default in partial defense to an action on the bond, but under the modern statutes placing sealed instruments on practically the same basis as unsealed ones, the buyer has been permitted to recoup his damages from breach of the seller's warranty and the like though the action for the price was on an obligation under seal.9

375. Pleading Defenses.-Under a general denial or the general issue, the buyer may give in evidence almost every matter which goes to show that the seller had no cause of action at the time the action was commenced, for the action being founded on the contract or promise of the defendant, anything which disaffirms the obligation of the contract at the time the action is commenced goes to the gist of the action.10 Thus the objection that the action was prematurely brought is open to the defendant under a general denial. It is the general view that a claim of recoupment is an affirmative defense to an action for the price of goods sold and delivered and must be specially pleaded.12 And though the contrary view has also been taken,18 this has been held true where the claim for breach of warranty is set up to defeat the right of the seller to recover the possession of the chattel under a purchase money mortgage for default in the payment of the price.14 Under the code practice it is generally held that a party cannot use denials on information and belief, or of knowledge or information sufficient to form a belief, as to the sale of goods to him.15 A general plea of fraud in an action for goods sold and delivered without specifying the particular acts or representations constituting the fraud has been held sufficient.16

Resale on Account of Buyer

376. Where Title Has Passed to Buyer.-Where the buyer wrongfully refuses to accept and pay for the property in accordance with the terms of sale the seller may resell to another and thereby convey a good title as against the original buyer.17 So it is generally recog

8. Christian v. Miller, 3 Leigh (Va.) 78, 23 Am. Dec. 251.

9. Withers v. Greene, 9 How. 213, 13 U. S. (L. ed.) 109 (effect of Alabama statute).

10. See PLEADING, vol. 21, p. 563 et seq.

11. Freeman v. Hedrington, 204 Mass. 238, 90 N. E. 519, 17 Ann. Cas. 741.

12. Vallancey v. Hunt, 20 N. D. 579, 129 N. W. 455, 34 L.R.A.(N.S.) 473. Note: 34 L.R.A.(N.S.) 473.

or counterclaim.

13. Note: 34 L.R.A. (N.S.) 473. 14. Vallancey v. Hunt, 20 N. D. 579, 129 N. W. 455, 34 L.R.A.(N.S.) 473 and note.

15. Starbuck v. Dunklee, 10 Minn. 168, 88 Am. Dec. 68.

Notes: 133 A. S. R. 117; 30 L.R.A. (N.S.) 775.

16. Elliott v. Coggshall, 4 Blackf. (Ind.) 238, 29 Am. Dec. 365.

17. Arnold v. Carpenter, 16 R. I. 560, 18 Atl. 174, 5 L.R.A. 357. As to See SET-OFF AND COUNTERCLAIM, as rescission by the seller for default on to the necessity to plead specially a the part of the buyer generally, see defense by way of recoupment, set-off infra, par. 552.

nized that where the buyer is in default in the payment of the price the seller in case he has retained his lien by the retention of the possession or by the exercise of his right of stoppage in transitu may after proper notice to the buyer resell the property on account of the buyer and recover from the buyer the difference between the amount received on such resale, after deducting the reasonable expenses thereof, and the agreed price; 18 and this right of resale is expressly recognized in the English Sale of Goods Acts. Also where the sale is executed so as to pass title and the buyer wrongfully refuses to receive delivery the seller may resell on account of the buyer without affecting his right to damages which under ordinary circumstances will be the difference between the agreed price and the amount received on the resale after deducting the expenses thereof.19 The reason given for this is that by reason of the buyer's wrongful rejection the seller is made by necessity the quasi trustee or agent of the buyer to manage the property and being thus constituted the quasi trustee or agent of the buyer, he must either abandon the property to destruction or take a course more for the advantage of the buyer by reselling.20 This power of resale in the absence of contract seems at first to have been placed upon the ground that where the goods are perishable the seller is not bound to let them perish in his hands, and thus lose his security, but this ground very much restricted the rule, and it has since been made general.1

377. Executory Contracts of Sale.-Where a contract of sale is executory and the buyer refuses to accept a proper tender of delivery, it is generally held that the seller may, after proper notice if such notice be necessary, resell on account of the buyer, for the purpose of fixing the general damages, that is, the difference between the agreed price and the actual market value of the goods at the time of delivery; and the fact that a receiver has been appointed for the buyer

18. White Walnut Coal Co. v. Crescent Coal, etc., Co., 254 Ill. 368, 98 N. E. 669, 42 L.R.A.(N.S.) 669; Newhall v. Vargas, 15 Me. 314, 33 Am. Dec. 617; Moore v. Potter, 155 N. Y. 481, 50 N. E. 271, 63 A. S. R. 692; Diem v. Koblitz, 49 Ohio St. 41, 29 N. E. 1124, 34 A. S. R. 531; Girard v. Taggart, 5 Serg. & R. (Pa.) 19, 9 Am. Dec. 327 and note; Patten's Appeal, 45 Pa. St. 151, 84 Am. Dec. 479; Arnold v. Carpenter, 16 R. I. 560, 18 Atl. 174, 5 L.R.A. 357; Ganson v. Madigan, 15 Wis. 144, 82 Am. Dec. 659.

Note: 52 L.R.A. 249.

19. Gilly v. Henry, 8 Mart. O. S. (La.) 402, 13 Am. Dec. 291; Van Horn v. Rucker, 33 Mo. 391, 84 Am. Dec.

52; Sands v. Taylor, 5 Johns. (N. Y.) 395, 4 Am. Dec. 374; Waples v. Overaker, 77 Tex. 7, 13 S. W. 527, 19 A. S. R. 727; Rosenbaum v. Weeden, 18 Grat. (Va.) 785, 98 Am. Dec. 737.

Note: 42 L.R.A. (N.S.) 671.

20. Sands v. Taylor, 5 Johns. (N. Y.) 395, 4 Am. Dec. 374.

1. Rosenbaum v. Weeden, 18 Grat. (Va.) 785, 98 Am. Dec. 737.

2. Clews v. Jamieson, 182 U. S. 461, 21 S. Ct. 845, 45 U. S. (L. ed.) 1183; West v. Cunningham, 9 Port. (Ala.) 104, 33 Am. Dec. 300; Arkansas, etc., Grain Co. v. Young, etc., Grain Co., 79 Ark. 603, 96 S. W. 142, 116 A. S. R. 99; Mendel v. Miller, 126 Ga. 834, 56 S. E. 88, 7 L.R.A.(N.S.) 1184;

who declines to receive and pay for the property does not prevent the seller from making the resale, as the seller in so doing does not act in the strict legal sense as the agent of the buyer, nor can the seller be regarded by reason of the resale as in contempt of court or as interfering with the possession of the receiver, and though the seller elects to resort to the remedy by resale, the title still remains in him to an extent which would prevent the buyer from demanding or recovering the property sold without complying with the provisions of the contract. It has been held that the fact that a commodity which the buyer has refused to accept and pay for according to contract had not been produced at the time of a repudiation of the contract of purchase by the buyer does not affect the right of the seller to produce and resell it on account of the buyer. On the other hand it has been held that where a mere agreement to purchase is repudiated by the buyer before tender of the subject of sale or before the seller has done all required of him in order to effect a transition of title by a tender he cannot liquidate his damages by selling the subject, or an ostensible subject, of the agreement as the property of the buyer; though a sale fairly conducted by him of the actual or a similar subject might create evidence on the question of damages. And a distinction has been made between the right to sell where the sale is executed and where it is executory, and while the right to resell on account of the buyer is recognized in the former class of sales it is denied in the latter class. In some instances the right of resale is expressly recognized by statute.

5

& S. (Pa.) 216, 37 Am. Dec. 505; Waples v. Overaker, 77 Tex. 7, 13 S. W. 527, 19 A. S. R. 727; Braithwaite v. Foreign Hardwood Co., [1905] 2 K. B. (Eng.) 543, 74 L. J. K. B. 688, 92 L. J. N. S. 637, 21 Times L. Rep. 413, 10 Com. Cas. 189, 10 Asp. M. L. Cas. 52, 3 British Rul. Cas. 580.

Notes: 19 A. S. R. 734; 32 A. S. R. 783; 42 L.R.A. (N.S.) 672; 43 L.R.A. (N.S.) 23; Ann. Cas. 1913A 615; Ann. Cas. 1913C 765.

North Georgia Milling Co. v. Hender- 758; McCombs v. McKennan, 2 Watts son Elevator Co., 130 Ga. 113, 60 S. E. 258, 24 L.R.A. (N.S.) 235; White Walnut Coal Co. v. Crescent Coal, etc., Co., 254 Ill. 368, 98 N. E. 669, 42 L.R.A.(N.S.) 669; Swisher v. Dunn, 89 Kan. 412, 131 Pac. 571, 45 L.R.A. (N.S.) 810; Webber v. Minor, 6 Bush (Ky.) 463, 99 Am. Dec. 688; Atwood v. Lucas, 53 Me. 508, 89 Am. Dec. 713; Putnam v. Glidden, 159 Mass. 47, 34 N. E. 81, 38 A. S. R. 394; Van Den Bosch v. Bouwman, 138 Mich. 624, 101 N. W. 832, 110 A. S. R. 336; Piowaty v. Sheldon, 167 Mich. 218, 132 N. W. 517, Ann. Cas. 1913A 610; Van Horn v. Rucker, 33 Mo. 391, 84 Am. Dec. 52; Mason v. Decker, 72 N. Y. 595, 28 Am. Rep. 190; Moore v. Potter, 155 N. Y. 481, 63 A. S. R. 692; Ackerman v. Rubens, 167 N. Y. 405, 60 N. E. 750, 82 A. S. R. 728, 53 L.R.A. 867; Grish v. Williams, 111 N. C. 53, 15 S. E. 889, 32 A. S. R. 782; Krebs Hop Co. v. Livesley, 59 Ore. 574, 114 Pac. 944, 118 Pac. 165, Ann. Cas. 1913C

3. Moore v. Potter, 155 N. Y. 481, 50 N. E. 271, 63 A. S. R. 692.

4. White Walnut Coal Co. v. Crescent Coal, etc., Co., 254 Ill. 368, 98 N. E. 669, 42 L.R.A. (N.S.) 669.

5. Lincoln v. Charles Alshuler Mfg. Co., 142 Wis. 475, 125 N. W. 908, 28 L.R.A. (N.S.) 780. As to anticipatory breach of contracts of sale generally, see supra, par. 234 et seq.

6. Note: 42 L.R.A.(N.S.) 672.

7. Stanford v. McGill, 6 N. D. 536, 72 N. W. 938, 38 L.R.A. 760, overruled

378. Notice of Resale.-The cases are not clear as to the necessity for or the effect to be given to a notice of the intention to resell on the buyer's account. Where a buyer wrongfully refuses to accept delivery, the seller is not required to give him notice of his intention to resell the property on his own account in order to entitle him to do so and recover his damages for the buyer's breach." And the view has been taken that it is sufficient to authorize the seller to resell on the buyer's account if the latter has wrongfully refused to accept delivery; that after notice of the right thus arising, notice of an actual intent to sell could only operate in the way of a threat to induce compliance, and if having once refused to comply with the contract there be locus pœnitentiæ for the buyer, he must avail himself of it without further notice or request from the seller.10 It has been said, however, that ordinarily if the seller elects to sell the goods and hold the buyer liable for the loss, he ought to notify the buyer that such is his election, in order that the buyer may know what the consequence of his continued default may be, and may, if he can and chooses to do so, avert it by performing his contract and receiving the goods, or at least may endeavor to mitigate his loss by paying some attention to the resale of the goods.11 In some cases it has been stated that the buyer should be given notice of the time and place of resale if it is to be at auction,12 and while it is the usual and more prudent course to give such notice, it seems to be the general view that if notice of the intention to resell has been given, the seller is not bound to give notice of the time and place of the resale.13 It has also been held that though notice of the time and place of the resale is given, the seller may postpone the sale to another day if in his judgment there be good cause for so doing.14

379. Conduct and Expenses of Sale Generally. In reselling the seller ought to dispose of the goods to the best advantage so as to obtain the best possible price,15 and he must use ordinary care in the preserva

on another point by Hart-Parr Co. v. Finley, 31 N. D. 130, 153 N. W. 137, Ann. Cas. 1917E 706, L.R.A.1915E 851.

8. Note: 42 L.R.A. (N.S.) 677. 9. West v. Cunningham, 9 Port. (Ala.) 104, 33 Am. Dec. 300. 10. Waples v. Overaker, 77 Tex. 7, 13 S. W. 527, 19 A. S. R. 727.

Note: 42 L.R.A. (N.S.) 679.

11. Mendel v. Miller, 126 Ga. 834, 56 S. E. 88, 7 L.R.A. (N.S.) 1184; Rosenbaum v. Weeden, 18 Grat. (Va.)

785, 98 Am. Dec. 737.

Notes: 52 L.R.A. 251; 42 L.R.A. (N.S.) 679.

12. Note: 42 L.R.A. (N.S.) 677.

13. Mendel v. Miller, 126 Ga. 834, 56 S. E. 88, 7 L.R.A. (N.S.) 1184; Rosenbaum v. Weeden, 18 Grat. (Va.) 785, 98 Am. Dec. 737. See also West v. Cunningham, 9 Port. (Ala.) 104, 33 Am. Dec. 300.

Notes: 52 L.R.A. 251; 42 L.R.A. (N.S.)_677.

14. Rosenbaum v. Weeden, 18 Grat. (Va.) 785, 98 Am. Dec. 737.

15. White Walnut Coal Co. v. Crescent Coal, etc., Co., 254 Ill. 368, 98 N. E. 669, 42 L.R.A. (N.S.) 669; Prowaty v. Sheldon, 167 Mich. 218, 132 N. W. 517, Ann. Cas. 1913A 610; Waples v. Overaker, 77 Tex. 7, 13 S. W. 527, 19 A. S. R. 727; Rosenbaum

tion of the goods between the time when they should have been accepted by the buyer and the time of the resale, in default of which he must bear the loss from deterioration.16 The time at which the goods are to be resold is to a large extent within the discretion of the seller, provided he acts with reasonable prudence and does not delay the sale an unreasonable length of time.17 He may resell at any time, and in any state of the market, and the fact that he refrains from selling them for several months on a falling market will not prevent him from recovering in an action against the buyer for the deficiency.18 Though the sale is on credit, if the buyer refuses to accept or becomes insolvent before delivery, the seller may resell on his account before the term of credit has expired.19 Ordinarily the sale ought to be at auction, because generally the goods will sell to most advantage in that way,20 but the seller need not always sell them in that way, and it has been said that it would be improper for him to do so if it happened that they would sell to greater advantage in some other way. As a general rule so long as good faith and reasonable prudence are exercised it seems that the manner of the sale is regarded as within the discretion of the seller. In some instances the statutes in conferring on the seller the right to resell on account of the buyer expressly prescribe the conditions under which the sale is to be made, and in order to avail himself of this remedy the seller must pursue the requirements of the statute. The seller in accounting for the proceeds of the resale is entitled to charge for the reasonable expenses incurred therein such as insurance, storage charges, etc.4

380. Place of Sale.-It is usual to make the resale at the place where the property is to be delivered by the seller according to the terms of the contract if there is a reasonable market there; though

v. Weeden, 18 Grat. (Va.) 785, 98 405, 60 N. E. 750, 82 A. S. R. 728, Am. Dec. 737. 53 L.R.A. 867; Rosenbaum v. Weeden, 18 Grat. (Va.) 785, 98 Am. Dec. 737.

Notes: 52 L.R.A. 251; 42 L.R.A. (N.S.) 682.

16. Mendel v. Miller, 126 Ga. 834, 56 S. E. 88, 7 L.R.A. (N.S.) 1184.

17. North Georgia Milling Co. v. Henderson Elevator Co., 130 Ga. 113, 60 S. E. 258, 24 L.R.A. (N.S.) 235; Piowaty v. Sheldon, 167 Mich. 218, 132 N. W. 517, Ann. Cas. 1918A 610;

Rosenbaum v. Weeden, 18 Grat. (Va.)

785, 98 Am. Dec. 737.

Notes: 19 A. S. R. 734; 42 L.R.A. (N.S.) 683.

18. Rosenbaum v. Weeden, 18 Grat. (Va.) 785, 98 Am. Dec. 737.

19. Diem v. Koblitz, 49 Ohio St. 41, 29 N. E. 1124, 34 A. S. R. 531. 20. Ackerman v. Rubens, 167 N. Y.

1. Rosenbaum v. Weeden, 18 Grat. (Va.) 785, 98 Am. Dec. 737.

2. Notes: 52 L.R.A. 251; 42 L.R.A. (N.S.) 683.

3. Stanford v. McGill, 6 N. D. 536, 72 N. W. 938, 38 L.R.A. 760, overruled on another point in Hart-Parr Co. v. Finley, 31 N. D. 130, 153 N. W. 137,

Ann. Cas. 1917E 706, L.R.A.1915E 851.

Note: 42 L.R.A. (N.S.) 689.

4. Piowaty v. Sheldon, 167 Mich. 218, 132 N. W. 517, Ann. Cas. 1913A 610 and note.

5. Notes: 52 L.R.A. 251; 42 L.R.A. (N.S.) (85.