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§ 5. From Gift. A sale differs from a gift in that there is a valuable consideration in sale, while to constitute a valid gift no consideration is necessary, but only delivery and acceptance of the thing given.8

§ 6. From Barter. A sale differs from a barter in that in a sale the property is transferred for a money consideration, whereas in barter one thing is exchanged for another thing. This was the primitive form of transfer of title to property, and is still the only one to be found in Vogue among undeveloped peoples, and survives with us in the custom of small boys in swapping knives and other personal belongings."

§ 7. From Bailment. A sale is distinguished from a bailment because it is a transfer of the absolute or general ownership of the goods, while in bailment only a special property or possession of the goods is transferred.

A bailment is either for the purpose of storing or using goods or performing some service in connection with them, and when the bailment is at an end, it is the duty of the bailee to return the identical article to the bailor.

The distinction between a bailment and a sale oftentimes not obvious is illustrated in a Pennsylvania case in which there was an agreement by defendant to take and buy, or at his pleasure, to sell to a third person two mares, within a certain time, at a minimum price or to return them to the plaintiff in good condition without any charge for keeping them. Here the court said:

"We are inclined to regard the contract as a bailment for safe-keeping; for sale if possible, at a price larger than $250; and for return in good condition if not sold. There was no provision for the change of title from the plaintiff to the defendant except in the case that the defendant should pay $275 for the mares. In that event, that is, actual payment of the money, they should be his exclusive property. There is no allegation and no proof that the defendant ever paid the $275, or declared that he would, and

8 Seymour v. Seymour, 28 N. Y. App. Div. 495; Noble v. Smith, 2 Johns. (N. Y.) 52.

Meyer v. Rousseau, 47 Ark. 460.

hence he could not possibly acquire the title in himself under this contract. The other alternative of a money pay. ment was not upon a sale to the defendant, but upon a sale by the defendant to a stranger; and in that event the amount to be paid depended upon the amount for which the defendant sold them. Such sale, of course, would be on account of the plaintiff. This part of the contract is undoubtedly a bailment for sale. The stipulation for redelivery in case of no sale makes that aspect of the contract a bailment." 10

The necessity of this distinction arises frequently in connection with deposits of grain in elevators, as may be seen from the case of Foster v. Pettibone.11 The facts and the law applied to them, as stated in the opinion of the court, were as follows:

"In October, 1844, one Brown agreed to deliver to Foster (the plaintiff) at Rochester, 30,000 bushels of wheat to be ground. These words, unless qualified and controlled by some subsequent grant of the agreement, show a bailment for manufacture and not a sale. They show what was to be done with the wheat. If the contract operated as a sale, Foster might lawfully sell it again and immediately. But it was to be ground and not sold; and the words used by the parties control the power of Foster over the wheat and prevent him from selling it as his own property.

"Why was the time fixed within which it was to be manufactured. If the transaction was a sale the time was immaterial, because Foster might have delivered other flour without having ground the wheat within that time, but it was a bailment the time was material, and the parties deemed it material or they would not have fixed it by a stipulation in the contract."

§ 8. From Pledge. In like manner sale is distinguished from pledge, in which there is a transfer of a special property in a thing upon condition, the thing to be returned upon fulfillment of the condition. A pledge is given to secure the payment of a debt, or the performance of an obligation. The ownership of the thing is not changed but may be 10 Middleton v. Stone, 111 Pa. St. 589, 4 Atl. Rep. 523 at 526; Fleet v. Hertz, 201 Ill. 594 at 600.

117 N. Y. 433 at 435.

changed, if the condition of the pledge be not fulfilled. A pawnbroker or banker secures a special property in goods left with him as security for a loan of money and can acquire the ownership or the right to sell the thing pledged only in pursuance of an agreement or of the law governing the relation.12

§ 9. From Lease. Again, a sale is distinguished from a lease in that in the latter there is only a temporary transfer of special property and of possession. A lease of personal property is, in the beginning, no more nor less than a bailment; but it frequently becomes a question whether a lease has not run into a conditional sale, and, ultimately, into an absolute sale, according to its terms and its present day use in connection with the sale of goods upon the installment plan. In some leases provision is made for periodical payments for rent of the article, the article to become the property of the lessee upon the last payment. Such a transfer, though in the form of a lease, is construed as a conditional sale.

In a sewing machine case,13 Mr. Justice Worthington, delivering the opinion of the court, said:

"Contracts of the kind in evidence are intended to secure the vendor for the purchase money. They should not be construed so as to give the vendor both the property and money received for it, unless so expressly stipulated, or unless the facts in the case disclose no wrongful act in the vendor, and no grounds for relief in the vendee.

"It would be a monstrous doctrine to hold, in these days when sales on the installment plan are so frequent, that a vendor can collect all but a trifling balance, and when the vendee proffers payment of the balance, refuse it, and retake the property and keep it and the money also."'14

Courts are disposed to construe leases, especially of household goods, as contracts of sale, if possible. Where there is provision for periodical payments and that title

12 Beidler v. Crane, 135 Ill. 92.

13 Singer Mfg. Co. v. Ellington, 103 Ill. App. 517 at 525.

14 See also Domestic Sewing Machine Co. v. Anderson, 23 Me. 57; Singer Sewing Machine Co. v. Holcomb, 40 Ia. 33.

shall not pass until the last payment, the transaction is construed as a conditional sale, final payment being a condition precedent to the vesting of title.

In Loomis v. Bragg,15 defendant hired a piano valued at $140 for twenty-seven months, paying $5 down and $5 monthly thereafter, with a provision that the piano should become his when all the installments were paid. The defendant failed to keep up payments. The agreement was held to be a conditional sale and not a lease; and the plaintiff, therefore, was entitled only to retake the piano, but not to collect the unpaid balance as he would have been entitled to do if the agreement were legally a lease.

The mere use of the terms "lease'16 or "hiring" in a contract will not be conclusive in the interpretation of a contract that is substantially one of sale, or of conditional sale. An instrument purporting on its face to be a lease of personal property, for the use of which the lessee is to pay certain sums with interest, may yet be construed as a conditional sale, and title will pass when the conditions are performed.18

§ 10. From Mortgage. The chief difference between a sale and a mortgage is that while the latter may be in form an absolute transfer of title, there is always a defeasance clause providing for revesting the title in the mortgagor on payment of the antecedent debt, which is invariably the consideration of the mortgage.19 Moreover, even after title may have vested in the mortgagor under the terms of the mortgage or as a result of foreclosure proceedings, the mortgagor has a fixed period of time within which to redeem the property under what is called his equity of redemption. And a bill of sale may be shown to have been intended for a mortgage.2

15 50 Conn. 238.

16 Singer Manfg. Co. v. Smith, 40 S. C. 529, 19 S. E. 132; Nat. Car & Loco. Builder v. Cyclone Steam Snow Plow Co., 49 Minn. 125, 51 N. W. 657.

17 Cottrell v. Mer. & Mech. Bank, 89 Ga. 508, 15 S. E. 944.

18 Gorham v. Holden, 79 Me. 317, 9 Atl. 894.

19 Brown v. Bement, 8 Johns. (N. Y.) 76; Patchin v. Pierce, 12 Wend. (N. Y.) 61.

20 N. E. Mar. Ins. Co. v. Chandler, 16 Mass. 275.

SALES CLASSIFIED

§ 11. Executed and Executory Sales. When a contract of sale is spoken of, a contract to sell is not included. In a contract of sale the vendor passes title at once in the present time: in a contract to sell he agrees to pass the title in the future. Hence, sales may be classified as "executed sales" and "executory sales," or "executed contracts of sale" and "executory contracts of sales". There is a large difference between the two. As stated by Professor Williston in his work on Sales:

"The most fundamental distinction in the law of sales is between a contract to sell in the future and a present sale. The distinction is often expressed by the terms executory and executed sales. Whether a bargain between parties is a contract to sell, or an actual sale, depends upon whether the property in the goods is transferred.21 If it has been transferred, there is an executed sale, even though the price be not paid."

This is equally true, although there be no delivery of possession of the goods at the time of the transaction. So long, however, as the property in the thing is not transferred, the contract of sale is executory and is only a contract to sell. It has reference to a future vesting of title. If A says to B, "I will sell you this horse for $100," and B says, "I accept," the property in the horse is at once transferred, and the sale is said to be executed. If the horse should die before delivery, the loss is on the buyer. But if A says to B, "I will sell you this buggy for $100 on the first of next January or I will paint it blue and deliver it to you within ten days for $100,” and B says "I accept," no immediate property or title passes. It is an executory sale and property does not pass until the time named, or until the carriage has been painted and delivered. If it should be destroyed by fire in the meantime, the loss would be on A, the vendor.

Sale as Part of Larger Contract. Both the "executed contract of sale" and the "executory contract of sale" 21 Williston on Sales, § 2.

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