SALE BY FRAUDULENT DEBTOR.-An innocent purchaser from a debtor's fraudulent grantee or assignee in good faith and for value will hold the goods against the debtor's creditors, 12 and so will an innocent purchaser from the debtor himself selling to defraud his creditors.13 INCUMBERED PROPERTY." If the general owner of personal property, having possession thereof, sell and deliver it to a person who has had no notice, actual or constructive, that the property is incumbered, but who purchases it in good faith for value, such Decan v. Shipper, 35 Pa. St. 239; Barker v. Dinsmore, 72 Pa. St. 427; McCrillis v. Allen, 57 Vt. 505. A falsely pretending to be the agent of B procured a load of hay from C; then representing himself as the owner of the hay sold it to B and departed with the purchase money. C hired a teamster to deliver the hay and had one of his own men help load the wagon. When he discovered the fraud he said to B "that this was the first time he had been swindled and he might as well swallow it." The next day he demanded the hay, and on B's refusal to surrender, brought an action in tort for conversion. Held, that C's title never passed from him and therefore B, as a bona fide purchaser, could acquire none, and that by his remark C waived none of his rights. Rogers v. Dutton, 182 Mass. 187, 188. Citing Rodliff v. Dallinger, 141 Mass. 1. A represents himself to be the agent of a person in good credit. Rodliff v. Dallinger, 141 Mass. 1. A represents himself to be B's partner. Moody v. Blake, 117 Mass. 23; Hardmann v. Booth, 32 L. J. Ex. 105. 12. Stokes v. Jones, 18 Ala. 734; Neal v. Williams, 18 Me. 391; Waters v. Riggin, 19 Md. 536; Green v. Tanner, 49 Mass. (8 Met.) 411; Sleeper v. Chapman, 121 Mass. 404; Gordon v. Ritenour, 87 Mo. 54; Comey v. Pickering, 63 N. H. 126; Anderson v. Roberts, 18 Johns. (N. Y.) 515; Barnes v. Hardmann, 15 Tex. 366. The owner of a wagon sold it on a Lord's Day to one who resold it to a third person who was ignorant that his vendor had bought it on a Lord's Day. Held, that it was not liable to attachment in the hands of his buyer on a writ against the original owner. Horton v. Buffington, 105 Mass. 399, 400. Citing Myers v. Meinrath, 101 Mass. 366; King v. Green, 88 Mass. (6 Allen) 139; Claridge v. Hoare, 14 Ves. 59; Way v. Foster, 83 Mass. (1 Allen) 408; Gregg v. Wyman, 58 Mass. (4 Cush.) 322; Sampson v. Shaw, 101 Mass. 145. Where, at a sale of goods for the non-payment of taxes, the collector of taxes became himself the purchaser, it was held that such a sale was voidable at the election of the owner of the goods. Pierce v. Benjamin, 31 Mass. 356. The sale, mortgage or pledge by a fraudulent vendee, even if he participates in the fraud, to a purchaser in good faith and for value is valid, and will be protected against creditors of the original vendor. 2 Mechem on Sales, § 977. Citing Hood v. Fahnestock, 8 Watts (Pa.), 489; Anderson v. Roberts, 18 Johns. (N. Y.) 515; Choteau v. Jones, 11 Ill, 300; Howe v. Waysman, 12 Mo. 169; Sydnor v. Roberts, 13 Tex. 598; Danbury v. Robinson, 14 N. J. Eq. (1 McCarter) 213; Herndon v. Kimball, 7 Ga. 432; Young v. Lathrop, 67 N. C. 63; McLeod v. O'Neill (Ky.), 22 S. W. 220. 13. Neal v. Williams, 18 Me. 391; Sleeper v. Chapman, 121 Mass. 104; Comey v. Pickering, 63 N. H. 126; Zoeller v. Riley, 100 N. Y. 103. purchaser will hold the property discharged of any prior incumbrance." 9914 MORTGAGED GOODS.--The title of the mortgagee to chattels mortgaged is absolute at law after forfeiture, and he may sell them for the satisfaction of his debt without the aid of a court of chancery; 15 but since the conduct and fairness of such a sale and the rights acquired under it are always open to investigation at the instance of the mortgagor or pledgor, the purchasers of such property do not acquire absolute title, for the mortgagor may always redeem by paying the debt and the mortgagee's title then CONDITIONAL SALES.--If one buy goods on condition that title remain in the vendor until the goods are paid for or other conditions performed, no title passes until the performance of the conditions precedent, and an innocent purchaser for value and without notice obtains no title.18 This principle applies to a vendee who 14. Andrews v. Jenkins, 39 Wis. 476. The owner of a horse, on which a livery stable keeper had a lien for its keeping, took it away from the stable with the keeper's consent, and while thus having it away from the stable in his possession, sold it to a bona fide purchaser, who took it to the stable informed the keeper of the sale and left it to be kept for him. Held, that the purchaser took it free from the keeper's lien which was lost by his surrendering possession. Fishell V. Morris, 57 Conn. 547, 552. If the mortgagee of a chattel orally authorize the mortgagor to sell it a sale by the latter would convey a good title to a bona fide purchaser." Pratt v. Maynard, 116 Mass. 388, 392. Citing Stafford v. Whitcomb, 90 Mass. (8 Allen) 518. 15. Hall v. Bellows, 11 N. J. Eq. (3 Stockt.) 334; Long Dock Co. v. Mallery, 12 N. J. Eq. (1 Beas.) 94; Chapman v. Hunt, 13 N. J. Eq. (2 Beas.) 370; Freeman v. Freeman, 17 N. J. Eq. (2 C. E. Gr.) 44, 47. 16. Morris Canal & Banking Co. v. Fisher, 9 N. J. Eq. (1 Stockt.) 667, 687, 689: Morris Canal & Banking Co. v. Lewis, 12 N. J. Eq. (1 Beas.) 323. On these accounts a sale under judicial sanction is safer, and, where the amount is large, advisable. It is the right of the mortgagee to foreclose his mortgage. He is not bound to incur the risk of selling the property without the sanction of a decree." Freeman v. Freeman, 17 N. J. Eq. (2 C. E. Gr.) 44, 47-48. 17. Doughten v. Gray, 10 N. J. Eq. (2 Stockt.) 323; Freeman v. Freeman, 17 N. J. Eq. (2 C. E. Gr.) 44, 47 Charter v. Stevens, 3 Denio (N. Y.), 33. 18. Mechem on Sales, §§ 152, 599, and cases there cited. A sale by a conditional vendee of goods in his possession, on condition that he may acquire title by the pay ment of the purchase price, is void, and his purchaser secures no title although he buys without notice of the vendor's defects. Hart v. Carpenter, 24 Conn. 427; Tomlinson v. Roberts, 25 Conn. 477; Cragin v. Coe, 29 Conn. 51: Hughes v. Kelly, 40 Conn. 148: Brown V. Fitch, 43 Conn. 512; Lewis v. McCabe, 49 Conn. 141; New Haven Wire Cases, 19 secures possession of goods sold for cash, or on credit where security is to be first given,20 which conditions the vendor has not waived. Title has not vested in him and he can convey none even to a bona fide purchaser. STATUTES. Most States have now enacted statutes which provide that sales on condition that possession shall be given to the vendee and title retained by the vendor until the performance of conditions precedent, unless in writing and recorded, shall be absolute as to all persons except the vendor and vendee and their 57 Conn. 353; Colvin v. Peck, 62 Conn. 155. One receiving goods with right to become owner on performance of certain conditions among which were that he should not sell or remove them from a certain place without owner's consent, and that they should not become his until paid for, does not convey title to a third person without performing conditions, and such third person is liable to the owner of the goods for their conversion, although he acted in good faith and had parted with them before any demand upon. him. Carter v. Kingman, 103 Mass. 517. Citing Coggill v. H. & N. H. R. R. Co., 69 Mass. (3 Gray) 545; Gilmore v. Newton, 91 Mass. (9 Allen) 171. An unpaid vendor of goods delivered under a conditional contract that title remain in vendor until payment of the price, may maintain an action for a conversion of the goods mortgaged by the conditional vendee, who, acting as the agent of the mortgagee, retains the key of the building containing the mortgaged property both before and after foreclosure sale. Geneva Wagon Co. v. Smith, 188 Mass. 202, 203. If a contract under which personal property is delivered passes no title until a certain condition is performed, the vendor in the absence of such performance, if guilty of no laches, may reclaim the property even from one who has purchased from the vendee in good faith and without notice, Went worth v. Woods Machine Co., 163 Mass. 28, 32. Citing Coggill v. H. & N. H. R. R. Co., 69 Mass. (3 Gray) 545; Hirschorn v. Canney, 98 Mass. 149. The buyer of a horse from a dealer under a conditional agreement in writing resold it in violation of its terms to a third person against whom the dealer brought replevin. Held, that oral evidence to show that according to the course of dealing between the original vendor and vendee, the vendee was expected to resell the horse, was competent and sufficient to warrant a finding that the plaintiff impliedly authorized the sale or was guilty of fraud or laches and was estopped to deny the defendant's title. Spooner v. Cummings, 151 Mass. 313, 315. A sold B certain real and personal property at a fixed price, with an agreement that some of the personalty should be so far conditional that if B should refuse or neglect to pay within three months certain notes given for the purchase price, that the sale should become void; held, that this was a sale upon condition subsequent Knox v. Perkins, 81 Mass. (15 Gray) 529. 19. National Bank of Commerce v. C. B. & Q. R. R. Co., 44 Minn. 224; Globe Milling Co. v. Minnesota Elevator Co., 44 Minn. 153; Freeman v. Kraemer, 63 Minn. 242; Owen V. Long, 97 Wis. 78. 20. Wheeler & Wilson Co. v. Irish American Bank, 105 Ga. 57. personal representatives." Where the writing is duly made and recorded subsequent purchasers from the conditional vendee have constructive notice. Section 25. Sale by Seller in Possession of Goods Already Sold. Where a person having sold goods continues in possession of the goods, or of negotiable documents of title to the goods, the delivery or transfer by such person, or by an agent acting for him, of the goods or documents of title under any sale, pledge, or other disposition thereof, to any person receiving and paying value for the same in good faith, and without notice of the previous sale, shall have the same effect as if the person making said delivery or transfer were expressly authorized by the owner of the goods to make the same. Delivery of possession is not necessary to the transfer of title between the parties. But if the buyer permits the goods to remain in the vendor's possession after sale, he enables the vendor to perpetrate a fraud upon another, buying in good faith, for value and without notice of the first sale, by selling the same goods to him. The delivery of possession has, therefore, been held to be necessary to the transfer of the title to the goods as to every one except the parties." The purpose of the provisions of this section is to prevent such fraud upon subsequent purchasers.3 By this rule, a purchaser who has clothed his vendor with the ostensible title, or, more accurately, who has not stripped his vendor of the indicia and appearances of ownership, is estopped 21. Conditional sales, § 4864, post. 1. 1 Mechem on Sales, § 167. "Under such appearances of ownership, every man is justified in regarding him as being still the owner." Streeper v. Eckart, 2 Whart. (Pa.) 302; S. P. Stephens v. Gifford, 137 Pa. St. 219; Daniels v. Nelson, 41 Vt. 161. 2. "The general rule is perfectly well established that the delivery of possession is necessary in a convey. ance of personal chattels, as against everyone but the vendor." Lanfear v. Sumner, 17 Mass. 110, 113; S. P. Ludwig v. Fuller, 17 Me. 162; Vining Possession of personal property has to deny that the vendor has authority to sell, and practically makes the vendor the vendee's agent to sell. This protects the subsequent purchaser and leaves the first purchaser, who has put it in the power of the seller to injure one of two innocent parties, to protect himself." The common law rule held as a rule of evidence that retention by the vendor of the goods after sale is a "badge of fraud;" that is, a prima facie rebuttable presumption of fraud. In some jurisdictions, this presumption is held to be conclusive. In either 4. The reason and operation of this rule is akin to the exception in Sec. 23. 1 Mechem on Sales, § 167; 2 Mechem on Sales, § 981; Burnell v. Robertson, 10 Ill. 282; Walker v. Collier, 37 Ill. 362, 367; Gradle v. Kern, 109 Ill. 557; Huschle v. Morris, 131 Ill. 587; Cummings v. Gilman, 90 Me. 524; Cole v. Bryant, 73 Miss. 297; No. Pacific Lumber Co. v. Kerron, 5 Wash. 214. The title of a purchaser of property in good faith after the seller has filed a petition in insolvency is invalid as against that of the latter's assignee. Palmer v. Jordan, 163 Mass. 350, 351. Citing Freeland v. Freeland, 102 Mass. 475; Gibbs v. Thayer, 60 Mass. (6 Cush.) 30, 33; Morgan v. Abbott, 148 Mass. 507. "If the owner of goods sells them to A but retains possession and afterward sells them to B, an innocent purchaser, who takes possession, the title of A is gone. It is of no consequence that he acted in good faith and paid a fair price, nor that his reasons for leaving the goods with the vendor were such as grew out of his confidence in or desire to aid him. The fact that the goods were left in the hands of the former owner with nothing to indicate that his relation toward them was changed put it in his power to sell them again for a full price to an innocent purchaser. When he makes such sale, one of the purchasers must lose the money he has paid; assuming that both are alike honest, on which of them ought the 8 loss to fall? Clearly on him whose act of ownership has made or contributed to make the loss possible." Stephens v. Gifford, 137 Pa. St. 219. 5. 2 Mechem on Sales, § 990. 6. "A subsequent purchaser with no notice of a prior sale receiving possession has a better title than one who has before purchased the same thing with no delivery of possession." Crawford v. Forristall, 58 N. H. 114. "When the same goods are sold to two different persons, by conveyances equally valid, he, who first lawfully acquires the possession, will hold them against the other." Lanfear v. Sumner, 17 Mass. 110; S. P. 1 Mechem on Sales, § 167; Jewett v. Lincoln, 14 Me. 116; Cummings v. Gilman, 90 Me. 524; Lamb v. Durant, 12 Mass. 54; Jewett v. Warren, 12 Mass. 300; Shumway v. Rutter, 24 Mass. (7 Pick.) 56; Brown v. Pierce, 97 Mass. 46, 48; Ricker v. Cross, 5 N. H. 570; Winslow v. Leonard, 24 Pa. St. 14; Stephens v. Gifford, 127 Pa. St. 219; Caldwell v. Ball, 1 T. R. 205. 7. Patten v. Smith, 5 Conn. 196, 201; Swift v. Thompson, 9 Conn. 63, 70; Hamilton v. Russell, 5 U. S. (1 Cranch) 309; Hight v. Harris, 56 Ark. 98; Chumar v. Wood, 6 N. J. L. (1 Hals.) 155; 2 Mechem on Sales, § 983. 8. See Sec. 26. This rule does not apply to sales of goods on execution. Heubler Smith, 62 Conn. 186, 189. "The want of any real or substantial change in the possession of prop |