a receipt for goods that contains or evidences a contract for the carriage of goods by sea; and
b: identifies the person to whom the carrier will deliver the goods in accordance with that contract ( see ship’s delivery order
a: is given under or for the purposes of a contract for the carriage by sea of the goods to which the document relates, or of goods that include those goods; and
b: is an undertaking given by the carrier to a person who is identified in the document to deliver the goods to which the document relates to that person.
2: In this subpart, unless the context otherwise requires,— contract of carriage
a: in relation to a bill of lading or sea waybill, the contract contained in or evidenced by the bill or waybill; and
b: in relation to a ship’s delivery order, the contract under which or for the purposes of which the undertaking contained in the order is given goods holder
a: a person who possesses the bill and who, by virtue of being the person identified in the bill, is the consignee of the goods to which the bill relates:
b: a person who possesses the bill as a result of the completion (by delivery of the bill) of an endorsement of the bill or, in the case of a bearer bill, as a result of any other transfer of the bill:
c: a person who possesses the bill as a result of a transaction under which the person would have become a holder under paragraph (a) or (b) had the transaction not been effected at a time when possession of the bill no longer gave a right (as against the carrier) to possession of the goods to which the bill relates information technology electronic electronic communication section 209 network section 3 received for shipment bill of lading section 324
3: For the purposes of this subpart,—
a: a person must be regarded as having become the lawful holder of a bill of lading if the person has become the holder of the bill in good faith:
b: references to a person being identified in a document include references to that person being identified by a description that allows for the identity of the person to be varied, in accordance with the terms of the document, after its issue. 1908 No 117 ss 13(1)–(3) 13A(2)–(4) Section 312(2) network replaced 13 November 2018 section 40 Telecommunications (New Regulatory Framework) Amendment Act 2018
313: Goods that cease to exist or cannot be identified
1: Nothing in this subpart prevents this subpart from applying where the goods to which a document relates—
a: cease to exist after the document is issued; or
b: cannot be identified (whether because the goods are mixed with other goods or for any other reason).
2: References in this subpart to the goods to which a document relates must be interpreted in accordance with subsection (1).
3: This section does not limit section 315 1908 No 117 s 13(4) Rights under shipping documents
314: Holder of bill of lading or person to whom delivery is to be made has rights under contract of carriage
1: All rights to bring a proceeding under a contract of carriage are transferred to and vest in a person ( A
a: the lawful holder of a bill of lading; or
b: the person who (without being an original party to the contract of carriage) is the person to whom the carrier will deliver the goods to which a sea waybill relates in accordance with that contract; or
c: the person to whom the goods to which a ship’s delivery order relates will be delivered in accordance with the undertaking contained in the order.
2: This section is subject to sections 315 to 318 1908 No 117 s 13B(1)
315: Rights where possession of bill of lading no longer gives right to possession of goods
1: This section applies if a person ( A
2: No rights are transferred to A under section 314
a: because of a transaction effected under a relevant arrangement; or
b: as a result of another person ( B
3: In this section, relevant arrangement 1908 No 117 s 13B(2)
316: Rights in relation to ship’s delivery order
1: This section applies to the rights vested in a person under section 314
2: The rights are vested subject to the terms of the ship’s delivery order.
3: If the goods to which the ship’s delivery order relates are only a part of the goods to which the contract of carriage relates, the rights that are vested are confined to rights in respect of the goods to which the order relates. 1908 No 117 s 13B(3)
317: Rights may be exercised for benefit of person who suffers loss or damage
1: This section applies if, in relation to a document to which this subpart applies,—
a: a person ( B
b: section 314 A
2: A may exercise the rights referred to in subsection (1)(b) for the benefit of B to the same extent as the rights could have been exercised if they had been vested in B. 1908 No 117 s 13B(4)
318: Transfer extinguishes certain rights
1: If rights are transferred under section 314
a: in the case of a bill of lading, from the person having been an original party to the contract of carriage; or
b: in the case of any document to which this subpart applies, from the previous operation of that section in relation to the document.
2: However, section 314
a: that derive from the person having been an original party to the contract contained in, or evidenced by, a sea waybill:
b: in relation to a ship’s delivery order, that derive otherwise than from the previous operation of that section in relation to the order. 1908 No 117 s 13B(5) Liabilities under shipping documents
319: Person in whom rights are vested becomes subject to liabilities
1: This section applies if a person ( A section 314
a: takes or demands delivery from the carrier of any of the goods to which the document relates; or
b: makes a claim under the contract of carriage against the carrier concerning any of those goods; or
c: is a person who, at a time before those rights were vested in that person, took or demanded delivery from the carrier of any of those goods.
2: A becomes subject to the same liabilities under the contract of carriage as if A had been a party to the contract.
3: This section, to the extent that it imposes liabilities under a contract on a person, does not limit the liabilities under the contract of any person as an original party to the contract. 1908 No 117 s 13C(1)
320: Liabilities exclude liabilities in respect of goods to which ship’s delivery order does not relate
If the goods to which a ship’s delivery order relates are only a part of the goods to which the contract of carriage relates, the liabilities that a person is subject to under section 319 1908 No 117 s 13C(2)
321: Right of stopping goods in transit, or claims for freight, not affected
1: This subpart does not limit or affect—
a: any right of stopping goods in transit; or
b: any right to claim freight against the original shipper or owner; or
c: any liability that the consignee or endorsee has because—
i: that person is the consignee or endorsee; or
ii: that person has received the goods as a result of the consignment or endorsement.
2: This section is subject to section 306 1908 No 117 s 14
322: Bill of lading in hands of shipper, consignee, or endorsee is conclusive evidence as against master or other signer of bill
1: Every bill of lading in the hands of the shipper or of a consignee or an endorsee for valuable consideration, representing goods to have been shipped on board a vessel, is conclusive evidence of the shipment as against the master or other person who signs the bill of lading.
2: Subsection (1) applies even though the goods or some part of the goods may not have been shipped.
3: However, subsection (1) does not apply if the holder of the bill of lading has had actual notice at the time of receiving the bill of lading that the goods were not in fact loaded on board.
4: The master or other person who signs a bill of lading may excuse himself or herself from liability for a misrepresentation that goods have been shipped on board a vessel by showing that the misrepresentation was caused—
a: without any default on his or her part; and
b: wholly by the fraud of the shipper or of the holder of the bill of lading (or a person under whom the holder claims). 1908 No 117 ss 15 16
323: Regulations relating to network or other information technology
1: The Governor-General may, by Order in Council, make regulations for the application of this subpart to cases where a network or other information technology is used for effecting transactions corresponding to—
a: the issue, the endorsement, the delivery, or any other transfer of a document to which this subpart applies; or
b: doing anything else in relation to a document to which this subpart applies.
2: The regulations may—
a: make the modifications of the provisions of this subpart that are appropriate in connection with the application of this subpart to any case mentioned in subsection (1); and
b: contain supplemental, incidental, consequential, and transitional provisions.
3: Regulations under this section are secondary legislation ( see Part 3 1908 No 117 s 13(5) The following table is small in size and has 3 columns that are grouped under the heading Legislation Act 2019 requirements for secondary legislation made under this section. Legislation Act 2019 requirements for secondary legislation made under this section Publication PCO must publish it on the legislation website and notify it in the Gazette LA19 s 69(1)(c) Presentation The Minister must present it to the House of Representatives LA19 s 114 cl 32(1)(a) Disallowance It may be disallowed by the House of Representatives LA19 ss 115 116 This note is not part of the Act. Section 323(3) inserted 28 October 2021 section 3 Secondary Legislation Act 2021 Special provisions about received for shipment bills of lading
324: Special provisions about received for shipment bills of lading
1: In this section, received for shipment bill of lading
a: is signed by a person purporting to be authorised to sign the document; and
b: acknowledges that the goods to which the document relates have been received for shipment.
2: A received for shipment bill of lading—
a: may not be issued until the goods are in the possession of the owner of the ship or of some person duly authorised on the owner’s behalf:
b: may be issued only for a named ship in which space has been actually reserved:
c: may not be issued earlier than 21 days before the time when the ship is expected to be in port in readiness to load.
3: The issue of a received for shipment bill of lading is, until the contrary is proved, sufficient evidence that subsection (2) has been complied with.
4: Every received for shipment bill of lading must contain a provision that, in the event of the goods being unavoidably shut out from the named ship, the shipowner ( A
a: by A’s next available ship, or, at A’s option, by a ship of some other owner, or by a ship sailing within a specified number of days; but
b: otherwise on the same terms and conditions, with all necessary modifications, as if the goods were actually shipped by the named ship.
5: Every received for shipment bill of lading must for all purposes be treated as a valid bill of lading with the same effect and capable of negotiation in all respects and with the same consequences as if it were a bill of lading acknowledging that the goods to which it relates had been actually shipped on board. 1922 No 25 s 3
4: Power for shipowner to enter and land goods, and lien for freight
325: Interpretation
1: In this subpart, unless the context otherwise requires,— entry Customs and Excise Act 1996 goods owner of goods report Customs and Excise Act 1996 shipowner warehouse warehouse owner wharf wharf owner
2: To avoid doubt about the application of this subpart to navigable lakes and inland navigable waters of New Zealand, this subpart extends and applies to all parts of New Zealand to the extent that this subpart is applicable. 1908 No 117 ss 1(4) 21
326: Shipowner may enter and land goods in default of entry and landing by owner of goods
1: This section applies if the owner of goods that are imported from overseas into New Zealand fails, by the relevant time,—
a: to make entry of the goods; or
b: having made entry of the goods, to land the goods or take delivery of the goods.
2: The shipowner may, at any time after the relevant time, make entry of and land or unload the goods in the manner and subject to the conditions specified in sections 327 to 330
3: In this section, relevant time
a: the time expressed for the delivery of the goods in the charter party, bill of lading, or agreement; or
b: if no time for the delivery of the goods is expressed in the charter party, bill of lading, or agreement, the time that is at the expiry of 72 hours after the report of the ship (excluding a Sunday or a holiday). 1908 No 117 s 22
327: Place for landing goods
1: The shipowner, in landing goods in accordance with this subpart, must—
a: place the goods on the wharf or in the warehouse named in the charter party, bill of lading, or agreement as the wharf or warehouse where the goods are to be placed if the goods can be conveniently received at that place; or
b: if paragraph (a) does not apply, place the goods on a wharf or in a warehouse where goods of a similar kind are usually placed.
2: Subsection (1)(b) is subject to the requirements imposed by or under the Customs and Excise Act 1996 1908 No 117 s 22(c)
328: Owner who is ready and offers to land or take delivery of goods
If, at any time before the goods are landed or unloaded, the owner of the goods is ready and offers to land or take delivery of the goods,—
a: the owner must be allowed to do so; and
b: the owner’s entry of the goods must be preferred to any entry made by the shipowner. 1908 No 117 s 22(e)
329: Landing of goods at wharf where ship is discharged for purpose of sorting goods
1: This section applies if—
a: goods are, for the purpose of conveniently sorting the goods, landed at the wharf where the ship is discharged; and
b: the owner of the goods at the time of the landing has made entry and is ready and offers to take delivery of the goods and to convey the goods to another wharf or warehouse.
2: The goods must—
a: be sorted at landing; and
b: if demanded, be delivered to the owner within 24 hours after being sorted.
3: The shipowner must bear the expense of and consequent on the landing and sorting of the goods. 1908 No 117 s 22(f)
330: Requirement for notice in certain circumstances
1: This section applies if,—
a: at any time before the goods are landed or unloaded, the owner of the goods has made entry for the landing and warehousing of the goods at a particular wharf or warehouse other than the one at which the ship is discharging, and has offered and been ready to take delivery of the goods; and
b: the shipowner—
i: has failed to make that delivery; and
ii: failed at the time of the offer to give the owner of the goods correct information of the time at which the goods could be delivered.
2: The shipowner must, before landing or unloading the goods under the power given under section 326
3: If the shipowner lands or unloads the goods without giving the notice required under subsection (2), the shipowner does so at the shipowner’s risk and expense.
4: In subsection (2),— warehouse owner wharf owner 1908 No 117 s 22(g)
331: Continuation of lien for freight if shipowner gives notice
1: This section applies if, at any time when any goods are landed from a ship and placed in the custody of a wharf owner or warehouse owner, the shipowner gives to the wharf owner or the warehouse owner notice in writing that the goods are to remain subject to a lien for freight or other charges that are payable to the shipowner to an amount specified in the notice.
2: The goods, while in the custody of the wharf owner or warehouse owner, continue to be subject to the same lien (if any) for the charges that the goods were subject to before the goods were landed.
3: The wharf owner or the warehouse owner who receives the goods must retain them until the lien is discharged under section 332 333
4: The wharf owner or the warehouse owner must, if he, she, or it fails to comply with subsection (3), compensate the shipowner for any loss suffered by the shipowner that is caused by the failure. 1908 No 117 s 23(1)
332: Discharge of lien on production of receipt and delivery of copy of receipt or release
A lien referred to in section 331
a: a receipt for the amount claimed as due is produced to the wharf owner or the warehouse owner; and
b: a copy of the receipt or of a release of freight from the shipowner is delivered to the wharf owner or the warehouse owner. 1908 No 117 s 23(3)
333: Discharge of lien on deposit with warehouse owner
1: The owner of the goods may deposit with the wharf owner or the warehouse owner a sum of money equal to the sum that is specified in the notice given by the shipowner under section 331
2: The lien referred to in section 331
3: Subsection (2) does not limit any other remedy that the shipowner may have for the recovery of the freight. 1908 No 117 s 24
334: Right of wharf owner or warehouse owner, if no notice is given, to pay deposit to shipowner
1: A wharf owner or a warehouse owner ( A section 333 B
2: The notice from B must state—
a: the sum (if any) that B admits is payable to the shipowner; or
b: that B does not admit any sum is payable to the shipowner.
3: A is discharged from all liability in respect of the deposit by making the payment in accordance with this section. 1908 No 117 s 25
335: Course to be taken if notice to retain is given
1: This section applies if—
a: a deposit is made with the wharf owner or the warehouse owner ( A section 333
b: the person who makes the deposit ( B section 334
2: A must—
a: immediately inform the shipowner of the notice; and
b: pay or tender to the shipowner out of the deposited sum the sum admitted by the notice to be payable (if any); and
c: retain the balance or, if B does not admit that a sum is payable, retain the whole of the deposited sum for 30 days from the date of the notice.
3: A must, at the expiry of the 30-day period referred to in subsection (2)(c), pay the balance or the whole of the deposited sum referred to in that paragraph to the owner of the goods.
4: However, subsection (3) does not apply if, before the expiry of the 30-day period referred to in subsection (2)(c),—
a: legal or arbitral proceedings are commenced by the shipowner against the owner of the goods to recover the balance or sum referred to in subsection (2)(c) or otherwise for the settlement of any disputes between them concerning the freight or other charges; and
b: written notice of those proceedings is served on A.
5: A is discharged from all liability in respect of the balance or sum by making the payment in accordance with subsection (3) (subject to subsection (4)). 1908 No 117 s 26
336: Wharf owner or warehouse owner may sell goods by public auction after 90 days
1: If a lien referred to in section 331 section 333 A
a: the goods; or
b: the amount of the goods that is necessary to satisfy the charges referred to in section 338(1)(c) and (d)
2: The goods may be sold under this section either for home consumption or export.
3: In this section, relevant time
a: any time after the expiry of 90 days from the time when the goods are placed in A’s custody; or
b: if the goods are of a perishable nature, an earlier time that is fixed by—
i: Lloyd’s agent
ii: any surveyor appointed by A. 1908 No 117 s 27 Section 336(3)(b)(i) amended 24 October 2019 section 26 Statutes Amendment Act 2019
337: Notices of sale to be given
1: A wharf owner or a warehouse owner ( A section 336
2: A copy of the notice of sale must, before a sale is made under section 336
3: A must notify the owner of the goods of the sale by letter sent by post if the address of the owner—
a: has been stated on the manifest of the cargo or on any of the documents in A’s possession; or
b: is otherwise known to A.
4: However,—
a: the title of a good faith purchaser of the goods is not invalidated because A fails to send a notice under subsection (3); and
b: the good faith purchaser of the goods is not required to inquire whether that notice has been sent. 1908 No 117 s 28
338: How money arising from sale is to be applied
1: A wharf owner or a warehouse owner must apply the money received from a sale of goods under section 336
a: if the goods are sold for home consumption, in payment of any customs or excise duties owing in respect of the goods:
b: in payment of the expenses of the sale:
c: in the absence of an agreement between the wharf owner or the warehouse owner and the shipowner concerning the priority of their respective charges, in payment of the rent, rates, and other charges due to the wharf owner or the warehouse owner in respect of the goods:
d: in payment of the amount claimed by the shipowner as due for freight or other charges in respect of the goods:
e: the surplus (if any) must be paid to the owner of the goods.
2: Despite subsection (1)(c) and (d), in the case of an agreement between the wharf owner or the warehouse owner and the shipowner that concerns the priority of their respective charges, those charges have priority according to the terms of the agreement. 1908 No 117 s 29
339: Wharf owner’s or warehouse owner’s rent and expenses
If goods are placed in the custody of a wharf owner or a warehouse owner ( A
a: is entitled to rent in respect of the goods; and
b: has, at the expense of the owner of the goods, the power to do, from time to time, all reasonable acts that in A’s judgement are necessary for the proper custody and preservation of the goods; and
c: has a lien on the goods for the rent and expenses referred to in paragraphs (a) and (b). 1908 No 117 s 30
340: Wharf owner’s or warehouse owner’s protection
1: This subpart does not require a wharf owner or a warehouse owner ( A
2: A is not required to see to the validity of a lien claimed by a shipowner under this subpart. 1908 No 117 s 31
5: Lien for work done
341: Power of sale under lien for work done
1: This section applies if—
a: a person ( A
b: the amount remains unpaid for 2 months or more after it should have been paid.
2: A may sell the goods by auction.
3: The remedy in this section is in addition to all other remedies provided by law.
4: In this subpart, goods 1987 No 188 s 3(1)
342: Notice of sale to be given
1: The person entitled to the lien ( A
a: to the owner of the goods in accordance with section 343
b: by advertisement in a newspaper that—
i: is published in the area in which the work was done; or
ii: circulates in that area (if there is no newspaper published in that area).
2: The notice must—
a: state A’s name; and
b: state the amount of the debt; and
c: provide a description of the goods; and
d: state the time and place of sale; and
e: state the name of the auctioneer.
3: The advertisement does not need to specify the name of the owner. 1987 No 188 s 3(2)
343: How notice of sale is given to owner of goods
1: The notice of sale required by section 342(1)(a)
a: delivering it to the owner; or
b: leaving it at the owner's usual or last known place of residence or business or at any address specified by the owner for that purpose; or
c: posting it in a letter addressed to the owner at a place of residence or business, or an address, referred to in paragraph (b).
2: If the notice is sent to the owner by registered post,—
a: it must be treated as having been delivered to that person when it would have been delivered in the ordinary course of post; and
b: in proving the delivery, it is sufficient to prove that the letter was properly addressed and posted. 1987 No 188 s 3(4)
344: How money arising from sale is to be applied
1: The proceeds of a sale of goods under this subpart must be applied in the following order:
a: in payment of the expenses of the advertising and sale:
b: in payment of the amount due under the lien:
c: in payment of the surplus (if any) under subsection (2).
2: The surplus (if any) must, as soon as practicable after the completion of the sale, be paid to the Registrar of the office of the District Court nearest to the place of sale (to be held by the Registrar for the benefit of the person entitled to it). 1987 No 188 s 3(3)
6: Repeal of revised Acts, consequential amendments, and miscellaneous provisions
345: Repeal of revised Acts
1: The following Acts are repealed:
a: Carriage of Goods Act 1979
b: Contracts (Privity) Act 1982
c: Contractual Mistakes Act 1977
d: Contractual Remedies Act 1979
e: Electronic Transactions Act 2002
f: Frustrated Contracts Act 1944
g: Illegal Contracts Act 1970
h: Minors' Contracts Act 1969
i: Sale of Goods Act 1908
j: Sale of Goods (United Nations Convention) Act 1994
k: Wages Protection and Contractors' Liens Act Repeal Act 1987
2: Section 1(4) and (5) Parts 1 2 4 Mercantile Law Amendment Act 1922 2017-09-01 Carriage of Goods Act 1979 Contracts (Privity) Act 1982 Contractual Mistakes Act 1977 Contractual Remedies Act 1979 Electronic Transactions Act 2002 Frustrated Contracts Act 1944 Illegal Contracts Act 1970 Minors' Contracts Act 1969 Sale of Goods Act 1908 Sale of Goods (United Nations Convention) Act 1994 Wages Protection and Contractors' Liens Act Repeal Act 1987 Mercantile Law Act 1908 Mercantile Law Amendment Act 1922 Mercantile Law Act 1908 — repeal s 1(4) and (5), and Parts 1, 2, and 4 only.
346: Revocation
The Electronic Transactions Regulations 2003 2017-09-01 Electronic Transactions Regulations 2003
347: Amendments to other enactments
The enactments specified in Schedule 6 2017-09-01 Armed Forces Discipline Act 1971 Births, Deaths, Marriages, and Relationships Registration Act 1995 Building Act 2004 Climate Change Response Act 2002 Commerce Act 1986 Companies Act 1993 Construction Contracts Act 2002 Consumer Guarantees Act 1993 Credit Contracts and Consumer Finance Act 2003 Criminal Procedure Act 2011 Crown Proceedings Act 1950 Deaths by Accidents Compensation Act 1952 Defence Act 1990 Disputes Tribunal Act 1988 Electoral Act 1993 Electricity Industry Act 2010 Electronic Identity Verification Act 2012 Employment Relations Act 2000 Fair Trading Act 1986 Financial Markets Conduct Act 2013 Gambling Act 2003 Health and Disability Commissioner Act 1994 Health and Safety at Work Act 2015 Hineuru Claims Settlement Act 2016 Holidays Act 2003 Home and Community Support (Payment for Travel Between Clients) Settlement Act 2016 Housing Restructuring and Tenancy Matters Act 1992 Human Rights Act 1993 Immigration Act 2009 Income Tax Act 2007 KiwiSaver Act 2006 Land Transport Management Act 2003 Legislation Act 2012 Life Insurance Act 1908 Limitation Act 2010 Maori Fisheries Act 2004 Maori Reserved Land Amendment Act 1997 Maritime Transport Act 1994 Motor Vehicle Sales Act 2003 New Zealand Railways Corporation Act 1981 NgāiTakoto Claims Settlement Act 2015 Ngāruahine Claims Settlement Act 2016 Ngāti Hauā Claims Settlement Act 2014 Ngāti Koroki Kahukura Claims Settlement Act 2014 Ngāti Kuri Claims Settlement Act 2015 Overseas Investment Act 2005 Personal Property Securities Act 1999 Privacy Act 1993 Property Law Act 2007 Rangitāne o Manawatu Claims Settlement Act 2016 Real Estate Agents Act 2008 Residential Tenancies Act 1986 Retirement Villages Act 2003 Road User Charges Act 2012 Smoke-free Environments Act 1990 Student Loan Scheme Act 2011 Taranaki Iwi Claims Settlement Act 2016 Tax Administration Act 1994 Te Atiawa Claims Settlement Act 2016 Te Aupouri Claims Settlement Act 2015 Te Kawerau ā Maki Claims Settlement Act 2015 Te Rarawa Claims Settlement Act 2015 Te Ture Whenua Maori Act 1993 Tūhoe Claims Settlement Act 2014 Armed Forces Discipline Rules of Procedure 2008 Crown Minerals (Minerals Other than Petroleum) Regulations 2007 Crown Minerals (Petroleum) Regulations 2007 Education (School Risk Management Scheme) Regulations 2003 Patents Regulations 2014 Sports Fish Licences, Fees, and Forms Notice 2016 Trade Marks Regulations 2003 Waste Minimisation (Calculation and Payment of Waste Disposal Levy) Regulations 2009