regulation of the manner of transferring documents of title to goods, and the declaration that the "transfer and delivery of these symbols of property should, for certain purposes, be equivalent to an actual transfer and delivery of the property itself." 1

Since the publication of the earlier editions of this book, statutes have been passed with the express purpose of overriding the decisions, above referred to, and of giving to bills of lading, and other documents of title, complete negotiability.2

303. Negotiability of Warehouse Receipts. Even a statute declaring that any person to whom a negotiable warehouse receipt "is transferred, must be deemed and taken to be the owner of the things or property therein specified, so far as to give validity to any pledge, lien, or transfer made or created by such person," has been interpreted as conferring upon the receipt only a quasi-negotiable character. It gives to the transfer of the receipt the same effect as the common law gives to the transfer of the goods represented by the receipt; but it does not modify the "common-law right of the owner of personal property to recover it from one who claims under a disposition of it which was unauthorized by the owner." Any other interpretation of such a statute "would enable any one, fraudulently depositing the goods of another, to pass title as against the true owner by obtaining a warehouse receipt in his own name." 4

In accordance with this view of the statutes, it has been held that a warehouseman is not a guarantor of the title of property

1 Nat. Bank v. Chic., Bur. & N. R. Ry., 44 Minn. 224, 237; 20 Am. St. R. 566; 46 N. W. 560 (1890); Ammon v. Gamble-Robinson Commission Co., 111 Minn. 452, 455; 127 N. W. 448 (1910).

2 See Md. Annotated Code, Arts. 14, 14a, 23 and 83. In Sealey v. Mo. K. & L. Ry., 84 Kan. 479; 114 Pac. 1077 (1911), the Uniform Bill of Lading Act (3 Mo. Rev. St. 1909, §§ 11 956-58) was construed to "make bills of lading negotiable in the stricter meaning of that term," in order to "promote commerce by facilitating financial operations."

* Com. Bank v. Hurt, 99 Ala. 130; 12 So. 568 (1892); Burdick's Cases on Sales, 518.

4 First Nat. Bank v. Boyce, 78 Ky. 42, 56 (1879). An attempt so to pass title, which failed is shown in Unger & Co. v. Abbott, 92 Miss. 563; 46 So. 68 (1908).

described in his receipt,' and that an indorser of a bill of lading does not guaranty the performance of the contract therein contained. In the case last cited, it is said: "If the instrument is fictitious, or if there is any fraud practised in transferring it, any remedy that the transferee would be entitled to would be for that special wrong; and not by importing into the indorsement a promise to perform what the carrier had agreed or purported to have agreed to do." 3

The Uniform Warehouse Receipt Act undertakes to make these documents fully negotiable.4

304. Sale by one in Possession without other Semblance of Authority. The apparent right of property as owner is not conferred, at common law, upon the mere possessor of goods, even though he is in possession with the consent of the owner. "The law is clearly laid down that the mere possession of personal property does not convey a title to dispose of it." If the owner of lumber delivers it to A, for shipment in the owner's name to B, for sale, and A ships it in his own name and sells it as his own property, the purchaser acquires no rights to the lumber as against the owner. Possession in such a case is given to A as bailee, or as agent for the transportation or custody of the goods, and no color of authority is bestowed upon him to sell them. To permit him to transfer a valid title to them would violate that fundamental principle of the common law, "that a man cannot be devested of his title to property without his consent" or the operation of law; and would

1 Insurance Co. v. Kiger, 103 U. S. 352 (1880).

7

2 Maybee v. Tregent, 47 Mich. 495, 498; 11 N. W. 287 (1882).

3 Such seems to be the rule laid down in the Uniform Warehouse Receipts Act.

4 See Md. Annotated Code, 1911, Art. 14a. In Mercantile Co. v. Bank, 83 Kan. 504, 507; 112 Pac. 114 (1910), it was held that one who buys a draft with a bill of lading attached and, upon collecting the draft from the consignee, delivers to him the bill of lading, does not make himself liable to the transferee for damages due to defects in the goods.

Pickering v. Busk, 15 East, 38, Le Blanc, J. (1812); Burdick's Cases on Sales, 521. See Farquharson v. King (1902), A. C. 325; 71 L. J. K. B. 667.

Covill v. Hill, 4 Den. (N. Y.) 323 (1847).

7 Leigh Bros. v. Mobile Ry., 58 Ala. 165 (1877).

give to bailees "the dominion over all the goods intrusted to them." 1

305. Sale by Possessor with Apparent Authority to sell. — If, however, the owner delivers goods into the possession of another "whose common business it is to sell, without limiting his authority, he thereby confers an implied authority upon him to sell them," and a bona fide purchaser for value from such a possessor can hold the property.2 The same result follows where the owner has suffered another to have possession of property and of those documents which are the indicia of property; 3 as where the owner of a ship in process of construction permitted his agent to take out the usual builder's certificate and to have her enrolled in the agent's name as owner; or where the owner of bank-stock delivered to his stockbrokers as collateral security the certificate therefor upon which was indorsed a blank assignment subscribed by him.5

306. The case last cited is referred to in a more recent decision of the same court as marking "the limit to which the court has gone in subordinating the rights of the true owner of a stock certificate to the title of a transferee derived under one who, being in possession of the certificate by the consent of the true owner, has transferred it in fraud of his rights." 6 It is also pointed out that the owner of the certificates in McNeil v. Bank, subscribed the blank assignment and pledged the certificates with his brokers as security for their advances to him, and with authority to fill up the blank and transfer the certificates when necessary to make the pledge available. In other

1 Wilkinson v. King, 2 Camp. 335 (1809); cf. Smith v. Clews, 114 N. Y. 190; 21 N. E. 160; 11 Am. St. R. 627 (1889).

2 Pickering v. Busk, 15 East, 38 (1812); Burdick's Cases on Sales, 521. 3 Dows v. Kidder, 84 N. Y. 121 (1881); O'Connor's Admx. v. Clark, 170 Pa. 318; 32 At. 1029; 29 L. R. A. (1895); Burdick's Cases on Sales, 523; American Process Co. v. Florida White Press Brick Co., 56 Fla. 116; 47 So. 942 (1908); Russell v. Am. Bell Tel. Co., 180 Mass. 467; 62 N. E. 751 (1902); Shattuck v. Am. Cement Co., 205 Pa. 197; 54 At. 785 (1903). 4 Calais Steamboat Co. v. Van Pelt, 2 Black (U. S.), 372 (1862). McNeil v. Bank, 46 N. Y. 325; 7 Am. R. 341 (1871).

Knox v. Eden Musée Co., 148 N. Y. 441; 42 N. E. 988; 31 L. R. A. 779; 51 Am. St. R. 700 (1896); Treadwell v. Clark, 190 N. Y. 51; 82 N. E. 505 (1907).

words, he had put the certificates into the possession of persons whose business it was to dispose of such property, and he had conferred upon them authority to dispose of this property. True, that authority was limited, but its limitations did not appear on the certificates, nor were they disclosed by any of the circumstances of the case.

307. Stock Certificates with Indorsements signed in Blank. — The mere possession of such certificates does not confer apparent authority upon the possessor to transfer them. If, in that form, they have been surrendered to the corporation by which they were issued, and have been put into the custody of its general manager to be destroyed, such manager, having no actual or implied authority to issue stock of the corporation, cannot give to a bona fide purchaser any title to them, nor confer upon him any right of action thereon against the corporation.1 Again, the owner of certificates indorsed in blank, who deposits them with a bank for safe keeping, does not confer upon the bank or any of its officers apparent authority to sell or pledge them for its or their benefit.2 Nor does such conduct on the part of the owner amount to negligence which estops him from setting up his title as against the bona fide purchaser.3 An agent, who deposits with third persons certificates belonging to his principal without filling the blank assignment with his principal's name, may act negligently towards that principal, but such act cannot be considered the natural and proximate cause of the bona fide purchaser's loss. It is at most a mere condition, not a cause of the loss. The proximate cause is the criminal act of the custodian or depositary of the property. A man does not forfeit his property "because he has done an act which will not be perilous unless others are guilty of misconduct which that act does not cause." 5

1 Knox v. Eden Musée Co., supra.

2 Scollans v. Rollins, 173 Mass. 275; 53 N. E. 863 (1899); Burdick's Cases on Sales, 709; Schumacher v. Greene, C. C. Co., 117 Minn. 124; 134 N. W. 510; 38 L. R. A. N. s. 180 (1912). See case note 29 L. R. A. n. s. 254. * But see Penn. Ry. Co.'s Appeal, 86 Pa. 80 (1878), which treats such negligence as estopping the owner.

♦ O'Herron v. Gray, 168 Mass. 573; 47 N. E. 429 (1897).

Ex parte Swan, 7 C. B. N. s. 400, 447 (1859), quoted with approval in Knox v. Eden Musée, 148 N. Y. at p. 461.

The doctrine stated above has been changed in those States which have adopted the Uniform Stock Transfer Act, as this statute declares certificates of stock fully negotiable.1

308. Sale by Conditional Vendee. - In accordance with the foregoing common-law principles, the delivery of goods to one who has contracted to purchase them, but is not to acquire title until they are paid for, does not confer upon him apparent authority to sell either as owner or as agent of the owner. His possession is that of a bailee for a specific purpose,2 not that of a purchaser under avoidable title, nor that of an agent for sale.1 Having no title, and no real or apparent authority from the owner to sell, he cannot convey to a purchaser any greater rights than he possesses. "Such is the necessary result of carrying into effect the intention of the parties to a conditional sale and delivery. Any other rule would be equivalent to the denial of the validity of such contracts." 5 The common law imposes upon a purchaser the duty of inquiry concerning the title of his vendor; and if he fails to make inquiry, or if his

1 Mass. L. 1910, ch. 171, §§ 1 and 5. The common-law view of such certificates is stated by Cullen, C. J., as follows: "A stock certificate is merely a muniment or representative of title. The stock, which it represents, exists apart from the certificate, and its existence is contemplated to endure so long as the corporation continues But an instru

ment for the payment of money contemplates payment at some time, either at a day fixed or on demand." Zander v. N. Y. Sec. & T. Co., 178 N. Y. 208, 212; 70 N. E. 449 (1904).

2 Coggill v. Hartford Ry., 3 Gray (69 Mass.), 545 (1854). Cole v. Berry, 42 N. J. L. 308, 314 (1880).

Leigh Bros. v. Mobile Ry., 58 Ala. 165, 180 (1877). But the owner may clothe his conditional vendee with apparent authority to sell as the owner's agent. See Rogers v. Whitehouse, 71 Me. 222, 226 (1880); Valentine v. Reid, 22 Sess. Cas. 4th ser. 711 (1895); Columbus Buggy Co. v. Turley, 19 So. 232; 73 Miss. 529 (1896); Burdick's Cases on Sales, 538. In Keystone Watch-Case Co. v. Fourth St. N. Bk., 194 Pa. 535; 45 At. 328 (1900), the consignee was held to be an agent for sale and not a conditional vendee.

Coggill v. Hartford Ry., 3 Gray (69 Mass.), 545 (1854). Such contracts are invalid under the laws of Louisiana. Barber Asphalt P. Co. v. St. Louis C. Co., 121 La. 152; 46 So. 200 (1908).

• New Haven Wire Co. Cases, 57 Conn. 352, 386; 18 At. 266 (1889). "The law does not, as an universal rule, protect a man in the assumption that he who asks for credit is the owner of every article of personal property of which he has possession; it imposes upon the intending creditor