Summary
In Hargous v. Stone, 5 N.Y. 73, Judge Paige, at p. 89, in speaking of the principle of caveat venditor, says: "This rule creates obligations where none were intended.
Summary of this case from Kinch v. HaynesOpinion
July Term, 1851
H.E. Dodge, for the appellant.
F.B. Cutting, for the respondents.
The counsel for the appellant insists that the sale of the goods in question was by sample; and that such sale implied on the part of the vendor a warranty that the bulk of the goods corresponded in fineness with the sample; and that the appellant is entitled to recover the entire value of the goods, together with all moneys paid for freight, insurance, commissions, cartage, c., as damages for the breach of the contract of warranty. Caveat emptor, is an ancient rule of the common law, and stands in contradistinction to the rule of caveat venditor of the civil law. An implied warranty of title on a sale of chattels is common to both the common and civil law. But in regard to the responsibility of the seller to answer for the quality or goodness of the articles sold, there exists between these two systems of jurisprudence an irreconcilable disagreement. According to the civil law, a sound price implies a warranty of the soundness of the article sold. By the common law, the vendor is not bound to answer to the vendee for the quality or goodness of the articles sold, unless he expressly warrants them to be sound and good, or unless he knew them to be otherwise, and hath used some art to disguise them, or unless they turn out to be different from what he represented them to the buyer; in other words, there must be either an express warranty, or fraud, to make the vendor answerable for the quality or goodness of the articles sold. (2 Black. Com., 451; 2 Kent Com., 478; Seixas v. Wood, 2 Caines, 48; Swett v. Colgate, 20 John., 196.) This principle was emphatically asserted in the cases of Chandelor v. Lopus, ( Croke James, 4), and of Parkinson v. Lee, (2 East, 315.) And Justice Kent, in Seixas v. Wood, says, that these decisions are two centuries apart, and the intermediate cases are to the same effect. In Chandelor v. Lopus, it was determined in the court of exchequer, that for selling a jewel which was affirmed to be a bezoar stone when it was not, no action lay unless the defendant knew it was not a bezoar stone, or had warranted it to be one. In Par kinson v. Lee, decided in 1802, all the judges agreed that the rule of caveat emptor applied to the sale of all kinds of commodities; that without an express warranty by the seller, or fraud on his part, the buyer must stand to all losses arising from latent defects, and that there was no instance in the English law of a contrary rule being laid down. In that case, Grose, J. says, that before the case of Stuart v. Wilkins (1 Doug., 20; K.B. year 1778,) "It was a current opinion "that a sound price given for a horse was tantamount to a "warranty of soundness; but when that came to be sifted, it "was found to be so loose and unsatisfactory a ground of decision, "that Lord Mansfield resisted it, and said there must "be an express warranty or fraud in the seller in order to "maintain the action." In Parkinson v. Lee, there was an express warranty that the bulk of the hops purchased by the plaintiff corresponded with the sample by which they were sold. It turned out that although the bulk of the commodity agreed with the sample, yet that there was a latent defect existing in the hops, unknown to the seller, and without fraud on his part, but arising from the fraud of the grower from whom he purchased. And it was held unanimously by all the judges, that the law did not raise an implied warranty that the hops were merchantable. On the argument of that case, the counsel for the plaintiff pressed upon the court the doctrine that in every contract of sale of chattels, where a fair price was paid, there was an implied warranty that the commodity sold should be in a merchantable condition at the time of the sale. This doctrine the judges unanimously rejected, and they distinctly and emphatically reasserted the common law rule of caveat emptor in all its integrity. The decision in this case, as I understand it, rejected the whole doctrine of implied warranty in regard to the quality or goodness of the articles sold, as inapplicable to any case of an executed contract of sale. The decision of Parkinson v. Lee, was in 1802. Since the decision of that case, the common law judges at Westminster-hall have manifested a strong disposition to borrow from the civil law its doctrine in relation to sales of chattels. Departing from the stern policy of their predecessors in resisting the encroachments of the civil law, and impelled by a new zeal for that system of jurisprudence, they have, step by step, introduced into the English system of the common law various modifications of the civil law doctrine of implied warranties on sales of chattels. Thus we find that in Hibbert v. Shee, (1 Camp., N.P.R., 113, year 1807,) and in Gardner v. Gray, (4 Camp. R., 144, year 1815), Lord Ellenborough recognised the principle that a sale by sample implied a warranty that the bulk of the goods corresponded in quality with the sample. ( See Lorymer v. Smith, 1 Barn. and Cres., 1, year 1822; Parker v. Palmer, 4 Barn. and Ald., 337, year 1821.) And in Jones v. Bowden, (4 Taun., 847, 852, year 1813) the English common pleas decided that a warranty of soundness was implied from the usage of trade. And in Laing v. Fidgeon, (6 Taun., 108, year 1815) the same court held, that in all contracts for the sale of manufactured goods by the manufacturer, a warranty was implied that the goods were merchantable. ( S.C., 4 Camp., 169.) And in a great number of subsequent cases, the English common law courts advanced still farther in their departure from the common law, and held that in every sale, without any express warranty, there was an implied warranty that the goods were merchantable, and if sold for a particular purpose, that they were reasonably fit and proper for such purpose. ( Gardner v. Gray, 4 Camp., 144, year 1815; Bluett v. Osborn, 1 Starkie, N.P.C., 384, year 1816; Jones v. Blight, 5 Bing., 533, year 1829; O'Kell v. Smith, 1 Starkie, 107, year 1815; Shepherd v. Pybus, 3 Man. and Gran., 867, year 1842; Brown v. Edgerton, 2 Man. and Gran., 279, year 1841; Olivant v. Bayley, 5 Ad. and El., 288, year 1843.) In this State we have in several cases applied the civil law rule of caveat venditor to sales by sample. This is the only inroad we have made upon the common law rule of caveat emptor. And this exception to the general rule, Justice Bronson says "stands upon no principle," (1 Denio, 386.) But our courts have as yet only applied the doctrine of implying a warranty on a sale by sample, that the bulk of the goods equals in quality and goodness the sample exhibited, to sales of cotton packed in bales. The supreme court refused to extend the doctrine to a sale of Italian hemp packed in bales, ( Salisbury v. Stainer, 19 Wend., 159.) And the application of the doctrine is limited to sales where the purchaser has no opportunity of inspecting the article purchased. (12 Wend., 576, Boorman v. Jenkins; 19 Wend., 159, Salisbury v. Stainer.)
Several of the cases of sales of packed cotton by sample, where the doctrine of implying a warranty has been applied by our courts, were clear cases of an express warranty. This was the character of the case of The Oneida Manuf. Co. v. Lawrence, (4 Cow., 440,) which was the case in the supreme court in which the doctrine of implying a warranty on a sale by sample was expressly adopted. In that case the seller presented the agent of the purchaser with samples, declaring that they were drawn from the bales in his warehouse, and that it was good upland cotton, and that those were true samples. The only case, I believe, in the court of last resort, in which this doctrine has been recognized, was the case of Waring v. Mason, (18 Wen., 432.) And that also was a plain case of an express warranty. The plaintiff there agreed to purchase, if the cotton was equal to the samples exhibited; and the agent of the defendants sold to the plaintiffs on this condition. This was an agreement, or in other words an express warranty, that the bulk corresponded in quality with the sample. Any representation or express affirmation that the bulk of the commodity sold is equal in quality to the sample exhibited, or that the sample is a true specimen of the bulk, presents the question of an express warranty. (19 John., 290; 4 Cow., 442.) Every exhibition of a sample to the purchaser at the time of the sale, does not, per se, make a sale by sample. There must be, Chancellor Walworth says, an agreement to sell by sample, or at least an understanding of the parties, that the sale is to be a sale by sample. (18 Wen., 434, 436.) The mere exhibition of a sample at the sale, amounts only to a representation that the sample exhibited has been taken from the bulk of the commodity offered for sale in the usual way. (18 Wen., 434.)
The sale of provisions for domestic use is not an exception to the general rule of caveat emptor. The remedy of the purchaser, where the provisions turn out to be unwholesome, is given on the ground of the knowledge of the unsoundness by the seller, which the law presumes, and not on an implied warranty that the provisions are wholesome. ( Moses v. Mead, 1 Denio, 378; Van Bracklin v. Fonda, 12 John., 468; Emerson v. Brigham, 10 Mass., 197, 202; 3 Black. Com., 165.) Where provisions are sold as merchandise, and not for immediate consumption by the purchaser, there is no implied warranty of soundness. (1 Denio, 378; 10 Mass., 197.)
Executory contracts of sale do not depend on the same principles as executed contracts of sale. The doctrine of implied warranty has properly no application to the former. Where a contract is executory, that is, to deliver an article not defined at the time, on a future day, whether the vendor has at the time an article of the kind on hand, or it is afterwards to be procured or manufactured, the contract carries with it an obligation that the article shall be merchantable, at least of medium quality or goodness. If it comes short of this, the vendee may rescind the contract and return the article after he has had a reasonable time to inspect it. He is not bound to receive or pay for it, because it is not the thing he agreed to purchase. ( Howard v. Hoey, 23 Wen., 351-2; Hart v. Wright, 17 Wen., 277; 2 Kent Com., 480; Chanter v. Hopkins, 4 Mees. and Welb., Exchr., 399, year 1838, per Lord Abinger, C.B., 404.) But if the article is at the time of the sale in existence and defined, and is specifically sold, and the title passes in presenti to the vendee, the transaction amounts to an executed sale; and although there is no opportunity for inspection, there will be no implied warranty that the article is merchantable. ( Howard v. Hoey, 23 Wen., 351; Hart v. Wright, 17 Wen., 269; 18 Wen., S.C. 449; Waring v. Mason, 18 Wen., 433, per Chan.)
Where the sale is executory if the goods purchased are found on examination to be unsound, or not to answer the order given for them, the purchaser must immediately return them to the vendor or give him notice to take them back, and thereby rescind the contract; or he will be presumed to have acquiesced in the quality of the goods, (2 Kent Com., 480; Fisher v. Samuda, 1 Camp., N.P.R., 190; Hopkins v. Appleby, 1 Stark, N.P.R., 477; Milner v. Tucker, 1 Car. and P., N.P.R., 15; 23 Wen., 352.)
The cases in our courts in which the doctrine of implied warranty on a sale by sample has been advanced are, The Oneida Man. Co. v. Lawrence, (4 Cow., 440); Andrews v. Kneeland, (6 Cow., 354); Gallagher v. Waring, (9 Wen., 20, S.C., 18 Wen., 425); Beebe v. Robert, (12 Wen., 413); and Boorman v. Jenkins, (12 Wend., 566). These were all cases of sales of cotton packed in bales. The decision in each of them was put upon the assumed ground that the purchaser had no opportunity to examine the bulk of the commodity sold. The first case, that of The Oneida Manu. Co. v. Lawrence, was, as we have seen, a case of an express warranty. It was therefore unnecessary to place the decision of that case on the ground of an implied warranty. Ch. J. Savage, in that case, advanced the doctrine of implying a warranty on a sale of packed cotton, on the authority of the case of Rose v. Beattie, decided by the constitutional court of South Carolina, (2 Nott and McCord, R., 540-1.) That case was no authority in this State for the decision of Ch. J. Savage, for the reason that in South Carolina the civil law rule that a sound price implies a warranty of soundness, prevailed. Ch. J. Savage assumed that there was no opportunity of inspecting cotton packed in bales, and held, adopting the precise language of Justice Nott in Rose v. Beattie, "that every sale of packed "cotton must be considered in the nature of a sale by sample, "which (he says) amounts to a warranty that the whole bulk "shall compare with the specimen exhibited." The subsequent cases in the supreme court of this State were decided upon the authority of the case of The Oneida Man. Co. v. Lawrence. The supreme court in all these cases assumed that there was no opportunity to inspect the cotton, not because the inspection was impracticable, but because it was inconvenient and expensive. (12 Wen., 419, 575.) The evidence in the case of Boorman v. Jenkins, (12 Wen., 569,) shows how unfounded was this assumption. In that case an experienced cotton broker testified, that by cutting a rope cotton could be drawn from the centre of the bale, and that this was done when it was suspected that the cotton had been fraudulently packed. In Hyatt v. Boyle, (5 Gill and Johnson, 110, year 1833,) the court of appeals of the State of Maryland held that the exception to the rule of caveat emptor applies only to cases where an examination is at the time of the sale morally speaking impracticable. Dorsey, J., in that case says, "The mere fact of the inspection being "attended with inconvenience is not equivalent to its impracticability." If the purchaser desire to avoid it, and yet "obtain the protection it would afford, he must do so by "exacting from the vendor an express warranty of quality." Justice Cowen, in Hart v. Wright, (17 Wen., 274,) expressed an unqualified approbation of the remarks of Judge Dorsey. There is certainly no impracticability in inspecting cotton packed in bales, although there may be both inconvenience and expense. It is to be regretted that any disposition should at any time have been manifested by our courts to relax the rule of caveat emptor, and to imply a warranty where none was either actually made or intended by the parties. It would have been by far the wisest and best policy to have adhered strictly to the rule, that the seller, in the absence of fraud and an express warranty, was not answerable for latent defects. The ablest jurists of England and this country have earnestly and eloquently defended the wisdom of the common law maxim of caveat emptor. (17 Wen., 275, Cowen, J.; 18 Wen., 454-5, Ch. Walworth; 1 Denio, 386, Bronson, J.; 2 Kent Com., 480, note; 3 Rawle, 44, Ch. J. Gibson.) Ch. J. Gibson says, in Borrekins v. Bevan, (3 Rawle, 44), that "I prefer the rule of the common law because it seems "to be more convenient and just than the rule of the civil "law; more convenient because it furnishes a plain test of "the vendor's liability in two words, 'warranty or fraud,' "and more just because it pretends not to release the vendee "from his bargain, where it happens to be a bad one." And in McFarland v. Newman, (9 Watts, 86,) he says, "No "more should be required of parties to a sale than to use "no falsehood, and to require more of them would put a "stop to commerce itself, by driving every one out of it by "the terrors of endless litigation." Justice Richardson, in The Comrs. of Highways v. Newberry Dis. (2 McCord, 407, Constitu. Ct. of S.C.) says, speaking of the rule of caveat venditor, as extended in South Carolina to every species of property, thus, "We find practically established "in judicial proceedings, a species of eminent domain to "make or break contracts."
The rule of caveat emptor is eminently adapted to a commercial community. It encourages trade by preventing actions against all in turn through whose hands the article of commerce has passed in a course of dealing. Large quantities of products, and articles of manufacture, are daily passing through the hands of bona fide purchasers and of agents, commission merchants, consignees and factors; and to apply to these persons the principle of caveat venditor would lead to endless litigation, and seriously embarrass the operations of trade. This rule creates obligations where none were intended. It implies warranties where none were actually made. The most just and convenient rule is, to confine the responsibility of the seller in relation to the quality and goodness of the articles sold, to the case of an express warranty or fraud. This rule will effectuate the intention of the parties, and will not surprise the seller with responsibilities he never intended to assume. Where the article sold is equally accessible to both parties, and its quality equally unknown to both, there can be neither justice or propriety in implying a warranty on the part of the seller against latent defects. It is more just to require the purchaser to apply his attention to those particulars which are within the reach of his observation and judgment, and the vendor to communicate all defects within his knowledge and not apparent on inspection. (1 Fonb. Eq., 380, n.) And if the purchaser does not wish to run the risk of latent defects, to require him to provide himself an indemnity against such defects, by exacting an express warranty from the vendor. When such warranty is required, the vendor will be at liberty to decide for himself whether he will enter into a contract of warranty or not.
As for myself, I feel indisposed to multiply the exceptions, if any now exist, to the rule of caveat emptor, and disinclined to relax the rule any further than I am compelled to do by the strict letter of the decisions of our courts. In my opinion, the sale of the brown cotton sheetings in the present case was not, under the principles above advanced, a sale by sample. And I do not think that the doctrine of implying a warranty on a sale by sample should be applied to a sale of sheetings, although packed in bales. But if the doctrine is applicable, there is no evidence in this case from which an agreement or understanding of the parties that this was to be a sale by sample can be inferred. The purchase was made from Stone by a broker acting as agent for the plaintiff. The proof fails to show that Stone had any knowledge of the Mexican tariff, or of the difference between the Spanish and American inch, or that the goods were destined for the Mexican market. And there is no evidence that Stone was told by either the plaintiff or the broker that the goods to be purchased must count thirty-one threads in the fourth part of a Spanish square inch. And it is in proof that it is not unusual for domestic goods to vary one or two threads, in the quarter of an inch. The goods in question averaged from twenty-eight to twenty-nine threads to the fourth of a Spanish square inch. It is proved that the threads could not be counted without a glass, and that Stone had no glass at the time of the sale. The sample which the broker swears the plaintiff selected was left with the plaintiff, and it does not appear that it was returned to Stone to enable him to compare it with the goods delivered, in order to ascertain whether their fineness corresponded with each other. There was no affirmation by Stone that the sample selected was a true sample of the goods delivered, or that the goods would count thirty-one threads to every one-fourth part of a Spanish inch, and no promise on his part to deliver goods of that degree of fineness. The plaintiff did not make it a condition of his accepting the goods that they should correspond in fineness with the sample exhibited. One of the samples which the broker exhibited to the plaintiff, the broker cut himself from an open sample bale in Stone's store. This bale was one of the twenty which Stone had on hand at the time of the negotiation, and which he delivered for the plaintiff at Thorne's packing warehouse. If the sample selected was the one cut from the open sample bale, it is altogether probable that the goods delivered did correspond with the sample. The variation of the number of threads, as counted by the plaintiff, and in Mexico, may be accounted for by the different character of the glasses used in New York and in Mexico. The variation was no greater than usually occurs in every bale of this kind of goods. The case fails to show that the sample exhibited and selected was the one furnished by Stone; and it also signally fails to show that it was exhibited by Stone as a specimen of the bulk of the goods he had on hand, and of the goods he was able to procure, and would deliver, to fill the plaintiff's order. The broker acted only as the agent of the plaintiff. He was not the common agent of both parties. To make a sale by sample there must be an agreement to sell by sample, or at least an understanding of the parties that the sale is to be by sample, from which an agreement can be inferred. ( Waring v. Mason, 18 Wen., 433-4-6.) There is not sufficient evidence in this case to authorize an inference that the parties here agreed that the sale should be by sample. But if the sale was a sale by sample, no warranty can be implied that the bulk of the goods should equal in fineness the sample, because the plaintiff had an opportunity to inspect the goods. The plaintiff could have examined the twenty bales first delivered, when in Stone's possession, or while they were at Thorne's warehouse. At Thorne's warehouse there was neither any difficulty, inconvenience, or expense, in inspecting the goods. Every bale was there opened, and the goods separated and repacked. While this process was going on, the goods could and ought to have been examined. If it is a good ground of objection that this was after the delivery, and therefore after the title passed, I answer that the inspection was practicable, and the plaintiff should therefore have examined the goods to ascertain for himself whether they were of sufficient fineness before, or at the time of, the delivery at Thorne's, and before he accepted them. In sales of packed cotton it is held there is no opportunity of inspecting the commodity, because this cannot be done without breaking up and repacking the bales. (12 Wen., 419, 574, 5; 4 Cow., 444.) In this case the plaintiff, at the time of the sale, intended to break up the bales and repack the goods, and he had them delivered at Thorne's warehouse for that purpose.
As to the twenty-three bales received from Boston, if the order required goods of any particular fineness to be furnished, the contract of sale was executory. It was a contract to deliver articles not specifically defined at the time, indeterminate things, any twenty-three bales of brown cotton sheetings. The contract of sale was, therefore, necessarily as to the number of bales which Stone had not on hand, executory; and being so, the plaintiff, after having had a reasonable time after the delivery of the twenty-three bales to inspect the goods, if they did not answer his order, he should have returned them to Stone, or given him notice to take them back. Having failed to do so, he will be presumed to have acquiesced in the quality of the goods. Every one of the twenty-three bales was opened, and the goods separated and repacked at Thorne's. They were at Thorne's several days; and, while there, the plaintiff had sufficient time and ample opportunity to examine them and to ascertain before they were shipped whether they corresponded with the order or not.
In Vanderhorst v. McTaggert (2 Bay. R., 498, Consti. Court, S. Carolina, in 1803,) it was held, that on sales of rice or of any other staple article of South Carolina, it was the duty of the purchaser to examine the article before it was shipped, and that by a neglect so to do he tacitly admits the quality to be good, and takes the risk on himself. As to the twenty-three bales, the sale cannot under any view which may be taken of the evidence be regarded as a sale by sample. A sale by sample is where certain determinate commodities in existence, and in the seller's possession, or under his control at the time of the sale, are specifically sold by samples taken from the bulk of such commodities. The twenty-three bales were not in Stone's possession or under his control at the time of the sale; nor were they specifically sold, nor did any property in these identical bales pass at the time of the sale to the plaintiff. I am also inclined to believe that the samples selected by the plaintiff ought to be regarded as a fair specimen of the bulk of the goods delivered. It will be remembered that Stone, the seller, had no knowledge that the goods were to be sent to the Mexican market, nor any knowledge of the Mexican revenue laws. It is in evidence that goods like those purchased usually vary one or two threads in the space of the quarter of an inch. With this fact, the plaintiff, being a dealer in these goods, must be presumed to have been acquainted. The goods delivered actually averaged twenty-eight to twenty-nine threads to the fourth part of a Spanish square inch. There is no evidence to show that in the New York market there is any difference in the price or value of cotton sheetings which count twenty-eight, or twenty-nine, or thirty-one threads within the space of the fourth part of a Spanish square inch. In Sands v. Taylor, (5 John., 395,) the plaintiff sold to the defendant, a maltster and brewer, a cargo of Virginia wheat which was known to be Southern wheat, and which is always more or less heated, but not so as to injure it when manufactured into flour, although it renders it unfit for malting. A sample, taken in the usual manner from the cargo, was exhibited to the defendant before the purchase, which, on experiment, was found to malt. It was held that the sample was a fair specimen of the quality of the cargo. Spencer, J., says, that the exhibition of the sample did not warrant against the fact that the cargo was heated, which prevented its malting. He said that this was a fact with which the defendant must be presumed to be acquainted, "for the law will presume every "dealer in articles brought to market, acquainted with all the "circumstances usually attendant on cargoes composed of "those articles." If the sample in this case is to be regarded as a fair specimen of the goods purchased, then there is no breach of any assumed warranty that the bulk of the twenty bales should equal the sample in fineness, nor any violation of the obligation implied in the executory contract to sell twenty-three bales; that goods of a particular fineness should be delivered, and the delivery of the twenty-three bales was a substantial compliance with the order given for them. Stone was guilty of no fraud or false representation, and he made no express warranty of any kind. My opinion is, and such is the opinion of the court, that the plaintiff made out no cause of action, and that he was properly nonsuited. The judgment of the supreme court must therefore be affirmed.
Judgment affirmed.