6 Colo. App. 216 | Colo. Ct. App. | 1895
delivered the opinion of the court.
Which equity must prevail in a suit between a bona fide transferee for value of a bill of lading and a vendor of goods who attempts to exercise the right of stoppage in transitu has never been doubted since their legal status was defined in the leading case of Lickbarrow v. Mason (4 Bro. P. C. 57, 2 T. R. 63), decided in the House of Lords in 1793.
In such cases the principal things to be inquired about are
For some five or six jrnars prior to the spring of 1892, Boehm & Co. had been large wholesale rectifiers and dealers in spirits. They did business with The First National Bank of Denver. In the course of their dealings they were frequently large borrowers of mone}r, and procured extensive accommodations from the bank by way of advances on drafts drawn by them on their customers, loans on their own and their customer’s commercial paper and overdrafts, which accrued in the general course of business. The firm had a substantial and large credit with the bank, and the account varied from the ordinary credit maintained by such a house to an indebtedness of $150,000. The debt was cared for in various ways; — sometimes by payments in cash and sometimes by the deposit of other forms of commercial credit. During the later part of the dealings between the bank and the house, Boehm & Co. were accustomed to protect their liabilities by daily deposits of warehouse receipts and bills of lading, which covered goods in stock and in transit. On the 10th of March, 1892, Boehm & Co. were indebted in a very large sum, amounting, speaking generally, to upwards of $100,000. The firm required more money on that day, and applied to the bank for a loan of $15,000, which the bank declined to make without some engagement on the part of the company to protect or “ cover ” the loan, as the English bankers have it. It is very clear the firm agreed on that day to protect this- loan by the deposit of sundry warehouse receipts and bills of lading, if' the bank would advance the money. Ther.e is no very clear testimony as to what receipts or what bills of lading were to be delivered to the bank. The cashier gave evidence that Mr. Boehm mentioned, as .part of the securities which he was to deposit, a bill of lading for some goods which were coming from New Orleans. It is not plain whether the class or description or amount of this particular shipment was stated. On the testimony, it seems to be a general statement or promise by Boehm to
The finding of the court respecting this matter is not very plain, though in his opinion he- intimates the delivery to have been on Sunday. We do not depart from our custom to yield our own judgment on any matter of fact to the finding of the nisi prius court, because in this particular, the case is not at all dependent on the court’s conclusion. As we view it, it would make very little legal difference whether the bill was delivered on Saturday or Sunday. We are, however, so clearly of the opinion that the case as made justifies no other conclusion, that we state out judgment about this matter of delivery. On the evidence, it is very satisfactorily shown that the bill passed into the hands of the bank on Saturday. We attach no importance whatever to the hour of its delivery, whether before or after the bank was generally closed to the public. We- are bound to know the course of dealings-between banks and their customers. Everybody understands that it is a very common occurrence for a customer to arrange for a loan and receive a credit in the bank on which lie can check on his promise to- cover or protect the credit by a subsequent delivery of some kind of security. The agreement is frequently carried out in respect to the delivery óf the securities after the bank has technically closed. The bank cannot be said to- lose its rights acquired by a transaction with its customer had after its doors are technically shut to the general public for the- purposes of deposit and check. The bill of lading of these goods was endorsed by Boehm & Co. and delivered to the bank in performance of the agreement made on the-10th. of March, when the greater part of the $15,000 was paid over to the firm. The subsequent delivery of the bill' on- Saturday was in fulfillment of the agreement made by Boehm at the time- the bank did its part in the payment of the money. On Sunday, the 13th, the bank became suspicious of the solvency of Boehm & Co., and took steps for the protection of their interests. A statement
This judgment is not supported by the proof. The equi
In this state, then, there need be no concurrence between the advancement of the money and the delivery of the security. Whatever may be the fact respecting the particular advance of $15,000, and the endorsement of the bill, the legal status of the bank would be unchanged. It would be a holder for value whichever way the fact might be found. We do not concede the appellee’s contention izi regard to this fact. There is no evidence whatever respecting the tz-ansaction, save what was given by the cashier. His direct evidence was to the point that the bank loaned $15,000 on its
It was there adjudged that a holder of a bill of lading received subsequent to an advance, which was made on the strength of a promise by the transferor to cover his account, made the banker a holder for value. The cases generally concede that an advance made on the strength of a promise to deliver a particular security will make the banker a holder for value. According to this case, a general promise to cover, followed by performance, will be equally effectual. We conclude the facts in this case show not only a general promise to cover the credit, followed by either a total or partial performance, but a specific promise to cover by the delivery of this particular bill. In any event, the bank brought itself strictly within the legal definition of a holder for value.
The only other consideration, which, under the record, is of veiy slight consequence, respects the good faith of the bank in accepting the security. Knowledge of the endorsers’ insolvency is seldom a matter of presumption. The extent of the indebtedness to the bank, the call for collaterals, which was heeded, followed shortly and sharply by an attachment to collect the debt, does not necessarily compel us to infer that Boehm & Co. were insolvent, or that the bank had knowledge of their financial condition. Whatever significance might be given to this proof, in the absence of direct testimony on the subject, we are not at liberty to indulge in speculations and permit our inferences to overcome the direct testimony in the case. Direct evidence was given about the bank’s knowledge of this fact, and it was established that the bank was without knowledge either of the insolvency of the firm or of such facts respecting its financial condition as would legally charge them with knowledge about it. In
On the oral argument and by a subsequent brief, the appellees seek to question the authority of the bank to maintain the suit for lack of either allegation or proof of their incorporation. The question does not appear to be one of any gravity or importance, nor do we incline to the opinion that the appellees may question the right of the bank to contract as it did with Boehm & Co. about this bill of lading. The legality of their act seems to be a question only between the original parties to it, or the government from which the bank derives its authority. National Bank v. Whitney, 103 U. S. 99 ; Gold Mining Co. v. National Bank, 96 U. S. 640.
In one of the defenses the appellees alleged a lack of authority on the part of the bank to make the loan, and aver it was a national bank organized and incorporated under the national bank act, which after judgment would certainly.be treated as a sufficient admission to entitle the bank to maintain its suit when the only question was whether, by allegation and proof the bank’s corporate capacity had been established. The complaint was probably defective in this partic
Some other matters have been brought to our attention, but it does not seem necessary to determine them or assign; the reasons for our judgment about' them. For the errors already discussed and resolved in favor of the appellant, the judgment must be reversed and remanded for a new trial.
Reversed.