Sect. 11.

Questions between English and Scottish contracting parties.

Cases illus

trative of buyer's remedy.

fraud, the existence of fraud must necessarily widen and strengthen the remedy, and may be important in questions regarding "reasonable time," and the presumption arising from the buyer's delay in giving notice.

The buyer's remedy in Scotland has now gone beyond, instead of falling short of, the corresponding remedy in England. The laws of the two countries in this matter are not assimilated, and therefore questions of difficulty may still arise between English seller and Scottish buyer, or vice versa. If either country is clearly the locus contractus, the law of that country will probably prevail, but it is often difficult to determine whether a correspondence between England and Scotland results in an English or a Scottish contract.1

Additional cases illustrative of the buyer's remedies in Scotland before this Act will be found in the footnote.2

1 See Hope v. Crookston Brors. (1890), 17 Ret. 868; Hamlyn and Co. v. Talisker Distillery (1893,) 21 Ret. 204, Revd. H.L. (1894), 21 Ret. H.L. 21; Starkie v. Paterson (1893), 10 Sh. Ct. Repts. 27.

2 Aiton v. Fairie (1668), Mor. 14230; Paton v. Lockhart (1675), Mor. 14232; Seaton v. Carmichael (1680), Mor. 14234; Wallwood v. Gray (1681), Mor. 14235; Brisbane v. Merchants in Glasgow (1684), Mor. 12328 & 14235; Watson v. Stewart (1694), 1 Fount. 589; Mitchell v. Bisset (1694), Mor. 14236; Ralston v. Robertson (1761), Mor. 14238; Lindsay v. Wilson (1771), 5 Br. Sup. 585; Gordon v. Scott (1773), 5 Br. Sup. 585; Lombe v. Scott (1779), Mor. 5627; Brown v. Gilbert (1791), Mor. 14244; Grant v. Dumbreck (1792), Hume 673; Vickers and Co. v. Sheriff and Dudgeon (1803), Hume 332; Newmann, Hunt, and Co. v. Harris (1803), Hume 335; Stevenson v. Dalrymple (1808), Mor. Sale, App. No. 5; Sheriff v. Marshall (1812), Hume 697; Wilson v. Marshall (1812), Hume 697; Bennoch v. M'Kail (27th January 1820), F.C.; Bruce v. M'Kenzie (1821), 1 Sh. 77 (N.E. 79); Pitcairn v. Brown (1823), 2 Sh. 576 (N.E. 495); Jaffray v. Boag (1824), 3 Sh. 375 (N.E. 266); Cossar and Co. v. Marjoribanks (1826), 4 Sh. 685 (N.E. 629); Sharrat v. Turnbull (1827), 5 Sh. 361; Watt v. Glen (1829), 7 Sh. 372; Robertson v. Harford Brors. and Co. (1832), H.L. 6 W.S. 1; Fraser and Co. v. Outram and Co. (1834), 13 Sh. 84; Potter v. Greig (1836), 14 Sh. 210; Pollock v. Macadam (1840), 2 D. 1026; Napier v. Campbell (1841), 3 D. 879; Ransan v. Mitchell (1845), 7 D. 813; Ramsay v. M'Lellan and Son (1845), 8 D. 142; Smart v. Begg (1852), 14 D. 912; Padgett and Co. v. M'Nair and Brand (1852), 15 D. 76; M'Bey v. Gardiner (1858), 20 D. 1151; Todd and Higginbotham v. O'Regan (1859), 21 D. 1320; Edinr. and Leith Brewing Co. v. Reid (1861), 24 D. 26; Morson and Co. v. Burns (1866), 5 Macp. 99; Couston, Thomson, and Co. v. Chapman (1872), 10 Macp. H. L. 74; Smith Brors. and Co. v. Scott (1875), 2 Ret. 601; Croan v. Vallance (1881), 8 Ret. 700; Fleming and Co., Ltd. v. Airdrie Iron Co. (1882), 9 Ret. 473; Cal. Ry. Co. v. Rankin (1882), 10 Ret. 63. See also Morison v. Glen and Forrester (1712), Mor. 14236; Melville v. Crichley and Co. (1856), 18 D. 643; Mackay v. Dick and Stevenson (1881), 8 Ret. H.L. 37; Bradley and Co. v. G. & W. Dollar (1886), 13 Ret. 893. In a few cases the actio quanti minoris seems to have been admitted in opposition to the

12. In a contract of sale, unless the circumstances Sect. 12. of the contract are such as to show a different inten- IMPLIED tion, there is

(1.) An implied condition on the part of the seller that in the case of a sale he has a right to sell the goods, and that in the case of an agreement to sell he will have a right to sell the goods at the time when the property is to pass :

(d)

(2.) An implied warranty that the buyer shall have and enjoy quiet possession of the goods:

(e)

(3.) An implied warranty that the goods shall be free from any charge or encumbrance in favour of any third party, not declared or known to the buyer before or at the time when the contract is made.

UNDERTAKING
AS TO TITLE,

ETC.

NOTES.

(a) Circumstances showing a different intention. A sale by auction of forfeited pledges was held to imply a sale of such right only as the seller himself possessed.1 Different intention may be inferred from the terms of the contract 2 or from the nature of the subject sold, e.g. a patent right.3

general principles of Scottish law, e.g. Hoggersworth v. Hamilton (1665), Mor. 14230; Fairie v. Inglis (1669), Mor. 14231; Baird v. Charteris (1686), Mor. 14235. In other cases the remedy has been allowed as forming an indirect term of the contract, e.g. M'Cormick v. Rittmeyer (1869), 7 Macp. 854; Hope v. Crookston Brors. (1890), 17 Ret. 868; or as arising out of circumstances otherwise inextricable, e.g. Bailey and Co. v. Paterson (1828), 4 Mur. 478 at p. 480; Pearce Brors. v. Irons (1869), 7 Macp. 571; M'Carter v. Stewart and Mackenzie (1877), 4 Ret. 890; Spencer and Co. v. Dobie and Co. (1879), 7 Ret. 396. See also Reid v. Steele (1824), 3 Sh. 201. The alternative remedy now allowed to the buyer is confined to the sale of goods. The law as to heritage is unaltered.

1 Morley v. Attenborough (1849), 3 Exch. 500. The same rule seems to apply to any sale by a person acting in a special or limited capacity, such as a sale under a judicial warrant.

2 Leith Heritages Co. v. Edinr. and Leith Glass Co. (1876), 3 Ret. 789. 3 Hall v. Conder (1857), 2 C.B. N.S. 22; Smith v. Neale (1857), 2 C.P. N.S. 67.

Sect. 12.

Development of law of implied title in England.

(b) "Condition"-" warranty." See COM., Sect. 10 ante, p. 44; also Sect. 11, Note (a) ante, p. 51, and COм. infra, p. 60. (c) "Sale "-" agreement to sell." Defined Sect. 1. Sect. 62 (1).

See also

Words now for the

Adopted from the

(f) "Shall be free." The words are not 66 are free." The seller, therefore, does not warrant that the goods are free at the date of the contract, but that he is, or will be, in a position to discharge the encumbrance.

COMMENTARY.

The rule of this section has been the subject of much controversy in England. The result of the older authorities was thus stated by Baron Parke in 1849. Where, in the sale of a specific chattel, there is no fraud or concealment on the part of the seller, and where nothing is said about title," there is no warranty of title any more than there is of quality. The rule of caveat emptor applies to both." Two years later Lord Campbell thus referred to Baron Parke's judgment. The exceptions stated in it, he said," well-nigh eat up the rule. Executory contracts are said to be excepted; so are sales in retail shops, or where there is a usage of trade; so that there may be difficulty in finding cases to which the rule would practically apply." The decision in Eichholz v. Bannister 3 (1864) cast further doubt upon the rule itself, and led to a new rule formulated by Benjamin, and confirmed in Raphael v. Burt (1864), as follows: "A sale of personal chattels implies an affirmation by the vendor that the chattel is his, and therefore he warrants the title, unless it be shown by the facts and circumstances of the sale that the vendor did not intend to assert ownership, but only to transfer such interest as he might have in the

3

1 In Morley v. Attenborough, 3 Ex. 500 at p. 510.

2 In Sims v. Marryat (1851), 17 Q.B. 281 at p. 291.

3 17 C. B. N.S. 708. A full review of the previous authorities will be found in the report of this case, pp. 709 to 720. See also Broom's Legal Maxims, 4th ed. p. 768.

4 Cababé and Ellis, p. 325.

chattel sold."1 This is the rule embodied in the first sub- Sect. 12. section, but to avoid ambiguity the word "condition" is used instead of warranty.

Scotland.

During the development which led to the change of rule Law of in England, the law of Scotland was often quoted, along with that of Rome, as affording an example of implied warranty of title. The reference to the Civil Law was inaccurate, for under that law the only obligations of the seller were delivery, and a warranty against eviction. The buyer, even if he could show that the seller was not owner of the thing sold, was not entitled to get rid of his bargain so long as he had undisturbed possession. The language of Stair implies that the law of Scotland was the same, but it was early settled in Scotland that, at least in the case of heritage, the seller was bound to give a good title to the subject sold. Bell in certain passages, frequently cited in England, extended the rule to moveables, but M. P. Brown, after a careful review of the authorities, doubted if warranty of title in Scotland extended beyond sales of heritage. The judgment in Swan v. Martin (1865) supports the view Swan v. that in Scotland before this Act the warranty in a sale of goods was only against eviction. The sale was of goodwill

1 Benjamin, p. 634.

8

2 E.g. by Baron Parke in Morley v. Attenborough (1849), 3 Ex. 500 at p. 510.

Dig. 18. 1. 25. 1; ibid. 19. 4. 1; Cod. 8. 44. 3; Moyle, p. 103 et seq.; Macintosh, p. 150 et seq.; Benjamin, p. 377 et seq.

Referring to the law of Rome (and inferentially to that of Scotland), Stair says:"In sale, delivery of the goods or things bought, with the obligation of warrandice in case of eviction (which is implied in sale though not expressed) is the implement of it on the seller's part, and even though the buyer know and make it appear that it were not the seller's, yet he could demand no more but delivery and warrandice."-Stair, i. 14. 1.

5 Nairn v. Scrymger (1676), Mor. 14169; E. Morton v. Cunningham (1738), Mor. 14175; Lockhart v. Johnston (1742), Mor. 14176; Little v. Dickson (1749), Mor. 14177.

6 Bell on Sale, pp. 79, 94, 95. But Bell is inconsistent, or at least ambiguous, for, while stating the rule, he qualifies it in a manner destructive to its existence. "The seller," he says, "by the act of selling gives an implied assurance to the buyer that he holds such powers as effectually to make the transfer to him. This assurance resolves into a right on the part of the buyer and corresponding obligation on that of the seller that the buyer shall be safe against eviction or disappointment from other parties."-Bell on Sale, p. 95. In his Principles (Sect. 114) Bell states the rule without qualification.

7 M. P. Brown on Sale, pp. 231, 239.

8 3 Macp. 851.

Martin.

Sect. 12.

Exceptional instance of "warranty' in Scotland.

and fittings per inventory, and the Sheriff and SheriffSubstitute (whose judgments were reversed) held that the pursuer had proved a title in another person, inconsistent with that of the seller. It was further urged that the property had never passed to the buyer, his possession being attributable to his occupation of the premises as lessee. The decision, however, is not necessarily inconsistent with the provisions of this section, taken in connection with the then existing law of Scotland as to rejection and repudiation. The buyer had been in possession for nearly three years before raising action, and the remedy asked was not rescission of the entire contract, but repayment of the price of certain items of the inventory, alleged by the buyer to have been claimed by the landlord. In holding that the action was not relevant without a statement of eviction or distress, the Court may have had in view that repudiation of the contract was not asked, and was perhaps impossible, and that therefore the remedy was limited to a warranty in the English sense of the term.

It will be noticed that the first sub-section provides an implied condition and the remaining two sub-sections an implied warranty. The distinction illustrates an exceptional case in which, in the matter of warrandice, the law of England and the former law of Scotland run on parallel lines. "Warranty," as elsewhere observed,' is generally in Scotland equivalent to "condition," but an exception exists where restitutio in integrum is impossible, e.g. where delivery has been given and the subject of sale has been used by the buyer. In such a case the contract cannot be rescinded, and the buyer's only remedy is one of damages. It is true that the measure of damages may in some cases be repayment of the full price, as where seed has been sown resulting in a total failure of crop, but the result is the same

1 COM., Sect. 10 ante, p. 46.

2 Adamson v. Smith (1799), Mor. 14244; Wright v. Blackwood (1833), 11 Sh. 722. The damages are assessed on the principle of indemnification, and may therefore include interest and expenses necessarily incurred by the buyer. Adamson v. Smith, and Wright v. Blackwood (supra); Bell v. Queensberry's Executors (1824), 3 Sh. 416. But see Inglis v. Anstruther (1771), Mor. 16633; Stephen v. Lord Advocate (1878), 6 Ret. 282.