effect of the transfer of order bills of lading,82 and more recently of warehouse receipts giving the transferee not only title, but in effect possession of the property,83 is another illustration of a change in the law owing to mercantile custom, though express stipulation that something which the law does not regard as possession shall be so regarded, would ordinarily be ineffective. A converse case arises in England, where it is held that because of the usage of selling goods to hotel-keepers on conditional sale with retention of title, the goods are not in the order and disposition of the hotel-keeper within the bankrupt law.84 So the custom of market overt in England is contradictory to the general rule of the common law applicable to sale of goods. In truth usage is one of the agencies by which the law has been gradually formed and still is not only added to, but otherwise amended. The change, however, when other than a merely additional rule as distinguished from one contradicting a previously settled principle is gradual, especially in recent times, and not always frankly admitted when first made. That usage may harden by repeated decisions into such new rules of law as do not contradict any previously existing rule is, however, clearly stated.85

§ 656. A usage which the parties have indicated an intention not to adopt is ineffective.

Though a usage may show that the effect of a written contract is different from an apparently clear meaning which the writing would otherwise bear, it is obvious that if the parties

modern custom may be made negotiable. Goodwin v. Robarts, L. R. 10 Ex. 337, 356; Rumball v. Metropolitan Bank, 2 Q. B. D. 194; Bechuanaland Co. v. London Trading Bank Co., [1898] 2 Q. B. 658; Edelstein v. Schuler, [1902] 2 K. B. 144.

82 Lickbarrow v. Mason, 2 T. R. 63, 1 H. Bl. 357, 2 id. 211, 6 East, 20 n. 5 T. R. 683. See Buller's general remarks, 2 Y. R. 63, 73.

83 See Merchants' Banking Co. v. Phoenix, etc., Steel Co., 5 Ch. D. 205;

Millhiser Mfg. Co. v. Gallego Mills
Co., 101 Va. 579, 44 S. E. 760.

84 In re Blanshard, 8 Ch. D. 601; Ex parte Brooks, 23 Ch. D. 261.

85 "There is no doubt that a mercantile custom may be so frequently proved in courts of common law, that the courts will take judicial notice of it, and it becomes part of the law merchant," per Mellish, L. J., in Ex parte Powell, 1 Ch. D. 501, 506. See also Universo Insurance Co. v. Merchants' Marine Ins. Co., [1897] 1 Q. B. 205, 2 id. 93.

choose to exclude the application of usage by contracting upon different terms from those customary in the locality, they may do so; and it cannot be necessary in order to produce this result that they should state in terms that the usage is not adopted as part of the contract, if they otherwise make their intention manifest. Therefore, if the terms of their agreement read in the light of surrounding circumstances warrant the conclusion that they did not contract with reference to the usage, it will not be applicable. The question is whether "upon the construction of the whole contract, enough appears, either from express words or by necessary implication, to show that the parties did not intend that meaning, [i. e., that indicated by the usage] to prevail. The consequence is that every individual case must be decided on its own grounds, and upon the terms of the particular contract in dispute, regarded as a whole." 86 On the one hand, the fact that a collateral stipulation contradicts the express words of the writing, if those words are taken literally, will not necessarily, though it will generally, prove that the parties did not contract with reference to the usage. Indeed, even though a usage contradicts merely Myers v. Sarl, 3 E. & E. 306, 320, per Blackburn, J. See also Sutro v. Heilbut, [1917] 2 K. B. 348.

* In the following cases usages which contradicted the express terms of a contract were held ineffective. Suse 1. Pompe, 8 C. B. (N. S.) 538; Hall v. Janson, 4 E. & B. 500; Dickenson v. Jardine, L. R. 3 C. P. 639; Hayton v. Irwin, 5 C. P. D. 130; The Alhambra, 6 Prob. Div. 68; The Nifa, [1892] Prob. 411; Sutro v. Heilbut, [1917] 2 K. B. 348; Leopold Walford, Ltd., v. Les Affreteurs Réunis, [1918] 2 K. B. 498; Moore v. United States, 196 U. S. 157, 25 S. Ct. 202, 49 L. Ed. 428; The Rebecca R. Douglass, 248 Fed. 366; Smith v. National Bank, 191 Fed. 226; Jenkins S. S. Co. v. Preston, 186 Fed. 609, 108 C. C. A. 473; Municipal Investment Co. v. Industrial Trust Co., 89 Fed. 254; Shelby Iron Co. v. Dupree, 147 Ala. 602, 41 So. 182; People's Bank & Trust Co. v. Walthall,

(Ala. 1918), 75 So. 570; Withers v. Moore, 140 Cal. 591, 74 Pac. 159; Wiggin v. Federal Stock & Grain Co., 77 Conn. 507, 59 Atl. 607; Vardeman v. Penn Mutual Life Ins. Co., 125 Ga. 117, 54 S. E. 66; Braun v. Hess, 187 Ill. 283, 58 N. E. 371, 79 Am. St. Rep. 221; Van Camp v. Hartman, 126 Ind. 177, 25 N. E. 901; Independent School Dist. v. Swearngin, 119 Ia. 702, 94 N. W. 206; Eckhardt v. Taylor, 90 Kans. 698, 135 Pac. 579; Columbia Malting Co. v. Glenmore Distilleries Co., 150 Ky. 229, 150 S. W. 53; Gooding v. Northwestern Mut. L. I. Co., 110 Me. 69, 85 Atl. 391; Denton v. Gill, 102 Md. 386, 62 Atl. 627; Auto, etc., Co. v. Merchants' Nat. Bank, 116 Md. 179, 81 Atl. 294; Parks v. Griffith & Boyd Co., 123 Md. 232, 91 Atl. 581; Agri Mfg. Co. v. Atlantic Fertilizer Co., 129 Md. 42, 98 Atl. 365; Boruszweski v. Middlesex Mut. Assur. Co., 186 Mass. 589, 72 N. E. 250; Johnson

an implication from the writing, that fact may show that the parties did not contract with reference to the usage. As a general rule in such cases, however, the usage will substitute a different implication for the implication which otherwise would be drawn; but no rule can be stated which will avoid the necessity of considering the particular contract in question in the light of surrounding circumstances including the usage and determining whether an intention has been manifested to exclude the application of the usage. It will be applicable provided the parties are chargeable with knowledge of it, unless such an intention is manifested.88

§ 657. Characteristics of usage essential for its validity.

It is said that a custom in order that it may be considered as entering into a contract and forming part of it, must be "reasonably uniform and well settled, not in opposition to fixed rules of law, and not in contradiction of the terms of the contract." 89 There is some confusion between usage and custom, when the same statement is made in regard to usage, as it often is. How far any such statement is warranted must be considered.

v. Norcross Bros. Co., 209 Mass. 445, 95 N. E. 833; Hayward v. Wemple, 152 N. Y. App. Div. 195, 136 N. Y. S. 625, affd., 206 N. Y. 692, 99 N. E. 1108; Goulds Mfg. Co. v. Munckenbeck, 20 N. Y. App. Div. 612, 47 N. Y. S. 325; Richard v. Haebler, 36 N. Y. App. Div. 94, 55 N. Y. S. 583; Manerud v. Eugene, 62 Oreg. 196, 124 Pac. 662; Syer v. Lester, 116 Va. 541, 82 S. E. 122; Mowatt v. Wilkinson, 110 Wis. 176, 85 N. W. 661; Dunning v. Lederer, 164 Wis. 399, 160 N. W. 159.

88 See cases supra, §§ 653, 654.

89 Hopper v. Sage, 112 N. Y. 530, 535, 20 N. E. 350, 8 Am. St. Rep. 771; P. J. Kennedy & Sons v. Perkins & Squier Co., 154 N. Y. S. 101. To similar effect see-Continental Coal Co. v. Birdsall, 108 Fed. 882, 47 C. C. A. 124; Loval v. Wolf, 179 Ala. 505, 60

So. 298; Wheelright v. Dyal, 99 Ga. 247, 25 S. E. 170; Cleveland, etc., R. Co. v. Jenkins, 174 Ill. 398, 51 N. E. 811, 62 L. R. A. 922, 66 Am. St. Rep. 296; Wallace v. Morgan, 23 Ind. 399; Shaw v. Ingram-Day Lumber Co., 152 Ky. 329, 153 S. W. 431, L. R. A. 1915 D. 145; Rochester, etc., Ins. Co. v. Peaselee-Gaulbert Co., 27 Ky. L. Rep. 1155, 87 S. W. 1115; Hartley v. Richardson, 91 Me. 424, 40 Atl. 336; Shute v. Bills, 191 Mass. 433, 78 N. E. 96, 7 L. R. A. (N. S.) 965, 114 Am. St. Rep. 631; Pennell v. Delta Transp. Co., 94 Mich. 247, 53 N. W. 1049; White v. Tripp, 125 N. C. 523, 34 S. E. 686; Robeson v. Pels, 202 Pa. 399, 51 Atl. 1028; Oriental Lumber Co. v. Blades Lumber Co., 103 Va. 730, 50 S. E. 270; Sterling Organ Co. v. House, 25 W. Va. 64.

§ 658. Reasonableness of usage.

One quality which it is universally stated that usage must. possess in order to be effectual is reasonableness. This rule was originally laid down in regard to custom-that is customary law, which is applicable to a neighborhood irrespective of its being adopted as part of a contract.90 It is obvious that such a requirement is there appropriate. The common law cannot adopt as one of its rules a custom which is not reasonable in its nature. With regard to usage, however, the question is different. Parties may make an unreasonable contract if it is not so unreasonable as to be illegal or in violation of public policy. If they may make an unreasonable contract in express terms, there seems no reason why they should not make one equally unreasonable by implication of fact. It is true that the more unreasonable the terms of the alleged implication are, the clearer proof will the court require that parties assented to the unreasonable terms, and the less ready will the court be to assume knowledge or a duty to know, in the absence of clear evidence of actual knowledge and adoption of the usage. "There can be very few cases, where a custom has been sufficiently proved, in which a court could hold that it was unreasonable, for that it must be convenient is shewn by the fact that it has been established and followed." 91

§ 659. Reasonableness of usage continued.

Though, as just shown, there seems force in the argument that where a usage is adopted as part of a contract by apparent assent thereto, the law should impose no more stringent requirement of reasonableness than it does where express terms of a contract are in question, there seems no doubt that a more rigorous test is in fact imposed. The reason is probably because the assent to a usage which is given by parties to a contract is generally constructive. An outward manifestation of assent to the express terms of a contract almost invariably connotes mental assent. Contracting under circumstances which make a usage applicable less certainly connotes an actual purpose to adopt the usage as a term of the contract. *01 Bl. Comm. 77, referring to Co. 91 Moult v. Halliday, [1898] 1 Q. B. Litt. § 212; 1 Inst. 62. 125, 130.

The test of reasonableness is necessarily somewhat indefinite. Even an express contract must not be opposed to public policy, and a fortiori, a usage must not be. Where a usage is actually known to the contracting parties, and the court can feel confident that they intended to adopt it, it is probable that the requirement of reasonableness means little more than that the usage must not be so opposed to public policy that if the parties had expressly stated it as part of their contract, the law would not have enforced it. Reasonableness, therefore, may in some degree depend upon the actual knowledge of the parties. A usage that an outgoing tenant under a lease shall be paid for straw left on the farm, has been upheld,92 but a usage which makes the incoming tenant liable to the outgoing tenant, while the landlord is under no liability to him, has been denied enforcement because it is unreasonable.93 A usage that a broker employed to buy 50 tons of tallow, might buy on behalf of this and other customers a larger amount, and subsequently appropriate 50 tons to the customer, was also held bad; 94 as were a usage permitting a buyer to reject at his option a portion of a shipment of goods ordered by him; 95 a usage of brokers to charge commissions to both parties; 96 and one requiring a consignor to allow whatever shortage in a shipment was stated to exist by the consignee.97

It is impossible to lay down a general rule covering all cases. The decisions of particular courts as to what customs are unreasonable will necessarily depend upon all the circumstances of the situation including perhaps the views of the court on economic questions.98

92 Muncey v. Dennis, 1 H. & N. 216. 93 Bradburn v. Foley, 3 C. P. D. 129. 94 Robinson v. Mollett, L. R. 7 H. L. 802. Cf. Scott v. Godfrey, [1901] 2 K. B. 726, where a somewhat similar usage of stock brokers was upheld.

95 Kalamazoo Corset Co. v. Simon, 129 Fed. 144, 1005, 64 C. C. A. 166; Syer v. Lester, 116 Va. 541, 82 S. E. 122.

96 Farnsworth v. Hemmer, 1 Allen, 494, 79 Am. Dec. 756.

97 Byrd v. Beall, 150 Ala. 122, 43 So. 749.

98 See Phillips v. Briand, 1 H. & N. 21; Stewart v. West India Co., L. R. 8 Q. B. 88, 362; Barrow v. Dyster, 13 Q. B. D. 635; Macoun v. Erskine, [1901] 2 K. B. 493; Liverpool & G. W. Steam Co. v. Suitter, 17 Fed. 695; Young v. One Hundred and Forty Thousand Hard Brick, 78 Fed. 149; Municipal Inv. Co. v. Industrial Trust Co., 89 Fed. 254; Chilberg v. Lyng, 128 Fed. 899, 63 C. C. A. 451; Anderson v. Whittaker, 97 Ala. 690, 11 So. 919; Bauer v. Samson Lodge, 102 Ind. 262, 1 N. E. 571; Becker v. Hall, 116 Ia.