Sale of Goods Act 1979: The rights of an unpaid seller

Under section 38(1) of the Sale of Goods Act 1979 a seller is defined as unpaid when the whole of the price has not been paid. Therefore a part paid seller is an unpaid seller.

If time for payment is stipulated in the contract time becomes of the essence and the clause becomes a condition of that contract. Breach of a condition allows a party to sue for payment, sue for damages and repudiate the contract as an unpaid seller.

If time for payment is not stipulated in the contract the clause is a warranty and a party can only sue for payment and damages. The contract cannot be repudiated.

Section 49 of the Sale of Goods Act 1979 provides that an unpaid seller has a right to sue for the price of the goods even when the title to the goods has not passed.

Section 39(1) of the sale of goods act gives an unpaid seller a right to retain the goods for the full price while he is in possession of them and a right to resell the goods.

Section 41 states that an unpaid seller of the goods has the right to retain possession until paid in full.

Section 13 of the Sale of Goods Act 1979 states that goods sold should comply with their description.

Under section 14(2) of the Sale of Goods Act 1979 there is an implied term that the goods must be objectively of satisfactory quality.

Section 14(3) of the Sale of Goods Act 1979 implies a term that the goods must be fit for any particular purpose which the buyer makes known to the seller, either expressly or by implication.

 It is very difficult for a claimant to discharge the burden of proving a lack of fitness for purpose in matters requiring expert technical evidence (FT Everand & Sons V BP Marine Ltd [2005]).

Section 15A restricts the right of the buyer to reject the goods where there has been a breach of the Sale of Goods Act 1979. Section 15 applies to section 13, 14 and 15 and provides that the right to reject goods is lost where the sale is not to a consumer and the breach is so slight that it would be unreasonable for the buyer to reject the goods.

Section 35 provides that if a buyer acts inconsistently with the seller’s ownership he losses the right to reject the goods.

Damages for late payment may also be awarded by a court.

Section 41 allows a seller who is in possession of the goods is entitled to retain possession.

Section 46 allows the seller to stop the goods in transit where the buyer has become in solvent.

Section 50 allows a seller to sue for damages where goods are wrongfully refused.

share this Article

Share on facebook
Share on twitter
Share on linkedin
Share on whatsapp
Share on email

Recent Articles