ATTENTION

Please note that this site is now an archive site and is no longer being updated. Updates ceased in May 2003.

For current information please go to

www.paclii.org


LA313 - Commercial Law - Topic 6

REMEDIES

Aim
To stimulate your understanding of how a buyer or seller may claim for breach of contract by relying on any or some of these remedies.

Introduction
The court grants remedies to aggrieved parties. This usually occurs where there has been a breach by a defaulting party. Remedy is therefore a compensatory relief issued in favour of an affected party against the actions of a defaulting party to a contract of sale. This units explains in detail the remedies that may be applied for in court by a buyer or a seller.

 

Green_and_Black_Diamond.gif (591 bytes) Seller’s Remedies
Examine how these remedies may be best utilised by the seller in the event of default by the buyer.

In determining whether a seller is entitled to make claims against a defaulting buyer, the seller must satisfy the statutory requirements of being an ‘unpaid seller’. The question you need to explore then is- who is an unpaid seller?

Please read the case of
R V Ward Ltd v Bignall [1967] 1 QB 534 at 550 especially the dictum of Lord Diplock.

Please read
Sections 39 and 40 of the Sale of Goods Act [Fiji Islands] and Sections 38 and 39 of the Sale of Goods Act [Samoa].

 

The following are some of the seller’s remedies.

(a) Lien

This is a right to detain the goods in the custody of the seller that belong to the buyer or those having been sold to the buyer. The intention is to compel the buyer to tender the price to the seller.

The right of a seller to exercise a lien over the goods are subject to some qualifications. What are these qualifications?

Please read the case of
Re Edwards (1873) 8 Ch App 289.

Please read
Sections 41-43 of the Sale of Goods Act [Fiji Islands] and Sections 40-42 of the Sale of Goods Act [Samoa].

(b)Stoppage in transitu

This right can be exercised by a seller to stop goods that are in transit and are on their way to the buyer. This right may be exercised where the buyer has not paid the price. By utilising this remedy, the seller would be in a position to resume possession of the goods until the price is paid by the buyer.

Please read the following cases:

The Tigress (1863) 32 LJPM & A 97.

The Constantia (1807) 6 Ch Rob 321.

Please read
Sections 44- 46 of the Sale of Goods Act [Fiji Islands] and Sections 43-45 of the Sale of Goods Act [Samoa].

(c) Action for price

The ultimate reason for the selling the good is for a seller to be paid. Where the buyer fails to pay the price for the goods so delivered, the seller is entitled to maintain an action in court for the price.

Please read the case of
Stein Forbes & Co v County Tailoring Co (1916) 86 LJKB 448

Please read
Section 49 of the Sale of Goods Act [Fiji Islands] and Section 48 of the Sale of Goods Act [Samoa].

(d) Action for non acceptance

The seller can institute an action for damages against a buyer who refuses to accept goods ordered by him/her.

Please read the case of
Colley v Overseas Exporters (1919) Ltd [1921] 3 KB 302.

Q Would you consider the doctrine of equitable right of tracing as an appropriate remedy for an unpaid seller to exercise? This remedy has not been provided for by statute.

Q Can an unpaid seller apply for the remedy of rescission? If so what conditions are to satisfied before rescission could be relied upon by a seller?

Please read the case of
Braithwaithe v Foreign Hardwood Co Ltd [1905] 2 KB 543.

Please read
Section 50 of the Sale of Goods Act [Fiji Islands] and Section 49 of the Sale of Goods Act [Samoa].

 

Green_and_Black_Diamond.gif (591 bytes) Buyer’s Remedies

Examine how these remedies may best be utilised by the buyer in the event of default by the seller.

(a) Specific performance

This is an order of court that would compel the seller to carry out the terms of the agreement. In short, to deliver the goods to the buyer.This remedy is applicable only in instances where the sale was for a specific or ascertained good.

Please read the following cases:

Sky Petroleum Ltd v VIP Petroleum Ltd [1974] 1 WLR 576.

Re Wait [1927] 1 Ch 606

Phillips v Lamdin [1949] 2 KB 33.

Please read
Section 52 of the Sale of Goods Act [Fiji Islands] and Section 51 of the Sale of Goods Act [Samoa].

(b) Action for non delivery

A buyer can claim damages for the price of the goods, against a seller who has refused to deliver goods already paid for by the buyer. What is the quantum of damages that may be claimed by the buyer in this instance?

Please read the case of
Hadley v Baxendale (1854) 9 Exch 341.

Please read
Section 51 of the Sale of Goods Act [Fiji Islands] and Section 50 of the Sale of Goods Act [Samoa].

(c) Action for breach of warranty.

In this instance, the buyer’s right to damages is restricted to a claim for a breach of a warranty by the seller.

Please read the following cases:

Jones v Just (1868) LR 3 QB 197

H. Parsons Ltd v Utley Ingham Ltd [1978] QB 791.

 

To fully understand the scope of all applicable remedies in favour of the seller and the buyer, you should read all the underlisted cases:

The Golden Rio [1990] 2 Lloyd’s Rep 273

Lazenby Garages Ltd v Wright [1976] 1 WLR 459.

Charrington Ltd v Wooder [1914] AC 71

Jones v Just (1868) LR 3 QB 197

H. Parsons Ltd v Utley Ingham Ltd [1978] QB 791.

Hadley v Baxendale (1854) 9 Exch 341

Braithwaithe v Foreign Hardwood Co Ltd [1905] 2 KB 543.

Colley v Overseas Exporters (1919) Ltd [1921] 3 KB 302

Stein Forbes & Co v County Tailoring Co (1916) 86 LJKB 448

The Tigress (1863) 32 LJPM & A 97.

The Constantia (1807) 6 Ch Rob 321.

Re Edwards (1873) 8 Ch App 289.

R v Ward Ltd v Bignall [1967] 1 QB 534

Readings

Goode pp 385-439

Sections 39-54 Sale of Goods Act [Fiji Islands] and Sections 38-49 Sale of Goods Act [Samoa].

 

Review Questions

*What is an ‘available market’ with respect to the determination of the price of a good and the assessment of damages for a breach of contract?

*Apart from the remedies cited here, are there other remedies that a seller or buyer could claim?

*Can these remedies be used simultaneously or in the alternative? Are there conditions for applying any or all of these remedies?

 

Click here for Study Tips and Exercises for Topic 6

pixgrn.jpg (632 bytes)

[About the School of Law] | [Courses Offered] | [Course Materials] | [Staff]
[Pacific Law Materials] | [Journal of South Pacific Law]
[Emalus Campus Library] | [Recommended Internet Links]
[Latest Additions]  | [Search the Site]

University of the South Pacific 1998-2002

If you have any comments, suggestions or difficulties with using this web site please email
Robynne Blake
, Internet Project Manager, The School of Law, The University of the South Pacific or fax: (678) 27785

Last Update: Monday, June 02, 2003 08:20