20 Ind. App. 247 | Ind. Ct. App. | 1898
The appellants instituted this action against the appellees in the Marion Superior Court. The complaint and exhibit filed therewith are as follows: On the 18th day of July, 1895, Nathan Vestal, by
The defendants answered by general denial. The court found for the appellees, and rendered judgment against the appellants for costs. The appellants filed their motion for a new trial upon the following-grounds, -to wit: First, that the decision of the court is not sustained by sufficient evidence; second, that the decision of the court is contrary to law. The motion for a new trial was overruled, which ruling of the court is the error assigned in this appeal.
The only questions arise upon the evidence. There is no conflict of the evidence. It may be summarized as follows: At the time the sight draft mentioned in the complaint was drawn, the appellants were engaged in a general merchandise and banking business at Clayton, Hendricks county, Indiana. The appel
Appellees knew before they sold the cattle that the draft had been drawn against the cattle and that it was Mr. Vestal’s desire that the proceeds of the sale should be applied to the payment of the draft. It is claimed by appellants that the sale of the cattle with the knowledge that the draft was drawn against them was in law an acceptance of the draft, and that therefore the judgment of the court was contrary to law, and not sustained by sufficient evidence. Appellants’ learned counsel argue that inasmuch as Vestal was owing both the appellants and the appellees, and elected to pay appellants first, he proposed to do what the law permits, prefer his creditors. It must be remembered, however, that the cattle were delivered to appellees by Vestal for sale by them before they had knowledge of the draft, and without notice that he wished the cattle sold for the benefit of appellants. When a debtor has delivered to his creditor the amount due him or placed in his hands the means by which it may be realized, without conditions, the debtor loses the right of preference. Appellees did not at any time promise to accept the draft. The cattle brought $36.00 less than the face of the draft,
Appellants7 learned counsel further contend that in view of the circumstances of the case, the‘sight-draft constituted in law and equity an assignment to appellants of the proceeds arising from the sale of the cattle, and to sustain their claim cite from 1 Daniels on Negotiable Instruments, section 21, also the 2 Am. and Eng. Ency. of Law (2nd ed.) p. 1059, to the effect that “It is a general rule that an order payable out of a particular fund operates as an equitable assignment of the fund not only as between the drawer and payee, but as regards the drawee also, notwithstanding the order may not be accepted by the latter party.77
In the case before us when the draft was drawn, there were no funds in the hands of the drawee. The drawer was indebted to the drawee upon former transactions. A factor to whom goods are consigned for sale has a lien upon those goods or upon the proceeds from the sale thereof, not only for any expenses that he may have incurred in connection with those particular goods, but also for the balance due him from his principal on their general acount. Johnson v. Hoosier Drill Co., 99 Pa. St. 216; Bryce v. Brooks, 26 Wend. 369; Hidden v. Waldo, 55 N. Y. 294; Daniel v. Swift, 54 Ga. 113; Chaffraix v. Harper, 26 La. 22; Story on Sales (1th ed.), section 97, p. 92. Chalmers on Bills of Exchange, on page 179, says: “A bill, of itself, does not operate as an assignment of funds in the hands of the' drawer available for the payment thereof, and the drawee of a bill who does not accept as required by this act is not liable on the instrument.77 In the First National Bank, etc., v. Ege, 109 N. Y. 120, 16 N. E. 317, a shipper drew against the consignment upon the consignee with whom his ac
In the case at bar the seller had overdrawn his account; he did not transfer the property to the bank, but he delivered the cattle to the appellees. The bank had no interest in the proceeds from the sale, although Vestal was indebted to appellants. In Waymuth v. Boyer, 1 Ves. Jr. 416, there was an agreement communicated to the factor and agreed to by him before the goods were placed in his hands, that the goods were to be sold for the benefit of a particular creditor, and it was held that the factor could not retain the proceeds for a demand against the owner. The difference in the case at bar and the one just cited is apparent. The evidence shows a refusal to accept the draft; that it was for more than the amount realized from the sale of the cattle; that the cattle were delivered for sale by the owner, who was at the time the debtor of appellees, to appellees without notice of the draft. Appellees accounted for the amount realized from the sale of the cattle less the amount of the expenses of the sale and former overdrafts. We find no error. Judgment affirmed.