§ 825. Unless waived, conditions precedent.— All of these acts are, unless waived, conditions precedent to the buyer's right of rescission, and a failure to perform them will foreclose his right.1 Express provision to this effect is frequently inserted, in the form of stipulations that failure to comply on the part of the buyer, or continued use, or use beyond a specified term, shall be deemed conclusive evidence of performance by the seller.2

The fuller discussion of these provisions will be found in the later chapter on Acceptance by the Buyer.3

§ 826. Rescission for non-payment of price. In the ordinary case, the seller who has transferred the title and delivered over the possession, without insisting upon payment, or upon giving a term of credit, has no implied right reserved to rescind the sale and recover the goods simply because the buyer does not pay as agreed. The seller's remedy in such a case rests simply in the contract.

Of course, where fraud is present, a different question arises, and cases may exist wherein the seller may rescind, as will be seen in the chapter on Avoidance of the Contract for Fraud.5

So, where payment and the transfer of the title are to be concurrent acts, and the buyer obtains possession in expectation of immediate payment, the seller may regain his goods if payment is not made as was expected."

§ 827.. Again, where the seller is in possession by virtue of his vendor's lien, he may, in many cases, as will be seen, treat the contract as rescinded in case the buyer makes default in payment.'

And the seller may expressly reserve the title until full pay

ment, though he surrenders the possession; and he may sell upon condition that in case of default the title shall revest in him.2

All of these cases, however, stand upon exceptional ground, and the general rule remains, as stated at the outset, that mere non-payment of the price does not justify rescission by the seller of an executed and completed sale.

1 See ante, § 585 et seq.

690

2 See ante, §§ 572, 693.

CHAPTER III.

OF AVOIDANCE OF THE CONTRACT FOR FAILURE OF CONSID

ERATION.

§ 828, 829. Of the nature of the ob- § 835. How in sales of commercial

jection in general.

L. AS A DEFENSE TO THE BUYER.

830. In what cases applicable as defense to buyer.

831. How in case goods not delivered at all, or in part only,

instruments.

836. How on sale of goods to which the seller had no title.

837. How in case goods conditionally sold are retaken by seller.

or were not such as buyer IL AS GROUND OF ACTION BY THE

bound to accept.

832, 833. How when article re

ceived of no value - Caveat
emptor.

834. How on sale of invalid patent.

BUYER.

838, 839. Buyer may have action to recover price paid without consideration.

§ 828. Of the nature of this objection in general. The objection of failure of consideration seems to have an established place in our law, but precisely what is meant by it, or what its limits and effects may be, seem nowhere to be accurately defined. It is often confused with the defense of mistake. It is often applied where a failure of performance of some condition precedent is the true reason. It is often interposed where a breach of an express or, especially, an implied warranty is the real defense. It may also be interposed where fraud or illegality would be a more appropriate defense. Thus, for example, a person who has apparently made a contract for the purchase of an article may, when called upon for performance, show that his apparent promise was not a real promise, because the parties were mistaken as to the subject-matter, the person, and the like. In such cases it is sometimes said that the consideration for his promise has failed, but the true ground is that there was no real promise or consent.

§ 829. So, where the promise of one party was not to be performed until the other had done some act which he has failed to do, it is frequently said that the consideration for the first party's promise has failed; but it is also true and probably more accurate to say that the contract has been discharged by breach. Again, where the purchaser has been given an article of no value where the seller has expressly or impliedly warranted that the thing should be of value, or where the purchaser has been given an article to which it appears that the seller had no title as he expressly or impliedly warranted that he had, it is often said that the purchaser is relieved from his obligation to pay by the failure of consideration; but it may also be said in either case that his defense would be a breach of warranty. And finally, where there has been such fraud as will justify a rescission of the contract, it is not infrequently said that the party who has been defrauded may be relieved because there has been a failure of the consideration for his promise.

I.

AS A DEFENSE TO THE BUYER.

§ 830. In what cases applicable as a defense.- Reserving for other places the consideration of the questions of mistake, fraud, illegality, warranty and performance, it may be asked whether there are any cases in which, in the absence of mistake, fraud, illegality, breach of warranty or failure of performance, the buyer may be relieved from his obligation because of a failure of consideration.

§ 831. How in case goods not delivered at all, or in part only, or not such as buyer bound to accept.-Where the goods contracted for are never delivered at all, or, though delivery were tendered, were not of such kind, quality or condition, or in such quantity, at such place or time, that the buyer was bound to receive them, and he rejected them, or, if delivered,

1 See, for example, Nash v. Towne (1866), 72 U. S. (5 Wall.) 689.

2 See, for example, Pope v. Allis (1885), 115 U. S. 363.

1

were returned by virtue of an express or implied right to do so, there would clearly be such an entire failure of consideration as would defeat a recovery by the seller. These matters, as will be seen, stand as conditions precedent to the buyer's liability. And the same result would ensue if the seller failed, in such respects, in part only where the contract was entire pro tanto where it was severable.1

or

§ 832. How when article of no value - Caveat emptor.Such a defense, however, cannot be interposed merely because the article sold proves to be of no value; for it is well settled that, in the absence of fraud or warranty, either express or implied, a purchaser of an article open to inspection cannot be relieved from his promise to pay because it is subsequently discovered that the article for which he has agreed to pay is of no value. In such cases the doctrine of caveat emptor applies. If he gets the article agreed upon, he must pay for it, though it proves to be valueless."

§ 833.—. There may, of course, be express warranties given, and, as will be seen," the law in certain cases will imply a warranty, as where goods, not open to inspection, are sold by description or sample, or where a manufacturer or dealer undertakes to supply goods of a certain kind or for a certain purpose; but none of these cases is the one now under consideration. "No principle of the common law," said Mr. Justice Davis of the supreme court of the United States, "has been better established or more often affirmed, both in this country and

1 See ante, §§ 812-815.

2 See post, 1206 et seq.

treated by the buyer as severable. Avery v. Wilson (1880), 81 N. Y. 341,

3 See Norris v. Harris (1860), 15 Cal. 37 Am. R. 503. 226.

4 See Young Mfg. Co. v. Wakefield (1876), 121 Mass. 91; Wheadon v. Olds (1838), 20 Wend. (N. Y.) 174; Hill v. Rewee (1845), 11 Metc. (Mass.) 268; Morgan. McKee (1874), 77 Pa. St. 228; Richards v. Shaw (1873), 67 Ill. 222. Or, though originally entire, is

5 Bryant v. Pember (1873), 45 Vt. 487; Barnard v. Kellogg (1870), 10 Wall. (U. S.) 383; Kircher v. Conrad (1890), 9 Mont. 191, 18 Am. St. R. 731, 23 Pac. R. 74, and many other cases cited in notes to § 1311, post. 6 See post, § 1320 et seq.

7 In Barnard v. Kellogg, supra.