Cases falling within rules 2 and 3 are examples of contracts of sale subject to a condition precedent, or, to use the more expressive term of the civil law, subject to a suspensive condition - the passing of the property being suspended until the performance of the condition. Other examples are afforded by sale, or rather delivery, on trial or on approval, and by the bargain known as "sale or return."
The Sale of Goods Act (Ont. s. 20; U. K. s. 18) provides: 20. Unless a different intention appears, the following are rules for ascertaining the intention of the parties as to the time at which the property in the goods is to pass to the buyer:
(d) Rule 4. - When goods are delivered to the buyer on. approval or "on sale or return" or other similar terms, the property, therein passes to the buyer: (i) when he signifies_his approval or acceptance to the seller or does any other act adopting the trans-acTioiiT^ (ii) if he does not signify his approval or acceptance to the seller but retains the goods without giving notice of rejection, then if a time has been fixed for the return of the goods, on the expiration of such time and, if no time has been fixed, on the expir-ation of a reasonable time. What is a reasonable time is a question of fact. Illustrations of delivery on approval or "on sale or return" or other similar terms may be found in the following cases:
Moss v. Sweet, 1851, 16 Q.B. 493. Elphick v. Barnes, 1880, 5 C.P.D. 321. Kirkham v. Attenborough,  1 Q.B. 201, distinguished in Weiner v. Gill,  2 K.B. 574; cf. Weiner v. Harris,  1 K.B. 285.
Canadian Oil Companies v. Margeson, 1917, 51 N.S.R. 331, 35 D.L.R. 298 (option to buy drums in which gasoline delivered).
The person called the " buyer" in the statute is really only a bailee, as he has not bought or agreed to buy, but has merely an option to buy. The_position of the seller is that he has. made an irrevocable offer to sellHelby v. Matthews,  A. C. 471; Kirkham v. Attenborough,  1 Q.B. 201, at p. 203; 25 Halsbury, Laws of England, p. 178, note (n).
The Sale of Goods Act does not mention, nor does it exclude, the alternative that the parties, instead of intending that the goods shall be sold or delivered on a suspensive condition, may intend that there shall be a present sale with an option on the buyer's part to return the goods within a certain time or in certain circumstances. The effect of this latter transaction is that the property passes at once, subject to be divested in a certain event, that is, the transaction is a sale subject to a condition subsequent, or, to use the term of the civil law, subject to a resolutive condition.
Illustrations of sale upon resolutive condition may be found in the following cases:
Head v. Tattersall, 1871, L.R. 7 Exch. 7 (right to return if condition not fulfilled).
May v. Conn, 1911, 23 O.L.R. 102 (right to return in case of breach of warranty), following Taylor v. Tillotson, 1836, 16 Wend. (N.Y.) 494.
In the United States the words " sale or return" indicate a sale on resolutive condition, and the Uniform Sales Act (s. 19) specifically provides:
When goods are delivered to the buyer "on sale or return," or on other terms indicating an intention to make a present sale, but to give the buyer an option to return the goods instead of paying the price, the property passes to the buyer on delivery, but he may revest the property in the seller by returning or tendering the goods within the time fixed in the contract, or, if no time has been fixed, within a reasonable time.