                                 CODE OF VIRGINIA

SELLER&#8217;S REMEDIES ON DISCOVERY OF BUYER&#8217;S INSOLVENCY (§ 8.2-702)

1. Where the seller discovers the buyer to be insolvent he may refuse delivery
except for cash including payment for all goods theretofore delivered under the
contract, and stop delivery under this title (&#xA7; 8.2-705).

2. Where the seller discovers that the buyer has received goods on credit while
insolvent he may reclaim the goods upon demand made within ten days after the
receipt, but if misrepresentation of solvency has been made to the particular
seller in writing within three months before delivery the ten day limitation
does not apply. Except as provided in this subsection the seller may not base a
right to reclaim goods on the buyer&#8217;s fraudulent or innocent
misrepresentation of solvency or of intent to pay.

3. The seller&#8217;s right to reclaim under subsection (2) is subject to the
rights of a buyer in ordinary course or other good faith purchaser or lien
creditor under this title (&#xA7; 8.2-403). Successful reclamation of goods
excludes all other remedies with respect to them.

HISTORY: 1964, c. 219.