This section is from the book "The Law Of Contracts", by Theophilus Parsons. Also available from Amazon: The law of contracts.
(d) Thompson v. Thompson, 4 Cush. 134; Shore v. Lucas, 3 Dow. & R, 218, Bayly v. Schofield, 1 M. & Sel. 338; Secomb v. Nutt, 14 15. Mon. 326.
(e) 2 Kent, Com. 548. Hut the right exists only in cases of insolvency of the vendee. The Coustantia, 6 Rob, Adm 321.
1 "By the term, ' insolvency' of the buyer, is meant his inability to pay his debts in the usual course of business. It is not necessary that he should have been adjudicated a bankrupt or insolvent debtor." Per Morton, .J., in Durgy, etc. Co. v. O'Brien, 123 Mass. 12, 13. See also Secomb v. Nutt, 14 B. Mon. 261; Blum v. Marks, 21 La An. 268; Walsh v. Blakely, 6 Mont. 194; More v. Lott, 13 Nev. 376; Benedict v Schaettle, 12 Ohio St. 515, 519.
G19 execute his right, that doctrine is now exploded. Notice of the consignor's claim and purpose given to the carrier before delivery by him is sufficient; (f) and it should be given to the carrier having possession * and not to the vendee himself without giving notice to the carrier. (g) This notice and demand on behalf of the consignor need not be made by any person specially authorized for that purpose; it may be made by a general agent of the consignor; or even by a stranger, if it be ratified by the vendor before the delivery to the vendee. (h)l But a ratification of a notice and demand by an unauthorized person, not made until after delivery to the vendee, will not suffice. (i)
The question has been raised when the insolvency may take place, in order to give this right; that is, whether the right exists by reason of an insolvency before the sale; and it was held that the insolvency must take place between the time of the sale and that of the exercise of the right of stoppage. (j) * But we are far from certain that the insolvency of the buyer, existing at the time of the sale, but then unknown to the seller, and discovered by him before delivery to the buyer, does not give this right.2
(f) Litt v. Cowley, 7 Taunt. 169; Hoist v. Pownal, 1 Esp. 240; Newhall v. Vargas, 13 Me. 93. Notice should be given, it seems, to the carrier, middleman, or other person having at the time the actual custody of the goods; or given to such a person, that it may reach the carrier before delivery. Mottram v. Heyer, 5 Denio, 629. But in Bell v. Moss, 5 Whart. 189, it was given to the assignees of the consignee, who had become insolvent, and was held sufficient. In Northey v. Field, 2 Esp. 613, the demand was on the officer of the custom-house where the goods were stored. Whitehead v. Anderson, 9 M. & W. 518, is an important case upon this point. There it is held, that a notice of stoppage in transitu, to be effectual, must be given either to the person who has the immediate custody of the goods, or to the principal whose servant has the custody, at such a time, and under such circumstances, as that he may, by the exercise of reasonable diligence, communicate it to his servant, in time to prevent the delivery to the consignee. Therefore, where timber was sent from Quebec, to be delivered at Port Fleetwood in Lancashire, a notice of stoppage given to the ship-owner at Montrose, while the goods were on their voyage, whereupon he sent a letter to await the arrival of the captain at Fleetwood, directing him to deliver the cargo to the agents of the vendor, - was held not to be sufficient notice of stoppage in transitu. See also Ex parte Falk. 14 Ch. D. 446; Kemp v. Falk. 7 Ap. Cas. 573; Rucker v. Donovan, 13 Kan. 251; Seymour v. Newton, 105 Mass. 272, 275; Reynolds v. Boston, etc. R. R., 43 N. H. 580.
(g) Mottram v. Heyer, 5 Denio, 629.
(A) Whitehead v. Anderson, 9 M. & W. 518; Bell v. Moss, 5 Whart. 189; Newhall v. Vargas, 13 Me. 93. See ante, p. *49, note (g).
(i) Bird v. Brown, 4 Exch. 786.
(j) Rogers v. Thomas, 20 Conn. 53.
1 In Durgy, etc. Co. v. O'Brien, 123 Mass. 12, where the demand was made by a person sent by the seller's agent, whose acts were subsequently ratified, before the buyer came into possession, but after a creditor of the buyer had attached them, the right of stoppage was held to have been reasonably exercised. - K.
2 It is well settled that this is sufficient (contrary to Rogers v. Thomas, note (j), supra); Loeb v. Peters, 63 Ala. 243; Jones v. Earl, 37 Cal. 630; Pattison v. Culton, 33 Ind. 240; Blum v. Marks, 21 La. An. 268; O'Brien v. Norris, 16 Md. 122; White who has parted with his possession. And then the right would be considered rather as a quasi lien; or, in other words, the right of stoppage in transitu is measured and governed, as to its effect and consequences, rather by the rules of law applicable to lien than by those which belong to rescission of sale. Perhaps the difference of opinion on this subject may be attributed, in some degree at least, to the difference in the circumstances of the cases in which the question has arisen. Thus, if there has been a complete sale of a specific chattel, agreeably to a specific order of the purchaser, the property in the chattel would, it should seem, pass thereby to the purchaser, subject only to the exercise of the seller's lien for the price. And, in such a case, the exercise of the right of stoppage would revest in the seller only the possession, just as it was when he sent the goods away; that is, subject to the property in the purchaser, and only for the purpose of restoring and making effectual the seller's lien. But, on the other hand, if A should send to B an order for a certain quantity of goods of a certain kind or description, and B should procure goods which he supposed answerable to the order, and send them to A, and should then hear of the failure of A, and thereupon stop the goods on their passage, B's rights might become the same as if he had never sent the goods; and the property would remain in him, because they had never been accepted by A, and now never could be. (o) Still, however, we think there is a strong tend-ency in the courts, both of England and this country, * to treat the right of stoppage in transitu as the exercise. of a lien.
 
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