STOPPAGE IN TRANSITU Meaning and
Definition
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Stoppage in transitu refers to a legal term used in commercial law to describe the act of halting the delivery of goods that are in the process of being transported from one party to another. Specifically, it refers to the right of a seller or creditor to regain control of goods that have been sold on credit to a buyer or debtor, but have not yet been delivered to their intended destination.
This legal concept is primarily aimed at protecting the rights of unpaid sellers or creditors who have reason to believe that the buyer or debtor is insolvent or incapable of fulfilling their payment obligations. By exercising the right to stoppage in transitu, the seller or creditor can intercept the goods while they are still being transported and retain possession until payment is made in full or suitable arrangements are made.
The right to stoppage in transitu can only be exercised if certain conditions are met. Firstly, the goods must be in transit, meaning they are in the process of being delivered to the buyer. Secondly, the buyer must be in default of payment. Lastly, the seller or creditor must have reasonable grounds to believe that the buyer is insolvent.
Stoppage in transitu is a crucial legal mechanism that protects the interests of sellers and creditors in commercial transactions. It provides them with a means to recover their goods and prevent potential losses in situations where the buyer or debtor fails to fulfill their financial obligations.
Common Misspellings for STOPPAGE IN TRANSITU
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