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(132 Wash. 667, 233 Pac. 35.) stroyed, there is, in our opinion, an 817, it was said that "it seems inentire failure of consideration.' conceivable that the absolute title
Professor Elliott, in the section remain in the seller, and at the same cited from his work, supra, reasons time the purchase price be an enas follows: “Where there is a sale forceable debt obligation against the of specific goods the parties must purchaser." have contemplated that there was And in the following cases we something in existence to be sold, have stated and reiterated that one and if goods agreed to be sold per- who takes property, under a condiish or are destroyed without fault tional bill of sale is not the owner, of the buyer or seller, before the and has no element of title: Stewrisk passes to the buyer, the agree- art & H. Drug Co. v. Reed, 74 Wash. ment is thereby avoided.
401, 133 Pac. 577; Norman v. MeekThere being no subject-matter, an er, 91 Wash, 534, 158 Pac. 78, Ann. essential element of a valid sale is Cas. 1917D, 462; Peterson v. Chess, lacking."
92 Wash. 682, 159 Pac. 894; BarSo Mechem, Sales, ubi supra: bour v. Hodge, 99 Wash. 578, 170 "The question of the effect of the ac- Pac. 115. We have, therefore, cidental destruction of the property aligned ourselves against the decibefore it was fully paid for has also sions of those jurisdictions holding given rise to decisions apparently in that the title is merely reserved as conflict. The true view would seem security, or that the vendee has a to be that the loss follows the title. qualified property in the title. Hence in the case of a conditional Nor can we agree with the reacontract to sell where no title passes soning of those courts that have until payment in full, the loss, un- placed their conclusions on the less otherwise provided by the con
ground that the purchaser has abtract, would fall upon the party solutely bound himself to buy and agreeing to sell; while in the case pay for the article, and that, if it is of a sale upon condition subsequent,
destroyed while in his possession, the loss would fall upon the pur
that is no reason why he should be chaser, and so the decisions are
relieved. On the contrary, the when not complicated by other
promise to buy and pay for the arfacts.”
ticle is mutual and interdependent
with the promise of the vendor to In the greater number of the cases
sell and deliver the article. The supporting the majority rule it is said that the purchaser has a qual- promises being mu
tual and interde- effect of inabillified title to the property, and the
pendent, when the ty of one party seller holds the title merely as se
one cannot comply curity for the purchase price, some the other is under no obligation to courts stating that the contract is
comply. See Hawley v. Kenoyer, 1 equivalent to a chattel mortgage. Wash. Terr. 609, and Hogan v. Kyle, But a different rule has been estab
7 Wash. 595, 38 Am. St. Rep. 910, lished in this state regarding the 35 Pac. 399. character and effect of contracts of
Our conclusion is, therefore, that conditional sale of chattels. We
the loss must fall on the holder of have consistently held that under
the title, and since the statutes of this state no title
the title was at all -conditionalwhatever passes under a conditional times in the vendor, tion of property
personal property, be held for the un
and that the rela- paid part of the purchase price. tion of debtor and creditor is not The judgment is reversed. created. In Winton Motor Carriage Co. v. Broadway Auto. Co. 65 Wash. Mackintosh, Holcomb, Mitchell, 650, 37 L.R.A. (N.S.) 71, 118 Pac. and Main, JJ., concur.
effect of destruc
no title passes.
Askren, J., concurring:
conditionally pay the purchase price. For the reasons stated in my con- I cannot see any reason why one curring opinion in Ashford v. Reese, who has agreed to pay the purchase
Wash. 233 Pac. 29, I concur. price, and who has received possesBridges, J., dissenting:
sion of the thing purchased, should Most of the members of the court
be able to deny his agreement simare of the opinion that under a con
ply because the property has been ditional sales contract the loss must
destroyed, lost, or damaged while in follow the title, and that, since we
his possession. Suppose the prophave held that under a conditional
erty involved in this case had not sales contract the purchaser obtains
been completely destroyed, but had no title or interest in the thing pur
been damaged 5, 10, or 20 per cent chased, the loss must fall upon the
of its value, would the majority still vendor because he has both the legal
hold that the vendor must stand the and equitable title. This view has loss, and that the purchaser may caused us to review our cases hold
repudiate his agreement, refuse to ing that the purchaser, before com
carry out his contract, and recover pletion of the contract, does not ob
what has already been paid by him? tain any interest in the property
If, during the life of the contract, purchased. I have long been of the
the property increases in value, the opinion that these cases are unsound
purchaser gets the benefit thereof. and against the best interests of the
and if it decreases in value, or is by people of this state. However, if I the elements damaged, he ought to could be convinced that to overturn
bear the loss. If the property be real them would be greatly detrimental,
estate and be affected by a stream of I would be in favor of adhering to
water, and, during the life of the them. But I am unable to see that contract, accretion adds to the propany considerable harm can follow erty he thereby benefits, why should the overruling of those cases; on the
he not stand the loss if the same contrary, I can see great benefit in stream should cut off or destroy a so doing, and in laying down a rule part of the land which he has agreed which is supported by almost all of
to purchase? The rule contended the decisions, which is that the pur
for by me is stated in 24 R. C. L. chaser under such a contract obtains
494, as follows: "The authorities an interest in the property pur
are not in accord as to the liability chased, at least to the extent of the
of the buyer for the unpaid part of payments made on the purchase the agreed price where the property price.
is accidentally destroyed while in Since it has become necessary to
his possession and without his fault. determine whether we will adhere
According to the better view, if the to our previous decisions or over
buyer has entered into an uncondirule them, I am in favor of the lat
tional promise to pay the price the ter, for the reasons given by Judge fact that the property is accidentalTolman in his dissenting opinion in
ly destroyed while in his possession the case of Ashford v. Reese,
does not relieve him from liability Wash. –, 233 Pac. 29.
for the unpaid and subsequently acI am, however, of the opinion that cruing instalments of the price.” there is no reason back of the rule The case of Burnley v. Tufts, 66 which requires the loss to follow the Miss. 48, 14 Am. St. Rep. 540, 5 So. title. My investigation of this ques- 627, is probably the leading case o! tion (which includes the reading of this subject, and is referred to by nearly all the cases) convinces me nearly all of the other cases. There that the loss should be on the pur
the court said: "Burnley uncondichaser, not because he has or has not tionally and absolutely promised to any interest in the property pur- pay a certain sum for the property chased, but because he has agreed the possession of which he received to purchase and has agreed to un
from Tufts. The fact that the prop
(132 Wash. 667, 233 Pac. 35.) erty has been destroyed while in his Ark. 403, 140 S. W. 582, 36 L.R.A. custody and before the time for the (N.S.) 594, Ann. Cas, 1913C, 659; payment of the note last due, on Whitlock v. Auburn Lumber Co. 145 payment of which only his right to N. C. 120, 12 L.R.A. (N.S.) 1214, 58 the legal title of the property would S. E. 909; Exposition Arcade Corp. have accrued, does not relieve him v. Lit Bros. 113 Va. 574, 75 S. E. of payment of the price agreed on. 117, Ann. Cas. 1913D, 335; Tufts v. He got exactly what he contracted Wynne, 45 Mo. App. 42; Lavalley v.. for, viz., the possession of the prop Ravenna,
Ravenna, 78 Vt. 152, 2 L.R.A. erty and the right to acquire an ab- (N.S.) 97, 112 Am. St. Rep. 898, 62 solute title by payment of the agreed Atl. 47, 6 Ann. Cas. 684. price.
The seller had done I am therefore of the belief that all that he was to do except to re- this case ought to be decided withceive the purchase price; the pur- out reference to our former decichaser had received all that he was sions concerning the location of the to receive as the consideration of his
title to the property sold. promises to pay,
to relieve I dissent. him from this obligation the court
Parker, J.: must make a new agreement for the
I concur with Judge Bridge's disparties, instead of enforcing the one
sent. made, which it cannot do." The following additional cases
Tolman, Ch. J., dissenting:
For the reasons set forth in my support the view I have tried to express: Marion Mfg. Co. v. Buchan- dissenting opinion in the case of
Ashford v. Reese, - Wash. – 233 an, 118 Tenn. 238, 8 L.R.A.(N.S.)
Pac. 29, I dissent here. 590, 99 S. W. 984, 12 Ann. Cas. 707; Hollenberg Music Co. v. Barron, 100 Petition for rehearing denied.
Who bears loss incident to destruction of goods sold conditionally.
I. Introductory, 1319.
in possession of the vendee before II. View that purchaser bears loss, 1319.
payment, without his fault, does not III. View that vendor bears loss, 1327. relieve him from the obligation to pay 1. Introductory.
the price, and therefor he suffers the
loss. As to recovery by conditional vend
United States. - Chicago R. Equipor or vendee against third person
ment Co. v. Merchants' Nat. Bank for damage to or destruction of prop
(1890) 136 U. S. 268, 34 L. ed. 349, 10 erty, see annotation following Lacey
Sup. Ct. Rep. 999. Compare J. M. Arv. Great Northern R. Co. post, 1337.
thur & Co. v. Blackman (1894) 63 Fed. In discussing the question who
536. bears the loss incident to the destruc
Arkansas. - Phillips v. Hollenberg tion of goods sold conditionally, this
Music Co. (1907) 82 Ark. 9, 99 S. W. annotation is confined to cases involve
1105; Roach v. Whitfield (1910) 94 ing the rights of the vendor and pur
Ark. 448, 140 Am. St. Rep. 131, 127 S. chaser as between themselves only.
W. 722; Hollenberg Music Co. v. BarII. View that purchaser bears loss.
ron (1911) 100 Ark. 403, 36 L.R.A.
:(N.S.) 594, 140 S. W. 582, Ann. Cas. Rule stated.
1913C, 659. The weight of authority supports Connecticut. O'Neill - Adams Co. the rule that, where goods are sold
v. Eklund (1915) 89 Conn. 232, 93 and delivered to the vendee under an Atl. 524, Ann. Cas. 1918D, 379. agreement that the title is to remain Florida. Phenix Ins. Co. v. Hil. in the vendor until payment, the loss liard (1910) 59 Fla. 590, 138 Am. St. or destruction of the property while Rep. 171, 52 So. 799.
Illinois. See Cooper v. Chicago Cottage Organ Co. (1895) 58 Ill. App. 248. Indiana. — Jessup v. Fairbanks, M.
v & Co. (1906) 38 Ind. App. 673, 78 N. E. 1050.
Iowa. -- Neally v. Wilhelm (1854) 4 G. Greene, 240, 61 Am. Dec. 118. Compare Swaney V. Alstott (1907) 134 Iowa, 63, 8 L.R.A.(N.S.) 1032, 111 N. W. 406.
Kentucky. Prather V. Norfiet (1818) 1 A. K. Marsh. 178.
Mississippi. – Burnley v. Tufts (1888) 66 Miss. 48, 14 Am. St. Rep. 540, 5 So. 627. See also McPherson v. Acme Lumber Co. (1893) 70 Miss. 649, 12 So. 857.
Missouri. Tufts v. Wynne (1891) 45 Mo. App. 42.
Nebraska. Charles A. Stickney Co. v. Nicholas (1915) 98 Neb. 287, 152 N. W. 554.
New Jersey. American Soda Fountain Co. v. Vaughn (1903) 69 N. J. L. 582, 55 Atl. 54. See Collard v. Tully (1911) 78 N. J. Eq. 557, 80 Atl. 491, Ann. Cas. 1912C, 78.
New York. Ballard v. Burgett (1869) 40 N. Y. 314; Humeston v. Cherry (1880) 23 Hun, 141; National Cash Register Co. v. South Bay Club House Asso. (1909) 64 Misc. 125, 118 N. Y. Supp. 1044. See also Hintermister v. Lane (1882) 27 Hun, 497. Compare Edward Thompson Co. v. Vacheron (1910) 69 Misc. 83, 125 N. Y. Supp. 939. North Carolina.-Tufts
V. Griffin (1890) 107 N. C. 47, 10 L.R.A. 526, 22 Am. St. Rep. 863, 12 S. E. 68; Whitlock v. Auburn Lumber Co. (1907) 145 N. C. 120, 12 L.R.A. (N.S.) 1214, 58 S. E. 909. See also Lancaster v. Southern Ins. Co. (1910) 153 N. C. 285, 138 Am. St. Rep. 665, 69 S. E. 214.
Oklahoma. Harley & Willis V. Stanley (1909) 25 Okla. 89, 138 Am St. Rep. 900, 105 Pac. 188.
Pennsylvania. - Peerless Bread Mach. Co. v. Matthews (1923) 81 Pa. Super. Ct. 329.
Tennessee. Marion Mfg. Co. v. Buchanan (1906) 118 Tenn. 238, 8 L.R.A. (N.S.) 590, 99 S. W. 984, 12 Ann. Cas. 707. See also Planters Bank v. Vandyck (1871) 4 Heisk. 617;
Carolina, C. & O. R. Co. v. Unaka Springs Lumber Co. (1914) 130 Tenn. 354, 170 S. W. 591.
Vermont. Fuller Buswell (1861) 34 Vt. 107; La Valley v, Raven. na (1905) 78 Vt. 152, 2 L.R.A.(N.S.) 97, 112 Am. St. Rep. 898, 62 Atl. 47, 6 Ann. Cas. 684. See also French v. Os. mer (1895) 67 Vt. 427, 32 Atl. 254.
Virginia-Exposition Arcade Corp. v. Lit Bros. (1912) 113 Va. 574, 75 S. E. 117, Ann. Cas. 1913D, 335.
Wisconsin.-Osborn v. South Shore Lumber Co. (1895) 91 Wis. 526, 65 N. W. 184.
England. Compare Elphick V. Barnes (1880) L. R. 5 C. P. Div. 321.
Canada. Hesselbacher v. Ballantyne (1898) 28 Ont. Rep. 182; Goldie & McC. Co. v. Harper (1900) 31 Ont. Rep. 284; Sawyer & M. Co. v. Robert son (1900) 1 Ont. L. Rep. 297. See also Thibault v. Martel (1910) 11 Quebec Pr. Rep. 224. Reason and application of rule.
One reason for the foregoing view has been well expressed in American Soda Fountain Co. v. Vaughn (N. J.) supra. That was an action on one of a series of notes given for the purchase money of a soda-water apparatus, to which the vendor reserved the title, and which had been destroyed by fire before the note sued on had become due. The defense interposed was a total failure of consideration for the note. Swayze, J., speaking for the court, said: “The question to be determined is, What was the consideration of the note? If the passing of the title to the apparatus was the consideration, the defense must prevail. If the delivery of the apparatus, with the right to acquire title, was the consideration, the plaintiff must prevail. We think the consideration for the note was the delivery of the apparatus with the right to acquire title.
The consideration for these payments, and for the monthly instalments as they fell due. must necessarily be the same as the consideration for the notes not yet matured. It can hardly be contended that the consideration for the payments already made, and for the notes
which matured prior to the fire, and not relieve him from the obligation which we may assume were paid, has to pay the price.'" failed. It must have failed if the con- "Aconditional sale of personal sideration was the passing of the title. property by which the vendee takes The language of the note and order possession of the property with an also indicates that the obligation of unconditional promise to pay for it, the defendant was absolute immedi- but the vendor retains the title till ately upon the delivery of the goods, payment in full of the purchase price and was not conditioned in any way is made, confers upon the vendor the upon the passing of the title. The absolute right of the purchase price, title was retained by the plaintiff and imposes upon the vendee the unmerely as security for the unpaid pur- conditional obligation to pay the purchase money.
Nothing remained to chase price, and also casts upon the be done by the plaintiff to perfect the vendee all the risks of loss incident title of the defendant; that title to the full and complete ownership of would have become perfect immedi- the property, unless otherwise specialately upon payment."
ly, provided by contract. 6 Am. & Eng. The court said in Marion Mfg. Co. Enc. Law, 2d ed. 455.” Phenix Ins. v. Buchanan (Tenn.) supra: “We are Co. v. Hilliard (1910) 59 Fla. 590, 138 of opinion the true rule is that the Am. St. Rep. 171, 52 So. 799. loss must fall on the purchaser: First, In O'Neill-Adams Co. v. Eklund because his promise to pay the pur- (1915) 89 Conn. 232, 93 Atl. 524, chase price of the machinery was un- Ann. Cas. 1918D, 379, the facts and conditional. The machinery had been the law were stated by the court as actually delivered, and was being follows: "The question presented by used by the defendant. There was the appeal is this: Can there be a reno provision in the contract that the covery for property sold and delivered purchaser was to be released from on condition that the title shall not the payment of the price in the event pass until full payment has been the machinery was destroyed by fire made therefor, when, without fault of before payment of the purchase money the purchaser, the property is denotes. The retention of title in the stroyed ? There is some conflict of vendor was a mere security for the authority on the right of a vendor, payment of the price. Sec nd, the who retains title to the property unpurchaser should sustain the loss, til the payment of the purchase monbecause the machinery passed under ey, to recover the amount unpaid his dominion and control, and, if the when the property has been destroyed rule were otherwise, the purchaser without the fault of the vendee. The would have no incentive to take care Sales Act
provides: 'Unless of the property. This rule, more- otherwise agreed, the goods remain over, is in accord with the policy of at the seller's risk until the property this state in dealing with conditional therein is transferred to the buyer, sales."
but when the property therein is In Harley v. Stanley (Okla.) supra, transferred to the buyer the goods the court said: “There is some con- are at the buyer's risk, whether deflict of authority on the question pre- livery has been made or not, except sented, but to our minds the great that (a) where delivery of the goods weight of authority supports the gen- has been made to the buyer, or to a eral rule laid down in 6 Am. & Eng. bailee for the buyer, in pursuance of Enc. Law, 2d ed. 455, which is stated the contract, and the property in the as follows: "Where personal property goods has been retained by the seller is sold and delivered to the vendee un- merely to secure performance by the der an agreement that title is to re- buyer of his obligations under the main in the vendor until payment, the contract, the goods are at the buyer's loss or destruction of the property risk from the time of such delivery.' while in the possession of the vendee • Eklund had obtained the posbefore payment, without fault, does session of the property with the right