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112. Inference may be rebutted. —- Notwithstanding the language of the Uniform Sales Act, the inference of the reservation of title from the form of the bill of lading is not conclusive, but may be rebutted by other evidence.1 Accordingly, if the seller indorses such a bill of lading as above described and sends it to the purchaser; 2 or if he takes the bill of lading in this form for some collateral purpose, such as protecting himself in case the purchaser does not accept the goods; or if the original contract shows that the vendor is not to retain the right of disposal; or if the invoice contradicts the bill of lading, as by declaring that the vendor shipped the goods by the order and for account and risk of the purchaser,5 - title may pass to the purchaser notwithstanding the form of the bill of lading. The controlling element, in all cases of the kind now under consideration, is the intention of the consignor as shown by his acts at the time of shipping the goods. When such acts are equivocal the consignor's intention is a question of fact for the jury.7

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113. Amount of Evidence required to rebut Inference. - While it is impossible to formulate a definite rule as to the amount

chase price, he becomes the owner of the property instead of the pledgee, and his relation to the original mover in the transaction is that of an owner under a contract to sell and deliver when the purchase price is paid."

1 The Uniform Sales Act recognizes this doctrine, for it provides: "But if, except for the form of the bill of lading, the property would have passed to the buyer on shipment of the goods, the seller's property in the goods shall be deemed to be only for the purpose of securing performance by the buyer of his obligations under the contract."

2 Van Casteel v. Booker, 2 Ex. 691 (1848).

Joyce v. Swan, 17 C. B. N. s. 84 (1864); cf. Garbarron v. Kreeft, L. R. 10 Ex. 274 (1875); Burdick's Cases on Sales, 432, which shows that the vendor may retain the right of disposal, if the bill of lading and other evidence clearly disclose his intent to do so, in violation of his original agreement.

Coxe v. Harden, 4 East, 211 (1803), as explained in Blackburn on Sales (2d ed.), 146; Browne v. Hare, 4 H. & N. 822 (1858). 5 Walley v. Montgomery, 3 East, 585 (1803); Straus v. Wessel, 30 Ohio St. 211 (1876); Burdick's Cases on Sales, 192. Compare the invoice in this case with that in Dows v. Nat. Ex. Bk., 91 U. S. 618, at p. 622 (1875); Burdick's Cases on Sales, 182; and see definition of invoice in Sturm v. Boker, 150 U. S. 328 (1893), and In re Smith & Nixon Piano Co., 149 Fed. 111 (1906).

Brandt v. Bowlby, 2 B. & Ad. 932 (1831). 7 Van Casteel v. Booker, 2 Ex. 691 (1848).

of evidence required to rebut the presumption that a shipper intends to retain the right of disposal, when he takes a bill of lading to his or his agent's order, the cases show that the presumption is to be deemed a strong one.

In Ogg v. Shuter,' plaintiffs contracted to buy from M a quantity of potatoes to be delivered free on board within a month, payment to be by cash, part payment down and the balance against bill of lading. The potatoes were shipped in sacks sent by plaintiffs for the purpose, but M took a bill of lading to his order and indorsed it to defendant, instructing him to present the draft for the balance of the purchase price against the bill of lading. Plaintiffs refused to accept the draft for the full amount when presented, erroneously supposing that the shipment was sixteen sacks short, but stated that if on discharge of the cargo the full quantity was on board, they would immediately accept the draft. Defendant declined this proposition and sold the potatoes at once the price having risen considerably intermediate the making of the contract and the proffered delivery. Plaintiffs sued for conversion, and the judge before whom the case was tried without a jury, as well as the Court of Common Pleas, held that the presumption in favor of M's having retained the right of disposal, arising from the form of the bill of lading and from the provision in the contract that payment was to be cash against bill of lading, was overcome by the circumstances that delivery was to be free on board, that there was part payment, and that the sacks in which the potatoes were shipped were the plaintiffs'. The decision was reversed in the Court of Appeal, where it was explicitly declared that the shipper by his manner of dealing with the goods had disclosed his intention to retain the power to dispose of them, unless the plaintiff complied with the conditions imposed by him.2

1 L. R. 10 C. P. 159, on appeal, 1 C. P. D. 47 (1875); Burdick's Cases on Sales, 192 n.

2 Another illustration is afforded by W. & A. McArthur Co. v. Old Second Nat. Bank of Bay City, 122 Mich. 223; 81 N. W. 92 (1899); Burdick's Cases on Sales, 656. Plaintiff corporation shipped a carload of wheat, which it agreed to sell to M. & S., taking a bill of lading to its order. Having drawn a sight draft on M. & S. for the price, it delivered the draft,

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114. Bill of Lading to the Order of Buyer. -The Uniform Sales Act contains a rule for such cases, not found in the English statute. It is as follows: "Where goods are shipped, and by the bill of lading the goods are deliverable to the order of the buyer or of his agent, but possession of the bill of lading is retained by the seller or his agent, the seller thereby reserves a right of possession of the goods, as against the buyer." In other words, such conduct on the part of the seller indicates his intention to pass title to the buyer,2 but to retain the right of possession as against the buyer.3 Undoubtedly, this statutory provision modifies the rule laid down in some of the earlier cases, that such a bill of lading confers neither a right of property nor of possession until delivered to the consignee by the seller or by some authorized agent.4

115. Bill of Lading as Security for Draft for Price. — Under the English Sale of Goods Act,5 and in accordance with many

together with the bill of lading indorsed in blank, to a Cheyboygan bank for collection. This bank forwarded the draft and bill of lading to defendant bank, at Bay City, for collection. M. & S. accepted the draft upon its presentment by the defendant bank, whereupon the bank surrendered the bill of lading to them, and they obtained and disposed of the wheat. They were insolvent, and did not pay the draft. Plaintiff sued defendant bank for the amount of the draft, "on the ground that the bank had been negligent in delivering the bill of lading to M. & S. upon the acceptance of the draft and without the draft being first paid," and recovered. The court said: "The property being consigned to the shipper himself, showing that something further was to be done by him to pass title, the presumption was that it was a cash transaction; and we think this presumption was not negatived by the fact that the draft was entitled to three days' grace and considered in law a time draft. We are satisfied that the transaction did not import a sale of the goods upon credit." 1 Mass. L. 1908, ch. 237, § 20 (3).

2 Robinson & Ledyard v. Pogue & Son, 86 Ala. 257; 5 So. 685 (1888); Lumber Co. v. Hardware Co., 53 Ark. 196; 13 S. W. 731 (1890); Stanton v. Eager, 16 Pick. (33 Mass.) 467 (1835); Bailey v. Hudson River Ry., 49 N. Y. 70 (1872).

Gates v. Chic. B. & Q. Ry., 42 Neb. 379, 388; 60 N. W. 583 (1894); Furman v. Union Pac. Ry., 106 N. Y. 579, 585; 13 N. E. 587 (1887). "It is the duty of a carrier to ascertain whether a bill of lading was delivered to the shipper, and if so, he should retain the property until demanded by one claiming under that title."

cited.

Hauterman v. Bock, 1 Daly (N. Y.), 366, 369 (1859), and authorities

56 & 57 Vict. ch. 71, § 19 (3).

judicial decisions in England and in this country, the right to dispose of the goods, as distinguished from the mere right of possession, is deemed to be reserved, when the seller draws on the buyer for the price and transmits the draft to the buyer with the bill of lading to secure acceptance or payment of the draft,' even though by the bill of lading the goods are deliverable to the buyer or his order.2 In cases of this kind, the shipper ordinarily takes the bill of lading to his own order and conditionally indorses it to the buyer; or, if it is taken in the buyer's name, the seller delivers it as security for a draft for the price discounted by a bank.

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If the bill of lading 3 or railroad receipt 4 is taken in the name of the purchaser, and forwarded to him, the fact that the seller draws upon him for the price will not warrant the inference that the right of disposal is reserved. If title has passed by an unconditional shipment of the goods it cannot be regained by the seller's sole act.5

When, however, the bill of lading goes forward to the buyer with a bill of exchange for the price, the latter is advised that the seller is making a conditional shipment, and that the buyer has no right to the goods unless he complies with the condition, by paying, or by accepting the draft as the case may be.

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115 (a). Buyer's Power to pass Title. In the class of cases referred to at the close of the preceding paragraph, the buyer may get possession of the goods and dispose of them for value to an innocent third person. What rights does such person acquire to the goods? If the bill of lading makes the goods de

1 Shepherd v. Harrison, L. R. 5 H. L. 116 (1871).

2 Emery's Sons v. Irving Nat. Bk., 25 Ohio St. 360 (1874).

3 Ex parte Banner, 2 Ch. D. 278 (1876).

Phil. Ry. v. Wireman, 88 Pa. St. 264 (1878); Burdick's Cases on Sales, 158; Robinson v. Houston & T. C. Ry., Tex.; 146 S. W. 537 (1912).

5 Wigton v. Bowley, 130 Mass. 252 (1881); Burdick's Cases on Sales, 159; The Constantia, 6 Rob. 321 (1807).

The English statute declares, "and if he wrongfully retains the bill of lading the property in the goods does not pass to him," while the language of the American statute is, "he acquires no added right thereby."

7 W. & A. McArthur Co. v. Old Second Nat. Bank, 122 Mich. 223; 81 N. W. 92 (1899).

8 Nat. Bank of Commerce v. The Merchants Bank, 91 U. S. 92 (1875).

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liverable to the seller or his agent; or to the seller's or his agent's order, and is not indorsed in blank, the buyer cannot pass title even to a bona fide purchaser.1 If, on the other hand, the bill of lading, though to the seller's order, is indorsed in blank, to the buyer, or, if the bill of lading makes the goods deliverable to the buyer, the latter, upon receiving possession of it from the seller, is in a position to impose upon innocent third persons. As this power has been conferred upon him by the seller, the latter should be estopped from disputing the title of an innocent third person thus imposed upon by the buyer. Although common-law decisions do not uniformly support this view, mercantile usage accords with it, and the latest legislation in England and this country adopts it.2

116. Buyer's Rights, upon tendering Performance of Conditions. Whenever the seller, upon shipping the goods, reserves the jus disponendi, he is in a position to transfer a perfect title to a third party at any time before the buyer tenders performance of the conditions imposed by the seller. Indeed, we have seen that when the seller takes a bill of lading to his own or his agent's order, he thereby retains the power to dispose of the property as he wills.3 Accordingly, he may refuse to vest title to it in the buyer even though the latter tenders performance of the conditions originally named by the former. Such a refusal may subject the seller to an action for breach of his contract to sell and deliver the goods represented by the bill of lading, but the buyer's tender of performance secures to him no property right in the goods.

When, however, the seller intends that the property shall pass to the buyer upon his performance of a stipulated condition, such as the payment of a draft for the price, and deals with the bill of lading only to secure the performance of such

1 Farmers & Mech. Bk. v. Logan, 74 N. Y. 568 (1878); Burdick's Cases on Sales, 194.

The Factors Act, 1889 (53 & 54 Act, Mass. L. 1908, ch. 237, § 20, § 4.

Supra, ¶ 111.

Vict. ch. 45); The Uniform Sales
See infra, ¶¶ 300–303.

Hopkins v. Cowen, 90 Md. 152; 44 At. 1062 (1899); Burdick's Cases on Sales, 659; First Nat. Bk. of Cincinnati v. Felker, 185 Fed. 678 (1911).

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