Court case[1893] 2 QB 318

Mrs Lloyd took furniture from Lee under a 'hire and purchase' agreement: she was to pay a sum at once and the balance by a fixed later date, and on completing the payments the furniture would become hers. She was bound to pay every instalment and had no option to return the goods. Before the final payment she sold the furniture to Butler, who bought in good faith without notice of Lee's rights. Lee sued Butler for the furniture.

The Court of Appeal held for Butler. Because Mrs Lloyd was bound to pay the whole price and could not return the goods, the agreement was in substance an agreement to buy, the property being retained by the seller only as security. She was therefore a person who 'having agreed to buy goods' obtained possession with the seller's consent, and her sale to a bona fide purchaser passed a good title under the Factors Act, the owner's reservation of property notwithstanding.