Page 145 - DCOM103_COMMERCIAL_LAW

Commercial Law

Notes 14.4 Keywords

Implied conditions and warranties: These are deemed to be incorporated by law in every contract
of sale of goods unless the terms of the contract show a contrary intention.
Lien means to retain possession.
Unpaid seller: A person who is in possession of goods is entitled to retain them in his possession
until payment.
Warranty: A warranty is a stipulation collateral to the main purpose of the contract, the breach of
which gives rise to a claim for damages but not to a right to reject the goods and treat the contract
as repudiated.

14.5 Self Assessment

Fill in the blanks:
1. Conditions and warranties are said to the …………… when the terms of the contract
expressly, provide for them
2. The …………… is a fundamental principle of the law of sale of goods.
3. The …………… of goods refers to the custody of goods.
4. …………… lay down the rules which determine when property passes from the seller to
the buyer.
5. …………… lays down a general rule as to transfer of title.

6. …………… is defined as a voluntary transfer of possession from one person to another.
7. …………… provide for the duties of the seller and the buyer.

14.6 Review Questions

1. Define an unpaid seller. What are the different rights of an unpaid seller?

2. Distinguish between the right of lien and stoppage in transit.
3. State the circumstances when the right of stoppage in transit ends.

4. When can a seller resell the goods?
5. What remedies are available to a seller for breach of contract of sale?
6. Discuss the buyer’s remedies against seller where there is a breach of contract.
7. State the law which governs the sale of goods by auction.
8. Mr. Gupta sold a quantity of wheat to Mr. Verma, who paid by cheque which was
dishonoured upon presentation, Mr. Gupta gave a delivery order to Mr. Verma for the
wheat and Mr. Verma resold it to Sahil , purchaser in good faith, for consideration indorsing
the delivery order to him. Mr. Gupta refuses to deliver the goods to Sahil on the plea of
non-receipt of price. Advise Sahil.
9. Rahul sells and consigns goods to Ravi of the value of ` 10,000. Ravi assigns the bill of
lading for these goods to Roshan to secure the sum of ` 4,000 due from him to Roshan, Ravi
becomes insolvent. Can Rahul stop the goods in transit?

10. Goods were sold and sent by the sellers at the request of the buyer to shipping agents of the
buyer and were put on board a ship by those agents. Subsequently they were re-landed and

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