In which of the following cases the unpaid seller cannot exercise the right of lien on goods in his possession?

The correct answer is: C. Where the buyer becomes insolvent.

A lien is a legal right to retain possession of goods until a debt is paid. An unpaid seller can exercise a lien on goods in his possession if the following conditions are met:

• The goods must be in the seller’s possession.
• The goods must have been sold by the seller to the buyer.
• The buyer must have not paid for the goods.
• The seller must have not agreed to waive the lien.

If the buyer becomes insolvent, the seller may still be able to exercise a lien on the goods, but it will be more difficult. This is because the buyer’s creditors may have a claim to the goods. The seller will need to prove that he has a valid lien on the goods and that the buyer’s creditors do not have a superior claim.

In the other options, the unpaid seller can exercise the right of lien on goods in his possession.

• In option A, the goods have been sold without any stipulation regarding credit. This means that the seller has not agreed to sell the goods on credit. The buyer is therefore required to pay for the goods immediately. If the buyer does not pay for the goods, the seller can exercise a lien on the goods.
• In option B, the goods have been sold on credit but the term of the credit has expired. This means that the buyer has agreed to pay for the goods at a later date. If the buyer does not pay for the goods within the agreed-upon time period, the seller can exercise a lien on the goods.
• In option D, the goods have been sold on credit but the term of credit has not expired. This means that the buyer has agreed to pay for the goods at a later date. The seller cannot exercise a lien on the goods until the term of credit has expired.