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Q. Discuss fully his rights under the sale of goods act 1930. (1998) (2001)
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Q. Who is an ‘unpaid seller’ what are his rights against the goods? Explain under what circumstances such rights can be exercised by him. (2000)
Q. Write an un-paid seller’s right of stoppage of goods in transit. Indicate the circumstances which determine the duration of transit and how stoppage in transit is effected. (2002)
Unpaid seller means a person who has sold the good for a price but price has not been paid to him unpaid seller has rights against the goods and buyer.
2. Definition of unpaid seller:
According to Sec 45, the seller of goods is deemed to be an unpaid seller.
(i) When the whole of the price has not paid or tendered.
(ii) When a bill of exchange or other negotiable instrument has been received as a condition payment, and the condition on which it has been received remains unfulfilled by reason of dishonor of the instrument or other wise.
3. Features of unpaid seller:
Following are the features of unpaid seller.
(i) He must sells the goods on cash basis and must be unpaid.
(ii) He must be unpaid either wholly or partly.
(iii) If the price is paid through a bill of exchange or other negotiable instruments, the same must be dishonoured.
(iv) He must not refuse to accept the payment when tendered.
4. Rights of unpaid seller:
(i) Rights of unpaid seller against goods.
(ii) Rights of unpaid seller against the buyer.
(I) Right of un paid seller against the goods:
Against the goods the unpaid seller has the following. Rights.
(a) Right of lien:
Lien is the right to retain possession and refuse to deliver them to the buyer until the price due in respect of them is paid to the buyer.
Circumstances when right can be exercised:
Following are the circumstances when right of lien can be exercised.
(i) Where the goods have been sold without any stipulation.
(ii) Where the goods have been sold on credit, but the term of the credit has expired.
(iii) Where the buyer becomes insolvent, even though the period of credit may not have yet expired.
Termination of right of lien:
Under the following circumstances unpaid seller loses his right of lien.
(i) When he delivers the goods to a carrier or other bailee for the purpose of transmission to the buyer without reserving the right of disposal of goods.
(ii) When the possession of goods is obtained lawfully by the buyer or his agent.
(iii) When the seller waives his right of lien on goods.
(iv) When buyer further sells the goods.
(b) Right of stoppage of goods in transit:
Unpaid seller has right to stope the goods in transit.
Following are the conditions
(i) The seller must be unpaid.
(ii) Goods must be in transit.
(iii) Property has passed to the buyer.
(iv) Buyer is insolvent.
Modes of stoppage:
Following are the modes of stoppage:
(i) By taking possession of the goods.
(ii) By giving notice of his claim to the carried or other bailee in whose possession the goods are
(c) Right of resale:
Unpaid seller can resale the goods:
(a) Goods should be of perishable nature.
(b) Right of resale should be expressed in contract.
(c) Buyer has not paid.
(d) Buyer has received the notice from seller.
(II) Rights of unpaid seller against buyer:
He has right against buyer and have following remedies.
(i) Suit for price:
Where property has passed to the buyer, and the buyer wrongfully refuses or neglect to pay for the goods, the seller may sue him for the price of the goods.
(ii) Suit for repudiation:
If buyer repudiates the contract before the date of the delivery the seller may treat the contract as subsisting and wait till the date of delivery or may tread the contract as rescinded and sue for damages for breach.
(iii) Suit for damages for non-acceptance:
If buyer refused to accept and pay for the goods the seller has right to sue for damages for non-acceptance.
(iv) Suit for interest and special damages:
Unpaid seller can recover the interest on the unpaid price. He can also sue for special damages.
To conclusion it can be said that, unpaid seller under sale of goods. Act is a person who has not been paid. He has rights the goods sold and against the buyer. He can exercise right of stoppage of goods in transit under some circumstances.
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