CR (128) A losing (buyer or seller) is entitled to exercise such right only if the price difference according to common practice is a loss, for example a sum which most of the people will not overlook. If the price difference is minimal and nobody pays attention to it for its smallness, this choice is not effective. Some scholars have specified the price difference to be like one-third others have said it to be one-fourth, and according to a third one-fifth. This is because of different economic transactions. In some commercial transactions a price difference of one-tenth or even one-twentieth is sufficient to establish this choice. Whereas in ordinary transactions this is not sufficient and the Criterion is the negligibility according to common practice.

CR (129) It is apparent that the above mentioned choice is effectively established at the time of the contract, and not when the loss becomes manifest. Annulment is correct if it occurs before the manifestation of loss, with the actual existence of it.

CR (130) A losing party is not entitled to ask for the price difference and to ignore the annulment if the other party offers him the price difference, it is not incumbent upon him to accept. Rather he can choose either to abrogate the sale as a whole or to go ahead with it on the basis of the agreed price. However, if the two parties agree to drop this choice in return of some money, this agreement is good and the choice is dropped, and it is incumbent upon the other party to pay back what they agreed upon.

The Right Of Having The Choice Can Be Dropped In The Following Cases:

(a) Dropping it after the contract and before the loss is discovered. If it is dropped on the basis that the loss is only ten dollars and it is then discovered to be 100 dollars, if lesser amount is thought of to be a condition for dropping the right, dropping of right is void but if it is simply because minimal difference is only a motive to drop the right, the dropping is effective. The same rule applies to a settlement in exchange for some property. (b) That in the contract it is stipulated to drop the right in which case again if the difference is thought of to be minimal and it is then discovered to be otherwise, it is dealt with like the case in (a). (c) If the losing party (the seller or the buyer) utilized what he received in such a way that it indicates his commitment to the contract and such utilization comes after knowing the loss. It is considered as dropping the right. If it is used before the discovery of the loss, the choice does not become invalid according to well-known view by utilization but it requires thinking, but to say that this choice is dropped by utilization which indicated commitment to the contract, is not without reason. If there is no such indication, as it often happens when the loss is not realized, this choice remains valid even if the utilization renders the goods useless, takes it out of a party's ownership, or makes it difficult to return.

CR (131) If the seller's loss is discovered the contract is revoked if the merchandise is in the possession of the buyer, the seller is entitled to get it back from him. If it is not because of or not because of the buyer use, he must return its substitute, if that is possible or its price otherwise. If it is damaged because of or not because of the buyer's use, the seller is entitled to have it back with a compensation. If the seller finds it outside the buyer's possession, for instance if the latter moves it to somebody else by a binding contract as in sale, conditional gift, or giving it to a relative apparently, it must be considered as lost. The buyer gives back the seller the substitute or the price of the goods. The latter is not entitled to make the former to bring back the (same) merchandise by buying or having it back as a gift. This is also the case if the seller has transferred the goods to someone on the basis of a permissible contract as in gifting and selling with choice to annul the sale; the annulment of contract and returning the merchandise is not necessary for the buyer. If the original merchandise comes back to the buyer by dismissal of a deal, buying, inheritance, or the like after paying back to the seller the substitute or the price, it is not incumbent upon him to return it to the losing seller. Yes, if the coming back of the original merchandise to him happened before paying the substitute, he must return it to the seller. This remains true (also) if it comes back before the seller's abrogation of the contract. There is no difference if the coming back of the merchandise is because of the annulment of previous contract or the establishment of a new one the buyer must return the original merchandise to the losing seller who has annulled the contract, and it is not sufficient to pay back the substitute or the price, if the original is in the possession of the buyer when the losing seller annuls the contract, but the latter has transferred its benefits to someone else through a binding contract as binding rental contract or a non-binding one like renting conditionally to have the choice to revoke it, it is not necessary for him to revoke such contract ask the other party to dismiss it, if possible. He returns the substance itself and compensation for the loss of its being stripped off its benefits during rent.

CR (132) If the losing party annuls the contract when buyer has already changed and used the goods he may have:

(a) Reduced, (b) increased or, (c) Mixed it. In (a) the seller gets the merchandise back with compensation. In (b) the increase is:

(1) Only a change of a quality with or with no change in the price like changing the wheat to flour or gold into jewelers or coloring clothes.

(2) Or some inseparable increase.

(3) Or is separable like fruits, building and plants. In (1) the merchandise goes to seller and there is nothing for the buyer and so is also if the increase has some value but it is not because of buyer's deeds. In (2) also there is nothing for the buyer. In (3) the increase goes to buyer; if separating does not cause a loss to him, the seller may force him to separate it, in fact, even so separation can be forced, if the buyer wants to separate the seller does not have to stop him, if separating causes damage it is buyer's responsibility. In (c) if it is mixed with a different kind, it is considered as lost and the buyer is responsible for its replacement in kind or price, regardless, the merchandise is considered as totally changed or exists as a mixture.

CR (133) If the buyer due to loss annuls the contract when he has already used the merchandise as such that would not affect his right of having the choice to annul the contract because of his ignorance of the loss; his use would also be either without introducing a change in the merchandise or with a change in the form of reduction, addition or mixing. The situation here would be dealt with just like the cases mentioned in the previous rule. The same rule applies if the buyer who due to his loss annuls the contract, and the seller has used what he has in exchange for the merchandise or the seller who has suffered loss, annuls the contract, and he has used what he had in exchange for the merchandise, and his use would not affect his right to annul the contract. In any case, the rule about the merchandise being destroyed, transfer of his benefit, reduction addition and being mixed with other substance and the rules of the other cases mentioned in previous rules, would all apply here in the same way.

CR (134) Apparently, the right to annul the contract because of loss, does not have to be exercised immediately. Thus if one delays declaring the annulment intentionally and knowingly, waiting for the party causing the loss or the presence of consultant to annul the contract or not etc., like other valid purposes, the right of having the choice will not be affected. This right, no doubt, will not be affected if it is not exercised because of the party's ignorance of the loss or whether or not the party is entitled to such right or is unaware of such right or has forgotten. In all cases it is permissible for him to annul the contract as soon as he comes to know or becomes aware of it.

CR (135) Apparently, a party would be entitled to exercise the right of having the choice to annul the contract because of loss in all transactions in which time would be a factor for the loss to become evident, like settlement cases, rents etc.

CR (136) If a party buys two pieces of merchandise in a lump sum deal like buying a camel for ten units of money and a horse for another ten, and then the party happens to have suffered loss in the deal of the horse, it is permissible for him to annul the contract, and the seller will have the right of having the choice to sell the camel or not to sell.

CR (137) If the merchandise gets destroyed in the custody of the party who has caused the loss because of his own action or some heavenly reason and the merchandise would be of the kind exchanged in transaction according to the price (as opposed to its kind) if the person who has suffered the loss annuls the contract, he would be entitled to ask the other party for refund of the price of merchandise at the time of destruction or at the time of annulment or at the time of payment, there are several views; the strongest one is the second (at the time of annulment). If the destruction would be because of the action of the party who has suffered loss, he will not be entitled to claim any refund.