THE SALE OF GOODS ACT 1930
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UNPAID SELLEFR A contract comprises of reciprocal promises. In a contract of sale, if seller is under an obligation to deliver goods, buyer has to pay for it. In case buyer fails or refuses to pay, the seller, as an unpaid seller, shall have certain rights. the seller of goods is deemed to be an 'Unpaid Seller' when- (a) The whole of the price has not been paid or tendered and the seller had an immediate right of action for the price. .
(b) when a bill of exchange or other negotiable instrument has been received as conditional payment, and the condition on which it was received has not been ful lled by reason of the dishonour of the instrument or otherwise. Example 1: X sold certain goods to Y for 50,000. Y paid 40,000 but fails to pay the balance. X is an unpaid seller. Example 2: P sold some goods to R for 60,000 and received a cheque for a full price. On presentment, the cheque was dishonored by the bank. P is an unpaid seller.
RIGHTS OF AN UNPAID SELLER Unpaid seller's right (Section 46): Subject to the provisions of this Act and of any law for the time being in force, notwithstanding that the property in the goods may have passed to the buyer, the unpaid seller of goods, as such, has by implication of law- (a) a lien on the goods for the price while he is in possession of them (b) in case of the insolvency of the buyer a right of stopping the goods in transit after he has parted with the possession of them; (c) a right of re-sale as limited by this Act. . . ca
RIGHT OF UNPAID SELLER AGAINST THE GOODS The unpaid seller has the following rights against the goods: (1) Seller's lien, subject to the provisions of this Act, the unpaid seller of goods who is in possession of them is entitled to retain possession of them until payment or tender of the price in the following cases, namely:- (a) where the goods have been sold without any stipulation as to credit; . (b) where the goods have been sold on credit, but the term of credit has expired; (c) where the buyer becomes insolvent. .
the seller may exercise his right of lien notwithstanding that he in possession of the goods as agent or bailee for the buyer. Part delivery: Where an unpaid seller has made part delivery otf the goods, he may exercise his right of lien on the remainder, unless such part delivery has been made under such circumstances as to show an agreement to waive the lien. Termination of lien : the unpaid seller of goods loses his lien thereon- (a) 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 the goods; (b) when the buyer or his agent lawfully obtains possession of the goods; (c) by waiver thereof.
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