Law - Rights of an unpaid seller

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Law - Rights of an unpaid seller

  1. 1. The Unpaid Seller 1
  2. 2. Who is an Unpaid Seller? S.38(1) defines an unpaid seller… 'The seller of goods is an unpaid seller within the meaning of this Act… 2
  3. 3. Unpaid seller's rights S.39(1) provides the unpaid seller of goods with 3 rights: A. A right of lien. B. A right of stoppage. C. A right of resale of the goods. 3
  4. 4. Unpaid seller's lien (S.41-43) The seller's lien is a right to retain the goods until the whole of the price has been paid or tendered. 4
  5. 5. • Unpaid • No Credit Sale • Possession 5
  6. 6. Termination of Lien(Sec. 49) Delivery to a carrier. Possession by the buyer. Seller waives his right of lien. 6
  7. 7. Case on Right of Lien A Case in which X sells his car in an auction to Y who is the highest bidder. Y pays by cheque and is allowed to do so provided he signs a document stating that the property in the car would not pass to him until the amount is credited to X’s a/c. 7
  8. 8. The property in the car had passed on the fall of the Hammer!!! 8
  9. 9. Unpaid seller's right of stoppage of goods in transit S.44 states, 'when the buyer of goods becomes insolvent the unpaid seller who has parted with the possession of the goods has the right of stopping them in transit, that is to say, he may resume possession of the goods as long as they are in course of transit, and 9
  10. 10. • When the buyer becomes insolvent. • When the goods are in transit(Sec. 50) 10
  11. 11. Duration Goods are in transit when they have passed out of the possession of the seller into the possession of a carrier, but have not yet reached the possession of the buyer. 11
  12. 12. Transit Comes to an end when… • The buyer/agent obtains delivery before the appointed destination. • When the carrier acknowledges after the arrival at the appointed destination. • Carrier wrongfully refuses delivery. 12
  13. 13. Unpaid seller's right of resale The unpaid seller can resell the goods when… 13
  14. 14. On a re-sale… I(On notice) If there is a loss. If there is a surplus. II(Without notice) On loss. On Surplus. 14
  15. 15. Right of with-holding Delivery Where the property in goods has not passed to the buyer, an unpaid seller has, in addition to his other remedies. A right of with-holding delivery similar to and in co-existence with his rights of lien and stoppage in transit where the property has passed to the15
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