tice Peyton, "though first introduced and founded in equity, has long been considered and acted upon as a legal remedy. The courts of law, admitting the justice of the right, have recognized it in constant practice and extended a liberal aid in ciple of equity adopted by the common law to answer the purposes of justice. The most eminent equity lawyers that I have had the opportunity of conversing with in times that are gone by were unanimous in repudiating it as the offspring of a court of equity. The first case that occurred upon this subject affords some authority for the opinion of Mr. Justice Buller and Lord Kenyon. It is the case of Wiseman v. Vanderput, 2 Vern. 203, in 1690. That was a bill filed by the assignees of a bankrupt against the vendor. The lord chancellor directed an action of trover to be brought by the plaintiffs, upon which they recovered a verdict. It is clear, therefore, that the rule had not at that time been adopted at law. The lord chancellor, however, adopted it in equity, and, notwithstanding the verdict at law for the plaintiffs, made a decree against them. The next case is that of Snee v. Prescott, 1 Atk. 245. Lord Hardwicke again applied the rule to a certain extent in equity. But it is remarkable that he received evidence of what was the custom of merchants on this point; and he expressly founds his decree upon the evidence of the custom of merchants, as well as upon the justice of the case. This decision occurred about the year of 1742 or 1743. The next case is that of Ex parte Wilkinson, in 1755. referred to in D'Aquila v. Lambert, Ambler, 399, which took place in 1761. There the lord chancellor again grounded his decree on the usage of merchants, and stated that the several previous decisions which had taken place to the same effect had given great satisfaction to the merchants. Numerous cases have followed at law, showing that the right of stoppage in transitu, under certain circumstances, is now part of common law. 66 "Nevertheless, owing perhaps to the doubtful state of its parentage, many unsatisfactory and inconsistent attempts have been made to reduce it to some analogy with the principles which govern the law of contract, as it prevails in this country between the vendor and vendee. It is to be observed, however, that the right of stoppage in transitu is not peculiar to the law of England. It existed, I believe, in the commercial States of Europe. The cases I have already referred to show that it was practiced in the Italian States. That it existed in Holland was proved in a case tried by Lord Loughborough, and mentioned by him in his judg ment in the case of Lickbarrow v. Mason, 1 H. Bl. 357. That it is the law of Russia was also proved in the cases of Inglis v. Usherwood, 1 East, 515, and of Bohtlingk v. Inglis, 3 East, 381. It appears also, on reference to the Chapitre de la Faillité, in the Code Napoleon, that the law of France on this subject is in all points similar to our own. It is known that this celebrated code is chiefly a digest of the law of France as it existed before the Revolution. Indeed the right of stopping in transitu had, before the composition or digest of enabling an unpaid consignor or vendor to regain possession of property on its way to a vendee, who, from his circumstances, may not be in a condition to fulfill the terms of his contract. What was formerly a mere equitable claim is now, therefore, a legal possessory right. This right is nothing more than an extension of the lien which the vendor has on all sales for the price until after the delivery, to the very point of the goods coming to the actual custody of the vendee or his agent."1 The right, however, still retains so much of its equitable nature that it may be enforced by bill in equity in a proper case.2 that code, acquired the name in the French law of 'Revendication.' It may therefore be presumed to be a part of the law of merchants which prevails generally on the continent. The proof of which, from time to time, combined with its manifest justice and utility, has at length introduced it into the common law of England, of which the law merchant properly understood has always been reckoned to form a part." 1 In Morris v. Shryock, 50 Miss. 590. So in Newhall v. Vargas, 13 Me. 93, 29 Am. Dec. 489, Weston, C. J., said: "The right of stoppage in transitu upon the insolvency of the purchaser has been well settled in the commercial world. It had its origin in the civil law; was first recognized in England in equity, and was subsequently adopted by the courts of common law. It is analogous to the common-law right of lien, being an equitable lien which enables the vendor, after he has parted with his possession, to resume it at any time before the vendee has acquired it, and to retain the goods until the price has been paid or tendered." See also Johnson v. Eveleth (1899), 93 Me. 306, 45 Atl. R. 35. 2 Schotsmans v. Railway Co. (1867), 2 Ch. App. Cas. 332. In this case Cairns, L. J., said: "The case of the plaintiff Schotsman, as I understand it, may thus be stated. He says he had sold goods, thereby transferring the property at law to Cunliffe; that by a stoppage in transitu, alleged to be effectual, he has revested in himself the legal title to these goods, but that he holds this title merely as se curity for the price of the goods, and liable to be called on to surrender it on payment of the price; that he is therefore an incumbrancer only, or a person having what Lord Kenyon, in Hodgson v. Loy, 7 T. R. 440, described as a kind of equitable lien for the price of the goods, which lien or incumbrance he is entitled to realize, the account of what is due being at the same time taken; that the goods are in the meantime in the possession of one of the defendants, who is a stockholder or agent holding them merely for the person who is owner, subject to that lien, and that the goods require the protection of an injunction. I should be prepared to hold this to be a case entirely within the province of this court, and depending on the ordinary principles which regulate in equity the relations of mortgagor and mortgagee, whether of real or personal property, although, for obvious reasons, cases § 1527. Exists only when title has passed.-The right of stoppage in transitu, strictly so called, presupposes, and can be exercised only in the event, that the title to the goods has passed to the buyer. It is of course true, as will be more fully noticed further on,' that the vendor who has forwarded goods under executory contract may stop or recall them in case of the buyer's insolvency or for other reason, but this is not strictly to be considered as an exercise of the right in question.2 § 1528. Right favored in the law. The right of stoppage in transitu is one of great justice, resting, it is said, upon the substantial reason that one man's property shall not be taken to satisfy another man's debts. It is therefore often declared to be a right highly favored in law. As stated in one case,1 it is "regarded with so much favor that the rule governing it will not be subjected to restrictions less liberal than those of immemorial prescription." 2. Who May Stop the Goods. § 1529. Right may be exercised only by vendor or one in his position. The right of stoppage in transitu, being an extension of the seller's lien, and like that, as said by Bayley, J., a right "growing out of his original ownership," it is well set of this kind are more generally and more conveniently brought into a court of law." Lord Chelmsford, L. C., also said: "I entertain no doubt of the plaintiff's claim being the proper subject of a bill in equity." 1 See post, § 1614, subd. III. 2 Thus in Fraser v. Witt, L. R. 7 Eq. Cas. 64, Lord Romilly, M. R., said: "In these cases the goods are always the property of the purchaser; if they were not, the question would not arise, because, of course, the vendor or any other person may always take possession of his own property; but the doctrine of stoppage in transitu is that a vendor may stop the goods which he has sold to, and which have become the property of, the purchaser, at any time before they have got into his possession, if he has become insolv ent." To same effect, per Willis, J., in Bolton v. Railway Co., L. R. 1 Com. Pl. 439. 3 In D'Aquila v. Lambert, 1 Amb. 399, Willis. Cas. 358. 4 Calahan v. Babcock, 21 Ohio St. 281, 8 Am. R. 63. See also Newhall v. Vargas, 13 Me. 93, 29 Am. Dec. 489; Inslee v. Lane, 57 N. H. 454; Cabeen v. Campbell, 30 Pa. St. 254; Jones on Liens, § 857. tled that it can be exercised only by the seller of the goods or by one so far standing in the attitude of a seller as to be entitled to substantially the same protection. It is a right existing in virtue of original ownership or its equivalent, and does not avail one who at most had no ownership but a mere lien.1 § 1530. By factor who has bought goods for principal.— On the ground that he stands in the attitude of a seller, a factor who has purchased goods for his principal may exercise the right. Thus, where a factor had purchased for his principal, since deceased, a cargo of molasses, the court in a leading case 2 said: ແ The circumstance of his having purchased the molasses specially for this purpose can make no difference. It was paid for out of his own funds; and he stood in relation to the intestate in the character of a vendor, as much as if it had been supplied from his own warehouse. And it has been directly adjudged that a factor or agent who purchases goods for his principal, and makes himself liable to the original vendor, is so far considered in the light of a vendor as to be entitled to stop the goods. Every reason upon which this right is founded applies with equal force to a purchaser so circumstanced." § 1531. By person who pays price for vendee. So it is held that the right of stoppage may be exercised by a person who pays the price of the goods for the vendee and takes from the latter an assignment of the bill of lading as security for his advances. "To that extent," said the court, "he is a quasi vendor, entitled to use all lawful means in preventing his property or interests being sacrificed toward the payment of another person's debts." 1 One who has a mere lien on goods having surrendered them to a carrier and parted with his possession cannot regain his possession or revive his lien by stoppage in transitu. Sweet v. Pym, 1 East, 4. 2 Mechem on Agency, § 687; Newhall v. Vargas (1836), 13 Me. 93, 29 Am. Dec. 489. 3 Citing Feise v. Wray, 3 East, 93. To same effect: Seymour v. Newton, 105 Mass. 272. See also D'Aquila v. Lambert, 1 Amb. 399; Tucker v. Humphrey, 4 Bing. 516; Hawkes v. Dunn, 1 Cromp. & Jer. 519; Oakford v. Drake, 2 Fost. & Fin. 493. 4 Gossler v. Schepeler (1875), 5 Daly (N. Y. Com. Pl.), 476, cited in note to § 1532. But not by vendor of seller. But where goods are ordered of B by C, and B, instead of supplying them himself, orders them shipped on his account by A, who ships them to C but charges them to B, it is held that A, upon B's insolvency, cannot stop and hold the goods as against B. The right of stoppage, said the court, can only be exercised "upon the transit of the goods from a vendor to the purchaser from him." C bought the goods of B and not from A. A was C's vendor, and to A only was C liable. § 1533. Nor by unpaid agent of seller. So where goods are sold and paid for, but part are in the hands of seller's agents, who ship them in the seller's name to the buyer, and draw on the seller for a balance due by him to them, the agents may not, on the dishonor of their draft, stop the goods as against the purchaser. The agents may have had a lien as against their principal, but they surrendered that by delivering the goods to the carrier consigned to the buyer, and the agents stand in no such relation of vendor to him as will confer upon them the right of stoppage for non-payment by their principal.2 § 1534. Principal who has consigned goods to factor may stop.-A principal, however, who has consigned goods to a factor may stop them in transit, on the insolvency of the latter, even though the factor may have made advances to the Rucker v. Donovan, 19 Am. R. 87, where this question is fully discussed. 1 Memphis, etc. R. Co. v. Freed (1882), 38 Ark. 614. Feise v. Wray, supra, was relied upon. So where goods are sold to one person, who, before delivery to him, resells them to another, and this is known to the original vendor, who consigns them to the second purchaser, the original vendor will have no right of stoppage in transitu. Eaton v. Cook, 32 Vt. 58. 2 Mechem on Agency, § 687; Gwyn v. Richmond & Danville R. R. Co. (1881), 85 N. C. 429, 39 Am. R. 708. So an agent who has purchased goods for his principal, and consigned them to him, has no right of stoppage or of changing the destination or the consignee, as against his principal. Lake Shore, etc. Ry. Co. v. National Live Stock Bank (1899), 178 IH. 506, 53 N. E. R. 326. |