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if the buyer has not paid the price, he recovers only to the extent of his interest, which will usually be the difference between the contract price and the market value at the time of the conversion.

§ 1787. How when goods of fluctuating value — Stocks, bonds, etc.— The general rule, however, which bases the damages upon the market value of the goods at the time of the conversion, has been modified with respect of stocks, bonds, commercial securities and other property the market value of which is liable to frequent and great fluctuation caused by the depression and inflation of prices in the market.

There has been, in such cases, some tendency to hold that the measure of damages for the conversion of such securities should be the highest market price between the time of the conversion and the trial;? but the weight of authority, following the later cases in New York, permits the recovery only of the highest market value which the goods have reached between the date of the conversion and a reasonable time thereafter within which the plaintiff might have supplied himself with other goods of the same kind.3

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$ 1788. Because more transactions of this kind arise in the State of New York than in all other parts of the country," the supreme court of the United States adopted the New

1 Chinery v. Viall (1860), 5 Hurls. 356, 1 L. R. A. 289, Mechem's Cas on & Norm. 287; Mayne on Damages Damages, 469; Galigher v.Jones (1888), (6th Eng. ed.), p. 416.

129 U. S. 193, 9 Sup. Ct. R. 335; An2 See Romaine v. Van Allen (1863), drews v. Clark (1890), 72 Md. 396, 20 26 N. Y. 309; Markham v. Jaudon Atl. R. 429; Fosdick v. Greene (1875), (1869), 41 N. Y. 235, now overruled by 27 Ohio St. 484, 22 Am. R. 328; Freethe later New York cases cited in the man v. Harwood (1859), 49 Me. 195; next note.

Fisher v. Brown (1870), 104 Mass. 259. 3 Baker v. Drake (1873), 53 N. Y. 6 Am. R. 253; Walker v. Borland (1855), 211, 13 Am. R. 507; Baker v. Drake 21 Mo. 289; Brewster v. Van Liew (1876), 66 N. Y. 518, 23 Am. R. 80; (1886), 119 Ill. 554,8 N.E. R. 842, 59 Am. Gruman v. Smith (1880), 81 N. Y. 25: R. 823; Galena, etc. R. Co. v. Ennor Colt v. Owens (1882), 90 N. Y. 368; (1888), 123 Ill. 505, 14 N. E. R. 673; Wright v. Bank of Metropolis (1888), Hill v. Smith (1859), 32 Vt. 433; In110 N. Y. 237, 18 N. E. R. 79,6 Am. St. R. gram v. Rankin (1879), 47 Wis. 406, 2

York rule, saying: “The hardship which arose from estimating the damages by the highest price up to the time of trial, which might be years after the transaction occurred, was often so great that the court of appeals of New York was constrained to introduce a material modification in the form of the rule, and to hold the true and just measure of damages in these cases to be the highest intermediate value of the stock between the time of its conversion and a reasonable time after the owner has received notice of it to enable him to replace the stock.

It would be a herculean task to review all the various and conflicting opinions that have been delivered on this subject. On the whole it seems to us that the New York rule, as finally settled by the court of appeals, has the most reasons in its favor, and we adopt it as a correct view of the law.” 1

2. Where the Goods have been Delivered.

$ 1789, What questions arise.- Where, however, the seller has not only done that which is necessary to pass the title, but has also delivered the goods into the possession of the buyer, different questions arise. It may happen that, though the seller may have delivered the goods and may have done all that would ordinarily be necessary to transfer the title, no title will in fact be conveyed because the seller had none; or, though the title may have been transferred, the goods may be subject to liens or incumbrances which detract from, if not destroy, their value.

N. W. R. 755, 32 Am. R. 762; Coff-. N. E. R. 916, 43 N. E. R. 649, 25 Am. man v. Williams (1871), 51 Tenn. (4 St. R. 445. Heisk.) 233; Jackson v. Evans (1880), In Texas, see Heilbroner v. Doug. 44 Mich. 510, 7 N. W. R. 79; Chad- lass (1876), 45 Tex. 402. wick v. Butler (1873), 28 Mich. 349; In Pennsylvania, see Huntington, Bates v. Stansell (1869), 19 Mich. 91. etc. Coal Co. v. English (1878), 86 Pa.

In Alabama, see Burks v. Hubbard St. 247; North v. Phillips (1879), 89 (1881), 69 Ala. 379.

Pa. St. 250; Work v. Bennett (1872), In lowa, see Gilman v. Andrews 70 Pa. St. 484; Neiler v. Kelley (1871), (1885), 66 Iowa, 116, 23 N. W. R. 291. 69 Pa. St. 403.

In Indiana, see Citizens' St. Ry. 1 Galigher v. Jones (1888), 129 U. S. Co. v. Robbins (1895), 144 Ind. 671, 42 193, 9 Sup. Ct. R. 335.

So, though the title may in fact have been transferred and the goods have been delivered, it may be found that the goods are not such in kind, quality or condition as they were expressly or impliedly warranted to be.

Three general groups of questions therefore present themselves: (a) Where the goods are delivered, but not at the time

agreed upon. Where the title fails in whole or in part. (c) Where the goods are defective in kind, quality or con

dition. Each of these will be given separate consideration.

a. Where there was Delay in Delivery. § 1790, Measure of damages for delayed delivery. The buyer who has accepted a delayed delivery is, unless he has waived his right, entitled to damages for the delay. Of the loss by delay, in the ordinary case, the measure is the rental value for the period ? and not the loss of profits which might have been made with the article during that period, certainly where such a use was not within the contemplation of the parties, nor, in any case, where the profits would be uncertain or speculative, as the amount of profit that might have been made by the buyer's mill if he had had the engine contracted for to operate it, or the profit that might have been made by operating an excursion steamer if the machinery had been supplied in time.5

1 See ante, & 1389.

value during the delay may be recor. 2 Brownell v. Chapman (1892), 84 ered. Speirs v. Halstead (1876), 74 Iowa, 504, 51 N. W. R. 249, 35 Am. St. N. C. 620; Clements v. Hawkes Mfg. R. 326, Mechem's Cases on Damages, Co. (1871), 107 Mass. 362. 139; Griffin v. Colver (1858), 16 N. Y. 3 Thomas, etc. Mfg. Co. v. Wabash, 489, 69 Am. Dec. 718, Mechem's Cases etc. Ry. Co. (1885), 62 Wis. 642, 22 N. on Damages, 126; Benton v. Fay W. R. 827, Mechem's Cases on Dam(1872), 64 Ill. 417. Interest on the ages, 149, where the defendant did price paid in advance may be recov- not know the goods were bought for ered where no other damages are use, or, if so, for what use. shown. Edwards v. Sanborn (1859), 6 4 Griffin v. Colver, supra. Mich. 348. Depreciation in market 5 Brownell v. Chapman, supra

§ 1791. - Other damages than for the loss of use alone may, of course, in many cases be recovered under the second branch of the rule in Hadleyv. Baxendale. Thus, for example, where the goods are known to be purchased for resale and the resales are lost by reason of the delay, recovery may be had for the profits that would have been made upon resales contracted for in reliance upon receiving the goods within the stipulated time; and even if no profit could be shown, the vendee would be entitled to damages for expenses incurred by him in good faith in anticipation of performance by the seller.'

$ 1792. -So where, as the natural and proximate result of the delay, the buyer is deprived of the profitable use of his property, as where the seller made default in supplying a new hotel with furniture at the time agreed, where he knew that such was the intended use, damages based upon this special loss may be recovered. For like reasons, injuries to a farmer's crop caused by exposure to the weather while he was waiting for a threshing machine upon the seller's promise to furnish it forth with, may be compensated, where the buyer could procure no other machine.

b. Where Title Fails in Whole or in Part.

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$ 1793, Recovery of consideration. It is a fundamental condition, as has been seen,' that the seller shall be the owner of that which he attempts to convey. If, therefore, he tenders a chattel to which the buyer knows he has no title, the buyer may reject it, and may recover the price if he has paid

1 Harrow Spring Co. v. Whipple R. 336, 8 L. R. A. 65, Mechem's Cases, Harrow Co. (1892), 90 Mich. 147, 51 N. 252. W. R. 197, 30 Am. St. R. 421. See 3 Smeed v. Foord (1859), 1 Ell. & Ell. also Horne v. Midland Ry. Co. (1872), 602, 102 Eng. Com. L. 600. See also L. R. 7 C. P. 583, Mechem's Cases on Goodloe v. Rogers (1855), 10 La. Ann. Damages, 124; Booth v. Rolling Mill 631; Benton v. Fay (1872), 64 III. 417. Co. (1875), 60 N. Y. 487, Mechem's Compare Prosser v. Jones (1875), 41 Cases on Damages, 132.

Iowa, 674. Other cases

are cited 2 Berkey & Gay Furniture Co. v. $ 1773, ante. Hascall (1890), 123 Ind. 502, 24 N. E. 4 See ante, & 1205.

it in advance. So if, after the delivery of the goods and the payment of the price, the buyer is divested by or surrenders to a superior title, there is likewise a breach of the fundamental condition of the sale,— the seller has ignored the contract on his part, and the buyer may treat it as a sufficient ground for the rescission of the contract on his own part. Acting, therefore, in disaffirmance of the contract, the buyer may re-cover, as paid without consideration, so much of the purchase price as he has paid to the seller, with interest.

$ 1794. Damages for breach of warranty of title.— As has been seen, however, this fundamental condition on the part of the seller to convey the title is treated not only as a condition but as a warranty;? and the buyer, instead of treating the seller's failure in this regard as a ground for disaffirmance of the contract, may recover damages for the breach of warranty.

What the measure of damages for the breach of warranty of title should be seems to be involved in some confusion. Certain of the cases, acting in analogy to the rule generally pre vailing in regard to real estate, declare the rule to be that the buyer shall recover the consideration paid with interest.

Other cases declare, in the language of one of the most re

1 See ante, § 838; Wilkinson v. cover such a portion of the whole Ferree (1855), 24 Pa. St. 190; Ledwich price as the value of the part lost v. McKim (1873), 53 N. Y. 307; Eich- bears to the value of the whole, estioltz v. Bannister (1864), 17 Com. B. mated at the price paid. Moorehead (N. S.) 708.

v. Davis (1883), 92 Ind. 303 [citing 2 See ante, § 1300 et seq.

Wiley v. Howard, 15 Ind. 169; Hoot 3 Crittenden v. Posey (1858), 38 v. Spade, 20 Ind. 326; First Nat. Bank Tenn. (1 Head), 311; Johnson v. Mey. v. Colter, 61 Ind. 153; Mooney v. ers (1863), 34 Mo. 255; Ellis v. Gosney Burchard, 84 Ind. 285). (1832), 7 J. J. Marsh. (Ky.) 109; And- Where two mules and a colt were ing v. Perkins (1867), 29 Tex. 348; sold for a lump sum, and the purGoss v. Dysant (1868), 31 Tex. 186; chaser lost the colt by paramount Armstrong v. Percy (1830), 5 Wend. title, held, that he could recover the (N. Y.) 535; Noel v. Wheatly (1855), value of the colt at the time he so 30 Miss. 181; Ware v. Wheatnall lost it, although no separate price (1823), 2 McCord (S. C.), 413; Arthur had been fixed for it. Brown v. v. Moss, 1 Oreg. 193.

Woods (1866), 43 Tenn. (3 Cold.) 182. Partial breach.— For a partial See also Hunt v. Sackett (1875), 31 failure of title, the buyer may re Mich. 18.

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