Story Case

George Warner met a stranger on the train who sold him a gold watch for the sum of twelve dollars. He exhibited his bargain to the town postmaster, Mr. Jonah Hopkins became interested in the unique Swiss movement, and offered to buy the watch. After several days of negotiation, Mr. Warner sold the watch to the postmaster for $19.50. Several days later, the buyer visited the county seat, where the watch was identified and claimed as one recently stolen from the Bevin Jewelry Company. Mr. Hopkins surrendered it and then requested a return of the purchase price from his friend Warner. Mr. Warner consulted his son, who was studying law, and finally agreed to pay Mr. Hopkins ten dollars, provided this would satisfy the latter. Mr. Hopkins did not want to lose the good will of his friend, and accepted the offer. Could he have demanded more?

Ruling Court Case. Euchholz Vs. Bannister, Volume 17 Common Bench Reports, New Series, Page 708

Euchholz was a commission merchant at Manchester; Bannister was a job warehouseman in the same place. Euchholz went into Bannister's warehouse and there saw, among other goods purchased by the defendant, seventeen pieces of print, which he offered to buy. Bannister accepted the offer. Euchholz paid for the goods at once. Later, it developed that the merchandise had been stolen, and that Bannister was not the true owner of them. Euchholz was compelled to surrender them upon the rightful owner's demand. This was an action to recover from Bannister the price paid for the goods.

It was contended by Bannister that there could be no recovery, because there was no warranty of title, express or implied.

Mr. Earle, Chief Justice, said: "In the case of goods sold in an open shop or warehouse, there is an implied warranty on the part of the seller that he is the owner of the goods, and, if it turns out otherwise, as where the goods are claimed by the true owner, from whom they have been stolen, the buyer may recover the price as money paid upon a consideration, which has failed." Judgment was given for Euchholz.

Ruling Law. Story Case Answer

When one sells property as his own, he implicitly warrants that he has title. A pawn broker does not make such an implied warranty. His act is simply a declaration that he is selling such title as he may have.

Mr. Hopkins, of the Story Case, did not receive the full measure of his loss, but this would have been granted at law. George Warner tacitly asserted his ownership of the watch he agreed to sell; on this implied warranty, Hopkins could have recovered the whole of his loss.