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"nothing could be clearer than that liens real difference in the incidents between a

were personal, and could not be transferred to third persons by any 'tortious pledge' of the principal's goods;" but he afterwards added that he would have it fully understood that his observations were applied to a tortious transfer of the goods of the principal, by the broker undertaking to pledge them as his own; and not to the case of one who, intending to give a security to another, to the extent of his lien, delivers over the actual possession of the goods. on which he has the lien to that other, with notice of his lien, and appoints that other as his servant to keep possession of the goods for him." It would therefore seem that in the case of a broker or factor for sale, before the Factors Acts, although he had no power to pledge his principal's goods, except to the extent of his own lien, with notice of the extent of his interest, yet, when he pledged the goods on which he had a lien tortiously, neither the factor nor his pawnee could retain them even for payment of the amount of the original lien. The case of M'Combie v. Davis (10), however, shews that the factor or broker's lien, although simply a right to retain possession, as between him and his principal, might be transferred and made a security to a third person, provided he professed to assign it only as a security to the like amount of that due to himself.

Still the character of the transaction is that of lien, and not of deposit by way of pledge; and although the goods were intrusted to the broker for sale, and up to the time of sale remained in his hands upon a personal right to retain them for advances, yet he could not pledge them, and if he did, the act was an essential violation of the relation betwixt him and his principal, and entitled the latter at once to the recovery of the value of the goods in trover. "But the relation of principal and factor where money has been advanced on goods consigned for sale is not that of pawnor and pawnee," as was said by the Court in Smart v. Sandars (28), and the same case after amendment of the pleadings (29). There would therefore appear to be some

(28) 3 Com. B. Rep. 401; s. c. 16 Law J. Rep. (N.8.) C.P. 39.

(29) 5 Com. B. Rep. 895; s. c. 17 Law J. Rep. (N.S.) C.P. 258.

simple lien, like that in Legg v. Evans (26), and the lien of a broker or factor before the Factors Acts, and the case of a deposit by way of pledge to secure the repayment of money, which latter more nearly resembles an ordinary mortgage, except that the pawnor retains the general property in the goods pledged, which he does not in the case of an ordinary mortgage-Notes to Coggs v. Barnard (30): "A lien, as we have seen, gives only a personal right to retain possession; a factor or broker's lien was apparently attended with the additional incident that to the extent of his lien he might transfer even the possession of the subject-matter of the lien to a third person, appointing him as his servant to keep possession for him."

In a contract of pledge for securing the payment of money, we have seen that the pawnee may sell and transfer the thing pledged on condition broken; but what implied contract is there that the pledgee shall not in the mean time part with the possession thereof to the extent of his interest? It may be that upon a deposit by way of pledge the express contract between the parties may operate so as to make a parting with the possession even to the extent of his interest before condition broken, so essential a violation of it as to revest the right of possession in the pawnor, but in the absence of such terms, why are they to be implied? There may, possibly, be cases in which the very nature of the thing deposited might induce a jury to believe and find that it was deposited on the understanding that the possession should not be parted with; but in the case before us we have only to deal with the agreement which is stated in the plea. The object of the deposit is to secure the repayment of a loan, and the effect is to create an interest and a right of property in the pawnee to the extent of the loan in the goods deposited; but what is the authority for saying that until condition broken the pawnee has only a personal right to retain the goods in his own possession?

In Johnson v. Stear (9), one Cumming, a bankrupt, had deposited with the defendant 243 cases of brandy, to be held by him as a security for the payment of an (30) 1 Smith's Lead. Cas. 194.

acceptance of the bankrupt for 627. 108., discounted by the defendant, and which would become due on the 29th of January, 1863, and in case such acceptance was not paid at maturity, the defendant was to be at liberty to sell the brandy and apply the proceeds in payment of the acceptance. On the 28th of January, before the acceptance became due, the defendant contracted to sell the brandy to a third person, and on the 29th delivered to him the dock warrant, and on the 30th such third person obtained the actual possession of the brandies. In an action of trover, brought by the assignee of the bankrupt, the Court of Common Pleas held that the plaintiff was entitled to recover, on the ground that the defendant wrongfully assumed to be owner in selling, and although that alone might not be a conversion, yet, by delivering over the dock warrant to the vendees in pursuance of such sale, "he interfered with the right which the bankrupt had on the 29th if he repaid the loan"; but the majority of the Court (Erle, C.J., Byles, J. and Keating, J.) held that he was only entitled to nominal damages, on the express ground that the deposit of the goods in question with the defendant to secure repayment of a loan to him on a given day, with a power to sell in case of default on that day, created an interest and a right of property in the goods which was more than a mere lien; and the wrongful act of the pawnee did not annihilate the contract between the parties, nor the interest of the pawnee in the goods under that contract."

From that view of the law, as applied to the circumstances of that case, Mr. Justice Williams dissented, on the ground "that the bailment was terminated by the sale before the stipulated time, and, consequently, that the title of the plaintiff to the goods became as free as if the bailment had never taken place."

Although the dissent of that most learned Judge diminishes the authority of that case as a decision on the point, and although it may be open to doubt whether in an action of trover the defendant ought not to have succeeded on the plea of not possessed, and that the plaintiff's only remedy for damages was by action on the contract, I am nevertheless of opinion that the substantial ground upon which the majority

of the Court proceeded, viz., that the "act of the pawnee did not annihilate the contract nor the interest of the pawnee in the goods," is the more consistent with the nature and incidents of a deposit by way of pledge. I think that when the true distinction between the case of a deposit by way of pledge of goods for securing the payment of money, and all cases of lien correctly so described is considered, it will be seen that in the former there is no implication in general of a contract by the pledgee to retain the personal possession of the goods deposited, and I think that although he cannot confer upon any third person a better title or a greater interest than he possesses, yet if, nevertheless he does pledge the goods to a third person for a greater interest than he possesses, such an act does not annihilate the contract of pledge between himself and the pawnor, but that the transaction is simply inoperative as against the original pawnor, who, upon tender of the sum secured, immediately becomes entitled to the possession of the goods, and can recover in an action for any special damage which he may have sustained by reason of the act of the pawnee in re-pledging the goods; and I think that such is the true effect of Lord Holt's definition of a "vadium, or pawn" in Coggs v. Barnard (2), although he was of opinion that the pawnee could in no case use the pledge if it would thereby be damaged, and must use due diligence in the keeping of it, and says that the creditor is bound to restore the pledge upon payment of the debt, because by detaining it after the tender of the money he is a wrongdoer, his special property being determined; yet he nowhere says that the misuse or abuse of the pledge before payment or tender annihilates the contract upon which the deposit took place. If the true distinction between cases of lien and cases of deposit by way of pledge be kept in mind, it will, I think, suffice to determine this case in favour of the defendant, seeing that no tender of the sum secured by the original deposit is alleged to have been made by the plaintiff; and considering the nature of the things deposited, I think that the plaintiff can have sustained no real damage by the repledging of them, and that he cannot successfully claim the immediate right to the possession

of the debentures in question. I am therefore of opinion that our judgment should be for the defendant.

BLACKBURN, J.-This is a question arising on demurrer to a plea. The count is in detinue for certain debentures. The plea is, that the plaintiff deposited the debentures with one Simpson as security for the due payment of a bill of exchange, indorsed by plaintiff to Simpson, and discounted by him, and that it was agreed between the plaintiff and Simpson, that Simpson should have full power to sell or otherwise dispose of the debentures if the bill of exchange was not paid when it became due; that the bill was dishonoured, and not yet paid by any one, and that Simpson deposited the debentures with the defendant as a security for the repayment of money advanced by the defendant to Simpson on the security of the debentures.

We

To this plea there was a demurrer. The plea does not expressly state whether the deposit with the defendant by Simpson was before or after the dishonour of the bill of exchange; and, as against the defendant, in whose knowledge this matter lies, it must be taken that it was before the bill was dishonoured, and consequently at a time when Simpson was not yet entitled by virtue of his agreement with the plaintiff to dispose of the debentures. cannot construe the plea as stating that Simpson agreed to transfer to the defendant, as indorsee of the bill, the security which Simpson had over the debentures and no more. We must, I think, as against the defendant, construe the plea as stating that Simpson deposited the debentures, professing to give a security on them for the repayment of a debt of his own, which may or may not have exceeded the amount of the bill of exchange, but was certainly different from it. And it is quite clear that Simpson could not give the defendant any right to detain the debentures after the bill of exchange was satisfied, so that a replication that the plaintiff had paid, or was ready and willing to pay the bill, would have been good. The defendant could not in any view have a greater right than Simpson had. But there is no such replication; and the question which is raised on this record, and it is a very important

one, is, whether the plaintiff is entitled to recover in detinue the possession of the debentures, he neither having paid nor tendered the amount for which he had pledged them with Simpson.

In detinue the plaintiff's claim is based upon his right to have the chattel itself delivered to him, and if there still remain in Simpson, or in the defendant as his assignee, any interest in the goods, or any right of detention inconsistent with this right in the plaintiff, the plaintiff must fail in detinue, though he may be entitled to maintain an action of tort against Simpson or the defendant for the damage, if any, sustained by him in consequence of their unauthorized dealing with the debentures. The question therefore raised on the present demurrer is, whether the deposit by Simpson of the debentures with the defendant, as stated in the plea, put an end to that interest, and right of detention till the bill of exchange was honoured which had been given to Simpson by the plaintiff's original contract of pledge with him.

There is a great difference in this respect between a pledge and a lien. The authorities are clear that a right of lien, properly so called, is a mere personal right of detention, and that an unauthorized transfer of the thing does not transfer that personal right. The cases which established that, before the Factors Acts, a pledge by a factor gave his pledgee no right to retain the goods, even to the extent in which the factor was in advance, proceed on this ground. In Daubigny v. Duval (11), Mr. Justice Buller put the case on the ground that "a lien is a personal right and cannot be transferred to another." In M'Combie v. Davis (10), Lord Ellenborough puts the decision of the Court on the same ground, saying "that nothing could be clearer than that liens were personal, and could not be transferred to third persons by any tortious pledge of the principal's goods."

Story, in his treatise on Bailments, ss. 325, 326 and 327, is apparently dissatisfied with these decisions, thinking that a factor, who has made advances on the goods consigned to him, ought to be considered as having more than a mere personal right to detain the goods, and that a pledgee from him ought to have been considered entitled to detain the goods until

the lien of the factor was discharged. This is a question which can never be raised in this country, for the legislature has intervened, and in all cases of pledges by agents within the Factors Acts the pledge is now available in all cases to the extent of the factor's interest.

But, on the facts stated in the plea, Simpson was not an agent within the meaning of the Factors Acts; and we have to consider whether the agreement stated to have been made between the plaintiff and him did confer something beyond a mere lien, properly so called, an interest in the property, or real right, as distinguished from a mere personal right of detention.

I think that both on principle and on authority, a contract such as that stated in the plea, pledging goods as a security, and giving the pledgee power in case of default to dispose of the pledge (when accompanied by an actual delivery of the thing) does give the pledgee something beyond a mere lien; it creates in him a special property or interest in the thing. By the Civil Law such a contract did so, though there was no actual delivery of possession, but the right of hypothec is not recognized by the common law. Till possession is given, the intended pledgee has only a right of action on the contract, and no interest in the thing itself—Howes v. Ball (31). I mention this because in the argument several authorities, which only go to shew that a delivery of possession is, according to the English law, necessary for the creation of the special property of the pawnee, were cited as if they determined that it was necessary for the continuance of that property.

The effect of the civil law is thus stated by Story, in his treatise on Bailments, s. 328: "It enabled the pawnee to assign over or to pledge the goods again to the extent of his interest or lien on them; and in either case the assignee was entitled to hold the pawn until the original owner discharged the debt for which it was pledged." But, beyond this, the second pledge was inoperative, and conveyed no title, according to the known maxim, "Nemo potest plus juris ad alium transferre quam ipse habet."

In England there are strong authorities (31) 7 B. & C. 481.

that the contract of pledge, when perfected by delivery of possession, creates an interest in the pledge, which interest may be assigned. This was the very point decided by the Court in Mores v. Conham (7), where the Court say that the pawnee is responsible if he misuseth the pawn, "also he hath such an interest in the pawn as he may assign over, and the assignee shall be subject to detinue if he detains it upon payment of the money by the owner." It is true that one Judge, Mr. Justice Foster, dissented on this very point. That may so far weaken the authority of the decision, but it shews that there could be no mistake in the reporter, and no oversight on the part of the majority, but that it was a deliberate decision.

It is laid down by Lord Holt, in his celebrated judgment in Coggs v. Barnard (2), that a pawnee "has a special property, for the pawn is a securing to the pawnee that he shall be repaid his debt, and to compel the pawnor to pay him"-language certainly seeming to indicate an opinion that he has an interest in the thing, or real right, as distinguished from a mere personal right, of detention. And Story, in his treatise on Bailments, s. 327, says, "But whatever doubt may be indulged as to the case of a factor, it has been decided," (that is, in America) "that in the case of a strict pledge, if the pledgee transfers the same to his own creditor, the latter may hold the pledge until the debt of the original owner is discharged."

In Whittaker, on Lien, p. 140 (published in 1812), the law is laid down to be that the pawnee has a special property beyond a lien. I do not cite this as an authority of great weight, but as shewing that this was an existing opinion in England before Story wrote his treatise.

But there is a class of cases in which a person, having a limited interest in chattels, either as hirer or lessee of them, dealing tortiously with them, has been held to determine his special interest in the things, so that the owner may maintain trover as if that interest had never been created. But I think in all these cases the act done by the party having the limited interest was wholly inconsistent with the contract under which he had the limited interest, so that it must be taken from his doing it

that he had renounced that contract, which, as was said in Fenn v. Bittleston (32), operates as a disclaimer of a tenancy at common law; or, as it is put by Mr. Justice Williams in Johnson v. Stear (9), he may be said to have violated an implied condition of the bailment. Such is the case where a hirer of goods, who is not to have more than the use of them, destroys them or sells them; that being so wholly at variance with the purpose for which he holds them that it may well be said he has renounced the contract by which he held them, and so waived and abandoned the limited right which he had under that contract. It may be a question whether it would not have been better if it had been originally determined that, even in such cases, the owner should bring a special action on the case, and recover the damage which he actually sustained, which may, in such cases, be very trifling, though it may be large, instead of holding that he might bring trover and recover the whole value of the chattel without any allowance for the special property. But I am not prepared to dissent from these cases where the act complained of is one wholly repugnant to the holding, as I think it will be found to have been in every one of the cases in which this doctrine has been acted upon.

But where the act, though unauthorized, is not so repugnant to the contract as to shew a disclaimer, the law is otherwise. Thus, where the hirer of a horse for two days to ride from Gravesend to Nettlestead, deviated from the straight way and rode elsewhere, it was held that the hirer had a good special property for the two days, and although he misbehaved by riding to another place than was intended, that was to be punished by an action on the case, and not by seizing the gelding-Lee v. Atkinson (16). This certainly was a much more equitable decision than if a rough rule had been laid down that every deviation from the right line, however small, was to operate as a forfeiture of the right to use the horse for which the hirer had paid; and it may be reconciled to the decisions already referred to, because the wrongful use, though wrongful, was not (32) 7 Exch. Rep. 152; s. c. 21 Law J. Rep. (N.S.) Exch. 41.

NEW SERIES, 35.-Q B.

such as to shew a renunciation of the contract with the owner of the horse. Now, I think that the subpledging of goods, held in security for money, before the money was due, is not in general so inconsistent with the contract as to amount to a renunciation of that contract. There may be cases in which the pledgor has a special personal confidence in the pawnee, and therefore stipulates that the pledge shall be kept by him alone; but no such terms are stated here, and I do not think any such term is implied by law.

In general, all that the pledgor requires is the personal contract of the pledgee that on bringing the money the pawn should be given up to him, and that in the mean time the pledgee shall be responsible for due care being taken for its safe custody. This may very well be done though there has been a subpledge; at least the plaintiff should try the experiment whether, on bringing the money for which he pledged these debentures to Simpson he cannot get them. And the assignment of the pawn for the purpose of raising money (so long at least as it purports to transfer no more than the pledgee's interest against the pledgor), is so far from being found in practice to be inconsistent with or repugnant to the contract, that it has been introduced into the Factors Acts, and is in the Civil Law (and according to Mores v. Conham (7) in our law also) a regular incident in a pledge. If it is done too soon, or to too great an extent, it is doubtless unlawful, but not so repugnant to the contract as to be justly held equivalent to a renunciation of it.

The cases of Bloxham v. Sanders (17) and Milgate v. Kebble (33) are cases of unpaid vendors; and therefore are not authorities directly applicable to a case of pledge. But the position of a partially unpaid vendor who irregularly sells the goods, which have only been partially paid for, is very analogous to that of a pledgee, and in Milgate v. Kebble (33) Chief Justice Tindal is reported to have used language that seems to indicate that in his opinion a pledgor could not have maintained trover any more than the vendee in that case. But the latest case, and one which I think is binding on this Court, is that of Johnson v. Stear (9). I think that the

(33) 3 Man. & G. 100; s. c. 10 Law J. Rep. (N.S.) C.P. 277.

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