City Motors v South Aerial Super Service Pty Ltd [1961] HCA 53; (1961) 106 CLR 477 (21 August 1961)

HIGH COURT OF AUSTRALIA

CITY MOTORS (1933) PTY. LTD. v. SOUTHERN AERIAL SUPER SERVICE PTY. LTD. [1961] HCA 53; (1961) 106 CLR 477

Sale of goods

High Court of Australia
Dixon C.J.(1), Kitto(2) and Windeyer(3) JJ.

CATCHWORDS

Sale of goods - Hire Purchase - Balance of purchase price intended by buyer to be secured by hire purchase agreement - Exclusive possession of goods given to buyer - Hire purchase agreement not accepted by finance company - Renunciation of agreement for sale by seller - Goods retaken by seller - Balance of purchase price tendered by buyer and refused by seller - Passing of property - Trespass to goods - Right of bailee to maintain action of detinue against bailor to regain possession.

HEARING

Hobart, 1961, February 16, 17;
Sydney, 1961, August 21. 21:8:1961
APPEAL from the Supreme Court of Tasmania.

DECISION

August 21.
The following written judgments were delivered:
DIXON C.J. This appeal is from a judgment of the Supreme Court of Tasmania plaintiff do have the return of a certain motor truck on payment by the plaintiff to the defendant of 1,250 pounds or do recover against the defendant the sum of 1,450 pounds being the value of the vehicle 2,700 pounds less 1,250 pounds the amount due by the plaintiff to the defendant under a contract of sale of the said vehicle. (at p478)

2. The first alternative of the judgment is evidently based upon the hypothesis that property in the motor truck is vested in the plaintiff but he cannot recover possession except on payment of 1,250 pounds, which as will appear, is the residue of the price payable therefor by the plaintiff to the defendant. That cannot mean that a lien subsisted for unpaid purchase money for in that event the buyer would not be entitled to possession: Lord v. Price (1874) LR 9 Exch 54 . The second alternative is based simply on the view that property having passed to the buyer, as an alternative to delivery or redelivery, he can recover the value of the chattel less unpaid purchase money: cf. Chinery v. Viall [1860] EngR 451; (1860) 5 H & N 288 (157 ER 1192) . In this form of judgment the option to deliver the goods or pay their value lay with the defendant (Phillips v. Jones [1850] EngR 67; (1850) 15 QB 859 (117 ER 683) ) and this seems still to be so, unless a special order be made: cf. Bailey v. Gill (1919) 1 KB 41 . (at p479)

3. The question to which the judgment provides a solution, though a solution strongly challenged by the appellant, arises from a very commonplace transaction going amiss in an unexpected way at an unexpected point. The transaction was simply the purchase, on hire purchase terms provided by a motor finance or acceptance company, of a new motor vehicle with the trading-in of an old one to cover a substantial part of the price. What went wrong was the break-down of the motor vehicle traded-in after it had gone into the possession of the distributors or dealers and the new vehicle had gone into the possession of the purchaser. At the point of time when this happened the finance company had not formally accepted the hiring agreement. That company then renounced or refused the proposal and the distributors took back or repossessed the new vehicle. In this state of affairs Crawford J. has held that the property in the new vehicle passed, a cheque for the balance of purchase money having been offered to the distributors who refused it. On the basis that the property passed to the intending purchaser, who is the plaintiff in the action, his Honour gave judgment in the form already described against the distributors, who are the defendants. (at p479)

4. It is necessary to state the facts more in detail. The defendant appellant is City Motors (1933) Pty Ltd whose business in Hobart is to sell new motor vehicles. It is a subsidiary company or off-shoot of Perpetual Insurance and Securities Limited whose business in Hobart includes hire purchase finance of motor vehicles. That company is not a party to the proceedings. The plaintiff respondent is Southern Aerial Super Service Pty. Ltd. ("Super" is an abbreviation of "superphosphate", not a claim to the superiority of the service). It is a company carrying on operations at Campania, a farming district about thirty miles from Hobart, where it is represented by one Gangell, its managing director. He decided that the company should buy a new truck and trade in an old one. He communicated with the defendant company whose sales manager sent up two salesmen to inspect the truck to be traded-in. Next day they returned with a new Thames diesel truck which Gangell was agreeable that his company should buy. They placed the vehicle to be traded in under tests and, with one qualification, expressed themselves as satisfied; but they did not come to terms with Gangell who then went down to Hobart to see the sales manager. After some discussion in the course of which Gangell held out prospects of purchasing one or more vehicles later on, the sales manager agreed to sell the new truck for 2,700 pounds and to take the old truck as a trade-in at 1,450 pounds against that price. The qualification of the salesmen about the trade-in is not clearly explained. According to Gangell the sales manager said that (according to them) there was a little crack in the back of the cab and a noise in the cam shaft. At all events it was met by an agreement on the part of Gangell expressed in a letter addressed to the defendant company as follows - "Arising from an appraisal and general inspection (of the trade-in vehicle) I am prepared to authorize you to undertake such remedial action to rectify any fault that may be found with the motor overhead cam gear this (sic) reconditioning of the cab: this total expense is not to exceed the sum of 50 pounds. Costs incurred to be debited to my account." (at p480)

5. The sales manager asked whether Gangell wanted terms saying "We are allowing you 1,450 pounds on your vehicle leaving a balance of 1,250 pounds to be financed. How are we going to handle this?" According to him Gangell answered "Put it through the P.I.C. I have done business with them before." According to Gangell he answered that he could get terms down town. The sales manager then asked would Gangell let their firm have it; it would be some help and "they were carrying their own both combined". Crawford J. found that Gangell said that he could arrange terms for himself but was persuaded by the sales manager against doing that and agreed that an attempt should be made to obtain terms from Perpetual Insurance and Securities Limited. The sales manager then telephoned to Perpetual Insurance and Securities Limited, described the transaction and told Gangell it was "O.K.". Two instruments complying with the Hire Purchase Act, 1959 (Tas.) were filled in. The first consisted in the summary of financial obligations under the proposed hire purchase agreement and the second the agreement itself. The latter took the form of an offer by the plaintiff company to Perpetual Insurance and Securities Limited to hire the goods described therein, that is to say the Thames diesel truck. The form contained elaborate conditions but the two matters of importance are that it is expressed as an offer and that it states the "cash price", the insurance and the "terms charges". The like statement was contained in the "summary of financial obligations". That document stated that the cash price of the goods was 2,700 pounds, the terms charges were 196 pounds 12s. 0d., the insurance for one year 56 pounds and the total amount including the deposit of 1,450 pounds was 1,502 pounds 12s. (an error for 2,952 pounds 12s. 6d.) and the difference between the cash price of the goods and the total amount the buyer would have to pay was 252 pounds 12s. 6d. The hire purchase instalments were to be thirty in number and 50 pounds 1s. 9d. each in amount, payable monthly. The sales manager obtained for Gangell on the telephone at Campania the latter's driver so that he could inform him that the new Thames diesel truck could be put into use next day. Gangell signed the documents and returned to Campania. On the following day the two salesmen came and drove away the trade-in truck, leaving the plaintiff company in possession of the new truck which was already in use. Half-an-hour later they reappeared and said that they had had an accident. According to Gangell one of them said "I was a bit late. I was hooling the truck along and something started to rattle in it. Would you come to look at it?" Gangell went accordingly: he says that he found metal for about three chains down the road and that the engine was damaged. The question whether the fault lay with the salesmen or with the vehicle was not investigated at the trial, where it was not treated as relevant. The vehicle was towed to Hobart and placed in the defendant company's garage or yard. That was a Friday. On the telephone the sales manager told Gangell that Perpetual Insurance and Securities Limited had refused to accept the hire purchase agreement. Gangell said he would come to Hobart and pay cash for the new truck, meaning the balance of 1,250 pounds. He could not of course do that until the Monday, business houses being closed in the meantime. Two representatives had been sent to Campania by the defendant company to take possession of the new truck but the protest of Gangell led to their recall that night. However two men armed with a written authority from the defendant company came to Campania on Monday and by means of the authority persuaded the driver of the Thames diesel truck in the absence of Gangell to surrender it to them. The driver had no authority to do any such thing and it was known by the sales manager that Gangell violently objected to giving the truck up. It is to be presumed that the men sent to take it knew this too. They drove the truck back to Hobart where it has been retained by the defendant company. On the same day Gangell offered the sales manager to pay the sum of 1,250 pounds in cash and next day his solicitor sent his cheque for that amount with a letter demanding the return of the new vehicle. The cheque was returned and the request was refused. It is necessary only to add that reasons lying in Gangell's slowness to pay off instalments in prior dealings with Perpetual Insurance and Securities Limited were put forward as a justification for the refusal to accept the hire purchase agreement, but there can be little doubt that the operative reason was the break down of the trade-in vehicle. This was not contested by the appellants' counsel before this Court. Upon this state of fact Crawford J. adopted the view that a sufficient tender had been made to the defendant company of the sum of 1,250 pounds and that thereupon the property in the Thames diesel truck passed to the plaintiff company, which thus could sue in detinue. (at p482)

6. This view necessarily means that the proposed hire purchase agreement was simply a subordinate means for carrying out a purchase at 2,700 pounds of which 1,450 pounds had been discharged by delivery of the trade-in vehicle and 1,250 pounds remained to be paid either by means of a hire purchase agreement with a finance company or as a cash payment in money. (at p482)

7. The case is a difficult one but in the end the determination of the rights of parties must depend upon ascertaining their expressed and implied intentions as embodied in their bargain and of course applying the appropriate legal rules. It seems clear enough that, but for the desire that the 1,250 pounds forming the residue of the price should be paid by instalments secured by a hire purchase agreement, there would have been an executed contract by which the property in the trade-in vehicle passed to the defendant company and the property in the Thames diesel truck passed to the plaintiff company and the 1,250 pounds was paid, or else left outstanding as a debt for an executed consideration. But the desire to secure the amount of 1,250 pounds by a hire purchase agreement under which that sum was payable by instalments made it inevitable that the property in the Thames diesel truck should not pass to the plaintiff company. It must be vested in the hire purchase finance company and if, pending the acceptance of the hire purchase proposal whether by Perpetual Insurance and Securities Limited or by some other body prepared to finance the residue of the price, the property in the Thames diesel truck were to pass to the plaintiff company, the subsequent hire purchase agreement would be invalid as an unregistered bill of sale. We may therefore begin with the position that property in the new diesel truck was not to pass to the plaintiff company until it had been fully paid for. But clearly that company was to become the immediate bailee of the new truck and to put it forthwith into working use. Further the trade-in truck was to be handed over to the defendant company at once. What did all this mean? For the defendant appellant it is contended that the bargain was all subject to an implied condition that if Perpetual Insurance and Securities Limited refused the proposal for the hire purchase agreement the whole transaction lapsed or failed or was at once nullified. This does not seem to be the correct inference. Several considerations tell strongly against it. In the first place there were other finance companies and the manner in which Perpetual Insurance and Securities Limited was chosen does not warrant the assumption that the choice was an essential element in the transaction; it was a subsidiary matter. In the next place the trade-in truck was handed over at once to the defendant company, a car dealer and distributor, without any express reservation: as dealers they might deal with it as they chose and without delay. Then it must be remembered that both parties believed that Perpetual Insurance and Securities Limited had committed itself, although informally, to the transaction. Again the new Thames diesel truck was handed over to the plaintiff company to be put into immediate use as a necessary part of its plant and the sales manager of the defendant company was told of the need for going on without a gap. (at p483)

8. In all these circumstances the true inference appears to be that the manner in which the 1,250 pounds was found was a subsidiary and not an essential matter and that the new truck was received upon a bailment which could not be terminated without sufficient default on the part of the plaintiff respondent, while property in the trade-in truck passed at once unconditionally to the defendant company, on that company's men taking delivery of it and driving it away. There is no suggestion that any deception as to the state of the vehicle was practised upon the defendant company or its men or that there was any breach of condition as to its state of repair. The risk in respect of that vehicle seems to have passed to the defendant company before the vehicle sustained the damage or broke down. (at p483)

9. The possession of the plaintiff company of the Thames diesel truck as bailee was exclusive and in obtaining possession of it from the driver against the strongly expressed will of Gangell the defendant company committed a trespass to goods. That this may be so notwithstanding that the trespasser is the bailor appears to be shown by the cases discussed in his work Bailment in the Common Law (1952) by Sir George Paton under the head of "Theft by Owner from the Bailee": see s. 96 p. 444. The bailment seems clearly not to have been at will and the plaintiff company had made no default nor committed any act justifying its termination. There seems to be no reason why the bailee with an immediate right to possession should not maintain detinue against the bailor if the bailor is clearly entitled only "in reversion". To take the further step of saying that the tender of the 1,250 pounds on the Monday or Tuesday, assuming the tender by cheque to have been valid, resulted in the passing of the property, that is to say the "general property", in the Thames truck to the plaintiff company may be possible: in part it depends on the view that the agreement between the parties involved payment of the price in a lump sum on the failure of the attempt to obtain the acceptance of the hire purchase agreement proposed, in part on adopting the view of the law for which there appears to be good American authority (see Corpus Juris Secundum Sales vol. 78, s. 571, p. 288 and Williston on Sales Rev. ed. (1948) vol. 2 para. 331, p. 288) that tender of the price under an agreement to sell a specific chattel though unjustifiably repudiated by the seller may result in the property passing. But this point can be left undecided. (at p484)

10. It is proper to note that the defendant company had renounced the agreement and although the renunciation could not be effective, since it was not accepted, to terminate the contract, it meant that the owner no longer possessed an intention to transfer property and he did not actually receive the purchase money. Hunter v. Rice (1812) 15 East 100 (104 ER 782) , so far as has been discovered, is the only reported case where a rejected tender of the balance of the price might have been relied upon as a ground for holding that the property had passed. It was not an agreement to sell but an award given under a submission to arbitration. The award required that a tenant named Sharpe should give up a farm including a stock of hay straw and manure on payment of a certain sum. It was held that the award did not vest the property. The tender of the money which was rejected was not given the force of payment. Lord Ellenborough at one point in his judgment said "If indeed Sharpe had accepted the money tendered, that would have been a ratification of the award, and an assent on his part to the transfer of the property; but without that I cannot conceive that the property was transferred by the mere force of the award" (1812) 15 East, at p 102 (104 ER, at p 783) . Perhaps Lord Ellenborough would have distinguished an agreement to sell, although ex hypothesi it could not of its own force pass the property and although the purchaser had renounced performance. But it rather looks as if tender would not have been considered enough for the purpose. However what has been already said seems enough to establish the conclusion that had this action been framed in contract the plaintiff company must have recovered unliquidated damages. It is in fact framed in detinue and the question is whether the plaintiff company's title to possession as bailee is sufficient to support that form of action. (at p485)

11. It must be steadily borne in mind that the Thames diesel truck was in the possession of the plaintiff company as bailee and the vehicle was wrongfully taken out of that company's possession. The right asserted is simply to regain possession, not to establish a possession not before held. The title of the bailee persists: nothing has happened to destroy or impair it. It follows that he may sue in detinue. The owner or bailor who wrongfully took it from the bailee's possession is compellable to restore it. There is much to be said for the view that in the circumstances a judgment to be enforced by a writ of delivery would have been more appropriate, a judgment leaving the defendant company to its cross action for the balance of the price and if there be default in payment any remedies arising thereout. That of course assumes that enforcement of such a writ remains possible. But as there has not been a specific objection to the alternative form of judgment it is better to allow it to stand, notwithstanding the misgivings one may feel as to the amount of the damages named as an alternative to restoring the chattel. (at p485)

12. The appeal therefore should be dismissed. (at p485)

KITTO J. I agree. As at present advised, however, I would think it right to hold, as the learned trial judge held, that upon tender of the 1,250 pounds to the appellant the general property in the Thames Trader diesel truck passed to the respondent. (at p485)

2. Mr. Kemmis, the appellant's sales manager, gave evidence from which, in my opinion, the proper conclusion is that the agreement reached between that gentleman and Mr. Gangell, the respondent's managing director, was an agreement to the effect that the respondent should transfer and deliver its Commer diesel truck to the appellant and pay or cause to be paid to the appellant 1,250 pounds; and that upon performance by the appellant of these obligations the Thames Trader should become the property of the respondent, provided that if the 1,250 pounds should have been paid by a finance company under a hire-purchase arrangement with the respondent it should become the property of the finance company. When the respondent, having duly transferred and delivered the Commer diesel to the appellant, tendered a cheque for the 1,250 pounds and the cheque was rejected without any objection being taken to the form of the tender, the respondent had done all that was to be done by it to make the property pass. I should be disposed to think that that was in law a fulfilment of the condition: Benjamin on Sale, 8th ed. (1950) p. 777; for the law considers a party who has entered into a contract to deliver goods or pay money to another as having substantially performed it if he has tendered the goods or the money: Startup v. Macdonald [1843] EngR 857; (1843) 6 Man & G 593, at p 610 [1843] EngR 857; (134 ER 1029, at p 1036) . Not, of course, that the debt is thereby discharged; but, since the wrongful refusal of the other party to accept the tender has rendered the complete delivery or payment impossible, the doing of all that the party making the tender had to do to make the delivery or payment is considered "equal to performance" so far as conditions of the operation of the contract are concerned: Hotham v. East India Co. (1787) 1 TR 638, at p 645 (99 ER 1295, at p 1299) cf. Mackay v. Dick (1881) 6 App Cas 251, at p 270 . (at p486)

3. It is true that before the tender the appellant repudiated the contract; but the repudiation was wrongful, and, since the respondent elected not to treat the contract as at an end, it could have had no effect upon the subsistence or the operation of the contract. The appellant, of course, had no intention at any time thereafter that the property in the Thames Trader should pass to the respondent, and if the case had been one of gift by delivery the property would not have passed, for want of a present intention that it should do so. But in modern law the transfer of ownership of a chattel, in the case of a contract of sale, is, as I understand the matter, the work of the contract: Holdsworth, A History of English Law, 5th ed. (1942), vol. iii, p. 355; and, if this be so, no intention can be material save the common intention of the parties at the time of the contract. Thus s. 22 (1) of The Sales of Goods Act, 1896 (Tas.) provides that where there is a contract for the sale of specific or ascertained goods, the property in them is transferred to the buyer at such time as the parties to the contract intend it to be transferred. The principle which is thus given statutory force appears to me to govern this case. The contract was self-executing. Until the performance of the conditions as to the trading-in of the Commer diesel and as to the payment of the 1,250 pounds, the contract had only contractual effect; but upon fulfilment of the conditions it took effect as a conveyance: Blackburn on Contract of Sale, 3rd ed. (1910) p. 267; Chalmers, Sale of Goods, 13th ed. (1957) p. 68. No unilateral change of intention, and no other event which left the contract on foot and left the appellant the owner of the Thames Trader, could prevent the conversion of the contract of sale into a sale upon performance of the agreed conditions of vesting. This view is in accordance with a comment of Lord Blackburn, op. cit. p. 210, on the case of Mires v. Solebay (1677) 2 Mod 242 (86 ER 1050) , in which, after pointing out that the contract in that case did not operate as a sale, because the goods were transferred to a third person before the agreed conditions for the passing of the property were performed, the learned author wrote: "But if the conditions are fulfilled and the agreement made absolute whilst the seller remains owner of the goods, it seems that the agreement has the same effect as if it were then for the first time made without any condition, and consequently that the property passes at once". (at p487)

4. If the law were other than I take it to be, a contract under which goods are delivered on sale or return might be defeated by a change of intention on the part of the owner while the other party's right to elect is still on foot - a proposition which Lord Esher M.R. denied in Kirkham v. Attenborough (1897) 1 QB 201, at p 203 ; and in respect of a hire-purchase agreement it would be incorrect to speak as Lord Herschell L.C. spoke in Helby v. Matthews (1895) AC 471, at p 477 , or to describe the hirer's right as "an absolute right to purchase" as Swinfen Eady M.R. called it in Whiteley v. Hilt (1918) 2 KB 808, at p 818 , or to say of the owner's general property in the goods, as Warrington L.J. said of it in the same case (1918) 2 KB, at p 820 , that it is qualified and limited by the contractual interest of the hirer, or to say as Channell J. said in Belsize Motor Supply Co. v. Cox (1914) 1 KB 244 of an assignee from the hirer: "He might have completed his title as against the plaintiffs by tendering the amount of the purchase-money remaining unpaid" (1914) 1 KB, at p 252 . (at p487)

5. Reasoning applicable to a contract which is not also a conditional conveyance is inapplicable here. I should be disposed to regard the respondent as entitled to judgment by reason of ownership of the Thames Trader. But if this be not so, the respondent must nevertheless succeed by reason of a right to possession in virtue of the bailment, as the Chief Justice has shown. (at p487)

6. I would dismiss the appeal. (at p487)

WINDEYER J. The acquisition of a motor vehicle from a dealer on hire-purchase terms is very commonly effected by the intervention of a finance company. Recently Harman L.J. has remarked on the artificiality that is involved: Yeoman Credit Ltd. v. Apps (1961) 3 WLR 94 . When the dealer and the finance company, although separate persons in law, are in reality separate parts of one trading organization, the legal jugglery is certainly not lessened. But the legal nature of the transactions involved is not often adverted to by those concerned. They simply fill in the appropriate forms; and ordinarily no difficulty arises. This case, however, is out of the ordinary. (at p488)

2. The appellant and the respondent had come to an agreement that the respondent was to have a new vehicle for 2,700 pounds. Of this sum 1,450 pounds was to be paid by barter of the old vehicle. It was contemplated by the parties that the balance would be provided by a finance company. To this end Gangell, on behalf of the respondent, signed a form of offer to Perpetual Insurance and Securities Limited, a hire-purchase finance company associated with the appellant, to hire from it the new vehicle on hire-purchase terms. If this offer had been accepted, the proposal would have been carried into effect, according to common form, by the appellant company being paid by the finance company and transferring the legal ownership of the new vehicle to the finance company, which would then have hired it on hire-purchase terms to the respondent company. The offer was not accepted by the finance company. But in the meantime the appellant had delivered the new vehicle and had taken delivery of the old vehicle from the respondent; that is to say, it had received part of the agreed purchase price of the new vehicle. I can see no ground at all for saying that because the finance company, a third party, refused - it matters not for what reason - to accept the respondent's offer, the appellant became entitled to treat the whole transaction between it and the respondent as at an end. Some other finance company might have been prepared to provide the finance or the respondent might in some other way find the sum of 1,250 pounds to pay the appellant. But of this the appellant did not stay to inquire. Against the will of the respondent it took the new vehicle out of its possession. To Gangell's protest and offer to pay 1,250 pounds at once, Kemmis said he had "no authority to deal any further. The agreement had been rejected and that was that". The respondent thereafter tendered its cheque for 1,250 pounds but the appellant refused to accept it. The reason the appellant refused the tendered cheque was not that it required cash, not a cheque, but because it would not carry out its contract. (at p488)

3. The learned trial judge held that the property in the new vehicle was not transferred to the respondent on the making of the bargain between the appellant and the respondent because that was not the intention of the parties: it would have been inconsistent with the proposed hire-purchase from a finance company. The parties contemplated that upon receiving 1,250 pounds the appellant would transfer its ownership of the vehicle to whoever paid the money, a finance company or the respondent. In that view of the transaction his Honour was, in my opinion, right. He went on, however, to say that the property in the new vehicle passed to the respondent when the cheque was tendered - that the agreement to sell then ripened into an actual sale. I have difficulty in taking this step with His Honour. The property did not pass by virtue of the contract as it would have in an ordinary agreement for sale. The agreement was that it would pass upon payment. In such circumstances tender is equivalent to payment: a seller cannot, by refusing to accept the proferred payment, prevent the property passing. This has been laid down in decisions in the United States following Dame v. Hanson (1912) 212 Mass 124 (98 NE 589) and it is consistent with our law of sale. But in this case the position is not so simple, because before the tender was made the appellant had renounced the transaction and refused to go on with it. The respondent when informed of the appellant's attitude could have rescinded the contract and brought an action for damages at once. Alternatively, it could do as it did, that is treat the agreement as still afoot and tender performance on its part, giving the appellant "the opportunity of withdrawing from its false position"; but in that case, when protests proved unavailing, "its only remedy in the end is also a claim for damages", the contract not being specifically enforceable: Heyman v. Darwins Ltd. (1942) AC 356, at pp 361, 371 . When it refused the tender the appellant showed that it was adhering to its renunciation. In Martindale v. Smith [1841] EngR 489; (1841) 1 QB 389 (113 ER 1181) to which his Honour referred the property had already passed by bargain and sale, the seller having merely a possessory lien. And in Mirabita v. Imperial Ottoman Bank (1878) 3 Ex D 164 , the other case to which he referred, the seller's dealing with the bill of lading was taken to evidence an intention only to secure the contract price. The distinction between that kind of case and one in which the seller manifests an intention to renounce the contract is clear in principle, although the application of the distinction in particular cases is often difficult: see Halsbury's Laws of England, 3rd ed., vol. 34, pp. 182, 183. Here the appellant had, I consider, withdrawn the vehicle from the contract before the tender was made. It had already gone back upon its promise. The respondent had, no doubt, a right of action for damages for breach of the agreement but it could no longer insist on turning the agreement into a sale by tendering payment. Its rights lay in contract, not in ownership: cf. Wait v. Baker [1848] EngR 240; (1848) 2 Ex 1 (154 ER 380) ; The Parchim (1918) AC 157, at p 170 . And the contract was not one of which equity would decree specific performance. Although I appreciate that a different view can be taken, those are my reasons for thinking that the learned trial judge was wrong in deciding the case on the basis that the respondent had become the owner. A different theory of the effect of a conditional sale is accepted in some jurisdictions in the United States but the American decisions, although instructive, are conflicting: see 47 American Jurisprudence, Sales ss. 828, 868-871, Williston on Sales Rev. ed. (1948) vol. 2 para. 331 p. 288 and the judgments and annotations in Nevada Motor Co. v. Bream (1928) 61 AmLR 776 ; Walker v. Houston (1932) 87 AmLR 937 and Bisi v. American Automobile Insurance Co. (1951) 23 AmLR 2d 787 . (at p490)

4. As I feel unable to take the step that his Honour took, it becomes necessary to consider the rights of the parties on the basis that the ownership did not pass. The Chief Justice has shown in his judgment, which I have had the advantage of reading, that the question can be approached through the law of bailment. And, when it is so approached, the plaintiff, the respondent here, was entitled to succeed. To use the words of Chambre J. in Roberts v. Wyatt [1810] EngR 117; (1810) 2 Taunt 268 (127 ER 1080) : "It is not necessary at present to go into the absolute property. This action can be sustained on the right of possession, which the plaintiff clearly at this time had" (1810) 2 Taunt, at p 278 (127 ER, at p 1084) . An unpaid seller who has delivered his goods into the possession of a buyer but who has not parted with the property in them is a bailor, and the buyer, or prospective buyer, a bailee. The question is discussed in the learned judgment of Turner J. in Motor Mart Limited v. Webb (1958) NZLR 773 , to which I am indebted. The appellant delivered the new truck to the respondent to be used by it pending the completion of arrangements for the payment of the outstanding balance of the purchase price by some means but not necessarily by the aid of any particular finance company. The respondent was not a mere licensee. He was a bailee. The bailment was not gratuitous. It was a part of a complex transaction in which the delivery to the bailor of the traded-in truck formed part of the consideration, so that it was not a bailment terminable by demand. (at p490)

5. In Bacon's Abridgment under "Bailment", this appears: "If A. borrow a horse to ride to Dover, and he ride out of his way, and the owner of the horse meet him, he cannot take the horse from him, for A. has a special property in the horse till the journey is determined; and being in lawful possession of the horse, the owner cannot violently seize and take it away, for the continuance of all property is to be taken from the form of the original bargain, which in this case was limited till the appointed journey was finished". The special property or right to possession, which a bailee has, can thus be asserted even against the owner. This appears most strikingly in the rule of the criminal law that an owner who takes his own goods out of the possession of a bailee may be guilty of larceny: Rose v. Matt (1951) 1 KB 810 ; Reg. v. Hough & Drew (1894) 15 NSWLR 204 . Similarly, a bailee wrongfully dispossessed by the bailor can sue either for trespass to goods or in trover or in detinue (see Roberts v. Wyatt [1810] EngR 117; (1810) 2 Taunt 268 (127 ER 1080) ); and perhaps in some cases for replevin. That a bailee can bring detinue against his bailor is an illustration of the flexibility that fictions can give to legal forms, for historically the action of detinue was based upon an actual or fictitious bailment by the plaintiff to the defendant. The proposition in Comyn's Digest that "detinue does not lie . . . if the defendant took the goods as a trespasser, for by the trespass the property of the plaintiff is divested" has long been considered mistaken: see Selwyn's Nisi Prius under "Detinue". At common law a judgment for the plaintiff in detinue required the defendant either to return the chattel to the plaintiff or pay him its value and also to pay damages for its detention. The defendant had an option not to return the chattel, but to keep it and pay its value together with damages: Crossfield v. Such [1852] EngR 1056; (1852) 8 Ex 159, at p 163 [1852] EngR 1056; (155 ER 1301, at p 1303) . This was altered in England by the Common Law Procedure Act, 1854, s. 78. In proceedings between a bailee and a third party the interest of the bailee in the chattel is its full value: The Winkfield (1902) P 42 . But where the defendant is the bailor, and thus himself has an interest in the chattel, what is in question is the value of the interest of the plaintiff as between himself and the defendant: Chinery v. Viall [1860] EngR 451; (1860) 5 H & N 288 (157 ER 1192) ; Johnson v. Stear [1863] EngR 888; (1863) 15 CB (NS) 330 (143 ER 812) ; Belsize Motor Supply Co. v. Cox (1914) 1 KB 244, at p 252 ; Garven v. Ronald Motors Pty. Ltd. (1938) QWN 74 . (at p491)

6. In this case a verdict for the plaintiff in the action being supportable on the basis of bailment, and the order of Crawford J. being in accordance with the ultimate intent of the bargain between the parties, I agree that the appeal should be dismissed. (at p491)

ORDER

Appeal dismissed with costs.