Court Opinion

ID: 6582542
Source: CourtListenerOpinion
Date Created: 2022-07-20 19:39:27.141494+00
Date Added: 2024-06-11T15:56:56.366541
License: Public Domain

Carpenter, J.,
(dissenting.) I cannot look upon this transaction otherwise than as a sale and delivery of the liquors in question to Corture, with an agreement that, as between themselves, the title was to remain in the seller for the sole purpose of securing payment of the purchase money. In principle I am unable to distinguish it from a sale and delivery accompanied with a re-transfer of the title, without possession, as security merely—in legal effect a mortgage. It is an attempt to do with personal property what is done with rreal estate, when that is sold and mortgaged to the grantor to secure payment of the purchase money; and that is, to create by parol a valid lien on personal property, while ownership for all other purposes, and the possession, remain with the lienor. That is clearly contrary to the policy of our law. A valid secret mortgage, without possession, has always been treated in this state as of no validity against creditors of the mortgagor. Any kind of personal property may be mortgaged or pledged if the pledgee takes and retains possession of it. By statute machinery, household furniture, and some other kinds of property, may be mortgaged by a written instrument executed and recorded as the statute requires. But this is a pledge of personal property by parol, the pledgor retaining the possession and the right to sell or use the thing pledged, the sale or use of which exhausts the property and destroys the lien. I had always regarded this as an impossibility. It is true we have approached that position in some of our decisions; but not until now, or quite recently, have we come to it.
In Forbes v. Marsh, 15 Conn., 384, A agreed to sell a coach to B at a future day upon the payment of the agreed price, B in the mean time to have the possession and use of the coach. He failed to pay and subsequently the coach was attached as his. This court held that the transaction was not a sale, but an agreement to sell at a future day, and that the title did not vest in B.
In Hart v. Carpenter, 24 Conn., 427, B took the plaintiff’s *417cow into his possession, under an agreement that he should be paid for her keeping by the milk she would yield, and if, at any time within four months, he should pay the plaintiff thirty-five dollars, the title to the cow should vest in him. B did not pay for the cow but sold and delivered her to the defendant, who bought her in good faith. It was held that the defendant thereby acquired no title.
In Tomlinson v. Roberts, 25 Conn., 477, A sold and delivered a horse to B and took his note for the price, soon after which, by mutual consent, the contract of sale was annulled, the horse delivered back to A, and the note given up to B. It was then agreed that B should have the horse at the same price, provided he paid the amount within sixty days, for which he was to give his note, the horse to remain the property of A until the note was paid, and to be kept in his stable, but used by B at pleasure, he paying a fixed rate per week for such use. Before the note fell due B absconded, having first disposed of the horse to C. Held that the title to the horse after the second arrangement remained in A.
In Cragin v. Coe, 29 Conn., 51, A leased to B certain personal property, with an agreement to sell the same to him on payment of the price agreed upon; the title until such payment to remain in A. A part of the price was paid at the time in cash, and the negotiable notes of B given for the balance, which he failed to pay. Held that the title remained in A.
In Hughes v. Kelly, 40 Conn., 148, by a written contract A agreed to let and B to hire a carriage and horses belonging to A for eight months, at a rent of $12 per week payable weekly; the property to be owned by B at the end of the term if the rent should be paid according to the contract. It was held that the contract did not constitute a sale, but was an executory agreement for a future sale.
In Brown v. Finch, 48 Conn., 512, the owner of a mowing machine delivered it to A under an agreement by which A was to become the owner on paying a certain sum agreed on, part of which was to be paid down and the balance in install*418ments at certain fixed times, the owner to have the right to retake possession on-default of any of the payments. It was held that the title did not vest in A.
In none of these cases was there in form even a present sale. There were agreements to sell; there ’ were leases giving the lessee the right contingently to become the owner; and there were sales contingent on the performance of future conditions. In none of them was the property exhausted by its use; and in none of them was the contemplated use by the lessee or bailee at all inconsistent with ownership in another.
But in Lewis v. McCabe, 49 Conn., 141, a case quite different in its facts, the reasoning in the preceding cases was applied. I thought then that the court went too far, but I contented myself with a silent dissent. I thought then and I think now that the tendency of that decision is in the wrong direction; that it applied the doctrine of agreements to sell and contingent sales to cases radically different. There is danger of encroaching upon the well-settled principles of law applicable to the possession of personal property and liens thereon by pledge or mortgage, and of preparing the way for fraud. I think it cannot be denied that that case, following some Massachusetts cases, and cases in some of the other New England states, and rejecting the doctriné prevailing in New York and Pennsylvania, occupies a position far in advance of any other case in this state. While I feel bound by it as far as it goes, I do not feel bound to go any further in that direction. In that case, as the court interpreted the finding, McAvoy, (Corture in the present case,) was authorized to sell the liquor, not as his own, but as the property of the plaintiff, (Mack in the present case.) That was the. pivotal point in the case. Loomis, J., speaking for the majority of the court, says: “ If however the contract in question must be construed to mean that the plaintiff authorized McAvoy to sell the property as his own, we should be constrained to hold it so absolutely inconsistent with the retention of the title in the plaintiff as to waive or make void the condition.”
*419Now let us analyze this finding and see how far this language is applicable to this case.
I concede that the court below has found, as it was found in that case, that the liquors were sold and delivered “ upon the express condition that the title to them should remain in the plaintiff until they were fully paid for.” If that was all that case might govern this. But it is not all. There are some features of this case which are entirely inconsistent with that finding, and which did not exist in that case.
In the first place, accompanying the delivery of the property, there was an absolute bill of sale. In that bill of sale there was not the slightest reference to any condition. To say nothing of the rule of law, that where the transaction is reduced to writing parol evidence is inadmissible to contradict or vary it, and admitting that that principle may not be applicable to this case, yet it remains true that where one party deliberately puts in writing his understanding of the transaction and the other party accepts it as correct, the writing is much better evidence of what was really done than the recollection of the parties after a controversy has arisen. But I do not invoke this principle as conclusive in itself, or as showing that the court came to a wrong conclusion as to the facts, but as tending to characterize the transaction and to exhibit it in its true light, as will presently appear.
The bill of sale commences in the usual form:—“Joseph Corture bought of L. W. Mack.” Bought what? Not the possession of the liquors, not a right to sell them, not a right to become the owner subsequently by paying for them, but the liquors themselves.
In the next place there was printed on the bill of sale this notice: “ N. B. We do not insure delivery or safe carriage of goods. We ship and take receipts ‘in good order,’ and they are at your risk after the receipt is signed by the Transportation Co.” The liquors then were at the risk of Corture after delivery in New York, precisely as if the absolute title was in him; and I think there can be little doubt that that was the real understanding of the parties. Therefore if the *420liquors had been lost or destroyed in transitu, or if they had been destroyed by fire after reaching Corture, the loss would have been his and not the plaintiff’s.
In the next place, the finding is in terms that “ the plaintiff’s agent * * * Jacob Harris * * * sold to Joseph Corture * * * the liquors described in the complaint, to be delivered in Norwich, upon the express condition that the title to them should remain in the plaintiff until they were fully paid for.” Here is an express recognition of the transaction as a perfected sale, which is consistent with the bill of sale; and in that same connection the liquors are spoken of as “ goods bought of the plaintiff.”
Again. “ It was further agreed at the time of said sale, that all of the liquors sold, by the plaintiff to Corture, should be paid for in three or four months, and that an acceptance should be given by Corture for the price of the liquors, and that something should be paid on the acceptance to said salesman whenever he should call at Corture’s place.” Here the transaction is twice spoken of as an unqualified sale.
What else was done? I quote again from the finding: “It was agreed between the> plaintiff and Corture that the plaintiff should draw on the latter for the amount for which the liquors were sold. * * * The plaintiff did draw on Corture two drafts, dated June 12th, 1885, one on three months time, and one on four months, each for one half the amount agreed upon for the price of the liquors sold.”
Here again the liquors are twice spoken of as “sold,” not an interest in them, but the liquors themselves; and the parties on the very day on which the delivery of the goods was completed, and on which the bill of sale bears date, treat the sale as an absolute one, giving and taking negotiable paper for the price. That Corture so regarded it is beyond all question, for he painted the barrels and so rendered them valueless for commercial purposes.
In view of these facts it is impossible for me to come to any other conclusion than that Cortare was to sell the liquors as his own and not as the plaintiffs. If the latter, then Corture, in selling the liquors over his bar, was the agent of the *421plaintiff. The plaintiff had no license to sell in Connecticut, and it will not be presumed that it was intended to bring him into this state as a violator of our law. There is no direct finding that Corture was to sell the plaintiff’s liquors, and the facts stated with overwhelming force forbid any such inference. If I am right the case is clearly brought within the qualifying language of the court in Lewis v. McCabe, and is entirely without the purview of that decision.
But I do nob stand on this ground alone. I assume that the court below has found the literal facts as they existed. I have no doubt that the parties agreed that the title should remain in the plaintiff; but I take the broad ground that such an agreement is legally inoperative. It is not in good faith. A careful analysis of the finding reveals every element of an absolute sale. For every possible purpose except that of security, the parties intended that the title as well as the possession should pass to and vest in Corture. The agreement that the title should remain in the plaintiff until he was fully paid, is so utterly inconsistent with every other fact in the case, that it amounts nearly to a demonstration that the agreement was merely colorable, and therefore fraudulent and void. The transaction was simply this—the liquors were sold in the ordinary way, the parties agreeing that the title should remain in the seller as security. If the form of the transaction had been a sale and delivery, and then the purchaser had reconveyed the title to the seller as security, himself retaining the possession, the reconveyance would have been void beyond all question. I contend that that is precisely its legal effect. It is the substance and not the form of the transaction that is to be regarded. Otherwise verbal mortgages may be created without limit, a salutary principle of law be abolished, and a door opened to innumerable frauds, by a simple change in the form or order of a transaction. Legal principles designed for the protection of the community are held by a very frail tenure if they can be thus easily evaded.
I earnestly contend therefore that I am right in characterizing this transaction as a sale, and a mortgage back to secure *422the purchase money; which cannot be legally done. The condition being invalid, the defendant was right in his claim that the sale was unconditional, for such was its legal effect.
Beardsley, J., was of opinion that the case could be distinguished from that of Lewis v. McCabe, and that the application of the principle of that case should be restricted rather than extended; and that the unrestricted right given to the purchaser to retail the liquors to his customers in his barroom was, as matter of law, inconsistent with the retention of a title in himself by the vendor.