Edwards v. Baldwin Piano Co.

• Decision Date: 25 February 1920
• Citation: 79 Fla. 143,83 So. 915
• Parties: EDWARDS v. BALDWIN PIANO CO.
• Court: Florida Supreme Court

83 So. 915

79 Fla. 143

EDWARDS v. BALDWIN PIANO CO.

Florida Supreme Court

February 25, 1920

Error to Circuit Court, Marion County; W. S. Bullock, Judge.

Proceeding by Dorothy C. Edwards on execution against one Lattner, with claim by the Baldwin Piano Company. Directed verdict for claimant and judgment thereon, and plaintiff Edwards brings error. Affirmed.

Additional Syllabus by Editorial Staff.

Syllabus by the Court

SYLLABUS

A contract whereby pianos are consigned to a dealer for sale is binding upon the creditors of the consignee.

A contract whereby pianos are consigned to a dealer for sale is binding between the consignor and consignee, but a purchaser from such dealer acquires good title as against such consignor.

A consignment of goods for sale does not create the relation of vendor and purchaser, but the relation of principal and agent.

An important inquiry in the case at bar was as to the intent of the parties.

A 'conditional sale' is valid and binding between the parties as well as upon the purchasers and creditors of the conditional vendee, with the exception if, however, the personal property is sold to a dealer in such goods for the purpose of resale, or if consent to a resale be given, a bona fide purchaser acquires good title as against the conditional vendor.

COUNSEL Hampton & Trantham, of Ocala, for plaintiff in error.

Anderson & Anderson, of Ocala, for defendant in error.

OPINION

HORNE Circuit Judge.

On November 23, 1916, the defendant in execution appears to have been a dealer in pianos, and by virtue of a rent contract with the plaintiff was occupying a building of hers in the city of Ocala and theretofore and thereafter continued to be the tenant of the plaintiff and continued to be such dealer until the issuance of the distress warrant in this case of May 25, 1917, and on said November 23, 1916, the defendant entered into a contract with the claimant.

The contract between the claimant and the defendant in execution provides that all pianos ordered or received by the defendant shall be held on consignment for sale, and that the title to the instruments, and the proceeds when sold are to remain in the claimant. Such consignment and such holding and the title remaining in claimant subject to terms and conditions as follows, in substance:

(1) The defendant to pay all expenses after the instrument leaves Cincinnati, all expenses of collection of proceeds of sale made by him, recording and attorneys' fees, is responsible for the safe-keeping, and to keep them insured in name of claimant at consignment price.

(2) The defendant to profit by selling the instrument for more than the value fixed at the time of consignment, plus such expenses; he to report full settlement for all sales as made if sold for cash to remit the whole sale price or value in cash, and if on time to send original contracts of sale, mortgages, or liens, and shall retain for his own use only one-half the cash payment, sending under all circumstances money or paper to cover the whole sale price, and that his customers shall pay claimant at least 6 per cent. per annum on deferred payments, and the defendant guarantees in case of sale the payment to claimant the whole sale price with 6 per cent. interest.

(3) The defendant agrees that, if any of his customers fail to pay as agreed, he will repossess the instrument at his expense, or pay for its being done, and failing to repossess that he will pay, and if not repossessed that the instrument shall be disposed of by reconsignment or return to claimant.

(4) The defendant agrees to sell under supervision of claimant, and, when he makes one that is not satisfactory, to make it so in one of three ways.

(5) The instruments may be returned any time at the option and expense of defendant, or the return may be required at any time at the option of the claimant at the expense of defendant, and defendant agrees to pay certain sums for depreciation and for the use of instruments where the relation is ended by a return of a piano.

(6) The defendant agrees to try to sell within four months of the consignment of an instrument, and agrees to compensate the claimant for his failure to make such sale by paying as compensation for the use thereof 6 per cent. per annum for such further time as it may remain unsold.

(7) The defendant agrees to make monthly reports as to all instruments consigned to him.

(8) The defendant agrees that his commissions cannot be assigned or transferred without the consent of claimant, but leaves the commission with claimant for security for any indebtedness or liability whether arising under the contract or otherwise.

(9) The agreement was that it be executed and construed under the laws of Ohio, and that nothing contained in the writing should in any sense be construed as constituting a sale of the instruments, and then there is an agreement as to termination of the contract, and there were certain rules for the disposition of instruments and minimum terms on time sales.

The pianos in question were shipped to the defendant in December, 1916, under the contract; reports as provided in the contract were made as to them on December 30, 1916, January 31, 1917, February 19, 1917, and March 15, 1917. The levy of the distress warrant was made May 25, 1917, returnable June 2, 1917, for the rent of a store building from November 1, 1915, to May 1, 1917, and which distress proceeding resulted in final judgment on June 12, 1917. The claim proceeding was instituted on June 28, 1917, and this finally resulted in an instructed verdict for claimant on the 17th day of May, 1918, and in judgment in accordance therewith on the same day.

It will be observed that some of the rent had accrued before the making of the contract between the claimant and the defendant, and much more of it before the pianos were received by the defendant. Under these facts, the learned circuit judge directed a verdict for the claimant, and the question is thus presented whether or not the plaintiff in execution acquired a lien upon such property so brought upon the leased premises.

The contract between the claimant and the defendant is not a contract of sale, and the relation of vendor and purchaser was not contemplated by them. Was the relation created that of employment of the defendant by the claimant to receive on consignment and to sell as agent pianos in accordance with the agreement between them, or was the defendant in a sense a purchaser, a mortgagor, or the owner of such property? Or did the relation of debtor and creditor exist? And this decision must be made independently of any recordation statute.

There is, and in the very nature of the case there can be, no question of constructive notice to affect the contention of the plaintiff in execution. Had the pianos in question been sold to a purchaser by the defendant and the sale completed by payment and delivery, such sale would have invested the purchaser with good title as against claimant, whether it received payment from the defendant or not, for the reason that both the claimant and the defendant intended and contemplated at the time they entered into their contract, and at all times thereafter while it was in existence, that such instruments should be sold by defendant in the course of business to some purchaser. The claimant would have been estopped. See Winchester Wagon Works & Mfg. Co. v. Carman, 109 Ind. 31, 9 N.E. 707, 58 Am. Rep. 382, where the rule is correctly announced as follows:

'When a manufacturer and wholesale vendor of wagons sells upon credit and delivers them to a retail dealer for the apparent and implied purpose of resale, a condition that the title shall remain in the vendor until the purchase price is paid is fraudulent and void as against a purchaser from the vendee.'

See, also, Peasley v. Noble, 17 Idaho, 686, 107 P. 402, 27 L. R. A. (N. S.) 216, 134 Am. St. Rep. 270, where the principle is recognized and upheld, and see note where many applications of the rule are cited and a learned discussion of the subject in hand is given--and especially that the subpurchaser is under no obligation to see to the application of the purchase money and the contemplation of the parties are of great importance in arriving at the right in such matters.

The writer assumes that the contract between complainant and defendant would form a basis for a fiduciary relation, the necessary predicate for conviction of embezzlement.

There is hardly any conflict among the authorities as to the distinction between a sale and a consignment of personal property for sale; the difficulty arises only in an application of the principle to the particular transaction. The primary test, as to the character of the contract is the intention of the parties. Vermont Marble Co. v. Brow, 109 Cal. 236, 41 P. 1031, 50 Am. St. Rep. 37.

The important question in this case, in the mind of the writer is whether or not, under the circumstances, the pianos in question had been simply consigned by claimant to defendant for sale, or whether or not under the law he was such a purchaser of the pianos as to render them liable to levy and sale under an execution against the defendant in execution, or whether the contract under the circumstances was colorable and in fraud of creditors. Unless the pianos became and were defendant's property under the law, they were not subject to levy and sale in the distress for rent proceeding. Ruge v. Webb Press Co., 71 Fla....