Columbus Buggy Co. v. Turley

Woods, J., delivered the opinion of the court. The following excerpt from the agreed statement of facts found in the transcript, will demonstrate that appellees were creditors of Smitha in the sum of $1,700, viz.: Smitha being ‘ ‘ insolvent and in failing circumstances, and owing the banking house of Britton & Koontz the sum of $1,700, upon notes dated February 27, 1894, and January 11, 1895, shortly falling due, on which the said defendants, Turley & Parker, were accommodation indorsers, proposed to the said defendants that, as he, Smitha, would be unable to meet said notes at maturity, and as they would have them to pay, that if they, Turley & Parker, would take up said notes and assume certain other obligations owing by said Smitha, that he., Smitha, would make them a bill of sale to the property hereafter mentioned; that the said defendants did take up said notes, by the payment of the $1,700, and assumed the payment of $600 due by said Smitha for rent in arrears. Whereupon, the said Smitha, on the sixteenth day of February, 1895, in consideration of a receipt in full for the $1,700 paid by the defendants, and the assumption of the payment of said $600, sold his said business, including horses, carriages, buggies, harness, book accounts, etc., to the said defendants, Turley & Parker. ’ ’ It thus appearing that appellees were creditors of Smitha, under the authority of Howe v. Kerr, 69 Miss., 311, they are clearly entitled to be protected by the sale to them by their debtor to the extent of the $1,700. Section 4234, code of 1892 (§1300, code of 1880), protects the rights acquired by appellees under the sale to them from their debtor, to the extent indicated. The agreed statement of facts shows that Smitha transacted the business of a livery and sale stable, including the sale of carriages, buggies, etc., and that the only sign used at the place of such business was one with the words [536] “J. M. Smitha, Proprietor,” and that the property in this litigation was used and acquired in that business. As to Smitha’s creditors, the property was liable for his debts, and was in all respects to be treated as his property in favor of his creditors. As was said in Howe v. Kerr, ‘ ‘ they [the creditors] might have subjected it [the property in controversy] to their demands by proceeding at law to judgment and execution, and what the law would have done it was permissible for the parties to do.” As to the debt of $600 due by Smitha for rent, and assumed by appellees §1231, code of 1892, has no applicability. To the extent of this $600 Turley & Parker yrere purchasers. This brings us to the remaining contention, viz.: Can the purchasers be protected in their title to the property thus acquired from Smitha against the claim of appellants, Smitha’s vendors, who, by their written contract with Smitha, retained title to the property conditionally sold him until the purchase price should be paid, Smitha being a trader actively engaged in the business of hiring and selling carriages and buggies, and having authority in the contract itself to sell ? The propounding of the proposition discloses features which distinguish the case from those where the conditional sale is made of articles for the use and consumption of the buyer, or where the property is not sold to a trader presumptively for resale, but for the use of the buyer. The books, including our own state reports, abound in cases of these characters, and the rule is well settled with us that here, in such cases, the title of the conditional seller will be protected. The present case is wholly unlike any heretofore decided in this court, and must be determined independently of former adjudications. In the case before us, the vehicles were presumably sold to Smitha for resale. The course of business and common observation would, perhaps, raise that presumption. But no resort need be necessarily had to presumption. The seller has, in its contract, expressly authorized a resale by its vendee. [537] True, the contract shows a retention of title in the seller until payment is fully made, but true, also, is it, the seller has authorized the buyer to resell. To resell was one of the two purposes had in view by both parties to the contract. Now, what effect shall be given to these conflicting and inconsistent terms of the contract? And, especially, what effect shall be given to these inconsistent terms when the buyer is'not only apparently clothed with all the indicia of ownership, but when, by the contract itself, the jus ctisponeruM is unequivocally conferred on the buyer? It would seem that only one answer can be returned to these questions. To permit the vendor in a conditional sale of personal property, bought in the course of trade for resale, to retain title and at. the same time authorize the buyer to resell, would operate as a fraud upon innocent purchasers. This case falls within a well-recognized exception to the general rule that no one can convey to another any better title than he himself has. Benjamin, in his work on Sales, §§ 448, 449, states with perspicuity this exception. In § 448, vol. 1, 4 Am. ed., the author uses this language: “The seller maybe estopped from claiming title, as against a bona fide purchaser from the buyer in possession, by giving the buyer evidence of title or authority to sell. ’ ’ And in the succeeding section an elaborate citation from Leigh v. Railroad Co., 58 Ala., 165, is made, in which this exception to the maxim nemo dat quod non habet is strongly presented. Said Brickell, J., in that case: ‘ ‘ If the person intrusted with the possession of the goods and with the indicia of ownership or of authority to sell or otherwise dispose of them, in violation of his duty to the owner, sells to an innocent purchaser, the sale will prevail against the right of the owner.” To the same effect the following cases will be found: Wilder v. Wilson, 16 Lea, 548; Winchester Wagon Works v. Carman, 109 Ind., 31; Ludden v. Hazen, 31 Barb., 650; Fitzgerald v. Fuller, 19 Hun, 180; Cole v. Mann, 62 N. Y., 1; Armington v. Houston, 38 Vt., 448; Rogers v. White [538] house, 71 Me., 222; Burbank v. Crooker, 7 Gray, 158; Haskins v. Warren, 115 Mass., 514; McMahon v. Sloan, 12 Pa. St., 229. The only case seen by us in direct conflict with the view which we adopt as the sound one, is that of Lewis v. McCabe, 49 Conn., 141. But that opinion seems to have rested largely upon the idea that the contract in that litigation was made upon and induced by the spirit and drift of the former Connecticut decisions in similar, though not identical, cases. Near the conclusion of that opinion, this language is employed: ‘ ‘ Possession, with the jus disponendi added, has been regarded by many courts as sufficient reason for declaring a contract color-able and fraudulent without regard to the real intent of the parties. Bump on Fraud. Conv., 123, and cases referred to. We concede that there is much force in the reasoning supporting such a rule, but, at the same time, we must bear in mind the spirit and drift of, our own decisions, as they may have induced the making of such contracts. ’ ’ Many states have of late years enacted statutes requiring the recordation of contracts in which title is retained in the vendor, and many adjudications may be found under such statutes, but the cases cited by us were decided independently of statute, and, as it appears, before the enactment of statutes. Affirmed.