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The content concerns Finnish legislation.
  1. Home⁠
  2. Contracts⁠
  3. Breach of Contract and Its Consequences⁠
  4. Breach of Contract and Its Consequences According to the Sale of Goods Act⁠
  5. Consequences for Breach of Contract to the Buyer⁠
  6. Seller’s Right to Demand Termination of the Contract
  1. Consequences for Breach of Contract to the Buyer

Seller’s Right to Demand Termination of the Contract

The seller may terminate the contract because of the buyer’s delay in payment, if the delay is substantial. The right to terminate is limited if the goods have already been handed over to the buyer. In these circumstances, the seller may terminate the contract only if they have explicitly reserved such right.

The seller may terminate 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 terminate the agreement if the buyer 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 received by the buyer.

If the goods are delivered to the buyer in instalments and payments are made separately for each instalment, the seller may terminate the contract for the instalment in default. The grounds for termination are the same as for termination of the entire contract.

The seller must inform the buyer of the termination before the buyer has fulfilled their obligation.

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

Laws (FINLEX)

  • Sale of Goods Act (in Finnish)⁠
  • Sale of Goods Act⁠ (in English, not updated)⁠

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