Seller's Right to Demand the Rescission of the Contract

The seller may rescind the contract on account of the buyer’s delay in payment, if the delay is substantial. The right to rescission is limited if the goods have been handed over to the buyer already. In these circumstances the seller may rescind the contract only if the seller has reserved himself/herself such right.

The seller may rescind the contract on account of the buyer’s failure to cooperate, if the breach of contract is of substantial importance to the seller. In addition it is provided that the buyer knew or ought to have known that. On the same presumption the seller is entitled to rescind the agreement, if the seller does not collect or take over the goods provided that the contract or the circumstances indicate that it is of special interest to the seller that the goods are removed.

In case that the price is to be paid in installments as deliveries of the goods are made, the seller may rescind the contract with respect to any delayed installment.The rescission is possible on the same grounds as the rescission of the whole contract.

The seller has to notify the buyer of the rescission before the buyer has performed his/her delayed or faulty obligation.

The effect of rescission is that the contract ceases to bind both parties. All performances already done are usually returned. The buyer has to return the delivered goods. In addition the buyer has to account the seller for any yield he/she has derived from the goods as well as pay reasonable compensation for any other benefit he/she may have derived from the goods. Correspondingly the seller has to refund the price and to pay interest on the amount to be refunded in accordance with the Interest Act from the date the seller received the payment.