Rights of an unpaid seller


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Rights of an unpaid seller

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Rights of an unpaid seller

  1. 1.  A seller of goods is deemed to be an unpaid seller when:- • The whole of the price has not been paid or tendered; • A bill of exchange or other negotiable instrument has been received as a conditional payment, and the condition on which it was received has not been fulfilled by reason of the dishonour of the instrument or otherwise.
  2. 2.  The term "seller" includes any person who is in the position of a seller, as, for instance, an agent of the seller to whom the bill of lading has been endorsed, or a consignor or agent who has himself paid, or is directly responsible for, the price.  The seller shall be called an unpaid seller even when only a small portion of the price remains to be unpaid.  It is for the non payment of the price and not for other expenses that a seller is termed as an unpaid seller.  Where the full price has been tendered by the buyer and the seller refused to accept it, the seller cannot be called as unpaid seller.
  3. 3.  Where the goods have been sold on credit, the seller cannot be called as an unpaid seller. Unless :  If during the credit period seller becomes insolvent, or  On the expiry of the credit period, if the price remains unpaid, then, only the seller will become an unpaid seller.
  4. 4. 1) Right against goods: Where the property in the goods has passed  Lien on goods  A right of stoppage-in-transit  A right of Re-sale Where the property in the goods has not passed  Withholding delivery  Stoppage in transit 2) Right against the buyer:  Suit for price  Suit for damages  Repudiation o contract  Suit for interest
  5. 5.  the goods are not sold on credit  the goods have been sold on credit, but the period of credit has expired  the buyer becomes insolvent
  6. 6.  The transit is end in following cases:  If the buyer obtains the possession of the goods before its arrival at the destination  If, after the arrival at their destination, the carrier acknowledges to the buyer that he holds on his behalf  If the carrier wrongfully refuses to deliver the goods to the buyer
  7. 7.  Where the goods are of perishable nature  When the buyer does not pay the price