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thrush, roaring proceeding from organic defect, and invetrate crib-biting.(z)

II. Obligations of the Buyer.

The obligations incumbent on the buyer, independently of special bargain, are-1. To pay the price; and, 2. To take delivery of the thing.

1. To Pay the Price.-When the bargain is simple and without special stipulation, the buyer's obligation is to pay immediately, and the seller is entitled to demand and have action for payment,-On offering delivery of the thing, or proving the delivery made; or, On shewing that the thing has perished by accident.

The seller is entitled to payment in a legal tender. The ordinary circulating medium of the country will be sufficient if not objected to; but if refused, that which is the legal tender by the law of the country will alone suffice to entitle the buyer to his action for delivery.

In Great Britain and Ireland the price may be exacted in gold if above 40s. (56th Geo. III. c. 68,) or in such bank notes as are by 3d and 4th Will. IV. c. 6, § 68, made legal tender. Such tender must be made immediately, or on such condition only as the bargain authorizes.

By the law both of England and Scotland, if, instead of money, the seller desires the buyer to send a bill by post, or where that is the usual [*104] course of remittance, the loss of it is at the risk of the seller. As where a bill so sent having fallen into bad hands, and the contents being received at a banker's, the price was held to be paid. (a)

If the seller take the note of a third party in payment, he takes it either with an indorsement, and on that will lie his remedy; or without recourse, and then he limits his demand; or simply by the third party giving a note to him instead of his own debtor giving it, and that seems to be nearly the same with a bill indorsed without recourse.

If the seller take the buyer's check on his banker, his account being overdrawn, or a draft on one having no funds of his, it is a fraud, and is held not to be satisfaction of the price, but only as prima facie evidence of payment. Thus, in a case where a draft was given in payment on one who had no funds of the drawer in his hands, Lord Kenyon, Chief Justice, said, “ That if the bill which is given in payment do not turn out to be productive, it is not that which it purports to be, and which the party receiving it expects it to be, and therefore he may consider it as a nullity, and act as if no such bill had been given, and that it had been so decided in many cases occurring at Nisi Prius."(b)

The same rule has been applied where a banker's notes were taken without agreement to receive them as money, and the banker failed next day. The Court held, that if the defendant had agreed to take the notes as payment, and to run the risk of their being *paid, that would have been [*105] considered as payment whether the notes had or had not afterwards been paid, but without such agreement the giving of such notes is no payment.(c)

(z) See Mr. Justice Coleridge's Note (21), 2 Blacks. p. 166, and 1 Bell's Illus. p. 114 and 115. (a) Warwick v. Noakes, 1791; Peake's Cases, 67.

(b) Puckford v. Maxwell, 1794; 6 T. Rep. 52.

(c) Owenson v. Morse, 1796; 7 T. Rep. 64. Swinyard v. Bowes, 1816; 5 Maule and Sel., 62. Tapley v. Martius, 1800; 8 T. Rep. 450. Taylor v. Briggs, 1827; 1 Mood. and Mal. 28.

The result of these cases seems to be, that if the bill or note given in payment be bad, the buyer is not discharged.

But there is an exception to the general rule, and such a note may operate as payment, if by the seller's undertaking or negligence, or fault, he make it his own, though it should ultimately produce nothing.

Thus, it has been held in King's Bench, that if the seller discount the note or bill for the price, without making himself responsible for the money, this is an approval of the bill, and he makes it his own; he in that case receiving payment of the price, which cannot be recalled from him.(d) But if the seller has discounted the bill with an indorsement, making himself responsible, it is not to be held as a payment; for the price in that case is not effectually and conclusively paid.(e)

So, if the seller agree to receive the note or bill as cash, and undertake the risk of it, discharging the buyer of responsibility, should it be dishonoured, it will operate as payment, and discharge the buyer, though dishonoured. Thus, where wine was sold by intervention of a broker, and the broker's note was *" to be paid for by a bill, without recourse on the buyer, in case of its not being paid," Lord Ellenborough held, “that, ac[*106] cording to the broker's note, the wines were not to be paid in money, but to be bartered against a bill of exchange; and it was expressly stipulated that the buyer was not to be liable in case the bill should be dishonoured. Therefore he never was indebted to the plaintiff for the price of the wines."(f)

So, where the seller takes a note from a third party, in preference to cash which, on the purchaser's order, he is ready to pay, he undertakes the risk. Thus, where a commodity was sold and delivered on receiving in payment a note on a banker to pay to the seller £193, the banker, on the presenting of this note, said the seller might have the whole in cash; but he preferred to take an order for £100 at three months, and the rest in bank-notes. The bill was dishonoured. The Court held that, having waived the right to immediate payment and taken the security, the seller must bear the loss which had happened through his own default.(g)

Such a case is different from that in which the seller takes from the buyer or his agent a draft which is dishonoured; and so in the above case the Court distinguished it from a case where a check on a banker having been given for the price, and presented immediately, it was refused, as the maker of the cheque had overdrawn his account and failed the same day. Lord Ellenborough said, that in the ordinary case, if a creditor prefer a bill of exchange, accepted by a stranger, *to ready money from his debtor, he [*107] must abide the hazard of the security he takes. But there is no pretence for saying that a debtor is discharged by giving a cheque which produces nothing, although payment in cash may have been previously tendered.(h)

If the seller, taking notes or cheques, is guilty of negligence or laches, by which a loss arises, it is equivalent to payment. So in England, where notes

(d) Bunney v. Poyntz, 1833; 4 Barn. and Ad. 568; 1 Bell's Illus. p. 383.

(e) Miles v. Gorton, 4 Tyrwhitt, 295; Tarleton v. Altensen, 2 Ad. and Ell. 32.

(ƒ) Read v. Hutchinson, 1813; 3 Camp. 352.

(g) Smith v. Ferrand, 1827; 7 Barn. and Cress. 19; 1 Bell's Illus. p. 113.

(h) Everett v. Collins, 1810; 2 Camp. 515; 1 Bell's Illus. p. 112, confirmed in Marsh v. Pedder, 1815; 4 Camp. 257; 1 Bell's Illus. p. 268.

of a banker were given in payment, and the seller had neither circulated nor presented the notes, but about a week after the banker had failed, demanded payment from the buyer, who refused, the Court held that the seller was bound, not instantly but within a reasonable time, to present or circulate those notes; and as he did neither, and did not even give notice, and so injury may have arisen by loss of responsibility against others, there was such laches as made these notes the seller's own.(i)

So, if the seller take a note and alter it, so as to render it void, he loses any claim for the price against the buyer. In a case of this sort, the Court of King's Bench held that the seller, by "altering the bill in an essential part, made it his own as against the defendant, and caused it to operate as a satisfaction of the debt for which it was originally given."(k)

Where the price has not been fixed, but there is no doubt of the

[*108] final bargain, as where the goods have been delivered, the seller, as already stated, is entitled to demand the true, real, or market value of the commodity. The natural and fair presumption, where a commodity currently purchasable in the market is sold, is, that the market price of the day of the bargain is tacitly agreed to.(1)

Where the sale is on credit, the future connection of the seller and buyer is as creditor and debtor, and against the price may be set off a debt due by the seller. But set-off is not payment of the price where the contract is not on credit. In England it was, in one case, held that set-off was pleadable against an action for the price of goods to be paid for in ready money.(m) But this was discountenanced by Lord Ellenborough, who said as to that case," where a party upon a sale of goods had stipulated for ready money payment only, which was held to be satisfied by a payment made with his own bill, I defer to the authority, but am not convinced by it."(n) Where the price is made payable at a future time, and the term of payment has arrived, set-off in England, or compensation in Scotland, may be pleaded effectually in extinction of the debt. And the distinction between those cases seems to be good, as in the former the seller relies on immediate payment *of the money, perhaps for the purpose of answering a debt due that [*109] day; whereas, in the other case, the obligation of the buyer to pay at a future term falls into the ordinary circumstances, where set-off may be expected to be urged in satisfaction of the debt.

2. To Receive the Goods.-The buyer is under an obligation to receive, as well as to pay for, the goods, and that at the place and time agreed on or understood. He will otherwise be liable not only to the risk of loss, but to pay damages to the seller, as warehouse rent, carriage, &c. But the seller will not have right to sell the goods to another for indemnification of warehouse rent or other expense, without judicial authority. Thus, in a case where goods sold were not taken away by the buyer, the seller, after notice to that effect, proceeded to sell them to another. Lord Ellenborough said,

(i) Camidge v. Allenby, 1827; 6 Barn. and Cress. 373; 1 Bell's Illus. p. 113. (k) Alderson v. Langdale, 1832, 3 Barn. and Ad. 660; 1 Bell's Illus. p. 113.

(1) See the cases of Acebal, and Hoadley, and Leslie, quoted supra pages 19 and 20.In Scotland, the prices of grain are fixed by a judicial act, on evidence called the fiar prices. But that is held to be the criterion only for bargains and transactions between landlord and tenant, or where the bargain is made with express reference to the fiar prices. (m) Eland v. Karr, 1801; 1 East, 375.

(n) Fair v. M'Iver, 1812; 16 East, 130.

"If the buyer does not carry away the goods bought within a reasonable time, the seller may charge him warehouse rent, or he may bring an action for not removing them, should he be prejudiced by the delay. But the buyer's neglect does not entitle the seller to put an end to the contract."(o)

The correct course is that followed in Scotland, to apply for judicial authority to sell the goods, the buyer being cited as a party.

*CHAPTER V.

EXPRESS CONDITIONS IN SALE.

[*110]

BESIDES implied conditions already considered, there are frequently introduced conditions by express convention, which produce important effects on the obligation of the parties.

They are reducible to two classes, 1. Such as suspend the sale; and, 2. Such as dissolve the transfer after it has been completed.

The law relative to such conditions, in France and in Scotland, is explained by Pothier and by Stair ;(a) and the effect of these, though unquestionable as between the parties, admits of an important distinction when purchasers or creditors are concerned.

1. Suspending Conditions.-The effect of a suspending condition in a sale is, that, while the event is still undetermined, the sale is pendant; and neither in England is the property passed, nor in Scotland is the risk altered. Those conditions are various; and,

(1.) It is sometimes made a condition, that the commodity shall, on arrival, be approved of by the buyer. In that case there is no transference till the buyer announce *his approval, or shall be held as approving, by lapse of such reasonable time as may be necessary to examine the thing [*111]

and make the communication.

(2.) Sometimes the sale is on trial, and approval within a certain time. Here, on the one hand, the buyer has the full appointed time to declare his mind; and, on the other, the expiration of the time, without notice, makes the sale absolute.(b)

(3.) A bargain on sale and return is a conditional sale, only, 1st, if the goods be sold by the consignee; or, 2d, if they be kept beyond the time fixed for their return, or beyond a reasonable time. (c) In this transaction of sale and return, the property is in suspense till sold, or the election determined; and, in the meantime, the creditors of the person so sending the goods will take them. But any of them sold are sold to the benefit of the person having them on sale or return, and his creditors will be entitled to the price, not the sender of the goods.(d)

(4.) A sale on arrival is also conditional, and in the loose use of mercantile language it is held to mean the arrival of the goods, not that of the ship in

(0) Greaves v. Ashlin, 1813; 3 Camp. 426.

(a) Pothier's Tr. des Oblig., Nos. 198 and 224; 1 Stair, 14. 5.

(b) Gibson v. Bray, 1817; Holt, 556, and Note; 8 Taunt. 76. Ellis v. Mortimer, 1812; 1 New Rep. 257. Humphries v. Carvalho; 16 East, 46.

(c) Gibson v. Bray, supra, (0).

(d) Baylie v. Gouldsmith; Peake, Nisi Prius, 56.

which they may be described as intended to come,(e) the contract being good as a ground of damages if the goods are detained by the fault of the seller.(ƒ) (5.) It is also a condition precedent and suspensive, where the subject is put in the possession of another, on *the footing of location, to be kept at a certain hire during an appointed term.(g)

[*112]

2. Resolving Conditions.-When the condition is not suspensive, but only a provisional voidance of the sale, the effect as against creditors is the converse of the suspending clause. The sale is complete from the first, but the fulfilment of the condition will not retransfer the property.

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THE RIGHT OF LIEN, AND STOPPAGE IN TRANSITU FOR THE PRICE.

It has already been observed, that, by the law of England and America, delivery of the goods sold is not necessary to the change of the ownership, but that this change is at once accomplished by the mutual agreement of the seller and buyer to exchange a specific commodity for a certain price; while in those countries which followed the principles of Roman jurisprudence, the sale is merely a contract, making the parties debtor and creditor to each other, the one for the price, the other for the commodity, the ownership remaining unchanged till delivery has been made; that France and Holland have recently so far departed from this principle of the Roman law, as to adopt in this respect, the rule of the law of England; but that Scotland has adhered to the principle formerly so widely adopted.

The effect of this difference is so remarkable, and, in regard to the law of Scotland, so much to be regretted, as to impose the necessity of inquiring very anxiously into the nature and description of the several kinds of delivery by which the ownership of goods is transferred. Amidst the different rules, however, which prevail as to the necessity of delivery, in order to change the ownership, the seller has, in all the nations which have been mentioned, a recognised right to be secured for *payment of the price by reten[*114] tion of the goods, if still in his hands, till it is paid; or even by recovering possession for that purpose, so long as the goods are in transit towards the buyer.

In this chapter shall be considered, 1st, The several recognised acts of delivery; and, 2d, The right of lien, and stoppage in transitu.

I. Delivery, Actual and Constructive.

By the law of England and America, delivery of the goods is requisite to the completion of the sale, where the question is on the statute of frauds, and the contract is parole, without earnest given, or part payment of the price, so

(e) Boyd v. Sifkin, 1809; 2 Camp. 326; 1 Bell's Illus. p. 106.

(f) Idle v. Thornton, 1812; 3 Camp. 274

(g) See Cowan v. Spence, 21st May 1824; 3 S. 28; 1 Bell's Illus. p. 108. Wight v. Forman, 10th Dec. 1828; 7 S. 175; 1 Bell's Illus. p. 108.

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