Question 3 (d)

Unpaid seller and his rights against the goods

9 marks

Time to write
About 18 minutes
Topic
Unpaid seller

Question

Question 3 (d) · 9 marks

Under the Sale of Goods Act, 1930, who is an 'unpaid seller'? Discuss what rights an unpaid seller has against the goods.

Reworded from the university paper; the task is the same. The original paper belongs to the University of Delhi. See DU's question bank.

Before you write

Read off the question and its marks

18 minfor 9 marks

Read from the question

  • Who…?Discuss…2 asks, each with its own marks below. Answer both.

Write it in this order

  1. Read; underline the asks; jot your points 1 min
  2. 1 Unpaid seller (s. 45) 2 marks 4 min
  3. 2 Rights against the goods 7 marks 12 min
  4. Check: every ask answered, key terms underlined 1 min

Short on time? Trim steps 1 and 2 evenly rather than skip one: each is capped at its own marks.

Try it first. About 18 minutes for 9 marks. Write it out, then open the solution.

Solution

Hover or tap a marked figure, like 72,000, to see how it is made and where else it appears.

Unpaid seller. Section 45(1) of the Sale of Goods Act, 1930 treats the seller as an unpaid seller when the price has not been paid or tendered in full and he has an immediate right to sue for it, or when a bill of exchange or other negotiable instrument received as conditional payment has been dishonoured.

Picture itUnpaid seller and his rights against the goods

1No payment yet, so Karim locks the crates and folds his arms—the goods stay with him.

LienThe right to retain the goods in his possession until payment or tender of the price.

2Word comes that the buyer has gone broke: he races the truck down the highway to stop it.

Stoppage in transitWhere the buyer becomes insolvent, the right to stop the goods while they are in the course of transit.

3The mangoes will not wait, so he sells them fresh to the next buyer at the market.

ResaleWhere the goods are perishable.

Rights against the goods:

  1. Lien (ss. 47-49): the right to retain the goods in his possession until payment or tender of the price, where the goods are sold without credit, the credit has expired, or the buyer has become insolvent. He may exercise it on the remainder after part delivery. It is lost by delivery to a carrier without reserving the right of disposal, by the buyer lawfully obtaining possession, or by waiver.
  2. Stoppage in transit (ss. 50-52): where the buyer becomes insolvent, the right to stop the goods while they are in the course of transit and resume possession until paid.
  3. Resale: where the goods are perishable, where he has given notice of his intention to resell and the buyer does not pay within a reasonable time, or where the right is expressly reserved.
  4. Withholding delivery: where the property has not passed to the buyer, the right to withhold delivery, similar to lien and stoppage in transit.

Where the 9 marks sit

#ComponentMarks
1Unpaid seller (s. 45)2
2Rights against the goods7
Total9
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