SECTION 11.-EFFECT OF RETENTION OF POSSESSION BY SELLER AFTER TRANSFER OF PROP

ERTY TO BUYER

EDWARDS v. HARBEN.

(Court of King's Bench, 1788. 2 Term Rep. 587.)

Assumpsit for goods sold to the defendant's testator. The defendant pleaded that he was not executor, nor had ever administered as such; and, secondly, that he had fully administered, &c. Replication, that he had administered divers goods &c. of the testator; and issue thereon. And to the second plea, that the defendant, at the time of exhibiting the plaintiff's bill, had, and still has, goods and chattels of 'the deceased in his hands sufficient to satisfy the plaintiff's demands; and issue thereon. At the trial at the last Assizes at East Grinstead, Sussex, a verdict was found for the plaintiff with £22. 18s. 6d. damages and 40s. costs, subject to the opinion of this court on the following case:

William Tempest Mercer in his life-time, and before the time of the execution of the bill of sale herein-after mentioned, was indebted to the plaintiff in the sum of £22. 18s. 6d. for goods sold and delivered, which sum still remains due to the plaintiff. William Tempest Mercer, at the time of the execution of the said bill of sale, was likewise indebted to the defendant in the sum of £191. for money lent. On the 27th of March, 1786, Tempest Mercer offered to the defendant a bill of sale of his goods, household furniture, and stock in trade, in his house at Lewes, by way of security for the said debt. The defendant refused to accept of the same, unless he should be at liberty to enter upon the effects and sell them immediately after the expira

sections 25, 40, 41, 47, and 49 of the Uniform Warehouse Receipts Act, which had been adopted in Illinois.

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Compare People's Nat. Bank v. Mulholland, 228 Mass. 152, 117 N. E. 46 (1917), in which the banker was protected against the representative of the insolvent importer's estate. Rugg, C. J.: The plaintiff purchased the hides in its own name and interest for the ultimate use of the firm, directly from the foreign seller, and paid for them. It therefore had the legal title to the hides and rightly dealt with them as owner in its relations with the firm, and was not a mortgagee or pledgee. See comment on this dictum by Williston, 34 Harv. Law Rev. 759.

On the law of trust receipts, see Frederick, The Trust Receipt as Security, 22 Columbia Law Rev. 395; Taylor, Trust Receipts, 6 Cornell Law Quarterly, 168.

For a comparison of conditional sales, chattel mortgages, and other methods of securing the seller of goods, see Magill, The Legal Advantages and Disadvantages of the Various Methods of Selling Goods on Credit, 8 Cornell Law Quarterly, 210; Isaacs, The Economic Advantages and Disadvantages of the Various Methods of Selling Goods on Credit, 8 Cornell Law Quarterly, 199; note, 32 Yale Law J. 602.

tion of fourteen days from the execution thereof, in case the money should not be sooner paid; to which Tempest Mercer agreed, and accordingly on the same day executed a bill of sale in the common form, by which Mercer bargained and sold to the defendant for ever his household furniture, medicines, stock in trade [particularly specifying them], and all and every other the goods, chattels, and effects whatsoever, in and about his dwelling-house and premises at Lewes. Immediately upon the execution of the bill of sale possession was delivered to the defendant in the manner described therein, viz. by the delivery of one cork screw in the name of the whole, but in no other manner whatsoever. All the effects described in the bill of sale remained in the possession of William Tempest Mercer until the time of his death, which happened on the 7th of April, 1786. On the 8th of April, 1786, being before the expiration of fourteen days from the execution of the bill of sale, the defendant entered and took possession of the effects contained in the bill of sale, being then in the house of the deceased, and afterwards sold the same for £236. 7s. 5d. William Tempest Mercer died intestate, and no letters of administration were taken out to the deceased by the defendant, or by any other person, before the commencement of this action. The question for the opinion of the court is, whether the defendant is entitled to retain the produce of the said effects, or at least the value of £191., the consideration of the bill of sale: or whether the bill of sale is void as against the creditors of William Tempest Mercer; and the plaintiff in this action is entitled to recover his debt of £22. 18s. 6d. against the defendant, as executor de son tort.

BULLER, J. This is an action brought by the plaintiff, who is a creditor of Mercer, against the defendant as executor. It does not appear by the case that any other goods than those mentioned in the bill of sale came to the defendant's hands. The bill of sale is dated on the 27th March, 1786, and is a general bill of sale of all the defendant's household furniture and stock in trade. This bill of sale is to take effect immediately on the face of it: but there was an agreement between Mercer and the defendant, that the goods should not be sold till the expiration of fourteen days from the date of its execution; and no possession was actually taken till after the death of Mercer, which happened within the fourteen days: but there was a formal delivery of a cork screw in the name of the whole. On this case two questions arise: First, whether this bill of sale be void or not; and Secondly, if void, whether the defendant by having taken. these goods under the bill of sale, made himself liable as an executor de son tort.

The first question came before the court in the last term in the case of Bamford v. Baron, 2 Term. Rep. 594, note, on a motion for a new trial from the Northern circuit: and after hearing that case argued, we thought it right to take the opinion of all the judges upon it. Ac

cordingly we consulted with all the judges, who are unanimously of opinion that unless possession accompanies and follows the deed, it is fraudulent and void; I lay stress upon the words "accompanies and follows," because I shall mention some cases where, though possession was not delivered at the time, the conveyance was not held to be fraudulent. There are many cases on this subject; from which it appears to me that the principle which I have stated never admitted of any serious doubt. So long ago as in the case in Bulstrode, the court held that an absolute conveyance or gift of a lease for years, unattended with possession, was fraudulent; but if the deed or conveyance be conditional, there the vendor's continuing in possession does not avoid it, because by the terms of the conveyance the vendee is not to have the possession till he has performed the condition. Now here the bill of sale was on the face of it absolute, and to take place immediately, and the possession was not delivered; and that case makes the distinction between deeds or bills of sale which are to take place immediately, and those which are to take place at some future time. For in the latter case the possession continuing in the vendor till that future time, or till that condition is performed, is consistent with the deed; and such possession comes within the rule, as accompanying and following the deed.

That case has been universally followed by all the cases since. One of the strongest is quoted in Bucknal and Others v. Roiston, Pr. in Chan. 287; there one Brewer, having shipped a cargo of goods, borrowed of the plaintiff £600. on bottomry, and at the same time made a bill of sale of the goods, and of the produce and advantage thereof, to the plaintiff; there Sir E. Northey cited a case "where a man took out execution against another; by agreement between them the owner was to keep the possession of them upon certain terms, and afterwards another obtained judgment against the same man, and took the goods in execution: and it was held that he might, and that the first execution was fraudulent and void against any subsequent creditor, because there was no change of the possession, and so no alteration made of the property." And he said it had been ruled forty times in his experience at Guildhall, that, if a man sell goods, and still continue in possession as visible owner of them, such sale is fraudulent and void as to creditors, and that the law has been always so held. The lord chancellor held in the principal case that the trust of those goods appeared upon the very face of the bill of sale. That though they were sold to the plaintiffs, yet they trusted Brewer to negotiate and sell them for their advantage, and Brewer's keeping possession of them was not to give a false credit to him as in other cases which had been cited, but for a particular purpose agreed upon, at the time of the sale. So that the Chancellor in that case proceeded on the distinction which I have taken; he supported the deed, because the want of possession was consistent with it. This has been argued

by the defendant's counsel as being a case in which the want of possession is only evidence of fraud, and that it was not such a circumstance per se as makes the transaction fraudulent in point of law: that is the point which we have considered, and we are all of opinion that if there is nothing but the absolute conveyance, without the possession, that in point of law is fraudulent. On the other hand there are cases, where the vendor has continued in possession, and the bill of sale has not been adjudged fraudulent, if the want of immediate possession be consistent with the deed. Such was the case of Lord Cadogan v. Kennet, Cowp. 432; because there the possession followed the deed. So also the case of Haslington and Another v. Gill and Another, Sheriff of Middlesex, Tr. 24 Geo. III, B. R.; there personal property, consisting (inter alia) of some cows, was settled on the marriage of the plaintiff's wife on certain trusts; and the court held that only those which were purchased after the marriage could be taken to satisfy the debts of the husband.

The second question then is, whether the defendant's having taken possession of these goods after Mercer's death, though under the bill of sale, will make him an executor de son tort. The two cases, which were cited by the defendant's counsel, are decisive of this point. In Bac. Abr. (2 Bac. Abr. 605) it is said "if a man make a deed of gift of his goods in his life-time by covin to oust his creditors of their debts, yet after his death the vendee shall be charged for them." There too the possession was delivered to the vendee. To support this doctrine 13 H. IV, 4, b, Rol. Abr. 549, are both quoted. Then in what manner shall he be charged? He can only be charged as executor; because any intermeddling with the intestate's effects makes him so. The cases in Cro. Fa. and Yelv. cited at the bar prove it, and state the manner in which he shall be charged. There is also another strong case on this point in Dyer, Dy. 166, b. In short every intermeddling after the death of the party makes the person so intermeddling an executor de son tort.

GROSE, J., observed that it was unnecessary to repeat what had been said from the bench; but said that he was perfectly satisfied that the law was as had been stated.

86 "Sales made by debtors in fraud of creditors are usually regarded as being governed by the statute of 13 Eliz. c. 5, and the decisions made under it; but other statutes had been previously passed on the same subject, and in 1776 Lord Mansfield, in Cadogan v. Kennet [Cowp. 432], said that 'the principles and rules of the common law, as now universally known and understood, are so strong against fraud in every shape, that the common law would have attained every end proposed by the statutes of 13 Eliz. c. 5, and 27 Eliz. c. 4. The former of these statutes relates to creditors only; the latter to purchasers. These statutes cannot receive too liberal a construction, or be too much extended in suppression of fraud.'

"The statute of 13 Eliz. c. 5 [made perpetual by 29 Eliz. c. 5], which merely declared the common law [Twyne's Case, 1601, 3 Co. 80a], provided among other things that all alienations of goods and chattels made to the intent

MARTINDALE et al. v. BOOTH.

(Court of King's Bench, 1832. 3 Barn. & Ad. 498.)

Trespass for taking away and converting furniture, goods, and chattels of the plaintiffs. Plea, not guilty. At the trial before Lord Tenterden, C. J., at the Middlesex sittings after Trinity term, 1829, the jury found a verdict for the plaintiffs for £93. 16s., subject to the opinion of this Court on the following case:

Before the 8th of May 1828, one W. G. Priest, who kept the Peacock Tavern in Maiden Lane, Middlesex, was indebted to the plaintiffs, wine and spirit merchants, in £10. for wine and spirits. Priest having applied to them for a further supply of wine upon credit, and for a loan of money, the plaintiffs refused to give him any further credit, or to lend him any money unless he would give them satisfactory security. Priest then proposed to execute a bill of sale to them of the furniture and fixtures in the Peacock Tavern as such security, and the plaintiffs agreed to give him credit thereupon to the extent of £200. After Priest and the plaintiffs had agreed to give and accept such security, but before the bill of sale was actually executed, the plaintiffs, upon the faith of such agreement, advanced to Priest £30. in money and to the amount of £60. in wine and spirits, and in two days afterwards, viz. the 8th of May 1828, in pursuance of the agreement, Priest executed and delivered to the plaintiffs a bill of sale, reciting that he, Priest, was indebted to the plaintiffs in the sum of £100. for money advanced and goods sold and delivered, and stating that, in consideration thereof, he granted, bargained, sold, and assigned unto the plaintiffs all the household goods, furniture, &c., in and about the premises called the Peacock Tavern, to hold to the proper use and behoof of the plaintiffs for ever, subject to the condition thereinafter contained: proviso, that if Priest should pay the said sum of £100. with lawful interest thereon by instalments, that is to say £25. on the 7th of June then next, £25. on the 7th of May next, and £50. the residue thereof, on the 7th of November, 1829, the deed should be void; but in default of payment of all or any of the said sums at the times appointed, then it should be lawful, although no advantage should have been taken of any previous default, for the plaintiffs forwith to enter upon the premises, and take possession of the goods, furniture, &c., and absolutely sell and dispose of the same. There was a power reserved to the plaintiffs, during the continuance of the deed, to enter upon the premises and take an inventory; and also at any time after default as aforesaid.

'to delay, hinder or defraud creditors' should, only as against creditors, their representatives and assigns, so delayed, etc., be 'clearly and utterly void,' saving always assurances upon good consideration and bona fide of any in-. terest in goods and chattels to any person not having any notice of the fraud." Benjamin, Sales (5th Eng. Ed.) p. 495.