The seller may have to comply with the reasonable demand of the carrier for a bond to protect it, where it has issued a negotiable bill of lading. An inter esting question arises as to the rights of the seller to stop goods in transitu, where the bill of lading has been indorsed to some innocent third party for value by the buyer, while the goods are in transit. The view generally accepted is, that if the bill of lading is trans ferred by the buyer for value, as by way of sale, to an innocent third party, before the vendor has exercised his right of stoppage in transitu, the right of stoppage is defeated. But where there is no such document of title, such as a bill of lading issued by the carrier, a sale of the goods by the buyer does not defeat the seller's right, unless the sale has been made with his consent.
14. Vendor's right of resale or ven dor who has a lien or has exercised the right of stop page in transitu may do one of two things: (a) Ile may constitute himself agent of the buyer and resell the goods,' if the buyer delays an unreason able time in paying for them, or he may sell them at once if they are perishable. Notice of intention to re sell should always be given, tho in some jurisdictions it has not been held to be necessary. A mere notice of intention is sufficient and need not contain a recital of the actual time and place of the resale. If the re sale nets to the vendor less than the amount which the buyer agreed to pay, the difference may be recovered by the vendor as damages.
(b) The vendor may rescind the sale and resume the title to the goods if the buyer does not pay for them within a reasonable time. Notice of the rescission and retransfer of title should be given, tho it has been held not to be necessary. An intention to rescind should be shown by some word or act, as, for example, the consumption of the goods by the seller. If the vendor exercises his right of rescission he may sue the buyer for loss of profit. He has been allowed to sue for the entire purchase price.
15. Actions by unpaid vendor for breach of con tract of the property in the goods has not been transferred to the buyer, as, for example, where goods are sold which have to be weighed or measured before delivery, the goods are still in the seller's possession, and if the buyer refuses to take delivery, he will have only an action for damages. As a rule, he will not be able to recover the full price of the goods, but only the actual damages he has suffered. The rule is that in such a case. the proper measure of damages is the difference between the contract price and the market price of the goods at the time when the contract was broken. The idea is that the seller sell
the goods, once the contract is broken, and thus deter mine his loss.
In one case goods were sold, to be delivered in the months of February and March following the con tract, which was made in the month of November previous. The buyer became bankrupt in January. On the dates fixed by the contract, namely, in Feb ruary and March, the goods were tendered, and, not being accepted, were resold at a heavy loss. It was proved that had the goods been sold in January, when the buyer had become bankrupt, the loss would have been considerably less. It was held, however, that the assignees could have demanded delivery according to the contract, which was not rescinded by the bank ruptcy; that the seller was not bound to resell before the time for delivery, and that the damages had to be estimated according to the market price of the goods at the times fixed by the contract for delivery.
Benjamin remarks, in connection with this subject: Although the buyer's insolvency does not per se put an end to the contract, yet if the buyer has given to the seller such a notice of his insolvency as amounts to a declaration of his inability or unwillingness to pay for the goods, the seller is justified in treating the notice as a repudiation of the contract, and, after the lapse of a reasonable time to allow the buyer's trustee, and also, it would seem, a sub buyer fro the insolvent, to elect to complete the contract by paying the price in cash, the seller may, without tender ing the goods to the trustee, consider the contract as broken, and prove against the insolvent's estate for the damages.
If the title to the property has passed to the buyer, or if under the contract the price is to be paid before title passes, the seller may bring an action for the price of the goods. This is the seller's only right if the goods have got into the possession of the buyer. The remedy is no longer against the goods, but there is a personal remedy against the buyer. The seller is on a footing with any other creditor of the buyer. In some cases, where the market value of the goods might be hard to ascertain, or where the market value could not be ascertained, probably a tender delivery and an action for the price in the case of refusal, would be upheld. In such a case the seller would act as bailee of the goods for the buyer. If the buyer wrongfully repudiates the contract, refuses to accept the goods, or returns them after delivery and refuses payment, he subjects himself to an action for such damages as the seller has sustained.