As a general rule, one cannot own that which is not in existence, and, therefore, things not in existence cannot be the subject of a present sale. An exception to this general rule is made in the case of growing products. Things which are the natural product or expected increase of things in existence have a potential existence, and if they are the product of things already belonging to the seller, they may be the subject of a present sale. This exception is recognized in most of the United States, as applied to the future crops from the seller's land, the future offspring of or products from the seller's animals, or wages to be earned under an existing contract. The only goods which are deemed to have a potential existence are growing crops and the unborn off-spring of animals. The Uniform Sales Act,* however, does not recognize the distinction and declares that all sales of future goods are merely contracts to sell and not sales. In most States this exception will not be applied to crops not planted, or until the potential existence is actually begun in nature. EXAMPLES 1. Fletcher contracts in April that he will sell to Murphy in September twenty bushels of tomatoes which he expects to grow on his vines. This is a contract to sell only, and Murphy possesses no property rights in any tomatoes until the contract is performed, and twenty bushels of tomatoes actually delivered. 2. Fletcher in July makes a present sale of thirty bushels of his growing tomatoes to Hatton, although the tomatoes are not yet ripe and both parties understand that the tomatoes are to be ripened on the vines. The property in the tomatoes is transferred to Hatton at once. His creditors may seize the tomatoes by an execution and levy. Fletcher has no title in them, and should he attempt to sell them to Jones, Hatton can reclaim them from Jones. 249. The Price. It is not necessary that the price be in money. It may be in other forms of personal property, and the character of the transaction will remain unchanged. *The Uniform Sales Act is a compilation of the laws regarding Sales of Goods, similar to the Negotiable Instruments Act, which has been recommended to the various states for adoption. It has not been generally adopted as yet, being in force only in Arizona, New Jersey, Connecticut, Massachusetts, Rhode Island, Ohio, and Wisconsin. The change in regard to the former doctrine of potential existence is one of the few changes in the existing law made by the uniform act. EXAMPLE Marcy agrees to sell Hines an automobile for 1000 bushels of potatoes or twenty tons of brick, as Hines may prefer. This is a contract for the sale of goods. If, however, the agreement had been to sell the automobile for an acre of land, the agreement would be governed by the laws relating to sales of real estate. It is also unnecessary that the price should be specified, whether it be in money or in other personal property. The amount may be left for future determination, provided a way of determining it is agreed upon or understood, or may be determined by the previous course of dealings between the parties, or, if neither of these alternatives applies, the buyer must pay the reasonable value of the goods. McConnell sold to Hughes 850 bushels of wheat at an agreed price of ten cents per bushel less than the Milwaukee price at any day thereafter which McConnell might select. McConnell delivered the wheat and notified Hughes that he selected March 24 as the day for determining the price. The Milwaukee market on that day was seventy-two cents a bushel, and this determined the price. McConnell vs. Hughes, 29 Wis. 537. It is also possible for the buyer and seller to agree that the price shall be fixed at a future date by a third person. This is called a sale at a valuation. If the transaction be merely a contract to sell and the property in the goods has not been transferred, death or other circumstances making it impossible for the third person to fix the price avoids the contract. On the other hand, if the transaction be a sale and the buyer has received the goods, he must pay the reasonable value as the price, should the third person fail to specify it. If the third person is prevented from naming a price by the fault of either the buyer or seller, special remedies are provided. (See Chapter XXVIII.) EXAMPLE Johnson sells a horse to Brewer, the price to be fixed by Gordon after an examination of the horse. Before fixing the price, Gordon dies. If the horse has been delivered, Johnson may claim its reasonable value from Brewer; if the horse has not been delivered the transaction is terminated without the fault of either party, because of impossibility of performance. If Gordon had fraudulently named an excessive price, or had been wrongfully influenced in naming the price by either of the parties, to the damage of the other, appeal could be made to the courts, which would then determine the reasonable value. Wendt vs. Vogel, 87 Wis. 462. REVIEW QUESTIONS 1. Evans, a farmer, sells to Barker, in the spring, the hay and corn that Evans will raise on his farm during the coming season. The corn has not yet been planted. He also sells to Barker the wool from 100 sheep, which he agrees to buy within thirty days, but which he does not yet own. In November, while he has the hay, corn, and wool in his possession, Evans' barn is destroyed by fire. Who suffers the loss as to each commodity? Why? 2. Hagins contracted to sell groceries to Combs and to take in exchange logs, and allow for the logs the most that the "seller could get offered in money for them, delivered at Oshkosh, when measured." Hagins delivered the groceries, and when Combs sought to pay him in logs, a dispute arose as to the number of logs which would satisfy Hagins' claim. What is the proper rule for determining the number? Is this a contract to sell goods? What goods? 3. Rodliff shipped some wool to Clementson, a wool broker, relying on his statement that he had a customer who would take the wool at once and pay cash, which he would remit to Rodliff. Instead of this, Clementson turned the wool over to Dallinger in payment of a debt which he owed Dallinger. What rights, if any, did Rodliff have against Dallinger? against Clementson? Why? 4. Corbett sold ten cords of wood to Moody, the wood to be inspected and valued by Jenner. After the wood had been delivered Moody paid Jenner $10 to place a low valuation on the wood, which he accordingly did, valuing it at $3 a cord. What rights, if any, has Corbett? How much may he recover for the wood? 5. Suppose that in the above example Jenner had departed for Europe before valuing the wood and remained away for ten years. What would the rights of the parties be (1) if the wood has been delivered; (2) if the wood had not been delivered? CHAPTER XXIV FORM OF CONTRACT OF SALE 250. Statute of Frauds. This statute was designed to make fraud difficult in important contracts. One of its provisions is that if a transaction involves a sale of goods of considerable value it is not enforceable unless evidenced by writing, or unless it shall have been partly performed, either by the delivery of some of the goods or the payment of a part of the price. Some states in the United States have changed the limit of value in adopting this provision; others have not adopted it in any form. In the latter states it is not necessary that any contracts for the sale of goods be in writing to make them enforceable. The rules regarding the various states are listed in the foot-note to Section 118. Some explanation of the terms of the provision is required. 251. Goods, Wares, and Merchandise. The requirements of this provision apply only to contracts for sale of goods, wares, and merchandise. They do not apply to contracts for the sale of work, labor, and materials. The contract of a shop-keeper to sell ordinary articles of commerce, such as potatoes, clothes-line, or needles, is a contract to sell goods, and if the value of the goods be more than fifty dollars (or whatever limit the particular state may have adopted) it must, if executory, be in writing or it will not be enforced. The contract of a noted sculptor, however, to make a statue of a particular person, is not a contract for the sale of goods, wares, and merchandise, but is a contract for work, labor, and materials, and will be enforced regardless of its form. Whether the contract belongs to the first or second class depends on the nature of the thing to be furnished. A contract for the sale of existing articles, or such articles as the seller manufactures in the ordinary course of his business for the general market, whether on hand at the time or not, is a contract for the sale of goods, wares, and merchandise, and the statute applies. On the other hand, if the goods are to be manufactured especially for the particular buyer and upon his special order, not for the general market, the contract is for work, labor, and materials and need not be in waiting. EXAMPLES 1. Garbutt, a miller, entered into a contract with Watson to sell him 100 sacks of flour to be ground from grain. No part was then delivered, no payment made, and no writing executed. When the flour was ground Watson refused to receive it, claiming that the contract was not enforceable because the price was more than $50. This was justifiable, because Garbutt ground the flour in the ordinary course of his business for the general market, and the contract was for the sale of goods, wares, and merchandise. vs. Watson, 5 B. & A. (Eng.) 613. Garbutt 2. Clay entered into an agreement to print a book for Yates, for which Yates had written the preface. When the book was completed Yates refused to receive it on the ground that the price was in excess of fifty dollars and the contract did not conform to the provisions of the Statute of Frauds. This was not justifiable, because this particular book was not suitable for the general market, and the contract was for the sale of work, labor, and materials. so that the Statute of Frauds did not apply. Clay vs. Yates, 1 H. & N; (Eng.)73. 252. Growing Crops and Standing Timber. Timber is real estate until it has been cut. A contract to sell growing timber is not a contract for the sale of goods, but a contract for the sale of real estate. To such the Seventeenth Section of the Statute of Frauds does not apply, but contracts for the sale of standing timber must nevertheless be in writing, regardless of value, because the Fourth Section of the English Statute of Frauds, everywhere adopted in the United States, requires all contracts for the sale of land, or any interest in land, to be in writing. The result is that if there be a sale of uncut standing timber the contract will not be enforceable unless in writing; but if the timber has been cut, the agreement need be in writing only if the price is in excess of the statutory value, and if no timber has been delivered or part payment received, because cut timber is personal property. On the other hand, whether growing crops are persona. property or real estate depends upon the nature of the crops, and not upon whether they have been cut. Crops which are dependent for their growth upon cultivation by the hand of man may be sold before they are harvested, or severed from the soil, as personal property. They are goods, wares, and merchandise, and contracts for their sale need not be written if the value is less |