48 N.J.L. 410 | N.J. | 1886
____The opinion of the court was delivered by
The contract expressed in the written order of May 1st, 1884, signed by Schwartz, is for the sale of the property to him conditionally, the vendor reserving the title,
In the most recent case in the Supreme Court of Pennsylvania Mr. Justice Sterrett said : “A present sale and delivery of personal property to the vendee, coupled with an agreement that the title shall not vest in the latter unless he pays the price agreed upon at the time appointed therefor, and that in default of such payment the vendor may recover possession of the property, is quite different in its effect from a bailment for. use, or, as it is sometimes called, a lease of the property, coupled with an agreement whereby the lessee may subsequently become owner of the property upon payment of a price agreed upon. As between the parties to such contracts, both are valid and binding; but as to creditors, the .latter is good while the former is invalid.” Forest v. Nelson, 19 Rep. 38; 108 Penna. St. 481.
The cases cited show that the Pennsylvania courts hold the same doctrine with respect to bona fide purchasers as to creditors.
The contract of sale between the Marvin Safe Company and Schwartz was made at the company’s office in Philadelphia. The contract contemplated performance by the delivery of the safe in Philadelphia to the carrier for transportation to Hightstown. "When the terms of sale are agreed upon, and the vendor has done everything that he has to do with the goods, the contract of sale becomes absolute. Leonard v. Davis, 1 Black 476 ; 1 Benj. on Sales, § 308. Delivery of the safe to the carrier in pursuance of the contract, "was delivery to Schwartz, and was the execution of the contract of sale. His title, such as it was, under the terms of the contract was thereupon complete.
The validity, construction and legal effect of a contract may / depend either upon the law of the place where it is made or of the place where it is to be performed, or, if it relate to movable property, upon the law of the situs of the property, J according to circumstances; but when the place where the! contract is made is also the place of performance and of the I situs of the property, the law of that place enters into and ] becomes part of the contract, and determines the rights of the' parties to it. Fredericks v. Frazier, 4 Zab. 162; Dacosta v. Davis, Id. 319; Bulkley v. Honold, 19 How. 390; Scudder v. Union National Bank, 91 U. S. 406; Pritchard v. Norton, 106 Id. 124; Morgan v. N. O., M. & T. R. R. Co., 2 Woods 244; Simpson v. Fogo, 9 Jur. (N. S.) 403; Whart. Confl. of Law, §§ 341, 345, 401, 403, 418; Parr v. Brady, 8 Vroom 201.: The contract between Schwartz and the company having been made, and also executed in Pennsylvania by the •delivery of the safe to him, as between him and the company Schwartz’s title will be determined by the law of Pennsylvania. By the law of that state the condition ex- '" pressed in the contract of sale that the safe company should not relinquish title until the contract price was paid, and that ■on the failure to pay any of the instalments of the price the company might resume possession of the. property, was valid
The contract of Norton, the defendant, with Schwartz for the purchase of the safe was made at Hightstown in this state. The property was then in this state, and the contract of purchase was executed by delivery of possession in this state. The contract of purchase, the domicile of the parties to it, and the situs of the subject matter of purchase were all within this state. . In every respect the transaction between Norton and Schwartz was a New Jersey transaction. Under these circumstances, by principles of law which are indisputable, the construction and legal effect of the contract of purchase, and the rights of the purchaser under it are determined by the law of this state. By the law of this state Norton, by his purchase, acquired only the title of his vendor—only such title as the vendor had when the property was brought into this state and became subject to our laws.
It is insisted that inasmuch as Norton’s purchase, if made in Pennsylvania, would have given him a title superior to that of the safe company, that therefore his purchase here should have that effect, on the theory that the law of Pennsylvania, which subjected the title of the safe company to the rights of a bona fide purchaser from Schwartz, was part of the contract between the company and Schwartz. There is no provision in the contract between the safe company and Schwartz that he should have power, under any circumstances, to sell and make title to a purchaser. Schwartz’s disposition of the property was not in conformity with his contract, but in' violation of it. His contract, as construed by the laws of Pennsylvania, gave him no title which he could lawfully convey. To maintain title against the safe company Norton must build up in himself a better title than Schwartz had. He can
The doctrine of the Pennsylvania courts that a reservation of title in the vendor upon a conditional sale is void as against creditors and bona fide purchasers, is not a rule affixing a certain construction and legal effect to a contract made in that state. The legal effect of such a contract is conceded to be to leave property in the vendor. The law acts upon the fact of possession by the purchaser under such an arrangement, and makes it an indelible badge of fraud and a forfeiture of the vendor’s reserved title as in favor of creditors and bona fide purchasers. The doctrine is founded upon considerations of public policy adopted in that state, and applies to the fact of possession and acts of ownership under such a contract, without regard to the place where the contract was made, or its legal effect considered as a contract. In McCabe v. Blymyry, 9 Phila. Rep. 615, the controversy was with respect to the rights of a mortgagee under a chattel mortgage. The mortgage had been made and recorded in Maryland, where the chattel was when the mortgage was given, and by the law of Maryland was valid though the mortgagor retained possession. The chattel was afterwards brought into Pennsylvania, and the Pennsylvania court held that the mortgage, though valid in the state where it was made, would not be enforced by the courts of Pennsylvania as against a creditor or purchaser who had acquired rights in the property after it had been brought to that state; that the mortgagee, by allowing the mortgagor to retain possession of the property and bring it into Pennsylvania, and exercise notorious acts of ownership, lost his right under the mortgage as against an intervening Pennsylvania creditor or purchaser, on the ground that the contract was in contravention of the law and policy of that state Under substantially the same state of facts this court sustained the title of a mortgagee under a mortgage made in another state, as against a bona fide purchaser who had bought the property of the mortgagor in this state, for the reason that the possession of the chattel by the mortgagor was not in con
The public policy which has given rise to the doctrine of the Pennsylvania courts is local, and the law which gives effect to it is also local, and has no extra-territorial effect. In the case in hand the safe was removed to this state by Schwartz as soon as he became the purchaser. His possession under the contract has been exclusively in this state. That possession violated no public policy—not the public policy of Pennsylvania, for the possession was not in that state; nor the public policy of this state, for in this state possession under a conditional sale is regarded as lawful, and does not invalidate the vendor’s title unless impeached for actual fraud. If the right of a purchaser, under a purchase in this state, to avoid the reserved title in the original vendor on such grounds be conceded, the same right must be extended to creditors buying under a judgment and execution in this state; for, by the law of Pennsylvania, creditors and bona fide purchasers are put upon the same footing. Neither on principle nor on considerations of convenience or public policy can such a right be conceded. Under such a condition of the law confusion and uncertainty in the title to property would be introduced, and the transmission of the title to movable property, the situs of which is in this state, would depend, not upon our laws, but upon the laws and public policy of sister states or foreign countries. A purchaser of chattels in this state, which his vendor had obtained in New York or in most of our sister states under a contract of conditional sale, would take no title; if obtained under a conditional sale in Pennsylvania, his title would be good; and the same uncertainty would exist in the title of purchasers of property so circumstanced at a sale under judgment and execution.
The title was in the safe company when the property in dispute was removed from the State of Pennsylvania. Whatever might impair that title—the continued possession and exercise of acts of ownership over it by Schwartz and the purchase by Norton—occurred in this state. The legal effect
The judgment should be reverse.1.