76 N.Y.S. 838 | N.Y. App. Div. | 1902
Lead Opinion
The evidence in this case is without practical dispute and in all essential features the questions involved are solely questions of law.
The rights and obligations of a common carrier at common law were essentially those of an insurer of the delivery of the goods to the owner or consignee at their point of destination. The only matters which could be invoked by the carrier as an excuse for failure to deliver the goods to the consignee or owner, were that loss was occasioned by the act of God or the public enemy. It was early recognized, however, that such liability might be modified by special contract made at the time of accepting the goods for carriage. (Dorr v. N. J. Steam Navigation Co., 11 N. Y. 485; Steinweg v. Erie Railway, 43 id. 123; Blossom v. Dodd, Id. 264.) Unless so limited by express agreement the common-law liability of the carrier remained. The contract of carriage, however, was fully and completely discharged when the goods had been carried to their destination and delivered by the carrier to the party entitled to receive the same, and having been so delivered all liability ceased. Such delivery was not dependent upon the production and surrender of the bill of lading in order to protect the carrier, but when he had carried and delivered, to the owner or consignee of the goods, the subject of the contract, liability upon the part of the carrier ceased, notwithstanding the fact that the bill of lading was not presented and surrendered at the time of the delivery of the
Out of this condition arose a necessity for the protection of the business community dealing upon the faith and credit of such bills. To that end statutes were passed in many jurisdictions impressing upon such bills to some extent the quality of negotiable paper and applying the rules of law applicable thereto so far as the nature of the case permitted. In many of the States, including the State of Hew York, stringent statutory provisions were enacted for the protection of persons dealing therewith, and penalties were attached thereto and imposed upon the carrier who failed in observance of such statutes. The course of. legislation in this State will be the subject of examination hereafter.
At common law, however, such contracts were not negotiable
The Legislature of this State in 1858 (Chap. 326 of the Laws of that year) enacted, among other things, that warehouse receipts given for any goods, etc., might be transferred by indorsement thereof, and any person or persons to whom they should be so transferred should be deemed and taken to be the owner of the goods, so far as to give validity to any pledge, lien or transfer made or created by such person or persons, and the act required that no property should be delivered except upon the surrender and cancellation of the original receipt or the indorsement of such delivery
This statute was amended in 1859 (Chap. 353 of the Laws of that year), whereby the provisions of section 6 of that act, to which we have made reference, were amended by making the provisions thereof applicable to bills of lading and to all persons or corporations that might issue such bills of any kind or description. The act, as amended, was required to be construed as including a forwarder and bills of lading, as though the same were mentioned in every section of the act to which the amendment applied. By virtue of the provisions of this act it was held that where a carrier had delivered goods under a bill of lading which did not have the words “ not negotiable ” plainly written or stamped thereon, without requiring the delivery and surrender of the bill at the time of the delivery, was liable in an action for damages sustained by the person to whom the bill of lading had been delivered. (Colgate v. Penn. Co., 102 N. Y. 120.) The facts in that case are quite similar in one respect to the conditions which appear in the present case. Therein the hills which were issued did not have either stamped or written upon their face the words “not negotiable,” but the goods represented thereby were delivered to the person entitled thereto, as named in the bill, but without the production or surrender of the bill of lading. Such bills became, therefore, there as here, what is denominated “spent” bills. There was, however, in that case a number of bills of lading, and a part of the property represented thereby was delivered according
In 1886 (chap. 593) the Legislature repealed these provisions of the statute, having in part re-enacted the same in sections 629 and 633 of the Penal Code (Laws of 1881, chap. 676). By virtue of
If it needed express statutory authority for the maintenance of a civil action for damages sustained for this breach of duty, then clearly such right of action has been taken away, for not a vestige of the provisions which conferred authority in this respect is found in the provisions of the Penal Code. The amendment or revision of the act of 1858 was, therefore, something more than a mere change of phraseology for the reason that it omitted the language which authorized the maintenance of an action, and, if the right of its maintenance depended thereon, then the intent of the Legislature is clearly manifested to take it away, and it would necessarily fall for the reason that it had not been continued. In the Colgate case it was asserted that the right of action therein involved could be maintained as an action of conversion, quite independent of statutory provisions, but this was for the reason that the defendant in that case had been guilty of a conversion of the goods. Damages arising out of “ spent bills ” were not the subject of consideration therein. It could not be, as the decision below had eliminated from the case such question, and the Court of Appeals nowhere intimates that such disposition of the matter was improper, and of course it follows that the action of conversion for the delivery óf the goods subsequent to the transfer of the bill of lading, as it was based upon conversion pure and simple, could be maintained.
The right existed to maintain such an action in conversion at common law. By the provisions of section 629 of the Penal Code, which is in all substantial respects a re-enactment of the provisions of the law of 1858, so far as it assumes to cover the subject, the person offending against its provisions is declared to be guilty of a misdemeanor and punishable by imprisonment for not exceeding one year or by a fine not exceeding $1,000, or by both. Section 633 is directed solely against the act of delivery of merchandise by the persons mentioned in section 629 without the production and surrender
It is clear, therefore, that the cause of action provided by the statute of 1858 for the act charged in the complaint finds no place in the present law of the State and did not survive in the repeal and revision of such act, and as the offense under the present provisions of the Penal Code is a felony, no right of civil action for the recovery of damages exists for the commission of the offense therein defined. This is a sufficient answer to the claim of the plaintiff. There seems to be some basis, however, for the claim that the provisions of section 633 of the Penal Code is authority for the maintenance of a civil action to recover damages for its violation. Such is the statement of one authority. (Burnham v. C. V. S. Co.,. 142 N. Y. 169,172.) The court therein, as authority for this proposition, cites the Colgate Case (supra), and First National Bank of Cincinnati v. Kelly (57 N. Y. 34). We have already sufficiently discussed the first of these cases and have shown, as we think, that the right of action therein sustained existed at common law; so far as it rested upon the statute it has been swept away by subsequent
Negligence cannot be predicated upon a violation of this statute for the reason that at common law the defendant was not bound to recognize any right that might exist in a third party either at the time or subsequent to the delivery of the goods if in fact at the time of such delivery it was made to the rightful owner. The right of action, therefore, was purely statutory and had no other foundation. It would not be contended that if the statute and constitutional provision giving a right of action to the next of kin for negligently causing the death of a person were repealed that any right of action would survive. If the right of action were taken away and there was substituted in its place a statute which made the act of negligently causing such death a felony, such act within well-settled authority would furnish the exclusive remedy and the cause of action based upon negligence would be wiped out. A violation of the statute thereafter, although caused by negligence, would give .no
If it be assumed that an action based upon negligence could have been maintained as a common-law right, it seems clear that it could only be predicated upon the negligence of the defendant as the moving cause of the injury. It would be going very far indeed to say that such an action could be maintained where the injury would and could not be inflicted except by the intervention of a criminal act by a third party. In the present case the “ spent bill ” could not have been negotiated had not the holder thereof forged the words “ order of and notify.” The language of the contract contained in the bill gave notice that the carrier could deliver without the production of the bill, unless these or words of similar import appeared thereon. With the addition of these words the carrier had nothing to do. The act placing them upon the bill was a forgery, and such act alone induced the plaintiff to take the bill. The mere failure to deliver the goods without the production of the bill worked no harm to any one, nor could it so work harm, as no one would take it or be authorized to take it thereafter and thereby assert a liability against the defendant. It is said that the bill was outstanding, and to so leave it was a wrongful act of the defendant, as thereby a fraud could be perpetrated. As well might it be said that the theft and negotiation of a promissory note never delivered gave a right of action in the holder for negligence, because the drawer of the note had filled it up and thereby enabled a thief to become possessed of it. The negligence which will sustain such an action must rest upon the doing of a harmful act either by omitting to do something or by taking affirmative action. The intervening agency of a criminal act where, without it, no wrong to any one would be done, cannot be urged as an element upon which to predicate liability. In the present case the plaintiff testifies that he would not have taken the bill had not the words appeared upon the bill, and, as these words were forged by the holder of it, it would
For these and the reasons already assigned, it follows that the judgment and order should be reversed and a new trial granted, with costs to the appellant to abide the event. The order denying leave to the defendant to amend should be affirmed; and the appeal from the order denying the motion for reargument should be dismissed.
Laughlin, J., concurred; Van Brunt, P. J., concurred in result; O’Brien, J., dissented.
Dissenting Opinion
I dissent from the conclusion reached by the majority of the court; and in view of the commercial importance of the case deem it proper that my reasons therefor should be given.
Where goods covered by a bill of lading have been delivered, the bill of lading, if thereafter outstanding, is denominated a “ spent bill.” It has many times been held that a “ spent bill ” is not effective or operative for the transfer of title to property therein described. Accordingly, in National Commercial Bank v. Lackawanna T. Co. (59 App. Div. 271), wherein recovery was sought on a “spent bill” based upon the theory of conversion, it was held that such an action would not lie because the functions of the bill ceased upon the delivery of the goods and it could not thereafter operate to vest the title of the goods in the subsequent transferee and that “ the liability, if any, of the carrier to the subsequent transferee of the bill of lading for the former’s failure to take up the bill when it delivered the goods, cannot he enforced in an action based solely upon the theory of a conversion of the goods.” It was therein sought to raise the question which is here directly presented as to whether the leaving of such a bill of lading outstanding after delivery of the goods in direct violation of section 633 of the Penal Code would create a cause of action in favor of one to whom the bill was transferred for value for the damages caused thereby. Although the court referred to the question as a serious one, it refused to pass upon it for the reason that it was not properly presented by the pleadings. In the present case the complaint is not framed, nor is relief demanded upon the theory of conversion, but it is sought to charge the defendant with
As we shall hereafter point out, this is not a statutory action, but it is based upon a violation of the common-law duty or obligation resting upon the defendant, and of which the statute is evidence, of observing care to prevent fraud and imposition on third persons. The precise question presented for our determination, therefore, may be thus stated: Does a cause of action upon the theory of a breach of duty or for neglect arise in favor of one who has received a “ spent bill ” of lading for a valuable consideration as against a person or corporation delivering the goods covered by the bill which does not bear the words “ not négotiable,” as required by the statute, without the surrender of such bill ? Or, differently formulated : Can a recovery upon the theory of negligence or breach of duty be had against a common carrier on a commercial bill of lading — as distinguishable from a mere freight receipt — for delivering goods without a surrender of the bill, in favor of the person to whom it is subsequently transferred for a valuable consideration %
It is conceded that section 633 of the Renal Code was directly aimed at preventing what has in this instance happened, namely, the delivery of the goods without the surrender of the bill, the bill not containing the words “ not negotiable.” Prior to the enactment of this section of the Penal Code, the Legislature sought to avert the evils resulting from such a practice by chapter 326 of the Laws of 1858 which was, however, repealed by chapter 593 of the Laws of 1886. Under the law of 1858, in addition to the prohibition similar to that contained now in the Penal Code, section 633, there was the further provision that every person aggrieved might maintain an action at law against those violating the act to recover all damages which he or they might have caused by reason of such violation. (§§ 6, 7.) An instance of recovery under this statute will be found in the case of Colgate v. Penn. Co. (reported in 31 Hun, 297, and on appeal 102 N. Y. 120). The additional provision to which we have referred having been repealed, the statutory action fell with it; but this by no means took away the remedy which at common law a person might have against one who through negligence or violation of duty had caused damage.
In that case also will be found a discussion of the claim there and here' made of laches against the plaintiff by reason of delay in presenting the bill of lading and making demand of defendant which we think sufficiently answers the argument which is again presented to us on that subject.
Although there is, undoubtedly, a distinction to be observed as to the status occupied by one who obtains a bill before the delivery of goods and one who obtains it after delivery, since those circumstances affect the form of action, there is no distinction in principle as to the basis of the recovery predicated upon neglect or failure to observe a duty imposed by statute. That this is so appears from the Colgate Case (102 N. Y. 120) wherein, referring to the law of 1858, the court says of “ spent bills: ” “ Doubtless the last was one of the evils sought to be prevented * * *. By no other mode could the existence of ‘ spent bills ’ in a form capable of deception
It will be noticed that the appellants’ argument in that case proceeded from an opposite standpoint, the insistence there being that the statute was aimed exclusively at “ spent bills ” and not at bills which were transferred before the goods were delivered; and that with reference to the latter an action would not lie: Although a decision under the former law (Laws of 1858, chap.' 326), that case is authority for the following propositions, (1) that the effect of the statute is to incorporate into every bill of lading the statutory condition and make it an element of the contract; (2) that the remedy of the transferee where the carrier has delivered the property in violation of statute is not confined to an action for damages given by the statute, and (3) that the intent of the statute was not to dictate the character or form of the action, but that any action appropriate to the injury was contemplated.
The Penal Code (§ 633), just as the former law of 1858, was intended to provide against the possibility of what has here occurred by requiring that the bills should be surrendered or else that they should be marked “not negotiable.” We think, therefore, that the change in the law which omitted the provision giving a cause of action for violation of the statute does not affect the right to maintain an action for damages. It still remains a statute for the protection of the individual and to prevent fraud by making use of “ spent bills; ” and upon such facts the right of action existed at common law. (Cooley Torts [2d ed.], 788, 790.) Nor is the delivery of the goods before the transfer to the plaintiff of the bill any excuse or defense to the action. The violation of the statute is conceded and damage was sustained and we think the liability thereupon attached.
Our view that punishment under the Penal Code is not the only liability incurred is enforced by what was said in Burnham v. C. V. S. Co. (142 N. Y. 172), where, in speaking of the consequences that would result from the wrongful delivery of goods covered by a bill of lading, the court, referring to the plaintiff there, said, “ if
Nor can sections 629 and 633 of the Penal Code be construed as limited to the person who makes delivery of the goods. These sections in terms designate a person, but the provision, as is perfectly • evident from the language which follows, embraces a corporation as well as an individual. Formerly the Penal Code (§ 718, subd. 14) defined the term “ person ” to include a corporation or joint association, unless the language either expressly or by necessary implication limited it to a natural person. (Laws of 1881, chap. 676.) This definition does not appear in section 718 of the present Penal Code, but it has been substantially re-enacted in the Statutory Construction Law (Laws of 1892, chap. 677, § 5). This, however, is not important. It was the rule at common law that a corporation might be included in the word “ person.” (1 Bish. Cr. Law [3d ed.], § 243 ; Peoples. Utica Ins. Co., 15 Johns. 358, 381, 382.) Section 13 of the Penal Code provides for the punishment of a corporation where imprisonment could be inflicted upon a natural person for the same act. It would, moreover, be a forced and unnatural construction to limit the provisions of the Penal Code to a natural person. If so construed it would grant immunity to a corporation or association for acts which the statute aims to prevent, and which, in view of existing conditions, could scarcely be done except by a corporation. The business is in the hands of corporations which can only act by- agents; and to say that these provisions of the statute were alone directed against the person acting for the corporation would defeat the whole purpose of the statute.
Many subsidiary questions are urged by the appellant, the more important of which may be briefly considered.
It appeared that after the bill was issued and delivered to the consignee and before its transfer to the plaintiff, the word “ order ” was written before the name of the consignee; and upon this is
The 9th clause provided that “ if the word ' order ’ is written * * * immediately before or after the name of the party to whose order the property is consigned * * * the surrender of this bill * * * properly indorsed shall be required before the delivery of the property,” otherwise “ the said property may at the option of the carrier, be delivered without requiring the production or surrender of this bill of lading.”
Although this clause permitted by its terms a delivery to the consignee without the production of the bill, it was ineffectual for that purpose for there was necessarily incorporated in it the provisions of the statute which commanded that the property, if the bill was not marked “not negotiable,” should be delivered only upon the production and surrender of the bill. (Colgate Case, 102 N. Y. 120.)
Of course if knowledge of the fact that the bill had been altered after it had been issued by the carrier was brought home to the plaintiff before he took it, a different question would be presented. He testified that the words “ order of and notify ” had been inserted before the name of the consignee and he believed that they were so inserted by him; but neither this testimony nor any other in the case shows that knowledge of the alteration had been brought home to him, nor would it justify the inference that he knew that the bill had been altered at the time he took it. On the contrary, the evidence and the inferencés are just the other way, he stating that he did not know of the alteration until after he presented the bill to the defendant.
"With respect to the further contention of the alleged error committed by the learned trial judge in refusing to permit an amendment of the answer setting up that section 633 of the Penal Code
The other minor points urged, I regard as without merit. My conclusion, therefore, upon the entire case as it was presented to the learned trial judge at the close of all the evidence, there being no disputed facts, and, hence, no question for the jury, is that on motion made he properly directed a verdict for the plaintiff, and the judgment appealed from should accordingly be affirmed.
Judgment and order reversed, new trial ordered, costs to appellants to abide event. Order denying leave to amend affirmed, and appeal from order denying reargument dismissed.