The distinction may be made clearer by saying that a person may not make an sale of a thing which has no actual or potential existence; but he may make an executory sale of something which he does not own and which may not exist: that is, he may make a contract to sell, of which execution may be de manded or enforced.. As will be readily seen, this is the kind of contract that is made in the ordinary course of business, where, for example, a wholesale house takes orders for goods which it must buy in order to fulfil its contracts.
If there is an agreement to sell certain specific goods, which later are destroyed without the fault of either party and before the risk has passed to the buyer, the agreement is discharged, and the buyer, who may have paid something on account, can get his money back.
We have spoken so far of goods as things which may be the subject of sale, that is, of corporeal things. Incorporeal things, such as rights, may also be bought and sold. Thus a member of the Toronto Stock Ex change has certain membership rights, and he may sell his stock exchange seat, as it is called. An artist may protect his drawings by copyright, but he may sell to other persons the right to print certain repro ductions of his copyrighted pictures. In an Ameri can case, it was held that a man could sell his knowl edge of the existence and location of an oil-well. A ferryman may sell his franchise to conduct a ferry. A license to carry on mining operations may be the subject of a sale.
It has long been a question of discussion whether a person may sell a mere expectancy based upon chance. In the case of a conditional sale, something which is hoped for is sold, that is, something which in the ordinary course of nature it is expected will come into existence, as a future crop or the young of ani mals. If the thing does not come into existence there is no sale, as the subject matter of the contract has failed, provided the seller had nothing to do with preventing the thing from coming into existence. This is different from the sale of a mere hope or chance, because here the chance is what is sold: for example, if a pearl fisherman before starting out sells his chance of what he may get, the contract is bind ing. As was said in an English case: "If a man will make a purchase of a chance, he must abide by the consequences." 1
5. Statute of frauds.—The principles of the Eng lish Statute of Frauds may be said to apply in a gen eral way thruout Canada. The seventeenth section of the English Statute provides that: No contract for the sale of goods, wares and merchandise for the price of £10 sterling or upwards shall be allowed to be good, except the buyer shall accept part of the goods so sold, and actually receive the same, or give something in earnest to bind the bargain, or in part payment, or that some note or memorandum of said bargain be made and signed by the parties to be charged by such contract, or their agents thereunto lawfully authorized.
This statute was later amended by the act known as Lord Tenterden's Act, which provided that the principles of the statute should apply to agreements to sell as well as to the sale of goods. Later the Sale of Goods Act of 1893 was passed, and this act is in force in some of the English law provinces. The amount fixed in the various provinces to replace the £10 sterling of the English act varies. Thus in Man itoba, Alberta, Saskatchewan, British Columbia, Yu kon Territory and Quebec, the amount is $50, in On tario, New Brunswick and Nova Scotia, $40, in Prince Edward Island, $30 and in Newfoundland, $50. Section 4 of the Sale of Goods Acts provides: (1) A contract for the sale of any goods of the value of £10 or upwards is not to be enforceable, unless the buyer shall accept part of the goods so sold and actually receive the same, or give something in earnest to bind the contract, or in part payment, or unless some note or memorandum of the contract in writing be made and signed by the party to be charged, or his agent in that behalf.
(2) The provisions of this section apply to every such contract, notwithstanding that the goods may be intended to be delivered at some future time, or may not at the time of such future contract be actually made, procured or provided, or fit or ready for delivery, or some act may be requisite for the making or completing thereof, or rendering the same fit for delivery.
(3) There is an acceptance of goods within the meaning of this section, when the buyer does any action in relation to the goods which recognizes a pre-existing contract of sale, whether there be an acceptance in performance of the con tract or not.