The correct answer is: C. Both I and II
Statement I is true because the right of stoppage in transit is a right that the seller has to stop the goods in transit and take possession of them again if the buyer has not paid for them. This right can only be exercised if the seller has parted with possession of the goods.
Statement II is also true because the unpaid seller can exercise his rights of resale when goods are in his possession. This means that the seller can sell the goods to someone else and recover the price from the buyer or the new buyer.
Statement III is not true because the seller can file a suit against the buyer for recovery of the price even if the property in goods has been passed to the buyer. This is because the seller has a right of lien over the goods until the price is paid.
Here is a more detailed explanation of each statement:
- Statement I: It is a pre-condition of right of stoppage in transit that seller must have parted with possession of goods.
The right of stoppage in transit is a right that the seller has to stop the goods in transit and take possession of them again if the buyer has not paid for them. This right can only be exercised if the seller has parted with possession of the goods.
For example, if the seller sells goods to the buyer and the buyer agrees to pay for the goods on delivery, the seller will usually deliver the goods to the buyer’s warehouse. At this point, the seller has parted with possession of the goods and the buyer has acquired possession of the goods.
If the buyer then fails to pay for the goods, the seller can exercise his right of stoppage in transit and stop the goods in transit. This means that the seller can prevent the goods from being delivered to the buyer and can take possession of the goods himself.
- Statement II: Unpaid seller can exercise his rights of resale when goods are in his possession.
The unpaid seller can exercise his rights of resale when goods are in his possession. This means that the seller can sell the goods to someone else and recover the price from the buyer or the new buyer.
For example, if the seller sells goods to the buyer and the buyer agrees to pay for the goods on delivery, the seller will usually deliver the goods to the buyer’s warehouse. At this point, the seller has parted with possession of the goods and the buyer has acquired possession of the goods.
If the buyer then fails to pay for the goods, the seller can exercise his right of resale and sell the goods to someone else. The seller can then recover the price from the buyer or the new buyer.
- Statement III: Where property in goods has been passed to the buyer, seller can file a suit against buyer for recovery of price.
Statement III is not true because the seller can file a suit against the buyer for recovery of the price even if the property in goods has been passed to the buyer. This is because the seller has a right of lien over the goods until the price is paid.
A right of lien is a right that the seller has to retain possession of the goods until the price is paid. This means that the seller can refuse to deliver the goods to the buyer until the buyer has paid for the goods.
For example, if the seller sells goods to the buyer and the buyer agrees to pay for the goods on delivery, the seller will usually deliver the goods to the buyer’s warehouse. At this point, the property in the goods will usually pass to the buyer.
However, the seller will still have a right of lien over the goods until the buyer has paid for the goods. This means that the seller can refuse to deliver the goods to the buyer until the buyer has paid for the goods.
The seller can also file a suit against the buyer for recovery of the price even if the property in goods has been passed to the buyer. This is because the seller has a right of action for the price.
A right of action for the price is a right that the seller has to sue the buyer for the price of the goods. This means that the seller can sue the buyer for the price of the goods even if the property in goods has been passed to the buyer.