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BBA 210 BL 12/6/2017

 Unpaid seller [sec 45]

 Rights of unpaid seller
 Right of withholding delivery
 Rights against the buyer personally
 Remedies for breach of contract of sale

BBA 210 BL 12/6/2017


Seller :- A person who sells the goods or agrees to

sell the goods is called seller.

Unpaid :- It means payment is not made or without

payment. In simple words,

"Unpaid seller" means a person who has sold the goods for a
price but price has not been paid to him.

BBA 210 BL 12/6/2017

Unpaid Seller Is A Person
Sales act defines the "unpaid seller" in the following words :

i. To whom the whole price has not been paid or tendered.

ii. And where a bill of exchange or other negotiable

instruments has been accepted by him as a condition.

EXAMPLE: Party A sells a car on cash basis to party B

and the price has not been received yet.

BBA 210 BL 12/6/2017

Rights of unpaid

Right against goods Right against the buyer personally

When the property in the Suit for price

goods has been transferred

Right of Lien Suit for damages for non

Right of stoppage in
goods in transit
Suit for special damage
Right to resale and interest

When the property in the

goods has not been transferred

Right of withholding delivery

BBA 210 BL 12/6/2017
A. When the property in the goods has been
1.RIGHT OF LIEN[Sec 46(1)(a) and 47 to 49]
The right of lien means lawfully right to
retain the goods possession until the full price
is received. An unpaid seller can exercise his right of lien
in following cases.Sec47-49

I. Where the goods have been sold on credit basis and

the term of credit has expired.
II. Where the buyer has become insolvent even if the
period of credit has not been expired.

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Other rules to satisfy the conditions for this right

I. The unpaid seller must be in actual possession

of the goods sold.

II. It can be exercised for the price and not for

other expenses.

III. If the seller delivers some goods, it can be

exercised on the remaining
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It means stoppage of goods while they are in
to take possession until the price is paid (sec.50-

 Unpaid seller can stop the goods in transit in

the following cases.
1. While the buyer becomes insolvent.
2. While the goods are out of actual possession of seller,
but have not reached buyer’s possession i.e. goods are
on the way.
3. The unpaid seller can stop the goods in transit only for
payment of the price of the goods and not for any other
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 The unpaid seller can not stop goods in transit
in following cases.
1. When the goods reaches the destination.
2. While the buyer or his agent takes possession of
delivery even if it is not reached destination.
3. In case the carrier is agent of the buyer, the transit
comes to an end the instance carrier receives the
goods and seller can not stop the transition.

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If a buyer fails to pay or offer the price within a

reasonable time, the unpaid seller has the right
to resell the goods in the following :

1. Where the goods are of perishable nature.

2. Where the unpaid seller has exercised his right of lien
or stoppage in transit and gives a notice to buyer of
his intension of resell the goods.
3. Where seller gives notice to the buyer of his intension
to resell and the buyer does not pay within a
reasonable time, he can
BBA 210 BL 12/6/2017
a) Recover loss on resale of the goods, if any
b) Retain any surplus on resale of goods, if

However if the seller sells with out the notice to

the buyer, he can not
a) Recover any loss of the goods, if any
b) Retain any surplus on the resale of the
goods, if any

Example:“M” sells 100 blankets to “N” and gives

him one week for payment. “N” does not pay.
“M” can resell those to any other person.
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B. When the property in goods has not been


If the property in the goods has not passed

to the
buyer, the unpaid seller has a right of
withholding the delivery of goods

BBA 210 BL 12/6/2017

Rights against the buyer personally
There are some rights which an unpaid seller
enforce against the buyer personally. These
rights are called RIGHTS IN PERSONAM

1. SUIT FOR PRICE[Sec. 55]

Where ownership of the goods has passed to the
buyer and the buyer refuses to pay the price
according to the terms of the contract, the seller
can sue the buyer for price, irrespective of delivery
of the goods.(Sec. 55)
BBA 210 BL 12/6/2017
Where the buyer refuses to accept and pay for the goods,
seller may sue him for damages for non acceptance. The
seller can recover damages only and not the full price.


Where there is a specific agreement b/w the seller and
the buyer as to interest on the price of the goods from
the date on which payment becomes due , the seller
may recover interest from the buyer .

BBA 210 BL 12/6/2017

 Seller’s suits
Suit for price(Sec. 55)
Suit for damages for non-acceptance of the
Suit for interest[Sec. 61(2)(a)]

 Buyer’s suits
Suit for damages for non-delivery of the goods(Sec.57)
Suit for specific performance(Sec.58)
Suit for breach of warranty(Sec.59)

BBA 210 BL 12/6/2017