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But a contract by which one person expressly agrees to pay for all twine shipped to him under the contract by the other party, and make a settlement with the latter no later than a specified date and pay interest on any balance then due, the title to the twine to remain in the seller until paid for, is a conditional and not an absolute sale (11).

But it would seem that a conditional contract to furnish the material for and construct an elevator is one for work done rather than a contract for the conditional sale of goods and chattels (12).

Distinguished from Chattel Mortgage. In order to ascertain whether an agreement is such an assurance of chattels as comes within a statute requiring bills of sale and chattel mortgages to be filed of record, the court may go outside the form of the document and enquire into the circumstances to see whether or not the document represents the real transaction between the parties (13).

So where a money lender takes an absolute transfer of certain goods and immediately lets the goods, by an agreement of hiring and conditional sale, to the borrowers from whom he had obtained the transfer, the transaction may be considered as an agreement of loan upon the security of the goods (14).

And where the owner of certain furniture desired to raise a loan upon same without the publicity of the

(11) Osborne v. Plano Mfg. Co. (Neb.) 70 N.W. Rep. 1124.

(12) Graves Elevator Co. v. Callanan 11 App. Div. (N. Y.) 301, 42 N.Y. Supp. 930.

(13) Re Watson 25 Q.B.D. 27.

(14) Russell on Hire Purchase 17; Hooper v. Ker 76 L T. (Eng.) 307; Phillips v. Gibbons 5 W.R. 527; Ex p. Odell 10 Ch. D. 76; French v. Bombernard 65 L.T. (Eng.) 49; Jones v. Tower Furnishing Co., 6 Morrell Bank. R. 193.

registration of a bill of sale, and the lender or person from whom the money was obtained went through the form of purchasing the furniture and taking delivery thereof, and on the same day let the furniture to the other at an advanced price upon an agreement of hire and conditional sale, it was held that the transaction was in fact one of loan, and not a sale with a right of repurchase, and that the contract was. consequently, to be considered either as a bill of sale by way of mortgage, or as a license to take possession of chattels as security for a debt (15).

But if there are in fact two bona fide and separate and distinct transactions, one of absolute sale of the goods and the other of hiring and conditional sale, the transaction is valid in that form (16). And it will make no difference that the goods were sold on the terms that the seller should repurchase it on the "hire system"; for a contract of sale, coupled with an option. of purchase, differs entirely from a mortgage (17).

The real nature of the transaction may be enquired into by oral evidence, beyond the mere hiring agreement, and if it be shewn that the latter is merely a device for giving security for a loan in a manner to evade a statute requiring registration of bills of sale and other transfers by way of security, the written hiring agreement will be treated as being in law such a bill of sale or transfer for the purposes of the statute, and as void for non-compliance therewith (18).

Stipulation for Lien. An agreement for the sale of certain machinery and other goods, contained a

(15) Re Watson 25 Q.B.D. 27.

(16) Ex p. Shane 29 Sol. Jour. 70.

(17) North Central v. Manchester 13 A. C. 554, 567.

(18) Madell v. Thomas (1891) 1 Q. B. 230; Beckett v. Tower Assets Co. (1891) 1 Q. B. 638 (C. A.)

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provision that, until the balance of the purchase money should be fully paid, the vendor should have a dor's lien" on the goods for such balance, and that no actual delivery of such property should be made, nor should possession be parted with, until such balance and interest should be fully paid. After the sale the vendee took possession of the goods, and subsequently, with the assent of the vendor, who surrendered a former lease, the defendants leased to the vendee the premises upon which the goods were situated. Afterwards, and while the balance of the purchase money was still unpaid, the defendants distrained for rent upon the goods in question. It was held, that the transaction in question amounted to an executory agreement to sell the chattels mentioned, the transfer of property in them being conditional upon payment of the price; that the retention of possession by the vendor was intended as security for the payment of the price, and that being the case, the stipulation that there should be a “vendor's lien" for the price should be read out of the contract as mere surplusage, because with the retention of possession provided for, there was no reason for the existence of the lien; and that only the interest of the tenant in the goods could be distrained on (19).

And where a note given for the purchase of machinery provided that it should be a "lien" upon the machinery until paid in full at maturity, at which time the property should, on default, be at the disposal of the vendors, the transaction was held to be a mortgage, and not a conditional sale, the reservation of the lien being inconsistent with the retention of the title by the vendors (20).

(19) Carroll v. Beard 27
Ont. R. 349.
(20) Frick v. Hilliard 95 N. Car. 117.

Hire-Purchase Contracts.-Where a contract is made, under which chattels are hired at a rental payable in instalments, but with the proviso that the hirer shall become the owner on paying rental instalments totalling the price agreed upon for the goods, and that, until all the instalments are paid, the property in the chattels shall remain in the person from whom they are hired, such an agreement is effectual to prevent the hirer from acquiring any title or property in the chattels by virtue of payments made amounting to less than the sum agreed upon (21).

The Bailment. The bailment is the delivery of the property intended to be sold by the vendor to the vendee, and is complete when the property is so delivered. The receipt note is simply the written evidence or statement of the conditions on which the bailment was made, or is intended to be made; and although the right to possession, as well as the title, is by its terms retained and reserved to the conditional vendor, there is a bailment if the vendee receives the actual visible possession (22).

Contract to be in Writing.-By statute in British Columbia, the bailment, or conditional purchase of chattels, made upon a condition under which the possession of the chattel passes without any ownership therein being acquired by the bailee until the payment of the purchase money, must be 'evidenced' in writing, or it will be invalid to reserve the bailor's right of property as against subsequent purchasers or mortgagees from the bailee acquiring the same without notice of the bailor's title, and in good faith for valuable consideration; and such writing must have been

(21) Re Robertson Ch. D. 419.

(22) Western Milling Co. v. Darke (1894) 2 N W. T. Rep. 34, 46.

signed by the bailee or conditional purchaser, or his agent (23).

And a copy of the receipt-note, hire receipt, order or other instrument providing for a conditional sale, must be left with the bailee by the bailor, at the time of the execution of the instrument or within 20 days thereafter (24).

In Manitoba a bailment of "manufactured goods or chattels," where the condition of the bailment is such that the possession of the chattel should pass without any ownership being acquired by the bailee, is invalid unless it is evidenced in writing, signed by the person so obtaining possession of the chattel (25).

A New Brunswick statute makes a similar provision in regard to bailments of manufactured goods, upon conditional sales in that Province (26), and it further provides, in terms identical with the British. Columbia Act, that the bailor shall leave with the bailee a copy of the instrument by which a lien on the chattel is retained, or which provides for a conditional sale, either at the time of the execution of the instrument, or within 20 days thereafter (27).

In the North-West Territories if it be a condition of the bailment that the right of property or right of possession, in whole or in part, shall remain in the bailor, notwithstanding that the actual possession of the goods passes to the bailee, but it is intended that the property in the goods shall eventually pass to the bailee on payment of purchase money in whole or in part, or on the performance of some condition by the

(23) R.S.B.C. 1897, c. 169, s. 25. (24) R.S.B.C. 1897, c. 169, s. 31.

(25) R.S.M. 1891, c. 87, s. 2.

(26) Stat. N.B. 1899, c. 12, s. 1; see Appendix. (27) Stat. N. B. 1899, c. 12, S. 4.

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