"(3.) Where any goods have been sold, and the vendor or any person on his behalf continues or is in possession of the documents of title thereto, any sale, pledge, or other disposition of the goods or documents made by such vendor or any person or agent entrusted by the vendor with the goods or documents within the meaning of the principal Acts as amended by this Act so continuing or being in possession, shall be as valid and effectual as if such vendor or person were an agent or person entrusted by the vendee with the goods or documents within the meaning of the principal Acts as amended by this Act, provided the person to whom the sale, pledge, or other disposition is made has not notice that the goods have been previously sold." This section bears upon the state of facts in Johnson v. Credit Lyonnais Company (ante, p. *475). If this section had been in force when those facts '"happened the plaintiff would have had to bear the loss, not the defendant (o).

(n) See remark in Benjamin on Sales, 2nd edit., p. 679; see also 3rd edit., pp. 806, 809.

"(4). Where any goods have been sold or contracted to be sold, and the vendee, or any person on his behalf, obtains the possession of the documents of title thereto from the vendor or his agents, any sale, pledge, or disposition of such goods or documents by such vendee so in possession or by any other person or agent entrusted by the vendee with the documents within the meaning of the principal Acts as amended by this Act, shall be as valid and effectual as if such vendee or other person were an agent or person entrusted by the vendor with the documents within the meaning of the principal Acts as amended by this Act, pro(o) See the remarks of Cockburn, C. J., in Johnson v. Credit Lyonnais Co., 3 C P. D. 36, 47 L. J. (Q. B., etc.) 245.

Vided the person to whom the sale, pledge, or other disposition is made has not notice of any lien or other right of the vendor in respect of the goods."

This section applies to the cases of Jenkyns v.

Usborne (p) and Van Casteel v. Booker (q), where it was held that pledges of documents of title by persons claiming to be owners, were not within the protection of the then Factors' Act, which applied only to the cases of persons entrusted with the documents as factors or agents.

*"(5.) Where any document of title to goods has been lawfully endorsed or otherwise transferred to any person as a vendee or owner of the goods, and such person transfers such document by endorsement (or by delivery where the document is by custom, or by its express terms transferable by delivery, or makes the goods deliverable to the bearer) to a person who takes the same bond fide and for valuable consideration, the last-mentioned transfer shall have the same effect for defeating any vendor's lien or right of stoppage in transitu as the transfer of a bill of lading has for defeating the right of stoppage in transitu." This section contains a very important alteration of the law as to the right of stoppage in transitu (r). This right exists where the unpaid vendor of goods who has contracted for their sale, and delivered them to a carrier in compliance witli the sale, ascertains that the vendee is insolvent before the arrival of the goods at their destination. In that case, while the goods are still in transitu, the vendor may stop and countermand their delivery. The doing this is called stoppage in transitu.

(p) 7 M. & G. (49 E. C. L. E.) 678.

(q) 2 Exch. 691. (r) It is not within the scope of this work to enter into the subject of stoppage in transitu at any length. The student who desires information thereupon is referred to Lickbarrow v. Mason, 1 Smith L. C, p. 753, 8th edit., and to Benjamin on Sales, book v., part i., chap. 5, p. 815,3rd edit.

*But though the consignor may thus stop the goods before they get to the consignee, yet the latter in almost all cases of the shipment of goods receives the bill of lading of the goods before the goods arrive. Now the bill of lading is a document signed by the master of the vessel on board of which the goods are shipped acknowledging their receipt on board, and that they are deliverable to the person named therein or his assigns; and by the custom of merchants if this bill of lading is transferred by endorsement for a valuable consideration, the property in the goods passes. The bill of lading thus becomes to a considerable extent a negotiable instrument, for not only is it a symbol of value passing from hand to hand if duly transferred, but if, while the goods are on their way to their destination, the consignee assign the bill of lading to a third person for a valuable consideration given bond fide, the right of the consignor to stop the goods as against such assignee is thereby divested (s). This degree of negotiability, however, was never extended to other documents of title before this act; but now the right of stoppage in transitu may be defeated by the due transfer of any documents of title (t).

*"(6.) This Act shall apply only to acts done and rights acquired after the passing of this Act."

It is not intended here to enter further into the consideration of the Factors' Acts. But you must not forget to observe that they relax the general rule of the Common Law, that a man cannot give a better title to goods than he has himself (u), in favour of persons who bond fide and without notice of any absence or limitation of authority in the person with whom they deal, pay or advance him money on the strength of the documents of title which he produces, or of the goods of which he is the ostensible owner (x). It is found on the whole fairest and most beneficial to trade that bond fide dealings on the security of goods or documents of title should be upheld rather than the title of the true owner, and that on him should fall the loss, if any, arising from the untrustworthiness of persons into whose hands the symbols of the ownership of his property have come.