Court Opinion

ID: 7129845
Source: CourtListenerOpinion
Date Created: 2022-07-24 15:17:35.294803+00
Date Added: 2024-06-11T16:14:25.730804
License: Public Domain

JUDGE DUVALL
delivered the opinion or the court:
The contract sued upon in this case must be regarded as a special or executory agreement for the sale and delivery of $10,000 worth of whisky. That such was the intention of the parties is manifest upon the face of the instrument. The vendors were distillers, as appears from the record, and were engaged at the time the contract was entered into, in the manufacture of whisky at their distillery. The subject of the contract was “ ten thousand dollars’ worth of whisky at twenty-one cents per gallon,” to be delivered at any time within twelve months from date. No specific lot of whisky is referred to, nor do the terms of the writing authorize the inference that the whisky was then on hand, or had been set apart, or had even been then manufactured by the vendors, or that the appellees so understood at the time they executed it. On the contrary, the most reasonable and natural construction of the agreement, giving proper effect to all its parts, is, that the whisky was to be thereafter manufactured, and to be delivered at the time and in the manner stipulated.
Even if the case of Bryan vs. Lewis were conceded to be good authority at the present day, the case under consideration is not within either its facts or its principles. That was the case of “ one who sells what he has not now, and has made no contract for purchasing, and has no definite right to expect, as by consignment, but intends to go into the market and buy. It was held that he could not enforce it.” But this doctrine was directly overruled in the late case of Hibblewhite vs. McMorine, (5 M. & W., 462.) “Such a contract,” says Parsons in his work on contracts, (1 vol., p. 439,) “ if enforceble, as by the later authority and the better reason it seems to be, must certainly be regarded as a contract for a future sale, and not as a present contract of sale; and, therefore, the property in the thing, when it is acquired by the proposed vendor, does not pass at once to the proposed vendee until the actual sale be made.”
*587So, Chancellor Kent, in stating the requisites of a valid executed sale, says: “The thing sold must have an actual or potential existence, and be specific or identified, and capable of delivery, otherwise it is not strictly a sale, hut a special or executory agreement'''’ — referring to several authorities. (See also Chitty on Contracts, p. 418.)
In every completed sale, the property in the thing sold passes to the purchaser, or, according to the definition given by Blackstone of a sale, there must be a “ transmutation of property from one man to another, in consideration of some price or recompense in value.” And it is for this reason that all the. authorities concur in laying down the rule just stated, that there can be no valid sale unless the thing sold have either an actual or potential existence at the time of the sale. For it would be absurd to say that there could be a transmutation of the property, from one man to another, in a thing which had no existence, actual or potential.
But neither the rule itself, nor the reason on which it is founded, has any application to an executory agreement for a future sale. And in the failure to distinguish between these two distinct classes of contracts, lies the fallacy of the whole argument by which the counsel for the appellees attempt to prove that the contract before us is invalid and not enforceable.
The case of Wheeler vs. Wheeler, decided at the present term, does recognize the elemental law of sales, as contended for on the part of the appellees, and it does also expressly recognize the distinction just referred to, between sales, properly so called, which pass the title, and executory or special contracts for future sales in which no title passes, because no existing or specific thing is sold, but which entitle the party injured by a breach of the contract, to an action for the recovery of such damages as he may have sustained in consequence of such breach.
It follows from this view, that the facts set forth in the first paragraph of the answer, presented no valid defense to the action, and the court erred in overruling the demurrer to that paragraph.
*588We are of opinion that the demurrer to the second and third paragraphs was properly overruled.
The allegation of the second paragraph is, that the writing sued on was obtained from the defendants by fraud, covin, and misrepresentation of the plaintiffs. This is not, as seems to be supposed, the statement of a mere conclusion of law. It is the averment of a substantive and traversable fact. This was repeatedly held to be a good plea in cases decided before the adoption of the Civil Code; and there is nothing in the section of the Code referred to (sec. 115) which can be construed as .operating to change the law in this particular.
And although the fifth paragraph of the answer contains a large amount of useless and redundant matter, it does, nevertheless, set forth a state of fact which, if true, must be deemed sufficient to defeat the action.
The record shows that the plaintiffs excepted to the action of the court in overruling their demurrer to each paragraph of the answer, and that they elected to stand by the demurrer to the first paragraph. As that paragraph is held to present no sufficient defense to the action, the plaintiffs will of course be entitled to a trial of the issues made by the second and fifth paragraphs. They were not bound, or even allowed by the Code to reply; but the facts stated in those paragraphs stood controverted by law.
For the error mentioned the judgment is reversed, and the cause remanded with directions to sustain the demurrer to the first paragraph of the answer, and.for further proceedings not inconsistent with this opinion.
There is no error in the judgment against Root, &c., and the judgment is affirmed upon their cross appeal.