the parties as to the time when the property is to be transferred is to be determined, as in other cases, from the terms of the contract and the circumstances of the transaction.55 Therefore, unless a contrary intention appears, the ordinary rule will prevail that no property passes before the chattel is completed."

RESERVATION OF RIGHT OF POSSESSION OR PROPERTY.

51. IN GENERAL. When there is a contract for the sale of unascertained goods, and goods are subsequently appropriated to the contract, the seller may, by the terms of the appropriation, reserve the right of possession or property in the goods until certain conditions have been fulfilled. The right of possession or property may be thus reserved notwithstanding the delivery of the goods to the buyer, or to a carrier or other bailee for the purpose of transmission to the buyer.*

52. BY BILL OF LADING. Where goods are shipped, and by the bill of lading the goods are deliverable to the seller or his agent, or to the order of the seller or his agent, the seller prima facie reserves the property in the goods; but where by the bill of lading the goods are deliverable to the buyer or his agent, or to the order of the buyer or his agent, prima facie the property in the goods passes to the buyer.

53. DEALING WITH BILL OF LADING TO SECURE PRICE. When, upon shipment, the seller takes a bill of lading and deals with it so as to secure the contract price,

Cliff. (U. S.) 370, Fed. Cas. No. 12,565, and Sandford v. Ferry Co., 27 Ind. 522

55 Clarkson v. Stevens, 106 U. S. 505, 1 Sup. Ct. 200, 27 L. Ed. 139, affirming Stevens v. Shippen, 29 N. J. Eq. 602.

66 Andrews v. Durant, 11 N. Y. 35, 62 Am. Dec. 55; Williams v. Jackman, 16 Gray (Mass.) 514; Briggs v. Light Boat, 7 Allen (Mass.) 287; Wright v. Tetlow, 99 Mass. 397; Elliott v. Edwards, 35 N. J. Law, 265, Edwards v. Elliott, 36 N. J. Law, 449, 13 Am. Rep. 463; Derbyshire's Estate, 81 Pa. 18; Green v. Hall, 1 Houst. (Del.) 506; Hall v. Green, 1 Houst. (Del.) 546, 71 Am. Dec. 96; In re Carter, 21 App. Div. 118, 47 N. Y. Supp. 383; Yukon River Steamboat Co. v. Gratto, 136 Cal. 538, 69 Pac. 252.

*See Sales Act, § 20 (1).

either by sending to an agent the bill of lading, with a bill of exchange drawn on the buyer for the price, with instructions to deliver the bill of lading only on acceptance or payment of the bill of exchange, or by transferring the bill of lading as security to a banker who has discounted the bill of exchange, the property in the goods does not pass to the buyer until acceptance or payment of the bill of exchange, or tender of the price, as the case may be. And, if the seller transmits the bill of exchange and bill of lading to the buyer to secure acceptance or payment of the bill of exchange, the buyer is bound to return the bill of lading if he does not honor the bill of exchange, and if he wrongfully retains the bill of lading he acquires no added right thereby.

The rule that the seller who delivers goods to a carrier in pursuance of authority derived from the buyer is presumed thereby to appropriate the goods unconditionally to the contract, like other rules for determining when the property has passed, is simply a rule of construction adopted for the purpose of ascertaining the real intention of the parties, which they have failed to express." And therefore, if it appears that the seller, though authorized to make such appropriation, has by the terms. of the appropriation reserved the property in the goods, the presumption must yield to the facts. 58 The commonest way of reserving the property is by means of the bill of lading." Right of Disposal.

60

Where goods are delivered to a carrier, and a bill of lading. is taken, the delivery by the seller is not a delivery to the buyer, but to the carrier as bailee for delivery to the person indicated by the bill of lading. When, therefore, the seller ships the goods which he intends to deliver under the contract, by taking a bill of lading making the goods deliverable to himself or to his agent, or to the order of himself or of his agent, he thereby retains the right to the possession of the goods. The time when the property passes depends upon the intention of

ST Benj. Sales, § 381.

8 See Godts v. Rose, 17 C. B. 229.

Ante, pp. 33-36.

Wait v. Baker, 2 Exch. 1, per Parke, B.; Gabarron v. Kreeft, 10 Exch. 274, per Bramwell, B.; Benj. Sales, § 399.

the parties, and it may be that the seller in such case reserves the property as well as the right to possession, or that the property passes notwithstanding the form of the bill of lading. Where the seller has appropriated the goods to the contract, but takes a bill of lading to himself or to his own order under circumstances which indicate that he intends to reserve the property, it is commonly said that he thereby reserves "the right of disposal." It has been justly said that "the term 'right of disposal' is not the most apt word to employ when laying down a general rule with regard to the passing of the property,' ,"1 and, although it has been retained in the English Sale of Goods Act, it has been discarded by the proposed American Sales Act. The rules established by the decisions involving the so-called right of disposal will be stated in the following sections.

1 Benj. Sales (5th Eng. Ed.) p. 318, note 6.

"Where the shipper takes and keeps in his own or his agent's hands a bill of lading in this form to protect himself, this is effectual so far as to preserve to him a hold over the goods until the bill of lading is handed over on the conditions being fulfilled, or at least until the consignee is ready and willing and offers to fulfill these conditions, and demands the bill of lading. And we think that such a hold retained under the bill of lading is not merely a right to retain possession of the goods until these conditions are fulfilled, but involves a power to dispose of the goods on the vendee's default, so long, at least, as the vendee continues in default." Ogg v. Shuter, 1 C. P. Div. 47, per Lord Cairns.

In Mirabita v. Bank, 3 Exch. Div. 164, Bramwell, L. J., says: "I think it not necessary to inquire whether what the shipper possess es is a property, strictly so called, or a jus disponendi, because I think, whichever it is, the result must be the same." But in the same case Cotton, L. J., appears to speak of the reservation of the right of disposal and of the reservation of the right of property as synonymous.

62 Section 19.

63 Section 20. In the note to this section Prof. Williston says: "Subsection (1) follows with some change of expression section 19 of the English Act, except that for the somewhat loose phrase 'right of disposal' is substituted 'possession or property.' The phrase 'jus disponendi' has gained some currency as the expression of the right of a seller who has definitely appropriated goods to a contract, but who nevertheless takes a bill of lading to his own order. The truth is he has reserved the property as security. The situation is similar to that in a conditional sale."

Bill of Lading to Seller or to His Order.

When goods are shipped, and by the bill of lading the goods are deliverable to the order of the seller or of his agent, prima facie the seller reserves the property in the goods. The fact that the seller takes the bill of lading to his own order is aldecisive to show his intention to reserve the property." most The presumption may, indeed, be rebutted by proof that in so doing he acted as agent of the buyer and did not intend to reserve the property; and it is for the jury to determine, as a question of fact, what the real intention was." But the mere fact that the seller sends to the buyer an invoice describing the

64 Mirabita v. Bank, 3 Exch. Div. 164, 172, per Cotton, L. J.; Wait v. Baker, 2 Exch. 1; Brandt v. Bowlby, 2 Barn. & Adol. 932; Moakes V. Nicholson, 19 C. B. (N. S.) 290, 34 Law J. C. P. 273; Ogg v. Shuter, 1 C. P. Div. 47, reversing L. R. 10 C. P. 159; Ellershaw v. Magniac, 6 Exch. 570; Falke v. Fletcher, 34 Law J. C. P. 146 (mate's receipt); Merchants' Nat. Bank v. Bangs, 102 Mass. 291, 295; Farmers' & Mechanics' Nat. Bank v. Logan, 74 N. Y. 568, 578; Erwin v. Harris, 87 Ga. 333, 13 S. E. 513; Alabama, G. S. R. Co. v. Mt. Vernon Co., 84 Ala. 173, 4 South. 356; Forcheimer v. Stewart, 65 Iowa, 593, 22 N. W. 886, 54 Am. Rep. 30; Bergman v. Railroad Co., 104 Mo. 77, 15 S. W. 992. See, also, Stollenwerck v. Thacher, 115 Mass. 224; Vaughn v. Railroad Co., 27 R. I. 235, 61 Atl. 695. See Sales Act, § 20 (2). Cf. Sale of Goods Act, § 19 (2), which provides that "the seller is prima facie deemed to reserve the right of disposal." The second sentence of Sales Act, § 20 (2), is new.

759.

The delivery to the carrier may be such as to vest the property In the buyer, so that the issue of a bill of lading making the goods otherwise deliverable will not divest it. Ogle v. Atkinson, 5 Taunt. See, also, Philadelphia & R. R. v. Wireman, 88 Pa. 264. The property and the right to possession vest in the buyer upon Indorsement and delivery of the bill of lading. Wilmshurst v. Bowker, 2 Man. & G. 792; Key v. Cotesworth, 7 Exch. 595; Chas. F. Orthwein's Sons v. Elevator Co., 32 Tex. Civ. App. 600, 75 S. w. 364 Mitchell v. Baker, 208 Pa. 377, 57 Atl. 760.

Where the seller took a receipt making the goods deliverable to himself, and gave the buyer an order making the goods deliverable to him, and the carrier attorned to the buyer, the property passed. Hatch v. Bayley, 12 Cush. (Mass.) 27.

65

Shepherd v. Harrison, L. R. 5 H. L. 116; Dows v. Bank, 91 U. S. 618, 23 L. Ed. 214; Newcomb v. Railroad Corp., 115 Mass. 230; Village of Bellefontaine v. Vassaux, 55 Ohio St. 323, 45 N. E. 321. se Joyce v. Swann, 17 C. B. (N. S.) 84: Van Casteel v. Booker, 2 Exch. 691; Browne v. Hare, 4 Hurl. & N. 822, 29 Law J. Exch. 6; Merchants' Nat. Bank v. Bangs, 102 Mass. 291; Hobart v. Littlefield,

69

67

goods as shipped on his account and at his risk, while evidence of an intention to transfer the property, is not enough to rebut the presumption; " and the presumption arises, although the seller ships the goods in the buyer's own vessel, and the bill of lading states that the goods are freight free and the buyer's own property. The presumption that the seller reserves the property arises, also, when he takes the bill of lading to himself or to his agent." When the seller thus reserves the property in the goods, for the purpose of entirely withdrawing them from the contract, he may dispose of them absolutely, even though he thereby commits a breach of the contract; nor will the property in the goods pass to the buyer upon tender by him of the price or of performance of the conditions of the contract. If the property does pass, but the seller retains possession of the bill of lading, he thereby reserves a right to the possession of the goods as against the buyer; in other words, he preserves his lien.72

The effect of a shipment under the circumstances under consideration was stated in a leading case as follows: 73 "In the case of such a contract [a contract for sale of goods not specific], the delivery by the vendor to a common carrier, or (unless the effect of the shipment is restricted by the terms of the

13 R. I. 341; Hamilton v. Brewing Co., 129 Iowa, 172, 105 N. W. 438, 2 L. R. A. (N. S.) 1078.

67 Walley v. Montgomery, 3 East, 585. Where the shippers, who were indebted to the consignee, took a bill of lading in their own name, but wrote to him, "We deliver you this load on our indebtedness," the property passed, and the consignee could maintain replevin against a creditor of the shippers who attached the goods while in possession of the carrier. Straus v. Wessel, 30 Ohio St. 211.

68 Cases cited in note 65, supra.

69 Turner v. Trustees of Liverpool Docks, 6 Exch. 543; Gabarron v. Kreeft, L. R. 10 Exch. 274.

70 Where the seller delivered goods to a carrier, consigned to himself in care of the buyer, the property did not pass. Ward v. Taylor, 56 Ill. 494.

71 Wait v. Baker, 2 Exch. 1; Ellershaw v. Magniac, 6 Exch. 570; Gabarron v. Kreeft, L. R. 10 Exch. 274.

72 See Browne v. Hare, 4 Hurl. & N. 822, 29 L. J. Exch. 6, per Pollock, C. B.

73 Mirabita v. Bank, 3 Exch. Div. 164, per Cotton, L. J.