Fruitland Packing Co. has a lien on 2,000 boxes of apples. The bailor has become insolvent and can't pay the charges. What rights does Fruitland have regarding the apples?
A) Under bankruptcy, will loose the benefit of a lien.
B) They have acquired the right to sell as a term of the bailment contract or through a provincial statute.
C) They have the right to sell the apples quickly before they become rotten.
D) They have the right of sale under the Public Auction Act.
E) They have the Right of Sale under common law.

Question

Quizplus · Accepted Answer

Fruitland Packing Co. has acquired the right to sell the apples as a term of the bailment contract or through a provincial statute. This is because, in a bailment contract, the bailee generally has the right to sell the bailed goods if the bailor fails to pay the charges. Additionally, in some provinces, there are statutes that allow a bailee to sell the bailed goods if the bailor becomes insolvent. Option A is incorrect because bankruptcy will not automatically void a lien. Option C is incorrect because the right to sell must be exercised within a reasonable time and not before the apples become rotten. Options D and E are incorrect because there is no indication that the Public Auction Act or common law apply in this situation.