Story Case

Mr. Robert Hanson made arrangements with the Illinois Steel Company to purchase ten five-ton girders, to be used in the construction of a foundry on the outskirts of Peoria, Illinois. Mr. Hanson chose the beams he desired, marking each with a white cross. They were to be delivered by the Illinois Steel Company, as called for by the architect of the building. Mr. Hanson gave his note, due in ninety days, in payment of the steel. Through some mistake, these same girders were delivered to the Ericson Construction Company, some days before Mr. Hanson's deliveries were due. Mr. Hanson demanded the steel from the Ericson Company. His demand was refused, and he brought suit. Can he recover the girders?

Ruling Court Case. Terry Vs. Wheeler, Volume 25 New York Reports, Page 520

Wheeler owned and operated a lumber yard in Tray, New York. One Elmore, came to the yard to purchase lumber. He examined its quality, and finally gave an order for a large quantity, all of which was particularly chosen and measured. A bill of sale was made out to him, in which the terms of the contract were set forth. It was also provided in this bill that Wheeler should deliver the lumber free of charge at the railway depot at Tray. It appeared also that Elmore had paid for the lumber. Soon after the above transaction took place, and before Wheeler had delivered the lumber at the station, all the lumber in the yards was destroyed by fire.

Elmore claimed that until Wheeler had delivered this lumber, that no title had passed to him, so that the loss by fire was Wheeler's loss, and that he was entitled to recover the money which he had paid therefor. This claim he assigned to Terry, who brings this action.

Mr Justice Silden said: "If the payment was to be made on or after delivery, at a particular place, it might fairly be inferred that the contract was executory, until such delivery; but where the sale appears to be absolute, the identity of the thing fixed, and the price for it paid, I see no reason for an inference that the property remains the seller's, merely because he has engaged to transport it to a given point."

It was held that the title had passed, and the loss fell upon the one holding title. Judgment was given for Wheeler.

Ruling Law. Story Case Answer

It has been stated that the passing of title depends primarily upon the intention of the parties to the transaction. In many cases, however, they have not clearly expressed their intention. In such cases the courts must consider all the circumstances and determine from the facts what their probable intention was. If the property in question is identified or set aside, the courts say that it must be presumed that the parties intended that title should pass at once, even though payment and delivery of possession have been postponed.

In the Story Case, the title to the girders had passed to Mr. Hanson. He selected and marked the beams to be delivered, although he left them in the hands of the seller and did not pay cash for them. Nevertheless, his promissory note was payment, and, as indicated in the Ruling Court Case, the fact that delivery was to be made by the Illinois Steel Company would not prevent the passing of title. Mr. Hanson owned the steel from the time the agreement with the Illinois Steel Company was completed, and he may, therefore, recover his property from the Ericson Company.