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O'Connor v. Clark - 170 Pa. 318, 32 A. 1029 (1895)

Rule:

In cases in which an owner of personal property has so acted with reference to his property as to invest another with such ownership, or apparent authority to dispose of it, as is calculated to mislead and does mislead a good faith purchaser for value, the principle of estoppel applies and declares that the apparent title or authority, for the existence of which the actual owner was responsible, shall be regarded as the real title or authority, at least so far as persons acting on the apparent title or authority and parting with value are concerned. Strictly speaking, this is merely a special application of the broad equitable rule that where one of two innocent persons must suffer loss by reason of the fraud or deceit of another, the loss should fall upon him by whose act or omission the wrongdoer has been enabled to commit the fraud.

Facts:

John O’Connor, who was engaged in the business of keeping wagons for hire, employed George Tracy, who had formerly been in business for himself as a piano mover. At this time, O’Connor was having a wagon built, and he directed the builder to print on the wagon the words “George Tracy, Piano Mover” in order to create the impression that the horse and wagon belonged to Tracy. Thereafter, Tracy encountered the defendant, who agreed to buy the horse and wagon for $125, apparently without the permission of O’Connor. Since Tracy was a stranger to the defendant, the latter inquired as to whether Tracy was the person whose name was on the wagon. The defendant then bought the horse and wagon, honestly believing that Tracy was the actual owner. Subsequently, O’Connor filed an action for replevin in order to recover the value of the horse and wagon from the defendant. The trial court ruled in favor of O’Connor; defendant appealed.

Issue:

Should O’Connor, the actual owner of the horse and wagon, be allowed to recover the value of the same from the defendant vendee?

Answer:

No.

Conclusion:

The Court held that O’Connor, the actual owner of the horse and wagon, was estopped from asserting title because he clothed the vendor, George Tracy, with the apparent authority to dispose of the horse and wagon. According to the Court, the defendant vendee acted and parted with value upon the faith of such apparent ownership and authority.

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