seller's redemption of the pledge.14 And if the seller transfers the note taken by him for the price without recourse and without a transfer of the title retained by him, this will, it would seem on principle, operate to vest in the buyer the absolute title, for the reason that the seller's right to the debt is entirely gone and the transaction operates in effect as a payment of the debt in so far as the title is concerned. 15 Other cases refuse to consider the transfer by the seller of the purchase money note either as collateral security or by an ordinary indorsement as vesting the title in the buyer, and hold that the transferee will acquire by subrogation the title of the seller, and in case of a transfer as collateral security that the seller may on redemption of the security enforce his title and right to possession on the default of the buyer in making payment.16 And it has been held, where the reservation of title appeared in the contract but not in the purchase money notes, that the seller, after transfer of the notes by an ordinary indorsement, may on default of the buyer replevin the subject matter of the sale, as he is interested in the payment of the notes so as to relieve him from liability as indorser, and the right to retake possession is not solely in the holder of the notes.17 The seller may on principle, and it is generally so held, transfer his right to receive the price and at the same time his title and thereby transfer all his rights to his transferee.18 799. Renewal of Obligation for Price; Collateral Security.-As a general rule the taking of a note of the debtor for a pre-existing indebtedness does not constitute payment of such indebtedness.19 And it is generally held that the taking of new notes for the amount of the price unpaid will not of itself constitute a payment of the price or novation, and convert the transaction, which in its inception constituted a sale with retention of title in the buyer until the price is 14. Winton Motor Carriage Co. v. 17. McDonald Automobile Co. v. Broadway Automobile Co., 65 Wash. Bicknell, 129 Tenn. 493, 167 S. W. 650, 118 Pac. 817, 37 L.R.A.(N.S.) 108, Ann. Cas. 1916A 265. 71. Note: 37 L.R.A. (N.S.) 72. This is analogous to the general rule that an action by the seller for the price is inconsistent with his retention of title and right to retake possession. See supra, par. 776. In the above case the court speaks of the right of the seller as in the nature of a lien merely, and it would seem that if the reservation of title is to be given its ordinary and full effect the seller could not himself retake possession after the transfer of the notes and before regaining them, as 15. Burch v. Pedigo, 113 Ga. 1157, such retaking would under the gen39 S. E. 493, 54 L.R.A. 808, distin- eral rule release the buyer from guished in Townsend V. Southern liability for the price. See supra, Product Co., 127 Ga. 342, 56 S. E. 436, 119 A. S. R. 340. Note: 37 L.R.A. (N.S.) 72. par. 785. 18. See supra, par. 772. 19. See PAYMENT, vol. 21, p. 70. paid, into an absolute sale or confirm the title in the buyer.20 This is especially true where the renewal note contains a similar provision retaining the title in the seller as that contained in the original note; 1 and the fact that the original purchase money note was surrendered and marked paid has been held insufficient to confirm the title in the buyer where the new note expressly recited that it was given "to extend the old note only and to stand in lieu thereof." On the other hand it has been held that the taking of a new note for the price will operate to vest the title in the buyer if it does not itself contain a provision reserving the title in the seller. The better view is that the taking by the seller, after the sale or after the price has become due and payable, of collateral security for the unpaid price does not affect his reservation of title and right to retake possession,+ as where a new note is given for the unpaid price with an additional surety. It is held, however, that if the seller on the maturity of the price takes a note secured by mortgage on the chattel for the amount of the unpaid price he thereby waives his reserved title under the contract of sale and vests the title in the buyer. In such a case the taking of the mortgage is inconsistent, it would seem, with title remaining in the seller. On the theory, however, that the chattel mortgage covered only the special interest of the buyer, it has been held that the taking of the mortgage did not vest the title in the buyer. 20. Segrist v. Crabtree, 131 U. S. 287, 9 S. Ct. 687, 33 U. S. (L. ed.) 125; Monitor Drill Co. v. Mercer, 163 Fed. 943, 90 C. C. A. 303, 16 Ann. Cas. 214, 20 L.R.A. (N.S.) 1065; A. Leschen & Sons Rope Co. v. Mayflower Gold Min., etc., Co., 173 Fed. 855, 97 C. C. A. 465, 35 L.R.A. (N.S.) 1; Triplett v. Mansur, etc., Co., 68 Ark. 230, 57 S. W. 261, 82 A. S. R. 284; Carlton Supply Co. v. Battle, 142 Ga. 605, 83 S. E. 225, L.R.A.1916A 926; Reed v. Upton, 10 Pick. (Mass.) 522, 20 Am. Dec. 545; International Harvester Co. of America v. Pott, 32 S. D. 82, 142 N. W. 652, Ann. Cas. 1916A 327; McDonald Automobile Co. v. Bicknell, 129 Tenn. 493, 167 S. W. 108, Ann. Cas. 1916A 265; Freed Furniture, etc., Co. v. Sorensen, 28 Utah 419, 79 Pac. 564, 107 A. S. R. 731, 3 Ann. Cas. 634. Notes: 33 L.R.A. (N.S.) 492; 35 L.R.A. (N.S.) 90; L.R.A.1916A 927; Ann. Cas. 1916A 335. 7 1. Freed Furniture, etc., Co. V. Sorensen, 28 Utah 419, 79 Pac. 564, 107 A. S. R. 731, 3 Ann. Cas. 634. 2. Carlton Supply Co. v. Battle, 142 Ga. 605, 83 S. E. 225, L.R.A. 1916A 926. 3. Thornton v. Findlay, 97 Ark. 432, 134 S. W. 627, 33 L.R.A. (N.S.) 491. Note: Ann. Cas. 1916A 335. 4. McDonald Automobile Co. V. Bicknell, 129 Tenn. 493, 167 S. W. 108, Ann. Cas. 1916A 265; Kimball v. Costa, 76 Vt. 289, 56 Atl. 1009, 104 A. S. R. 937, 1 Ann. Cas. 610. Notes: Ann. Cas. 1916A 266; Ann. Cas. 1917D 467. 5. McDonald Automobile Co. V. Bicknell, 129 Tenn. 493, 167 S. W. 108, Ann. Cas 1916A 265. 6. Thornton v. Findlay, 97 Ark. 432, 134 S. W. 627, 33 L.R.A. (N.S.) 491. 7. Note: Ann. Cas. 1916A 266. XXIV. NEGLIGENCE IN SALE OF DANGEROUS ARTICLES Seller's Liability to Buyer 800. In General.-It is well established that one who sells and delivers to another an article which he knows to be dangerous or noxious, without giving notice of its perilous qualities and nature, is liable for an injury that may result therefrom to the buyer.8 If the dealer knows that the article is inherently or imminently dangerous, or is highly explosive, or if he conceals or misrepresents its qualities, or warrants or represents it to be safe for the use intended; when it is not, there is no reason why he should not be held chargeable with the reasonable and proximate consequences of his act in selling it without notice of the danger in its use. The rule has been applied in many cases and to a great variety of subjects, such as sales of explosives, 10 illuminating oils,11 drugs and medicines, 12 food for human 8. Smith v. Clarke Hardware Co., 100 Ga. 163, 28 S. E. 73, 39 L.R.A. 607; McEldon v. Drew, 138 Ia. 390. 116 N. W. 147, 128 A. S. R. 203; Carter v. Towne, 98 Mass. 567, 96 Am. Dec. 682; French v. Vining, 102 Mass. 132, 3 Am. Rep. 440; Craft v. Parker, etc., Co., 96 Mich. 245, 55 N. W. 812, 21 L.R.A. 139; Schubert v. J. R. Clark Co., 49 Minn. 331, 51 N. W. 1103, 32 A. S. R. 559, 15 L.R.A. 818; Wright v. Howe, 46 Utah 588, 150 Pac. 956, L.R.A.1916B 1104 and note; Hasbrouck v. Armour, 139 Wis. 357, 121 N. W. 157, 23 L.R.A.(N.S.) 876; Clark v. Army, etc., Co-operative Soc., [1903] 1 K. B. 155, 72 L. J. K. B. 153, 88 L. T. N. S. 1, 19 Times L. Rep. 80, 3 British Rul. Cas. 435 and note. 9. Peaslee-Gaulbert Co. v. McMath, 148 Ky. 265, 146 S. W. 770, Ann. Cas. 1913E 392, 39 L.R.A. (N.S.) 465. 10. Smith v. Clarke Hardware Co., 100 Ga. 163, 28 S. E. 73, 39 L.R.A. 607; Carter v. Towne, 98 Mass. 567, 96 Am. Dec. 682; Cunningham v. C. R. Pease House Furnishing Co., 74 N. H. 435, 69 Atl. 120, 124 A. S. R. 979, 20 L.R.A. (N.S.) 236. Note: 5 Ann. Cas. 181. See EXPLOSIONS AND EXPLOSIVES, vol. 11, p. 700 et seq. 11. Note: 19 L.R.A. (N.S.) 929. 12. Blood Balm Co. v. Cooper, 83 Ga. 457, 10 S. E. 118, 20 A. S. R. 324, 5 L.R.A. 612; Howes v. Rose, 13 Ind. App. 674, 42 N. E. 303, 55 A. S. R. 251; Gwynn v. Duffield, 61 Ia. 64, 15 N. W. 594, 47 Am. Rep. 802; Fleet v. Notes: 111 A. S. R. 701; 19 L.R.A. Hollenkemp, 13 B. Mon. (Ky.) 219, (N.S.) 927; L.R.A.1916B 879; 5 Ann. 56 Am. Dec. 563; Norton v. Sewall, Cas. 181; 15 Ann. Cas. 1008; Ann. 106 Mass. 143, 8 Am. Rep. 298; Brown Cas. 1913C 804; Ann. Cas. 1914A 877. v. Marshall, 47 Mich. 576, 11 N. W. One who manufactures and another 392, 41 Am. Rep. 728; Thomas v. who sells a dangerous article, knowing Winchester, 6 N. Y. 397, 57 Am. Dec. it to be such, without warning to the 455; Goodwin v. Rowe, 67 Ore. 1, 135 consumer, may be sued jointly for Pac. 171, Ann. Cas. 1915C 416 and injury which the consumer receives note; Wright v. Howe, 46 Utah 588, through an attempt to make use of it. Clement v. Crosby, 148 Mich. 293, 111 N. W. 745, 12 Ann. Cas. 265, 10 L.R.A. (N.S.) 588. 150 Pac. 956, L.R.A.1916B 1104 and note; Peters v. Johnson, 50 W. Va. 644, 41 S. E. 190, 88 A. S. R. 909, 57 L.R.A. 428. As to the general duty of a seller to disclose latent defects in the subject matter of the sale, see supra, par. 621. p. Note: 111 A. S. R. 713. See DRUGS AND DRUGGISTS, vol. 9, 702 et seq. beings, 18 provender for cattle,14 and in the case of the negligent furnishing of unwholesome food by an innkeeper or restaurant keeper.15 The principle is illustrated by a recent English case, where it appeared that the seller of a tin containing disinfectant powder knew that it was likely to cause danger to a person opening it, unless special care was taken, and the danger was not such as presumably would be known to or appreciated by the buyer, unless warned of it. The court held that, independently of any warranty, there was cast on the seller a duty to warn the buyer of the danger.16 Again, where it appeared in an action against the seller to recover for injuries received from the explosion of a siphon of aerated water that such siphons were likely to explode unless first subjected to an adequate test, and that certain other siphons also charged and sold by the defendant had exploded under circumstances in which like siphons might be expected to be placed before using, it was held that the question of the defendant's negligence must be submitted to the jury, and a dismissal of the complaint without so doing is erroneous.17 801. Discovery and Disclosure of Danger Generally. In the absence of any express or implied warranty or fraudulent representation or concealent, which itself implies a scienter, it seems that the liability of the seller to the buyer is predicated on his actual or constructive knowledge of the defect in the article sold rendering it imminently dangerous, and his resulting duty to disclose the same to the buyer; 18 still he may be charged with knowledge of discoverable perils incident to his wares and with the duty of imparting information 13. Bishop v. Weber, 139 Mass. 411, 1 N. E. 154, 52 Am. Rep. 715; Craft v. Parker, etc., Co., 96 Mich. 245, 55 N. W. 812, 21 L.R.A. 139 and note; Neiman v. Channellene Oil, etc., Co., 112 Minn. 11, 127 N. W. 394, 140 A. S. R. 458; Tomlinson v. Armour, 75 N. J. L. 748, 70 Atl. 314, 19 L.R.A. (N.S.) 923 and note. Note: 111 A. S. R. 714. See FooD, vol. 11, p. 1118 et seq. As to the implied warranty of wholesomeness in case of a sale of provisions for consumption by man, see supra, par. 467 et seq. 14. French v. Vining, 102 Mass. 132, 3 Am. Rep. 440. See also National Cotton Oil Co. v. Young, 74 Ark. 144, 85 S. W. 92, 109 A. S. R. 71, 4 Ann. Cas. 1123. As to whether there is an implied warranty of wholesomeness in the case of a sale of provender for animals, see supra, par. 469. 15. Merrill v. Hodson, 88 Conn. 314, 91 Atl. 533, Ann. Cas. 1916D 917 and note, L.R.A.1915B 481 and note. See INNKEEPERS, vol. 14, p. 510. 16. Clark v. Army, etc., Co-operative Soc., [1903] 1 K. B. 155, 72 L. J. K. B. 153, 88 L. T. N. S. 1, 19 Times L. Rep. 80, 3 British Rul. Cas. 435. 17. Torgesen v. Schultz, 192 N. Y. 156, 84 N. E. 956, 127 A. S. R. 894. 18 L.R.A. (N.S.) 726. 18. National Cotton Oil Co. V. Young, 74 Ark. 144, 85 S. W. 92, 4 Ann. Cas. 1123, 109 A. S. R. 71; Giroux v. Stedman, 145 Mass. 439, 14 N. E. 538, 1 A. S. R. 472; Farrell v. Manhattan Market Co., 198 Mass. 271, 84 N. E. 481, 126 A. S. R. 436, 15 Ann. Cas. 1076, 15 L.R.A. (N.S.) 884. As to necessity of a scienter as a basis of a charge of fraud, see supra, par. 635. thereof to buyers.19 If a dealer or merchant, whether he be a wholesale dealer or a retail dealer, or the original buyer of the article, or the person who makes the sale to the consumer, knows that the article is inherently or imminently dangerous in the use for which it is intended, because of its inflammable or explosive qualities, it is his duty to label or mark the package containing the article in such a way as to indicate its dangerous contents.20 While a retailer is not liable for concealed dangers incident to goods manufactured or packed by others, inasmuch as he has no opportunity ordinarily to inform himself thereof, the manufacturer as a rule will be charged with notice of the quality of the article that he himself has made, and cannot excuse himself upon the ground that he did not know its dangerous qualities. There is and should be a difference between the liability of the manufacturer and the liability of the dealer in this class of cases. The manufacturer should be and is held to a higher degree of care than the dealer in putting on the market dangerous compounds, because he knows or should be charged with notice of the quality and contents of the article that he manufactures; and, being the originator of it, should be required to give notice of the danger in its use, if it is dangerous. But the dealer who buys from the manufacturer occupies practically the same position as does the buyer from the dealer, and is not presumed to know the formula by which the article is made, or whether it is inherently dangerous or not.3 802. Articles Manufactured or Packed by Others.-The distinction between the liability of the manufacturer and the liability of the seller consists in this: the seller is under no obligation to test articles manufactured or packed by others for the purpose of discovering latent or hidden dangers. The dealer who purchases and sells an article in 19. Wolcho v. Rosenbluth, 81 Conn. 358, 71 Atl. 566, 21 L.R.A. (N.S.) 571; French v. Vining, 102 Mass. 132, 3 Am. Rep. 440; Leavitt v. Fiberloid Co., 196 Mass. 440, 82 N. E. 682, 15 L.R.A. (N.S.) 855; Krahn v. J. L. Owens Co., 125 Minn. 33, 145 N. W. 626, 51 L.R.A.(N.S.) 650; Torgesen v. Schultz, 192 N. Y. 156, 84 N. E. 956, 127 A. S. R. 894, 18 L.R.A. (N.S.) 726; Crigger v. Coca-Cola Bottling Co., 132 Tenn. 545, 179 S. W. 155, Ann. Cas. 1917B 572, L.R.A.1916B 877 and note. 20. Peaslee-Gaulbert Co. V. McMath, 148 Ky. 265, 146 S. W. 770, Ann. Cas. 1913E 392, 39 L.R.A. (N.S.) 465. 1. See the following paragraph. 148 Ky. 265, 146 S. W. 770, Ann. Cas. 1913E 392, 39 L.R.A. (N.S.) 465; Schubert v. J. R. Clark Co., 49 Minn. 331, 51 N. W. 1103, 32 A. S. R. 559, 15 L.R.A. 818. See also Wolcho v. Rosenbluth, 81 Conn. 358, 71 Atl. 566, 21 L.R.A. (N.S.) 571; Watson V. Augusta Brewing Co., 124 Ga. 121, 52 S. E. 152, 110 A. S. R. 157, 1 L.R.A. (N.S.) 1178; Leavitt v. Fiberloid Co., 196 Mass. 440, 82 N. E. 682, 15 L.R.A. (N.S.) 855. 3. Peaslee-Gaulbert Co. v. McMath, 148 Ky. 265, 146 S. W. 770, Ann. Cas. 1913E 392, 39 L.R.A. (N.S.) 465. 4. See the preceding paragraph. 5. Howes v. Rose, 13 Ind. App. 674, 42 N. E. 303, 55 A. S. R. 251; Clement v. Rommeck, 149 Mich. 595, |