ACTIONS FOR BREACH OF

CONTRACT OF SALE
WHAT ARE THE REMEDIES OF AN UNPAID SELLER?
I. Ordinary
1. Action for Price
Exercised when:
a. ownership has passed to buyer;
b. price is payable on a day certain
c. goods cannot readily be resold for reasonable price and Art. 1596 is
inapplicable
2. Action for Damages – In case of wrongful neglect or refusal by the buyer to
accept or pay for the thing sold
II. Special
1. Possessory Lien – Seller not bound to deliver if buyer has not paid
him the
price. It is exercisable only in following circumstances:
a. goods sold without stipulation as to credit
b. goods sold on credit but term of credit has expired
c. buyer becomes insolvent
Note: When part of goods delivered, may still exercise right on goods
undelivered
2. Stoppage in Transitu
Requisites: I‐SENT‐U
a. Insolvent buyer
b. Seller must Surrender the negotiable document of title, if any
c. Seller must bear the Expenses of delivery of the goods after the exercise of
the right.
d. Seller must either actually take possession of the goods sold or give Notice of
his claim to the carrier or other person in possession
e. Goods must be in Transit
f. Unpaid seller
3. Special Right to Resell the Goods
Exercised when:
a. Goods are perishable,
b. Stipulated the right of resale in case of default, or
c. Buyer in default for unreasonable time
4. Special Right to Rescind
Requisites:
a. Expressly stipulated OR buyer is in default for unreasonable time
b. Notice needed to be given by seller to buyer
REMEDIES OF THE BUYER IN CASE OF
BREACH OF WARRANTY
1. Accept goods & set up breach of warranty by way of recoupment
in diminution or extinction or the price.
2. Accept goods & maintain action against seller for damages
3. Refuse to accept goods & maintain action against seller for
damages
4. Rescind contract of sale & refuse to receive goods/return them
when already received.