Fairbanks, Morse Company v. Parker

Hart, J., (after stating the facts). We think the decision of the circuit court was wrong. There is no showing in the record that appellees claimed the property adversely to the rights of appellant, or that the latter waived his. right to retake the property, under his contract, for failure to pay the purchase money. The contract in each case was in writing, and in express terms stated that the title to the propérty should remain in the seller until it was paid for. The fact that the original purchaser sold the engines did not give the second purchaser any greater rights than the original purchaser possessed, in the absence of notice to the seller, or of facts equivalent to notice, that the second purchaser claimed the property adversely to the rights of the seller. In conditional sales of personal property, where the title is retained by the vendor until the purchase price is paid, the vendee acquires an interest that he can sell or mortgage without the consent of the vendor, but the vendor’s right to recover the property, if the purchase price of the property is not paid, is not prejudiced by such sale or mortgage. Clinton v. Ross, 108 Ark. 442, and Estes v. Lamb & Co., 149 Ark. 369. In the latter case it was also held that the giving of promissory notes for the debt is no payment, unless, by agreement of the parties, the note's are taken in payment of the debt. In Triplett v. Mansur & Tebbetts Implement Co., 68 Ark. 230, it was held that, where goods are sold on condition that the title shall remain in the vendor until the purchase notes are paid, the execution of renewal notes for the debt is not a payment, unless, by agreement of the parties, the notes are taken as such. Thus it will be seen that the mere fact that the seller failed to demand possession of the property when the notes given for its purchase price became due, and the fact that a renewal note was taken for the balance of the purchase price of one of the engines, do not constitute a forfeiture of his rights under the original contract. The seller made demand of the purchaser and his vendee of the balance of the purchase mice of the engines, and, in default thereof, demanded that they should be returned to it. The purchaser and his vendee failed and refused to make the payment of the balance of the purchase price or to return the engines to the seller. Hence he had a right, under his contract, to bring a replevin suit for the engines. But it is contended that appellant is barred of this right by the statute of limitations of three years. We do not think there is anything to bar a recovery by appellant. As we have already seen, the original purchaser had a right to sell the property, and the fact that he did so did not divest the seller of any of his rights. The same may be said of the fact that a renewal note was given for the balance of the purchase price of one of the engines. There is nothing else in the record which would start the running of the statute of limitations. It is not shown that appellant knew that the vendee of the original purchaser was claiming the property adversely to its rights, or that it was in possession of any facts that would lead to :such knowledge. . It is true that the property was moved from one county to another, but both counties were in the same section of the State, and it is not even shown that appellant knew that the property had been moved from one locality to another. Even if such had been the case, it would not tend to show that the person removing the property was holding it adversely to appellant. In Nattin v. Riley, 54 Ark. 30, it was held that, under a contract for the conditional sale of property, the omission of the purchaser to pay the purchase price when due does not operate as a forfeiture of his rights under the contract, in the absence of a demand on the part of the seller of payment, or of the property for nonpayment of the purchase price. It was further held that, on such demand, even after the purchase money was overdue, the purchaser would have the right to pay the purchase price and retain the property which he received under the contract. To the same effect see Sunny South Lumber Co. v. Neimeyer Lumber Co., 63 Ark. 268. This holding was in recognition of the principle that the rights of the parties remained the same after the purchase price became due as they were before that time, in. the absence of a showing that the seller demanded the property on his part, or the purchaser ¡claimed adversely to the rights of the seller, and that the latter had knowledge of such claim or of such facts as would lead to knowledge, if inquiry was made. 'Therefore we are of the opinion that there is nothing upon which to base a finding that appellant was barred of recovery by the statute of limitations, or that appellant had waived his rights to treat the sale as a conditional one. . It follows that the judgment will be reversed, and the cause remanded for a new trial.