116 Cal. 9 | Cal. | 1897
On November 3,1891, the plaintiff made and delivered to William Frese & Co., a copartnership doing business at San Francisco, a letter of credit directed to Bullock Bros. & Co. of Rangoon, authorizing them to draw on plaintiff, at London, drafts at six months’ sight, for any sum or sums not exceeding in the aggregate £13,000 sterling, for the invoice cost of merchandise to be shipped from Rangoon to San Francisco on account of said Frese & Co., and agreed to pay said drafts at maturity, 'provided the)’ were accompanied by invoices and bills of lading purporting to be of the required value, and shipped as above stated. Under said letter of credit Bullock Bros. & Co. drew drafts upon the plaintiff in London amounting in all to $61,892.91, and the same were accompanied by invoices and bills of lading as required by the letter of credit.
On March 28, 1892, none of said drafts having matured or been paid, the defendants Roth, Blum & Co., at
The cargo of rice purchased under said letter of credit arrived at San Francisco September 17, 1892. Frese & Co. failed in business some time between June 20th and August 21, 1893. Up to the time of their failure they made sales of portions of the rice and the bank delivered the rice so sold. After their failure the bank disposed of the rice through brokers. Plaintiff's account as rendered shows a balance due the bank of $7,981.85. This action is upon said promissory note. Frese & Co. pleaded their discharge in insolvency. Both, Blum & Co. set out in their answer the circumstances, under which the note was made, and alleged that the aggregate amount of drafts drawn was $61,892.91, that plaintiff held as security for the payment of said drafts the invoices and bills of lading of said merchandise, and had received on account of said drafts a sum largely in excess of their aggregate amount.
The court found that plaintiff had received the proceeds of said cargo, and that “said cargo realized a sum in excess of the aggregate amount of all the drafts drawn under said letter of credit, to wit, in excess of the sum of $61,892.91.” Judgment was entered for the defendants, and the plaintiff appeals therefrom, and from an order denying its motion for a new trial.
Appellant contends that said finding is not justified by the evidence.
Upon the trial the discharge in insolvency of Frese & Co. was admitted by the plaintiff, and Both & Blum admitted the incorporation of the plaintiff and the making and delivery of the note set out in the complaint, and then put in evidence said letter of credit and plain
Of course, it was only necessary for the defendants in the court below to establish improper debit items, in the account as rendered, to equal the balance shown by the account to be due to the bank, in order to defeat the plaintiff. It is said by counsel for appellant in his brief that the court below adopted the defendants’ view that the expenses of the cargo, consisting of freight, duty, weigher’s fees, drayage, and storage, amounting to $15,602.79, could not be charged by the bank and deducted from the proceeds as against Roth, Blum & Co„ who are sureties to the extent of $10,000, the amount of their note. If such holding is correct, the judgment must be affirmed as a matter of course; though if it be wrong, and it be shown that other items appearing on the debit side of the account, equaling the balance claimed by the bank, were improper, an affirmance must follow, notwithstanding the error.
It is true the manager of the bank, upon his examination by the defendants, testified that Frese & Co. drew checks payable to John Livingston for freight charges amounting to $11,603.40, and, when presented, were paid by the bank and charged in the books to the ordinary account of Frese & Co., but the error was discovered the next morning and corrected by charging them to the rice account. He further testified, however, that prior to that time Frese & Co. had an account at the bank, but that they did not, at the date of the arrival of the cargo, or at any time afterward, have any moneys to their credit in said bank. The correction of the charge was therefore proper.
It may be further said, without entering into details^ that reasonable charges for storage, insurance upon the rice while stored, cartage, brokerage, etc., properly incurred in caring for, preserving and selling the rice, are properly deducted from the gross receipts. No question is made as to the necessity or propriety of any of these acts, or as to the prices for which the rice was sold, or the manner of sale; but some special objections are made to particular items which remain to be noticed.
It is contended by defendants that various charges of interest on overdrafts at different dates, from September 30, 1892, to June 19, 1893, are improper. Prior to, and including September 30, 1892, plaintiff had paid for freight and customs duties $12,306.40, and on October 11th it had paid on the draft drawn under the letter of credit, $35,157.74, and on October 14th, balance of draft, $26,735.17, in all $74,199.31, a sum exceeding the receipts by over $24,000. It is not questioned that, as between the bank and Frese & Co., that the interest charged had not been earned, or properly charged; and, if so, we fail to see upon what ground the defendants, Roth, Blum & Co., can object. The account shows, however, that nearly, if not the whole of the interest so charged was in fact paid by Frese & Co., and these charges of interest are balanced by the credits of money paid by them, and therefore, so far as the charges and credits balance each other, the account as to Roth, Blum & Co., is not affected, even if it be conceded that they are not liable for the interest so charged.
In the account certain entries appear of a given quantity of rice sold at a price stated, amounting to a given sum, “less discount” of a stated amount, the balance being carried out as the amount received from the sale. These items of discount amount to $226.14, and respond
On the debit side of the account is an item, “ To Pac. M. S. S. Co. $758.35,” and this entry, it is said, does not indicate what it was for, and should be disallowed. But it was part of the account put in evidence by defendants, and if it required explanation they should have called for it.
It is further objected by respondents that in the sums charged on October 11 and 14, 1892—which were in payment of the drafts—there was included a commission of one per centum, amounting to $618.92, and that they are not chargeable therefor, and that that amount should be deducted. Said sums so charged were the precise amounts of the drafts drawn at Rangoon by Bullock Bros. & Co., under the letter of credit “for the invoice cost of merchandise,” and did not include any commission. The answer of defendants, Roth, Blum & Co., alleged that the drafts were so drawn, and were for the sum of $61,892.91 (and the court so found), and said charges above mentioned only equaled the said sum. The contract between the bank and Frese & Co. did provide that a commission of one per cent should be paid the bank upon the amount of drafts drawn under said letter of credit, but it is not included in said items, nor anywhere in the account. If it did, it should be excluded, as defendants are not liable under their contract for profits made by the bank; but only for the liability it incurred.
On the record before us we find but two items which should be deducted from the balance claimed by the plaintiff. One of these, the item for marine insurance upon the cargo, $1,573, is conceded by appellant. The
We have not verified the footing of the accounts, but have taken the balance as stated; and deducting the above charges, which as the evidence now stands should, be disallowed, there would appear to remain due to the plaintiff from respondents $5,938.10. It follows that the finding that “ said cargo realized a sum in excess of the aggregate amount of the drafts drawn under said letter of credit” is not justified by the evidence.
But one exception to ruling upon evidence is specified. Mr. Powell was asked the following question: “ Did you ever learn from Mr. Blum whether his firm was interested with Frese & Co. in this cargo of rice?” The objection that the question was incompetent and irrelevant was sustained. No offer was made to show that the witness had been so informed, and hence it does not appear that plaintiff was prejudiced, even if it be conceded that the ruling was erroneous.
We are asked by appellant to enter judgment for the plaintiff for such amount as appears to be due it, the facts being before us. But the findings would not support such a judgment, and this court cannot make findings of fact.
The judgment and order appealed from should be reversed and a new trial granted.
Searls, C., and Belcher, C., concurred.
For the reasons given in the foregoing opinion the judgment and order appealed from are reversed and a new trial granted.
Harrison, J., Van Fleet, J., McFarland, J.
Hearing in Bank denied.