Where there is a breach of an express warranty, if the goods have not been paid for, the buyer may refuse to receive them. If it is an implied warranty, he may rescind the sale and sue to recover the difference in price between the value of the goods as they are and their value if as warranted. If the price has been paid he may rescind and recover the amount, or he may keep the goods and recover the difference in their value. Under the Sales Act,28 where a condition has been incorporated into a contract of sale or to sell, and the condition is not performed, the other party may refuse to perform his part of the contract. If one of the parties to the contract has promised that the condition should happen or be performed and the condition is not fulfilled, it may be treated as a breach of warranty. Where goods are sold by description, the buyer may regard the failure to furnish such goods as a condition precedent of his obligation to accept and pay for them, and may refuse them accordingly. § 76. Buyer's Damages. If a vendor of goods fails to deliver them in accordance with the contract, the buyer may sue and recover as his damages the difference between what he agreed to pay and the price he would have to pay for the goods in open market. The buyer, if notified that the seller cannot or will not furnish the goods contracted for, need not wait until the time of the performance of the contract, but may proceed at once to bring his action.29 He may buy similar goods of another dealer, and if he is obliged to pay for them a higher price than under the first contract, he may recover the difference as his damages. In case there is no difference between the contract price and the market price of goods, the buyer may nevertheless recover nominal damages and costs for the breach as a violation of his right. In case of a warranty, the vendee may recover the difference in the price of the goods as they are and what 28 Uniform Sales Act, § 11. 29 Masterton v. Mayor of Brooklyn, 7 Hill (N. Y.) 62. they would be worth if as warranted, or damages caused by the breach.30 Special Damages. Unless a vendor knows that the consequences of his failure to perform his contract will result in special damages to the buyer, or unless he agrees to be liable for such damages, he cannot be required to pay more than ordinary damages. Profits which a buyer might have made by sudden rise in the market, if goods which he had ordered had been delivered on time, cannot in the absence of special agreement be recovered, but ordinary profits may be recovered. Profits, however, may be recovered which can be properly regarded as within the contemplation of the parties. A farmer buys seeds for the purpose of planting them and raising produce or crops. If the seeds produce nothing, and they were warranted of a certain kind and quality, the farmer would be entitled to recover the loss of his profits that would ordinarily have been derived from the sale of his produce or his crop if the seeds were as warranted.31 A butcher has been allowed to recover special damages where an ice dealer failed to supply him with the amount of ice contracted for, in consequence of which he lost a large amount of fresh meat.32 § 77. Specific Performance. In unusual cases a buyer may compel specific performance of a contract of sale, and require the vendor to deliver the property purchased. The remedy of specific performance is an equitable one. Wherever money damages will not compensate the buyer, and the article is in existence and within the vendor's control, equity can afford relief. Where a vendor, after a sale, has become insolvent, the vendee may compel specific performance on the part of the vendor's assignee in bankruptcy. In the case of Equity Gas Light Company v. Baltimore Coal Tar Company, the defendant was compelled to carry out a contract to sell the plaintiff coal tar, this 30 Coyle v. Baum, 4 Pac. 389. 32 Hammer v. Schernfelder, 47 Wisc. 455. 33 63 Md. 285. being an indispensable article in plaintiff's business ana to be obtained only from the defendant in the city of Baltimore. A court of equity may decree specific performance of an agreement to transfer stock where the circumstances are such that an award of money damages would not compensate the buyer,34 or a sale of a rare picture or book. REFERENCE READING For fuller exposition of this branch of the law the student may study with great benefit the classic work of J. P. Benjamin on the "Law of Sales. This work, written by an American lawyer, once a United States Senator and Secretary of the Confederate States, subsequently an English barrister of the highest distinction, has passed through many English and American editions, and still holds its rank. A much later work, and one commanding respect from the courts, is "Mechem on Sales" in two volumes, by Professor Floyd R. Mechem of the University of Chicago Law School. A recent and exhaustive work, one of distinct value, is that by Professor Samuel Williston of the Harvard Law School, one of the framers of the Uniform Sales Act, entitled "The Law Governing Sales of Goods at Common Law and Under the Uniform Sales Act." Among good smaller books intended chiefly for the student are "Tiedeman on Sales", 'Burdick, F. M., on Sales." The student is advised to consult the excellent collection of cases on Sales by Professors Burdick and Williston, many of which are quoted from and cited in this article. The articles on Sales in the American and English Encyclopedia of Law, in the Cyclopedia of Law and Procedure, and in the American Digest, may also be studied to advantage by the student. 34 Nanton v. Rae, 18 R. I. 672, 29 Atl. 998, THE UNIFORM SALES ACT PART I FORMATION OF THE CONTRACT Section I. (1) A contract to sell goods is a contract whereby the seller agrees to transfer the property in goods to the buyer for a consideration called the price. (2) A sale of goods is an agreement whereby the seller transfers the property in goods to the buyer for a consideration called the price. (3) A contract to sell or a sale may be absolute or conditional. (4) There may be a contract to sell or a sale between one part owner and another. Section II. Capacity to buy and sell is regulated by the general law concerning capacity to contract, and to transfer and acquire property. Where necessaries are sold and delivered to an infant, or to a person who, by reason of mental incapacity or drunkenness, is incompetent to contract, he must pay a reasonable price thereof. Necessaries in this section mean goods suitable to the condition in life of such infant or other person, and to his actual requirements at the time of delivery. FORMALITIES OF THE CONTRACT Section III. Subject to the provisions of this act and of any other statute in that behalf, a contract to sell, or a sale may be made in writing, either with or without seal, or by word of mouth, or partly in writing and partly by word of mouth, or may be inferred from the conduct of the parties. Section IV. (1) A contract to sell or a sale of any goods or choses in action of the value of five hundred dollars or upward shall not be enforceable by action unless the buyer shall accept part of the goods or choses in action so contracted to be sold, or sold and actually receive the same, or give something in earnest to bind the contract, or in part payment, or unless some note or memorandum in writing of the contract or sale be signed by the party to be charged or his agent in that behalf. (2) The provisions of this section shall apply to every such contract or sale, notwithstanding that the goods may be intended to be delivered at some future time, or may not at the time of such contract or sale be actually made, procured, or provided, or fit or ready for delivery, or some *The Act as Adopted in Massachusetts Is Here Given. 1 act may be requisite for the making or completing thereof, or rendering the same fit for delivery; but if the goods are to be manufactured by the seller especially for the buyer and are not suitable for sale to others in the ordinary course of the seller's business, the provisions of this section shall not apply. (3) There is an acceptance of goods within the meaning of this section when the buyer, either before or after delivery of the goods. expresses by words or conduct his assent to becoming the owner of those specific goods. SUBJECT-MATTER OF CONTRACT Section V. (1) The goods which form the subject of a contract to sell may be either existing goods, owned or posessed by the seller, or goods to be manufactured or acquired by the seller after the making of the contract to sell, in this act called "future goods." (2) There may be a contract to sell goods, the acquisition of which by the seller depends upon a contingency which may or may not happen. (3) Where the parties purport to effect a present sale of future goods, the agreement operates as a contract to sell the goods. Section VI. (1) There may be a contract to sell or a sale of an undivided share of goods. If the parties intend to effect a present sale, the buyer, by force of the agreement, becomes an owner in common with the owner or owners of the remaining shares. (2) In the case of fungible goods, there may be a sale of an undivided share of a specific mass, though the seller purports to sell and the buyer to buy a definite number, weight or measure of the goods in the mass, and though the number, weight or measure of the goods in the mass is undetermined. By such a sale the buyer becomes owner in common of such a share of the mass as the number, weight or measure bought bears to the number, weight or measure of the mass. If the mass contains less than the number, weight or measure bought, the buyer becomes the owner of the whole mass and the seller is bound to make good the deficiency from similar goods unless a contrary intent appears. Section VII. (1) Where the parties purport to sell specific goods, and the goods, without the knowledge of the seller, have wholly perished at the time when the agreement is made, the agreement is void. (2) Where the parties purport to sell specific goods, and the goods, without the knowledge of the seller, have perished in part or have wholly or in a material part so deteriorated in quality as to be substantially changed in character, the buyer may at his option treat the sale: (a) As avoided, or (b) As transferring the property in all of the existing goods, or in so much thereof as have not deteriorated, and as binding the buyer to pay the full agreed price if the sale was indivisible or to pay the agreed price for the goods in which the property passes if the sale was divisible. Section VIII. (1) Where there is a contract to sell specific goods, and subsequently, but before the risk passes to the buyer, without any fault on the part of the seller or the buyer, the goods wholly perish, the contract is thereby avoided. |