In Kenya, the rights of an unpaid seller are primarily governed by the Sale of Goods Act, Cap 31 of the Laws of Kenya. The Act provides several rights and remedies for unpaid sellers when the buyer fails to make the necessary payment for the goods. Here are some of the key rights of an unpaid seller in Kenya:
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Lien on the Goods: An unpaid seller has the right to retain possession of the goods until payment or tender of the price is made. This is known as the right of lien. The seller can withhold the delivery of the goods until they are paid.
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Right to Stop Delivery in Transit: If the seller becomes aware that the buyer is insolvent or in financial difficulties, the seller can stop the goods in transit and resume possession of them until payment is made. This is referred to as the right to stop delivery in transit.
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Resale of Goods: In certain situations, the unpaid seller may resell the goods if the buyer fails to make payment. If the seller chooses to do so, they must give proper notice to the buyer and sell the goods in a reasonable manner. If the resale results in a surplus, the seller can claim it, and if there’s a deficit, the buyer remains liable for the difference.
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Sue for the Price: The unpaid seller can sue the buyer for the price of the goods, provided the buyer is obligated to pay the price even if the property in the goods has not passed to them.
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Sue for Damages: If the seller suffers any loss due to the buyer’s default, they can sue the buyer for damages. This could include loss of profit, storage costs, or any other expenses incurred as a result of the buyer’s failure to pay.
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Right to Reject the Goods: If the goods are not in conformity with the contract, the unpaid seller may reject the goods and refuse to deliver them until the buyer remedies the breach of contract.
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Right to Rescind the Contract: In some cases, the unpaid seller may choose to rescind the contract and refuse to deliver the goods if the buyer has failed to pay. This effectively terminates the contract and relieves the seller of the obligation to deliver the goods.
It’s important to note that the specific rights of an unpaid seller may vary based on the terms of the contract and the circumstances of the sale. Additionally, legal advice from a qualified lawyer is recommended when dealing with issues related to unpaid sellers’ rights in Kenya to ensure compliance with local laws and regulations.