Sect. 41. Part delivery. The lien is a lie for the price only, and not for charges for keeping the goods, for they are kept against the buyer's will.1 A sale on credit excludes the lien during the currency of the credit,2 unless there be a trade usage to the contrary.3 As regards instalment contracts, Mellish, L.J., says, "the seller, notwithstanding he may have agreed to allow credit for the goods, is not bound to deliver any more goods under the contract until the price of the goods not yet delivered is tendered to him; and if a debt is due to him for goods already delivered, he is entitled to refuse to deliver any more till he is paid the debt due for those already delivered, as well as the price of those still to be delivered. . . . It would be strange if the right of a vendor who had agreed to deliver goods by instalments were less than that of a vendor who had sold. specific goods." 94 Even if the seller has broken his contract to deliver while the buyer is solvent, his lien revives on the buyer becoming insolvent, and the buyer's trustee is only entitled at most to nominal damages for the breach, unless the value of the goods at the time of breach was above the contract price.5 Where the seller exercises his right of lien, the buyer's trustee may affirm the contract and obtain the goods by tendering the price within a reasonable tlme, for it is clear law that the mere insolvency or bankruptcy of a party to a contract does not rescind it. But it seems that, in the case of insolvency, an agreement to rescind will be presumed on slight grounds." A sub-purchaser also is probably entitled to obtain the goods by tendering the price to the original seller within a reasonable time.8 42. Where an unpaid seller has made part delivery 1 Somes v. British Empire Shipping Co. (1859), 28 L. J. Q. B. 220, Ex. Ch. affirmed by H. L., 30 L. J. Q. B. 229 (case of shipwright's lien, but the rule was stated to apply to the seller's lien). 2 Spartali v. Benecke (1850), 10 C. B. 212, at p. 223. 3 Field v. Lelean (1861), 30 L. J. Ex. 168 Ex. Ch. 4 Ex p. Chalmers (1873), L. R. 8 Ch. App. 289, at p. 293;.cf. Ex p. Stapleton (1879), 10 Ch. D. 586, C. A. 5 Valpy v. Oakley (1851), 16 Q. B. 941; 20 L. J. Q. B. 380; Griffiths v. Perry (1859), 28 L. J. Q. B. 204. Ex p. Stapleton (1879), 10 Ch. D. 586, C. A. 7 Morgan v. Bain (1874), L. R. 10 C. P. 15. As to trustee's right to disclaim onerous contracts, see s. 55 of the Bankruptcy Act, 1883. 8 Ex p. Stapleton, suprà; and cf. Kemp v. Falk (1882), 7 App. Cas., at p. 578, per Lord Selborne. of the goods, he may exercise his right of lien [or reten- Sect. 42. tion] on the remainder, unless such part delivery has been made under such circumstances as to show an agreement to waive the lien1 [or right of retention]. By sect. 62, post, p. 118, "lien" in Scotland includes right of retention. In a case where it was unsuccessfully contended that the delivery of part of a cargo to a sub-purchaser was a constructive delivery of the whole, Lord Blackburn says: It is said that delivery of a part is delivery of the whole. It may be a delivery of the whole. In agreeing for the delivery of goods with a person, you are not bound to take an actual corporeal delivery of the whole in order to constitute such a delivery, and it may very well be that a delivery of part of the goods is sufficient to afford strong evidence that it is intended as a delivery of the whole. If both parties intend it as a delivery of the whole, then it is a delivery of the whole; but if either of the parties does not intend it as a delivery of the whole, if either of them dissents, then it is not a delivery of the whole." 2 As regards severable contracts, if, for instance, delivery is to be Severable made by three instalments, and the first instalment has been delivered contract. and paid for, and the second has been delivered but not paid for, the seller may withhold delivery of the third instalment till he has been paid for both the second and third instalments. But any instalment which has been paid for must be delivered, even though the buyer be bankrupt.4 43.—(1.) The unpaid seller of goods loses his lien [or Terminaright of retention] thereon— (a.) When he delivers the goods to a carrier or other bailee [or custodier] for the purpose of transmission 1 Dixon v. Yates (1833), 5 B. & Ad. 313, see at p. 341; Miles v. Gorton (1834), 2 Cr. & M. 503; cf. Ex p. Cooper (1879), 11 Ch. D. 68, C. A. (stoppage in transitu). 2 Kemp v. Falk (1882), 7 App. Cas. 573, at p. 586, citing for the position, Dixon v. Yates, suprà, which was a case of seller's lien. 3 Ex p. Chalmers (1873), L. R. 8 Ch. App. 289 (buyer insolvent. Qu. if buyer was not insolvent?) + Merchant Banking Co. v. Phenix Bessemer Steel Co. (1877), 5 Ch. D. 205. tion of lien. G Sect. 43. to the buyer1 without reserving the right of disposal of the goods; 2 (b.) When the buyer or his agent lawfully obtains possession of the goods; 3 (c.) By waiver thereof.4 (2.) The unpaid seller of goods, having a lien [or right of retention] thereon, does not lose his lien [or right of retention] by reason only that he has obtained judgment [or decree] for the price of the goods.5 As to the term "unpaid seller," see sect. 38, ante, p. 75; and as to reservation of the right of disposal, see sect. 19, ante, p. 47. The words in brackets are Scotch terms. When goods are delivered to a carrier for transmission to the buyer, the right of lien becomes changed into a right of stoppage in transitu should the buyer become insolvent. As in the case of the buyer's insolvency the two rights are similar in their effects, they are sometimes confused in the cases. For the most part, the cases on what constitutes an actual receipt within the meaning of the Statute of Frauds appear to furnish the test for determining whether the seller's lien is gone or not. "The principle," says Blackburn, J., "is that there cannot be an actual receipt by the vendee so long as the goods continue in the possession of the seller so as to preserve his lien. But though the goods remain in the personal possession of the vendor, yet if it is agreed between the vendor and vendee that the possession shall thenceforth be kept, not as vendor, but as bailee for the purchaser, the right of lien is gone, 1 Benjamin on Sale, 4th ed., p. 813; Bolton v. Lanc. & Yorks. Railway Co. (1866), L. R. 1 C. P., at p. 439, per Willes, J.; Pollock on Possession, pp. 71, 72; cf. Griffiths v. Perry (1859), 28 L. J. Q. B., at pp. 207, 208; and see the cases cited for sect. 32, ante, p. 69. 2 As to reserving right of disposal, see sect. 19, ante, p. 47. 3 Hawes v. Watson (1824), 2 B. & C. 543; Cooper v. Bill (1865), 34 L. J. Ex. 161; Benjamin on Sale, 4th ed., p. 811; Dodsley v. Varley (1840), 12 A. & E. 632; cf. Schotsmans v. Lanc. & Yorks. Railway (1867), L. R. 2 Ch. App., at p. 335, as to stoppage in transitu. Amended in Committee. ♦ Benjamin on Sale, 4th ed., pp. 808, 812, and see note, post, p. 83. 5 Houlditch v. Desanges (1818), 2 Stark. 337; Scrivener v. Great Northern Railway (1871), 19 W. R. 388. (Qu. if lien extends only to price or also to costs on the judgment?) and then there is sufficient receipt to satisfy the statute."1 But this proposition must now be taken subject to the provisions of sect. 41 (2), ante, p. 79. The sub-section was altered in Committee into its present form. As the Bill was drafted it was confined to cases where the buyer was insolvent. Subject to sect. 47, when goods, at the time of sale, are in the possession of a third person there is no delivery to the buyer, and the seller's lien therefore is not divested till such third person attorns to the buyer.3 Again, the seller may deliver the goods to the buyer on such terms as that the buyer holds them as bailee for the seller; 3 but in that case the seller has rather a special property in the goods arising out of the special agreement, than a lien properly so called.1 Sect. 43. The right of lien is given to the seller by implication of law, see Waiver of sect. 39. It follows that it may be waived expressly. But it may lien. also be waived by implication. The seller may reserve an express lien which excludes the implied one,5 or he may take a bill for the price which ordinarily would exclude his lien during its currency, though the lien would revive on its dishonour; 6 or the seller may assent to a sub-sale;7 or part with the documents of title so as to exclude his lien under the provisions of the Factors Acts, if the documents get into the hands of a holder for value. See, too, sect. 55 as to negativing implied terms. Stoppage in transitu. 44. Subject to the provisions of this Act, when the Right of buyer of goods becomes insolvent, the unpaid seller who stoppage in has parted with the possession of the goods has the right 1 Cusack v. Robinson (1861), 30 L. J. Q. B., at p. 264; cf. Baldey v. Parker (1823), 2 B. & C., at p. 44, per Holroyd, J. 2 McEwan v. Smith (1849), 2 H. of L. Cas. 309, and ante, p. 66. 3 Benjamin on Sale, 4th ed., p. 812. 4 Cf. Dodsley v. Varley (1840), 12 A. & E. 632, at p. 634, per Lord Denman. 5 Re Leith's Estate (1866), L. R. 1 C. P., at p. 305. As to effect of taking subsequent security, sec Angus v. McLachlan (1883), 23 Ch. D. 330. • Valpy v. Oakeley (1851), 16 Q. B. 941, at p. 951; Griffiths v. Perry (1859), 28 L. J. Q. B., at p. 207. Knights v. Wiffen (1870), L. R. 5 Q. B. 660; see, too, sect. 47, post, p. 90. 8 See sects. 45 to 47. transitu. Sect. 44. Nature of transitu. of stopping them in transitu, that is to say, he may resume possession of the goods as long as they are in course of transit, and may retain them until payment or tender of the price.1 "The vendors being unpaid," says Lord Esher, "and the purchasers stoppage in having become insolvent, according to the law merchant the vendors had a right to stop the gools in transitu, although the property in such goods might have passed to the purchasers. The doctrine of stoppage in transitu has always been construed favourably to the vendor." 2 The right of stoppage in transitu is a right against the goods themselves. "If they arrive injured and damaged in bulk or quality the right to stop in transitu is so far impaired, there is no contract or agreement which entitles the vendor to go beyond those goods in the state in which they arrive, and to claim moneys which have been paid by the underwriters to the purchasers of the goods in respect of their loss by the non-arrival of their property.' "3 The term stoppage in transitu only applies in strictness to cases where the property in the goods has passed to the buyer. If the property has not passed, the seller's rights depend upon his so-called right of lien or upon a reservation of the jus disponendi.5 But it was clear before the Act that the seller's right of withholding delivery extended to executory, as well as executed, contracts, when the buyer was insolvent.6 In order to form a clear notion of the meaning of the term "transitus," two points should be noted:—(1) The goods may be in transitu although they have left the hands of the person to whom the seller intrusted them for transmission. It is immaterial how many agents' 1 Lickbarrow v. Mason (1793), 6 East, 21 H. L.; 1 Smith, L. C., 9th ed., p. 737, and notes; Gibson v. Carruthers (1841), 8 M. & W. 321; Bolton v. Lanc. & Yorks. Railway (1866), L. R. 1 C. P. 431, at p. 439; Bethell v. Clark (1887), 19 Q. B. D. 553, at p. 561, affirmed 20 Q. B. D. 615, C. A. ; Pollock on Possession, pp. 72, 74, 214. 2 Bethell v. Clark (1888), 20 Q. B. D., at p. 617, C. A. 3 Berndtson v. Strang (1868), L. R. 3 Ch. App. 588, at p. 591, per Lord Cairns; cf. Phelps v. Comber (1885), 29 Ch. D. 813, C. A. 4 Gibson v. Carruthers (1811), 8 M. & W. 321. 5 Bolton v. Lanc. & Yorks. Railway (1866), L. R. 1 C. P., at p. 439, per Willes, J. 6 See sect. 39 (2), and Griffiths v. Perry (1859), 28 L. J. Q. B., at p. 208; Ex p. Chalmers (1873), L. R. 8 Ch. App., at p. 292. |