turns upon the point whether (1) the buyer has left any- Sect. 45. thing undone for the perfect transfer of the property to himself, in which case, the sale being incomplete, he may honestly decline to complete it to the prejudice of the vendor, or (2) whether, although the transfer of the property be complete, the transit into his possession remains incomplete, in which event he may honestly refuse the possession so as to leave to his vendor the right of stoppage in transitu, which will be equally available to the latter if he can accomplish it before the assignees get possession of the goods." To this it may be added that mere custody by the buyer or his agent does not seem to involve possession in the character of owner, if there is clear evidence that such custody was intended for a different purpose, such as the preservation of the goods, or the setting free of the vessel.2

1

It

no power to reject.

After sequestration, the buyer has no power to reject,3 Sequestrated and if the goods are delivered into the bankrupt's stock bankrupt has before stoppage, the right is defeated.1 It is immaterial whether the bankrupt accepts or merely stands aside; if he accepts, he does so as the agent of his general creditors. follows that, after the bankrupt is divested of his estate and loses the power of rejection, he has no power to refuse delivery or to prolong the transit for the benefit of the seller by taking the goods custodiæ causa.5

Mere notice of an intention to stop the goods, given by

the benefit of all concerned." The agent's instructions were held evidence of the buyer's intention, and the seller was consequently preferred to the buyer's creditors.

1 Benjamin, p. 486.

2 "If the possessor of the goods has the intention to hold them for the buyer, and not as an agent to forward, and the buyer intends the possessor so to hold them for him, the transitus is at an end, but I apprehend that both these intents must concur "-Blackburn, p. 364. See Strachan v. Knox and Co.'s Trustee (21st January 1817), F.C.

3 Bell says "this has been held with expressions of regret."-Bell's Com. i. 255.

Hamilton v. Barrow and Reynolds (1767), Bell's Com. i. 255, note.

5 In Sinclair and Williamson's Creditors v. Robertson and Aitken (1801), Mor. App. Sale 3, one of the judges said: "The intimation to the bankrupts is nothing; they could not interfere. They could have no right to refuse the goods had they been brought to them for delivery." This dictum is reported by Bell (Com. i. 250, note), who was one of the counsel in the case. It does not appear in the Faculty Report or in Morrison.

Sect. 45.

Effect of notice

of intention to stop.

Ship chartered by buyer.

Part delivery -stoppage of remainder.

the seller to the creditors or the trustee of an insolvent or bankrupt buyer, will not prolong the transit, or prevent acceptance on the termination of the transit.1 In order to protect himself the seller must take the steps set forth in Sect. 46.2

Where a ship for conveying the goods is chartered by the buyer [Sub-sect. (5)], much depends upon the nature of the charter-party. If the ship has been " demised" so that the master is the servant of the charterer, it is practically the buyer's ship, but if the subject of hire is merely the exclusive use of the vessel, and the master remains the servant of the shipowner, he is an independent person, and the goods may be stopped. It is, however, a question of intention in every case.3

5

The rule of Sub-sect. (7) corresponds with that of Sect. 42. Part delivery does not affect the seller's rights of lien or stoppage in transitu over the remainder of the goods unless it is so intended. It was even held in Crawshay v. Eades (1823), that although part of the goods had been landed on the purchaser's wharf, the transitus was not ended as to these goods, because it was not the carrier's intention to give possession to the buyer. The English cases as to part delivery are collected in a note to Benjamin [p. 800,

1 Bell's Com. i. 249.

2 The seller must take some active step for resuming the possession Bell's Com. i. 250. "Here the seller was not vigilant: he did not get the goods into his possession; he suffered creditors to arrest, and the goods to come into public custody for the benefit of the arresting creditors."-Per Lord Meadowbank in Fotheringham v. Somerville and Co. (26th May 1809), F.C.

3 Robertson v. More (1801), Mor. App. Sale, No. 3; Baxter v. Pearson (1807), Hume 688; Drake v. M'Millan (1807), Hume 691; Neish v. Trompousky and Co. (1807), Hume 693; Turner v. Trustees of Liverpool Docks (1851), 6 Ex. 543; Schotsman v. L. and Y. Ry. Co. (1867), 2 Ch. App. 332; Berndtson v. Strang (1867), L.R. 4 Eq. 481 (1868), 3 Ch. App. 588; Ex parte Rosevear China Clay Co. (1879), 11 Ch. Div. 560; In re Bruno, Silva, and Son (1887), 56 L.T. N.S. 577-Bell's Prin., Sect. 1308; Benjamin, pp. 856 et seq. Baxter v. Pearson is considered by M'Laren to be an unsound decision-Bell's Com. i. 233, note. See as to goods shipped in a general ship in the buyer's name-M'Leod and Co. v. Harrison (1880), 8 Ret. 227. The statement in Bell's Prin. (Sect. 1308) is subject to qualification. 4 Melrose v. Hastie (1851), 13 D. 880, 14 D. 268.

5 1 B. & C. 181.

6 Compare this case with Collins v. Marquis' Creditors (1804), Mor. 14223, and Robertson and Aitken v. More (1801), Mor. App. Sale, No. 3.

note (u)], from which cases the editors of the fourth edition1 Sect. 45. deduce the following rule:" It rests with the party who relies on the part delivery as a constructive delivery of the whole, to prove the intention to make it operate as a delivery of the whole. This proof may be established (1) from the circumstances under which the delivery took place, e.g. the purchaser may at the time express his intention to take the whole of the goods, although he actually takes only a part; or (2) perhaps, in some cases, from the intrinsic nature of the goods delivered, as e.g. where the cargo consists of an entire machine, and an essential portion of it is delivered to the purchaser. Further, where the shipowner or carrier has not been paid in full his freight or charges, there is a strong presumption that he intends to retain his lien, and part delivery will not operate as a constructive delivery of the whole, unless it can be shown that the shipowner or carrier assented to the buyer's taking possession of the goods without payment of freight or charges.'

"3

As, in lien, the seller's privilege is merely that of detention of the goods in security of the price, so, in stoppage in transitu, the right cannot be exercised in respect of freight, insurance, or other expenses or damages. Bell indeed goes further, and, founding on a dictum of Lord Thurlow, he suggests that, "as the title to stop in transitu arises from a voidance of the contract, and the act of stopping puts

1 Messrs A. B. Pearson-Gee and H. F. Boyd. 2 Ex parte Cooper (1879), 11 Ch. Div. 68. In Girdwood and Co. v. Pollock and Co. (1827), 5 Sh. 507, the question was raised but not decided, whether delivery of part of a machine which a manufacturer was employed to make, and for which a bill had been granted, transferred the property of the part.

3 Brodie questions the Scottish case of Collins v. Marquis' Creditors (1804), Mor. 14223, on the ground that it is inconsistent with the rule in England whence stoppage in transitu is derived, but his notion of the English law on this subject is not founded on decision, but on an à priori view of what it is, or ought to be. See Brodie's Stair, p. 883 and note.

On the other hand, the seller is not liable for a premium of insurance from which he derives no benefit-Smith and Jamieson v. Drake (9th March 1809), F.C.

The

5 The contract may be rescinded without necessarily excluding a claim for damages at the instance of one of the parties as, e.g., under Sect. 48 (4), but in the ordinary case the contract is not rescinded [Sect. 48 (1)]. tendency of Scottish decisions was to hold the contract void. See Kincaid v. Murray and Henderson (1798) as reported in Bell's Com. i. 253, note, and cited

Effect of stoppage on seller's rights. Claims for carriage, in

surance, and damages.

Sect. 45.

things into the same situation between the vendor and vendee as if there never had been any transaction between them relative to the goods so stopped, the stopper can raise no charge against the bankrupt's estate respecting such goods, though the contract had in part been fulfilled by carrying them so far, or insuring them."1 This, however, was not law in Scotland even before this Act,2 and it is clearly inconsistent with Sect. 48.

Sect. 46.

HOW STOPPAGE
IN TRANSITU

IS EFFECTED.

46.-(1.) The unpaid seller(") may exercise his right of stoppage in transitu either by taking actual possession of the goods, or by giving notice of his claim to the carrier or other bailee or custodier in whose possession the goods are. Such notice may be given either to the person in actual possession of the goods or to his principal. In the latter case the notice, to be effectual, must be given at such time and under such circumstances that the principal, by the exercise of reasonable diligence, may communicate it to his servant or agent in time to prevent a delivery to the buyer.

(2.) When notice of stoppage in transitu is given by the seller to the carrier, or other bailee or custodier in possession of the goods, he must re

sub nom. Murray and Henderson v. Kincaid (1796) in Sinclair and Williamson's Creditors v. Robertson and Aitken (1801), Mor. App. Sale 3.

1 Bell's Com. i. 253. See also Bell's Com. i. 250 et seq. The opinion attributed by Bell to Lord Thurlow is said by him to have been expressed in Allan, Steuart, and Co.'s Case, but no remark of that description is to be found in the ordinary report. Elsewhere, Bell informed his readers that he had much communication with Lord Thurlow after the decision (Cơm. i. 223), in reference to which statement, Brodie brusquely remarked that it seemed "pretty evident from the learned commentator's misconception of the English law of sale, that he could not derive the just benefit from those communications."-Brodie's Stair, p. 865, note.

2 See Stoppel and Co. v. Stoddart (1850), 13 D. 61.

deliver the goods to, or according to the directions of, Sect. 46. the seller. The expenses of such re-delivery must

be borne by the seller."

NOTES.

(a)" Unpaid seller." Defined Sect. 38.

(b) "May exercise his right." This phrase is permissive, and suggests that there are other modes of stoppage in transitu not here specified. Thus, service upon the carrier of an action of interdict [note (d) infra], and, possibly, also, an arrestment in the hands of the carrier following upon an action by the seller against the buyer, would sufficiently certiorate the carrier of the seller's intention to exercise his right of stoppage. By contrast, where notice is given to a principal as provided in the latter part of the sub-section, the word "must" is used. So also in Sub-sect. (2) the carrier must re-deliver, and the expenses must be borne by the seller.

66

(c) “ Actual possession." "The vendor has a right if unpaid, and if the vendee be insolvent, to retake the goods . . and thereby to replace himself in the same situation as if he had not parted with the actual possession." 1

Bell

(d) "Notice." No specific form or solemnity is necessary.2 says "the most unquestionable stoppage is by the warrant of a judge," judge," but such warrant, though formerly often applied for in Scotland, is quite unnecessary. In Robertson v. More 4 (1801) the notice was given verbally to the shipmaster by a partner of the seller's firm, and the report bears that "nearly the whole Court were of opinion that, the shipmaster being the custodier for behoof of both parties, private intimation to him was effectual." If, however, judicial proceedings at the instance of the seller are served upon the shipmaster or the principal custodier, the intention to stop will be sufficiently intimated.5

1 Per Parke, B., in James v. Griffin (1836), 2 M. & W. 623 at p. 632. 2 Bell's Com. i. 248; Benjamin, p. 882.

3 Bell's Com.. i. 249.

4 Mor. App. Sale 3.

5 In Stoppel and Co. v. Stoddart (1850), 13 D. 61, the seller raised a suspension and interdict to prevent "the captain of the vessel delivering the cargo either to the buyer or to any person on his account or behoof." Appearance was entered by an indorsee of the bill of lading, but the indorsation being afterwards reduced as a fraudulent preference under the Act 1696 c. 5, the interdict was held an effectual stoppage, and the seller was preferred to the buyer's trustee in bankruptcy.