Definition
A resale is a second sale of the same goods or property. The term carries two distinct meanings in legal contexts:
1. General resale. Any sale by a person who previously purchased the item — a buyer who acquires goods and then sells them onward to a third party. This is the ordinary commercial sense, covering retail transactions, secondary markets, and distribution chains.
2. Vendor's resale upon buyer's default. A seller's act of selling goods a second time to a new purchaser after the original buyer has failed to perform — most commonly by failing to pay or refusing to take delivery. In this narrower, technically important sense, the original seller retakes the goods (constructively or physically) and disposes of them to recover the contract price. If the resale yields less than the original contract price, the defaulting buyer remains liable for the shortfall. If it yields more, the treatment of any surplus depends on the governing law or contract terms.
Common Language
Modern common usage (Wiktionary): The sale of something previously bought; also, a sale by an original seller to a new purchaser of goods not taken up by the first purchaser, with the first purchaser potentially liable for any price shortfall.
Historical common usage (Webster's 1913): A sale at second hand, or at retail; also, a second sale.
The common and legal meanings overlap substantially, but legal usage sharpens the vendor's-default scenario into a distinct commercial remedy with specific procedural requirements and damage consequences. The ordinary speaker using "resale" has no reason to think about seller's remedies, buyer liability for price differences, or notice obligations — all of which are legally operative in the vendor's-resale context.
Core Elements
For a vendor's resale upon buyer's default to function as a recognized remedy:
1. Valid original contract. A completed, enforceable sale transaction must have existed between seller and original buyer.
2. Buyer default. The original buyer must have failed to pay, refused delivery, or otherwise breached the contract terms that obligated acceptance of the goods.
3. Resale to a third party. The seller must dispose of the same goods to a new purchaser.
4. Notice (where required). Depending on the jurisdiction and governing law, the seller may be required to give the defaulting buyer notice of the intended resale, especially for non-perishable goods.
5. Damages calculation. The defaulting buyer's liability is typically measured by the difference between the original contract price and the resale price, plus incidental expenses.
Why It Matters in Research
Researchers encounter resale in at least three distinct legal contexts, and conflating them produces errors.
The vendor's-resale-as-remedy context is the historically dominant legal usage and governs most older treatise and case law discussions. When Black's and Bouvier's address resale, they are almost exclusively discussing this seller's remedy scenario, not the general commercial sense. A researcher reading nineteenth-century commercial law materials should assume "resale" refers to this remedy unless context clearly indicates otherwise.
In modern commercial law, resale as a seller's remedy is codified in Article 2 of the Uniform Commercial Code (specifically UCC § 2-706), which imposes procedural requirements — commercially reasonable manner, notice in many cases, good faith — that did not exist in the same form under older common law rules. Bouvier's entry trails off mid-sentence in its surviving form, likely cutting off a discussion of the damages consequences; researchers should treat that source as incomplete on the remedy's full operation.
In consumer protection and competition law, resale carries a third meaning: resale price maintenance (RPM), the practice by which a manufacturer or upstream supplier sets minimum or maximum prices at which downstream buyers may resell. This meaning is entirely absent from the historical dictionaries and requires cross-referencing modern antitrust materials.
In securities and real property transactions, "resale" appears with yet more context-specific meaning — resale of restricted securities under Rule 144 (SEC), or resale of foreclosed property. These uses share the root concept but are governed by wholly different bodies of law.
Historical Dictionary Support
Both Black's and Bouvier's treat resale primarily as a commercial remedy available to a seller when the buyer defaults. Black's (2nd Ed.) notes the vendor may reserve an express right of resale, but also acknowledges that for perishable goods the right may exist without express reservation — a common-law principle reflecting practical necessity. Bouvier's begins to illustrate with a concrete example (a horse sold to B, who fails to pay and refuses delivery, then resold to C) but the surviving text is truncated before the damages analysis.
The two dictionaries are in agreement on the basic structure: default triggers the right, and the resale operates as both mitigation and remedy. Neither source addresses the procedural notice requirements that modern commercial codes impose, nor do they engage with resale in the competition-law or securities sense — gaps a researcher must account for when moving from historical sources to modern doctrine.
Jurisdictional Note
In the United States, the vendor's resale remedy is now primarily governed by UCC § 2-706, which has been adopted (with variations) in nearly all states. Common law rules on resale still apply in jurisdictions or contexts outside the UCC's scope, including real property transactions and certain service contracts. Internationally, resale upon buyer's default is addressed in Article 75 of the UN Convention on Contracts for the International Sale of Goods (CISG), with a structure similar to but not identical to UCC Article 2.