## Facts

- In 1924, Sherer-Gillett Company (seller) agreed to sell a display counter to H. C. Taylor under a written conditional sale contract for use in Taylor’s grocery store.
- The contract permitted Taylor to take immediate possession after an initial payment and required monthly installment payments (about $10 per month) until the price was paid in full.
- The contract expressly provided that title to the counter would remain in Sherer-Gillett until Taylor completed payment.
- Taylor took possession after making the first payment.
- Two days later, Taylor sold the counter to J. W. Long for $100.
- Long paid value and had no notice of Sherer-Gillett’s retained-title interest or the conditional sale terms.
- Sherer-Gillett brought a replevin action against Long to recover the counter based on its retained title.
- The trial court found for Long and treated him as the owner.
- The Appellate Court reversed in favor of Sherer-Gillett and certified the controlling question to the Illinois Supreme Court because it involved construction of the Uniform Sales Act.

## Issues

1. Under the Uniform Sales Act, does a seller’s contractual reservation of title in a conditional sale remain effective against a later good-faith purchaser for value who buys from the conditional buyer in possession without notice?
2. Does the seller’s act of giving the conditional buyer possession, without more, bar the seller from denying the buyer’s authority to transfer full title to a subsequent purchaser?

## Decision

- The Illinois Supreme Court affirmed the Appellate Court’s judgment for Sherer-Gillett.
- The court held that Sherer-Gillett’s retained title under the conditional sale contract was enforceable against Long even though Long purchased in good faith and without notice.
- The court concluded Sherer-Gillett did not engage in conduct that would prevent it from asserting its title; giving Taylor possession alone was not enough.

## Legal Principles

- Under the Uniform Sales Act, a purchaser generally cannot obtain better title than the transferor had.
- A conditional sale contract may validly reserve title in the seller until the purchase price is fully paid, even though the buyer has possession.
- A good-faith purchaser from a conditional buyer in possession takes subject to the seller’s retained title unless the seller’s conduct precludes the seller from denying the buyer’s authority to sell (estoppel/apparent authority).
- Mere delivery of possession pursuant to a conditional sale, without additional acts representing ownership or authority to resell, does not bar the seller from asserting retained title.
- Uniform laws should be construed consistently with other jurisdictions’ interpretations when possible.

## Conclusion

Because Sherer-Gillett reserved title to the display counter until full payment and did nothing beyond placing Taylor in possession under the conditional sale contract, Taylor could not convey full title to Long; therefore, Long’s good-faith purchase without notice did not defeat Sherer-Gillett’s right to recover the counter in replevin.


Sherer-Gillett Co. v. Long, 149 N.E. 225 (1925)