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to acquire a perfect title by payment the plaintiff until all the notes were of the price agreed upon. The fact paid. After several of the notes had that the property was destroyed while matured and were paid, the apparatus in his custody, and before payment of was totally destroyed by fire, without the amount due did not relieve him of any fault on the part of the defendant. payment of the price agreed on. The The defendant had had exclusive use seller had done all he was bound to and control of the property from the do, except to receive the purchase time of its purchase until it was price. The vendee had obtained all burned. He refused to pay the subthat he was to receive from the vend- sequently maturing notes, claiming or in consideration of the payments that the title was in the plaintiff, and which he had agreed to make for his that the loss should be borne by him. property."
The court held that the fact that the Applying the rule, the court in property had been destroyed while in Roach v. Whitfield (1910) 94 Ark. 448, the defendant's custody and before 140 Am. St. Rep. 131, 127 S. W. 722, the time for the payment of the note said: "The appellant, a wholesale last due, on payment of which only his dealer, sold to appellees the goods at right to the legal title to the property a fixed price named at the time. Ap- would have accrued, did not relieve pellees obtained, the moment the him from payment of the price agreed goods were delivered to them, abso- on. Cooper, J., delivering the opinion lute control over them. They resold of the court, said: "He got exactly them at their own price. The title what he contracted for, viz., the poswas retained in appellant only for the session of the property and the right purpose of security, but for no other to acquire an absolute title by paypurpose. So far as the appellant was ment of the agreed price. The transconcerned, she had done all she action was something more than ar. could do to pass the title when the executory conditional sale. The seller goods were shipped to appellees. had done all that he was to do excep: Nothing remained for her to do. The to receive the purchase price; the purgoods were, on delivery, under the chaser had received all that he was to complete dominion of the appellees receive as the consideration of his to do with them as they chose, and to promises to pay." resell upon their own terms. We That case was followed in Tufts r. think that, according to the weight of Griffin (1890) 107 N. C. 47, 10 LRA. authority and the
and the best-considered 526, 22 Am. St. Rep. 863, 12 S. E. 68, cases, where the title is retained in Tufts v. Wynne (1891) 45 Mo. App. solely for security and passes imme- 42, wherein it was also said that the diately to the vendee upon the pay- rule that a loss by the destruction of ment of the purchase money, he in the improvements falls on the purchasmeantime having the absolute control er of real estate under a title bord and dominion over the property, the should apply to sales of personal rule is that the loss falls upon the property under like conditions, and vendee, and the vendor may recover in American Soda Fountain Co. F. the purchase price undiminished by Vaughn (1903) 69 N. J. L. 582, 55 Atl. such loss."
54, wherein it further appeared that In Burnley v. Tufts (1888) 66 Miss. the purchaser agreed to insure the 49, 14 Am. St. Rep. 540, 5 So. 627, property, making the loss, if any, parwhich is probably the leading case al- able to the seller as its interest migh: lowing a recovery upon the facts un- appear. der consideration, it appeared that In Osborn v. South Shore Lumber the plaintiff had sold to the defendant Co. (1895) 91 Wis. 526, 65 N. . a soda-water apparatus, taking there- 184, the sole question presented was for several notes, due at stated inter- whether the defendant was liable fo: vals. The notes, which were all sim- certain logs which were lost, in vier ilar, contained the stipulation that the of the fact that the plaintiff had retitle to the property should remain in tained the title solely as security for
the purchase money, it appearing that relieve the vendee from the obligation the logs were delivered into defend- to pay the purchase price." ant's possession, and were lost with- In Phillips v. Hollenberg Music Co. out any fault of his. The court said: (1907) 82 Ark. 9, 99 S. W. 1105, the "Where property is sold and delivered, defendant purchased a piano on the and the vendor has fully performed instalment plan, upon condition that all the conditions of the contract of the title was to remain in the plaintiff sale on his part, and the intention of company until the piano was fully the parties at the time of the making paid for. The piano was delivered and of the contract, as in this case, clearly several payments were made on the is that the vendor is to have no inter- purchase price. Before other payest in the property after delivery, ex- ments were due, the piano was decept as security for the unpaid pur- stroyed by fire without any fault of chase money; that, subject to the the purchaser. The court, in holding right to resort to said property as that the plaintiff was entitled to resuch security, the entire dominion and cover, said. “The obligation of the control over the same are turned over appellant to pay the purchase money to and assumed by the vendee, as became absolute upon the delivery of such, although, for the purpose of re- the piano, and was not conditioned taining effectually the security, the upon the vesting of the title in the contract of sale provides that the title purchaser. The title was held by the and right of possession shall remain vendor as security for the unpaid purin the vendor, as security, until the chase money. When it was paid, the purchase price is fully paid, and title vested in the purchaser. Noththough the amount of the property is ing remained for the vendor to do to yet to be ascertainend by a measure- complete the sale. On the contrary, ment in order to determine the amount he could not lawfully deprive the venof the purchase money, if any of such dee of the property so long as she perproperty is lost after such deliveryformed her contract, and she could before measurement, such loss must not rescind the contract so long as he fall upon the vendee, whether the loss elected to enforce it. She acquired an accrues through his negligence or oth- interest in the property which she erwise, and the amount of such lost could mortgage or sell. The considerproperty may be ascertained by com- ation of the contract was legal, valupetent evidence.”
able, and sufficient, and the fire did Likewise, in Hesselbacher v. Ballan- not destroy it. There was no failure tyne (1898) 28 Ont. Rep. 182, it was of consideration.” held that the loss or destruction of In Hintermister v. Lane (1882) 27 logs purchased under a conditional Hun (N. Y.) 497, where the purchaser sale fell on the vendee, although he of an organ, giving notes therefor, was not at fault and title still re- executed a paper acknowledging that mained in the vendor.
she had leased said organ until said In Carolina, C. & 0. R. Co. v. Unaka notes should be paid, it was said that Springs Lumber Co. (1914) 130 Tenn. she was bound to pay the purchase 354, 170 S. W. 591, wherein it appeared
price whether the organ should be dethat a purchaser of lumber under a
stroyed or not. conditional sale lost it through fire
In Charles A. Stickney Co. v. Nich
olas (1915) 98 Neb. 287, 152 N. W. started by sparks from a railroad locomotive, it was said: "A purchaser of
554, it appeared that the plaintiff
shipped a gas engine to the defendant personal property, under a conditional
under an agreement which specified sale in which title is retained in the
that the title should not pass to the vendor to secure the purchase price,
defendant until a full payment of the is the equitable owner of the property. purchase price was made. The court,
The destruction of the prop- in holding that a subsequent destrucerty by fire while in the possession of tion of the engine by fire, arising the vendee, before payment, did not through no fault of the defendant, did not relieve him from liability for until the purchase price is paid, the the purchase price, said: "Plaintiff, reservation gives the seller only a lien Charles A. Stickney Company, the upon the property for the amount of manufacturer of a gas engine, April the debt. The rule is different where 5, 1911, shipped to defendant, a retail there is anything further for the sellmerchant, a gas engine, under a writ- er to do; but where he has delivered ten contract containing the following the property, and he has no option to provision: 'Seventh. It is agreed that rescind his contract and retake posthe title to and ownership of all goods session, the mere reservation of title shipped under this contract shall re- for the purpose of securing payment main vested in the Charles A. Stickney of the debt will not defeat his right to Company, and the goods are to be held recover where the property is acciat all times subject to their order un- dentally destroyed. In this case the til paid for, and if sales are made be- vendee had possession with full right fore payment they shall be made only to sell, and any person dealing with in the regular course of business, and him would have acquired good title to the proceeds of all such sales, wheth- the property, and the reservation er cash, book accounts, or notes, are made in the contract between the parto be held as the property of Charles ties merely gave the vendor the right A. Stickney Company in trust as col- to pursue the property until sold in lateral security for their benefit, and the regular course of business, or, in subject to their order until all obliga- case of sale, to have the funds arising tions arising under this contract are therefrom held as a trust fund to sefully paid in money, and it is agreed cure the payment of the debt. He had that notes taken by the company are the option to rescind, and there was not accepted as payment. And it is nothing further for him to do but to further agreed that nothing in this accept payment, and it is expressly clause shall release the purchaser provided in the final sentence that from making the payments as herein nothing in this clause shall release stipulated.' The purchase price was the purchaser from making the paynot paid, but while the property was ments as herein stipulated.' The parin the possession of the defendant, ties were able to contract, and this and without fault or negligence on his defendant voluntarily assumed the part, it was totally destroyed by fire. risk of loss or damage. The loss of Plaintiff brought suit for the purchase the article in no manner changes the price, and defendant by answer al- character of the agreement, and the leged that under the section of the vendee must be held liable for the contract above set out, at the time the purchase price." property was destroyed, the title was Likewise, where a gasolene engine, in plaintiff, and he was holding it sub- sold under an agreement that title ject to its order. A jury was waived, was to remain in the vendor until paid the cause was tried to the court, and, for, was destroyed by fire before the 'from a judgment for the defendant, passing of title and while in one of plaintiff appeals. There was some the vendees' buildings, it was held correspondence between the parties that the loss must be borne by the which indicates that the engine did vendees. The court said: “The forenot prove satisfactory on a test, and going is a sale on condition. It is not that plaintiff had agreed to send an a contract to make a future sale. It expert to adjust it. However, as each required nothing to be done by the party relies upon that part of the con- vendor to pass title. It gives the retract quoted, the case must be deter- dor the right, upon vendees' default. mined solely on the construction there- to retake the property, which is a disof. The courts are not unanimous, affirmance of the sale; or, he may but the weight of authority seems to treat the sale as absolute, and bring favor the rule that, where the goods an action for the price.... The are sold and delivered upon condition contract being a present contract of that the title is retatned in the seller sale, its stipulation that the title should remain in the vendor until the lost her, it was held that the seller full payment of the purchase price who had retained title was entitled to did not relieve the vendees from the recover the price. Neally v. Wilhelm contract to pay, because the property (1854) 4 G. Greene (Iowa) 240, 61 Am. was injured or destroyed.” Jessup v. Dec. 118. Fairbanks, M. & Co. (1906) 38 Ind. Where furniture, sold under a conApp. 673, 78 N. E. 1050.
ditional sale with title retained by the In La Valley v. Ravenna (1905) 78 vendor, was destroyed by fire, it was Vt. 152, 2 L.R.A.(N.S.) 97, 112 Am. St. held that the risk of loss fell on the Rep. 898, 62 Atl. 47, 6 Ann. Cas. 684, vendee. Exposition Arcade Corp. V. the evidence showed that the defend- Lit Bros. (1912) 113 Va. 574, 75 S. E. ant refused to pay for a horse that 117, Ann. Cas. 1913D, 335. died before any payments became due In Prather v. Norfiet (1818) 1 A. K. on the conditional sale. The court Marsh. (Ky.) 178, the rule was apsaid: “Can there be a recovery for plied in the case of a slave sold conproperty sold and delivered on condi- ditionally, and dying before paid for. tion that the title shall not pass un- So, in Planters Bank v. Vandyck til full payment therefor has been (1871) 4 Heisk. (Tenn.) 617, the loss made, when without the fault of the resulting from the emancipation of purchaser the property is destroyed slaves, title to which had been rebefore the price falls due? This tained by the vendor, was held to fall question we answer in the affirmative. on the purchaser, such reservation of
.. The defendant's promise to pay title being regarded merely as a lien. was absolute, and was made upon a In Cooper v. Chicago Cottage Orsufficient consideration; for he got gan Co. (1895) 58 Ill. App. 248, all just what he bargained for—the use, that was decided was that the addipossession, and enjoyment of the tion of the words, “title not to pass property, with the right to acquire until this note is paid in full,” to an the absolute title upon payment of the ordinary promissory note, will not stipulated price; and this was the preclude a recovery thereon, though consideration for his promise. The the property for which it was given seller had done all that he was to do was, without the fault of anyone, deto or with the property by the terms stroyed by fire; the court expressly of the contract; all that he was to do refusing to say what its decision at all, except to receive the price. would have been, had the record disAnd, upon that, the title passed with- closed a contract of sale under which out further action on the part of the title was to remain in the vendor either party. The defendant's prom- until the note should be paid. ise was in no sense conditioned on the However, in Swaney v. Alstott seller's ability to deliver the title. He (1907) 134 Iowa, 63, 8 L.R.A.(N.S.) could not return the property to the 1032, 111 N. W. 406, it was held that seller and thereby avoid further lia- the loss of a stallion sold conditionalbility.
The result is that we ly must fall on the vendor, where the hold that the defendant is liable for contract provided that the purchase the unpaid balance, notwithstanding price should be paid out of the servthe death of the horse included in the ice fees. sale."
And in J. M. Arthur & Co. v. BlackIt was similarly held in Ballard v. man (1894) 63 Fed. 536, which was Burgett (1869) 40 N. Y. 314, that if a an action on a promissory note, given horse, purchased under a conditional in pursuance of a contract which prosale, had died before the payment of vided that, on the payment of certain a note given for the price, such death notes at maturity, the plaintiff would would have been no defense to an ac- "sell and transfer" certain machinery tion on the note, as the horse was held to defendants, and that the title to the at the risk of the purchaser.
machinery should remain in plaintiff Where a conditional purchaser of a until the notes were paid, it appeared cow negligently turned her loose and that the machinery was delivered to
the defendant, and without his fault, and before the maturity of the note sued on, was destroyed by fire. To an action upon the note sued on, the defendant entered a plea of failure of consideration In holding that this plea was good, the court said: “Now, according to the agreement of the parties, there are interdependent promises; defendants promise to pay money; the plaintiff promises to transfer property on payment of the money. I do not think the plaintiff can exact the payment of the money when it is made to appear to the court that it never can transfer the property. I consider this a valid defense. The demurrer to it will be overruled." Possession retained by vendor.
In Hollenberg Music Co. v. Barron (1911) 100 Ark. 403, 36 L.R.A.(N.S.) 594, 140 S. W. 582, Ann. Cas. 1913C, 659, the court carried the majority rule to the extent of holding that where the seller retakes the property on the failure of the vendee to pay, and it is destroyed without fault of the seller while held by him as security for the purchase price, the loss falls on the vendee.
In Whitlock v. Auburn Lumber Co. (1907) 145 N. C. 120, 12 L.R.A.(N.S.) 1214, 58 S. E. 909, it appeared that the defendant purchased conditionally a dry kiln, the title to remain in the vendor until the kiln was paid for. At the request of the purchaser, the vendor kept the kiln in its possession, subject to the order of the purchaser. Before actual delivery the kiln was destroyed by fire. In passing on the right of the vendor to recover the purchase price of the kiln, the court said: “The lumber
company has made an absolute promise to pay a certain sum of money, the consideration of which was the purchase of the property described in the contract. Why, then, should it not be compelled to perform its promise? It is a mistake to suppose that its liability depends upon whether the title did or did not pass unconditionally to it from the Acme Company. Its obligation arises out of the fact that it has promised to pay the money upon a sufficient
consideration, and the said obligation is in no way affected by the state of the title to the property, as between the parties; that is, whether vested conditionally or unconditionally. ... The real and substantial nature of the transaction, for the purpose of determining who should bear the loss, is that of mortgagor and mortgagee, or lienor and lienee. The contract, it is true, creates technically a conditional sale, but the vendor, in fact, only retains the legal title as a security in equity, and the title otherwise passes to the vendee with a lien for the purpose named.”
So, it has been held that where, on a sale of a pair of horses, it was agreed that the title thereto should remain in the vendor until payment, and the purchaser assumed control of the horses though they remained in the vendor's stable, and one of the horses died, the loss fell on the purchaser. Humeston v. Cherry (1880) 23 Hun (N. Y.) 141. Compare Elphick v. Barnes (1880) L. R. 5 C. P. Div. (Eng.) 321. Failure to deliver.
The holding in Edward Thompson Co. v. Vacheron (1910) 69 Misc. 83, 125 N. Y. Supp. 939, was to the effect that the conditional vendor of an undelivered set of law books was responsible for the loss thereof in transit. In support of the holding, the court said: “It would be unreasonable to say that defendant had bound himself to pay for what he never got. where it had been stipulated in advance that he should have no title in the article at the time of its loss.
.. Where a publisher contracts to make such a delivery to a subscriber at a distant place, some express clause is necessary to shift the risk of carriage.
In the absence of such stipulation, the risks of transit naturally follows the title to the goods at the time; and the publisher must carry out the engagement to deliver at the place appointed.”
In Sawyer & M. Co. v. Robertson (1900) 1 Ont. L. Rep. 297, it appeared that the plaintiffs sold an engine ard stone crusher to the defendant, re