The most common business transaction in the world is "the sale". Everyone has bought a loaf of bread or a newspaper. Many people have bought a house or an automobile. Actually there are a myriad of things that people buy in their lifetime.

With this lesson we start a long series of lessons regarding the Laws of Sales in halachah. These laws take up many, many chapters in Shulhan Aruch, Hoshen haMishpat, fifty-one altogether.

First, in all of these lessons we will be discussing sales, NOT CONTRACTS TO SELL. (Contracts were discussed in lessons 50, 51 and 52; TT 432, 433 and 434.) In the case of a contract for sale, Reuven and Shimon enter into the contract for the future transfer of ownership of an object, whether real estate or personal property. The contract states that Reuven will sell his painting to Shimon for $10,000, and Shimon will buy the painting for $10,000. The sale will be completed, let’s say, thirty hence. At that time (30 days hence) at the agreed upon time and place, Shimon pays to Reuven the $10,000 and Reuven hands over the painting to Shimon. When Shimon takes the painting into his hands, he becomes the owner of the painting. In halachah a contract to sell can sometimes be completed with mere words (see the aforesaid lessons).

However, a sale in halachah, ordinarily, does not take place with mere words. A sale is generally the contemporaneous transfer of ownership from the seller to the buyer; it takes place now. For example, On January 1, Reuven and Shimon discuss Shimon buying Reuven's painting for $60,000. Right there and then Shimon writes a check to Reuven for $60,000 and Shimon picks up the painting and the painting belongs to Shimon. There must be a moment in time when ownership of the object leaves the seller and enters into the buyer. The sale takes place at that moment. There are two requisites for the sale to take place: (1) the intent by the parties to transfer ownership from the seller to the buyer, and (2) an act of acquisition by the buyer that concludes the transfer. One of the requisites without the other does not effect a change in ownership of the object being sold. Both must be present. For example, if (1) the intent is missing, there is no transfer of ownership. The buyer picking up the object without the instructions from the seller does not acquire ownership of the object. There has not been a transfer of ownership to him. He must return the object or he will be a thief. Conversely, if (2) is missing there is no sale of the object. For example, Shimon paid $100 to Reuven for Reuven's book and the parties intended that Shimon should own the book. Reuven states, "The book is yours" and Shimon states "The book is now mine". The book is still not Shimon's since Shimon did not do an act of acquisition to acquire the book. An act of acquisition would have been Shimon picking up the book. The payment of money for an object of personal property is ordinarily NOT an act of acquisition. Both (1) and (2) must be present. When Shimon, pursuant to Reuven's instructions, picks up the book, it belongs to Shimon.

Without these two requisites, ownership remains with the seller. Thus, no matter how much each wishes ownership to be transferred, unless there is an act of acquisition, ownership will remain with the seller. And no matter that the buyer performed an act of acquisition to transfer ownership, the object will remain with owned by the seller if there was lacking the intent by the seller to sell and the buyer to buy.

I have called the moment when ownership is passed from seller to buyer the "moment of transfer of ownership". Transfer of ownership takes but a moment. I have called the act by which ownership passes from seller to buyer, "the act of acquisition".

As the title to the chapter indicates, words by themselves cannot effect an act of acquisition. There must be a physical act.

The balance of these lessons discuss the methods of acquisition of each type of object, real estate of personal property.

As stated in many of these lessons, very often, the law of the land and local laws, customs, and local court precedents will govern the rights, duties, liabilities, and obligations of the parties in halachik civil law. However, there are many situations where the local laws do not contemplate solutions to the transactions of the parties or more and more, the parties may agree that they want to be bound by the terms of the halachah in their dealings, or the local laws themselves provide that the parties to a transaction may agree to be bound by other laws. Also there are many situations where the laws of several systems can be applied simultaneously, since this may have been the intent of the parties. Beth Din must ascertain the facts in each case in determining the intent of the parties as to which system or systems of law to be bound by.

In conclusion, mere words by themselves usually cannot effect an act of acquisition. Thus if the seller states that he wishes the item to be sold to buyer and that ownership should pass to him and the buyer states that he wishes to acquire ownership and that the item should belong to him, the ownership to the thing has not passed from the seller to the buyer.

Ownership is still with the seller, even though all of the terms of the sale have been agreed upon, such as the price, the terms of payment, and the warranties and other terms that parties generally agree to when a sale takes place. The fact that witnesses were present when the words were spoken does not change the situation. Witnesses are never required in commercial matters. They act as persons who can testify to the facts of the case if there is a difference of opinion between the parties as to what took place, and Beth Din has to make a determination of what took place. The witnesses will testify as to what happened so that Beth Din can decide the case.

If there has not been an act of acquisition there is no transfer of ownership. The sale is not completed.

Once a sale has taken place, the transfer of ownership cannot be undone by the agreement of the parties. If the seller wishes to reacquire the thing he sold and the buyer wishes to have the seller take back the thing that the buyer acquired, there must be another transfer of ownership from the buyer to the seller. They cannot undo the sale even if there were no witnesses present when the sale took place. Their agreement to undo the sale and that each relinquishes and waives the rights that each acquired when the sale took place is not sufficient; there must be a reacquiring of the item by the seller in the same manner that such a thing is acquired.

If the sale is made by mere words of agreement as to the terms, the buyer may still then perform an act of acquisition and the sale will be complete. If either of the parties decides not to have the act of acquisition completed after he agreed to the sale or purchase, he is known as a person who is lacking in trust. Or if money has passed hands, the person who does not fulfill the agreed upon sale may subject himself to a curse. Ordinarily, a seller cannot tell a buyer to now perform an act of acquisition and the transfer of ownership will take place at a future time, whether one second thereafter or a long period of time thereafter. When the act of acquisition is completed the transfer of ownership is completed. If the intent of the parties is not to then transfer ownership to the thing being sold the act of acquisition is usually a nullity.

To summarize, to complete a sale there must be two things present: (1) the intent to effect a transfer from the seller to the buyer, and (2) an act of acquisition performed by the buyer. What the act of acquisition consist of will IYH be discussed in many of the forthcoming lessons. I have intentionally repeated the rules of acquiring an object. The concept is new to most readers. Their life experience has been when yo pay for the object it belongs to you. In halachah, in most instances, payment is not an act of acquisition of an object of personal property, such as a loaf of bread.

The subject matter of this lesson is more fully presented in Volume VI Chapter 189 of"A Restatement of Rabbinic Civil Law" byE. Quint, published by Jason Aronson, Inc. and on sale at local Judaica bookstores.
Questions to quint@inter.net.il

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