Fairbanks Co. v. Graves

Mates, J., delivered the opinion of the court. The record in this case does not warrant the conclusion that the Fairbanks Company sold this gasoline engine to the Freeman Service Company for the purpose of having it resold, or that it knew it was the intention of the Freeman Service Company to resell, or had knowledge of any such facts as would bind it with constructive notice of the intention of the Freeman Service Company to resell. This being the case it does not fall within the rule announced by the case of Columbus Buggy Co. v. Turley, 73 Miss., 529, 19 South., 232, 32 L. R. A., 260, 55 Am. St. Rep., 550. All the cases on this subject are reviewed in the case of Watts v. Ainsworth, 89 Miss., 40, 42 South., 672. There is nothing in the law which prohibits one merchant from selling an article of merchandise to another merchant, with reservation of title until the purchase money is paid, unless the article sold is meant to be resold, or is of such character as that it may be fairly inferred, when the sale is made, that the purpose of the purchase is to resell it. No absolute rule controling this subject can be laid down by this court, but each case must depend upon its own facts; and we only say that in this case we are not warranted in the conclusion that the Fairbanks Company sold this engine for purposes of resale, or that the character of the property sold was such as to bind it with notice of the use the purchaser intended to make of the property; nor are there such [460] facts in this record as would warrant the court in concluding that the Fairbanks Company had actual or constructive notice of the intention of the vendee. If the trustee in bankruptcy has any right in the subject-matter of this litigation, this record is not in shape for it to be asserted by him. It is to be hoped that the next legislature will put an end to the sale of personal property with reservation of title in the vendor, whereby ihe vendee is. clothed with all the indicia of ownership, authority, and control over the property, and yet in truth does not possess the title. In order to make these contracts effective as to third parties, and prevent many wrongs being perpetrated on innocent parties under this character, of contract, the legislature should require them to be recorded in the same manner as deeds of trust are required to be recorded, and, in default of such recordation, they should be held void as to innocent third parties. Cases of this nature are frequently coming to this court, and the evil effect of this kind of contract is made more and more manifest. The learned circuit judge should not have given the peremptory instruction. Therefore the case is reversed and remanded.