If the property in goods has not passed from the seller to the buyer, the seller can of course re-sell and give a good title to the goods to a third person, whether or not the seller's action in re-selling is in breach of his contract with the seller. If the property has passed to the buyer under the original contract, the seller cannot as a matter of course confer a good title upon a third person, but he may by virtue of his contract have the right to re-sell, or he may by statute or otherwise have the power to give a good title to a third person upon a re-sale.

The Sale of Goods Act (Ont. s. 47; U.K. 48) provides: 47-(1) Subject to the provisions of this section, a contract of sale is not rescinded by the mere exercise by an unpaid seller of his right of lien or retention or stoppage in transitu.

(2) Where an unpaid seller who has exercised his right of lien or retention or stoppage in transitu, re-sells the goods, the buyer acquires a good title thereto as against the original buyer.

(3) Where the goods are of a perishable nature, or where the unpaid seller gives notice to the buyer of his intention to re-sell, and the buyer does not, within a reasonable time, pay or tender the price, the unpaid seller may re-sell the goods and recover from the original buyer damages for any loss occasioned by his breach of contract.

(4) Where the seller expressly reserves a right of re-sale in case the buyer should make default, and on the buyer making default, re-sells the goods, the original contract of sale is thereby rescinded, but without prejudice to any claim the seller may have for damages.

The subject of re-sale at common law and under the Sale of Goods Act is discussed in Benjamin, 5th ed. 1906, pp. 932 ff. At pp. 951-2, it is said, by way of introduction to the discussion of the meaning of sub-ss. 3 and 4:

It has already been suggested that the true construction of s. 48 (1) [Ont. s. 47 (1 )] is one consonant with the common law, and that under its provisions the mere fact that the seller holds the goods under his right of lien, that is to say, adversely to the buyer, or has stopped them in transitu, does not rescind the contract. In other words, the mere fact that the buyer has failed to pay or is insolvent does not entitle the seller to res-seind the contract. Sub-s. 2, however, declares that in such circumstances the seller may pass a good title to a second buyer; but it leaves untouched any remedy the first buyer may possess in respect of the re-sale. As against the second buyer he has none, for he cannot sue him for trespass, or for conversion, or (as after tender he could at common law) for the detention of the goods, for the second buyer has a statutory title; nor can he sue the seller for trespass or conversion, as he is not entitled to the possession. But under this sub-section, as at common law, if the buyer, within the time allowed, was ready and willing to accept and pay for the goods, he can after a re-sale sue the seller for non-delivery; or if within such time he tenders the price and demands the goods, he can sue the seller for their detention, it being no defence in the latter action to say that the defendant has parted with the possession of the goods. Sub-s. 3 declares in what circumstances the seller may by law re-sell the goods. Sub-s. 4 declares the effect of a re-sale under an express power. The provisions of sub-ss. 3 and 4 give rise to very difficult questions of construction.

As to re-sale, see also 25 Halsbury, Laws of England, pp. 263 f.; Booth Steamship Co. v. Cargo Fleet Iron Co. [1916] 2

K.B. 570, at pp. 581, 598 ff.; McGregor v. Whalen, 1914, 31 O.L.R. 543, 20 D.L.R. 489.

In the United States the Uniform Sales Act provides: 60.- (1) Where the goods are of a perishable nature, or where the seller expressly reserves the right of re-sale in case the buyer should make default, or where the buyer has been in default in the payment of the price an unreasonable time, an unpaid seller having a right of lien or having stopped the goods in transitu may re-sell the goods. He shall not thereafter be liable to the original buyer upon the contract to sell or the sale or for any profit made by such re-sale, but may recover from the buyer damages for any loss occasioned by the breach of the contract or the sale.

(2) Where a re-sale is made, as authorized in this section, the buyer acquires a good title as against the original buyer.

(3) It is not essential to the validity of a re-sale that notice of an intention to re-sell the goods be given by the seller to the original buyer. But where the right to re-sell is not based on the perishable nature of the goods or upon an express provision of the contract or the sale, the giving or failure to give such notice shall be relevant in any issue involving the question whether the buyer had been in default an unreasonable time before the re-sale was made.

(4) It is not essential to the validity of a re-sale that notice of the time and place of such re-sale should be given by the seller to the original buyer.

(5) The seller is bound to exercise reasonable care and judgment in making a re-sale, and subject to this requirement may make a re-sale either by public or private sale.

61. - (1) An unpaid, seller having a right of lien or having stopped the goods in transitu, may rescind the transfer of title and resume the property in the goods, where he expressly reserved the right to do so in case the buyer should make default, or where the buyer has been in default in the payment of the price an unreasonable time. The seller shall not thereafter be liable to the buyer upon the contract to sell or the sale, but may recover from the buyer damages for any loss occasioned by the breach of the contract or the sale.

(2) The transfer of title shall not be held to have been rescinded by an unpaid seller until he has manifested by notice to the buyer or by some other overt act an intention to rescind. It is not necessary that such overt act should be communicated to the buyer, but the giving or failure to give notice to the buyer of the intention to rescind shall be relevant in any issue involving the question whether the buyer had been in default an unreasonable time before the right of recission was asserted.