Last night at the dinner table, Uncle Isaac started on again about his company buying a truck on time. Which of these statements by his friends is false with regard to conditional sales contracts?
A) If the company is in default and the conditional seller seizes the truck, the relevant statute provides that it still has the right to redeem it within a short period of time.
B) If goods are repossessed under a conditional sales contract, the creditor must use commercially reasonable care to protect the goods and keep them in good repair.
C) The rights and obligations of the company differ substantially if the company buys the truck under a chattel mortgage rather than a conditional sale contract.
D) If the company is in default, in some provinces the conditional seller can seize the truck, sell it, and sue for any deficiency between the amount received and the amount the company owes.
E) If the company were in default, the conditional seller could sell the truck, but it must return any of the proceeds from that sale beyond the debt and costs owed.

Question

Quizplus · Accepted Answer

This statement is false as the rights and obligations of the company do not differ substantially if they buy the truck under a chattel mortgage or a conditional sales contract. Both involve the creditor retaining a security interest in the property until the debt is paid off, with the main difference being how the security interest is created and enforced.

Last Night at the Dinner Table, Uncle Isaac Started on Again