The buyer of a chattel from one not having title or power to sell does not, as a general rule to which there are few exceptions, get a good title. The seller as a rule conveys no better title than he himself possesses. But possession of personal property is evidence of ownership, and consequently of the right to sell. There is a distinction between possession and ownership that must be kept in mind. One may be in possession and not be the owner. The possession may have been obtained fraudulently, and it is possible for one in such possession, by virtue of what is known as estoppel, to sell and convey a good title to another, an innocent purchaser.

If the seller has no title, he can as a rule convey none, but if he has a voidable title, it may be possible for him to transfer a perfect title to another, as, where one who having no knowledge of the defect buys in good faith.

2. The Contract. Reference should be made to the section of the Statute of Frauds relating to the sale of goods. (See page 43.) Three conditions are presented-a compliance with the statute, to pay a part of the purchase price, or to deliver a part of the goods by way of earnest.

3. The Memorandum. The statute requires in the absence of part payment or earnest, some note or memorandum signed by the party to be charged. It is not necessary that the memorandum be in contract form, and, in fact, the note or memorandum is not a contract; it is merely evidence that enables the contract to be established. The writing should contain all of the terms. The seller and buyer should be identified, and the price, time of payment, and description of the property should be certain. The essentials of a general contract should appear. No formality in the drawing of the note or in its structure is necessary. While the memorandum has not the dignity of a written contract, the general rule of evidence relating to written contracts is applicable.

4. Part Payment. A usual way to avoid the necessity of reducing the agreement to writing is to make a part payment of the purchase price. This part payment must be something of

value, not necessarily money. A promise to pay is not sufficient, nor is it a tender. A promise to pay to a third party who is a creditor of the seller is sufficient, if acceptable to the creditor. Some states by statute require that the payment be made at the time of the making of the contract.

5. Part Delivery. A part delivery of the goods sold is held sufficient to take the sale requirements out of the operation of the Statute of Frauds. The part delivered must be honestly made with the intention of transferring the absolute title to the whole quantity, and the part delivered must be of such a quantity as to lessen the amount to be delivered at a later date.

6. Price. The price must be a money consideration. It is what distinguishes a sale from mere trade or barter, and also from a gift. Adequacy of price is not essential; it is sufficient if the parties have agreed on a price. Barter is the exchange of one commodity for another, and is one of the earliest forms of contract. A gift is a transfer of title to a chattel without consideration. To be effective, a delivery of the chattel must be made. If the giver thereby deprives himself of the ability to pay his debts, the transfer may be set aside as fraudulent by an injured creditor. This is not so in case of a bona fide sale, or a barter of even exchange. When no price has been stipulated by the parties, the law presumes a reasonable price was intended, which is usually the market price.

7. Subject Matter. While formerly the subject matter of a sale did not include all kinds of personal property, there is little doubt that now any kind of personal property may be the subject matter of a sale. The English rule defined goods as all chattels personal other than money and choses in action. An earlier rule declared that only things capable of larceny could be the subject matter of a sale. Money was not considered as subject to bargain and sale.

8. Property. Property must be in existence in order to be sold. If it has ceased to exist, unknown to either party, the sale fails. If an article has been paid for and then is destroyed before

the delivery is legally complete, the sale also fails. An agreement to sell goods not yet in existence, or to be manufactured, is not a sale but an agreement to sell. One may, in the absence of statutory prohibitions, sell all that he lawfully possesses. He may also enter into an agreement to sell what he does not yet possess or what he may hereafter possess.

To make a valid sale, the seller must be the owner, or authorized by the owner, in order to sell. The true owner is one who has undisputed title to the thing and also has the right to demand possession.

239. Other Relationships. As there are a number of relationships that may be assumed by parties relative to property, it may not be amiss to define these various phases.

A sale is the transfer of property from one person to another for a valuable consideration, and passes the title.

A pledge or pawn is a delivery of goods to another as a security for a debt or other obligation. The possession passes but the title does not.

A mortgage is the transferring of the title to another as a security. The title passes conditionally; the possession may or may not pass; generally it does not.

A lien is the right to hold another's property, coupled with possession, until some specific charge has been satisfied.

The question of ownership must be determined in order to locate properly where loss is to fall, in case the goods are destroyed. As a general proposition, it may be said that the loss falls upon the one holding the title, provided due care has been exercised by all persons concerned.

Sale is a part of the general subject of contracts. In it are found the same general elements and the same underlying principles. There must be competent parties, proper subject matter, a valid consideration, and a meeting of minds.

To comply with the Statute of Frauds, a note or memorandum of the sale should be signed by the party to be charged. Compliance with the

statute may be dispensed with by payment of part of the purchase price, or by delivery of part of the goods.

The price must be a money consideration. If goods are exchanged for goods the transaction is an exchange or a barter. A transfer of title without consideration is a gift; but delivery of the chattel is essential. Where no price is stipulated, a reasonable price or market value is presumed.

All kinds of personal property may be the subject of sale. If the property has ceased to exist, the sale fails. If it is destroyed before delivery is legally complete, the sale likewise fails.

A pledge is a delivery of goods as a security. Possession passes but title does not.

A mortgage is transfer of title to another as a security. The possession generally does not pass.

A lien is a holding of property to secure the performance of a specific promise.

An innocent purchaser is one who pays a valuable consideration without notice of other persons' rights or of defects in the seller's title.

241. QUESTIONS

What are the elements to be considered in contracts of sale? What are the requisites as to parties? Distinguish between possession and ownership with reference to capacity to transfer title.

What provisions of the Statute of Frauds must be complied with in sales of personal property? What should the "Memorandum" contain? What is the purpose and operation of "part payment"? What is the purpose and operation of "part delivery"? What are the requisites of price in a sale?

What is barter? What is a gift? What things may be the subject matter of a sale?

State some instances in which a sale may fail. Define sale; pledge; mortgage; lien.

What is the difference between a sale and an agreement to sell? What is the distinction between a sale and a pledge? A sale and a mortgage? A sale and a lien? Of what significance is the location of the title?

242. Introduction. So far as the buyer and seller are concerned, the sale is complete when the agreement is complete, and delivery is not necessary. A sale without delivery, however, is looked upon unfavorably by the law, as it presents possibilities of defrauding third parties. If A sells a horse to B, and still, with B's consent, retains possession, holding himself out as owner, C, an innocent third party, may be led to believe that A is the owner and buy the horse and take possession. In such a case C obtains a good title, and the first sale is held void since no delivery was made. But B may recover the price paid.

1. What Delivery Is. This is a question of importance. Delivery can only be made of specific goods. If goods are sold and destroyed before delivery is made, the loss falls on the seller; but if delivery has been made, the loss falls on the buyer. Delivery has been effected whenever the buyer exercises ownership or control of the goods. When the buyer exercises ownership all title ceases in the seller, and any relationship that he may exercise thereafter toward the goods is that of care taker. When the seller has performed his part of the contract, the title passes to the purchaser, together with the attendant losses. If A sells grain to B and it is measured and set aside in accordance with B's