253 P. 757 | Cal. Ct. App. | 1927
[EDITORS' NOTE: THIS PAGE CONTAINS HEADNOTES. HEADNOTES ARE NOT AN OFFICIAL PRODUCT OF THE COURT, THEREFORE THEY ARE NOT DISPLAYED.] *319 Action by plaintiff for the value of a certain check alleged to have been converted by the defendant. Plaintiff had judgment in the sum of $17,884.48, from which judgment the defendant appeals.
In September, 1920, the plaintiff was a national bank organized and existing under an act of the general assembly of New Zealand and will hereafter be referred to as the "New Zealand Bank." At the same time and prior thereto, John Burns Co., Ltd., was a corporation organized and existing under a general act of the same assembly and will *320 hereafter be known as "Burns." At the same time, the Fiji Planters Co-operative Association, Ltd., of Savu Savu, Fiji Islands, were planters and shippers of copra, and will hereafter be referred to as the "Fiji Planters." During the same period of time the firm of Geo. Wills Sons, Ltd., was a corporation maintained under the laws of the United Kingdom of Great Britain and Ireland, doing business at San Francisco, California, and will hereafter be known as "Wills."
In September, 1920, the Fiji Planters offered Burns a shipment of copra; Burns arranged through Wills to charter a vessel in San Francisco to load the copra and Wills chartered the schooner "Narwhal." Burns accepted the offer of the Fiji Planters and opened a letter of credit in favor of the Fiji Planters with the New Zealand Bank for £ 20,000 to cover the cargo of copra. The copra was to be shipped to Wills and Wills was to resell the copra. Burns advised Wills to sell the copra. On October 12, 1920, Wills, in his own name, entered into a contract with John Rothchild and Company of San Francisco for the sale of the copra to the latter at seven and one-half cents per pound. The contract was made for shipment of the copra in October, November and December, 1920. The copra was not shipped until the early part of January, 1921. The contract provided for payment as follows: Net cash against seller's sight draft with attached documents, consisting of bill of lading, invoices, etc. Thus, no one could get title or possession of the copra other than the owner and holder of the sight draft until the draft should be paid. Rothchild neither paid the draft nor received the goods. The cargo was rejected by Rothchild on the ground that the shipment was not made at the time limited in the contract. When the copra arrived in San Francisco in 1921, the price had declined so that when the copra was finally disposed of it only brought gross three and one-half cents a pound. Burns was an old and large customer of the New Zealand Bank and was at the times mentioned indebted to the bank in the sum of £ 200,000. On February 1, 1921, Burns delivered to the New Zealand Bank a general letter of hypothecation, the latter clause of which reads: "This letter shall not affect or detract from the bank's general lien according to the law of banker and customer, over all property or any securities in your custody *321 not specifically charged by this letter belonging to us." This general letter of hypothecation authorized the bank to take possession and to proceed at once and without notice to sell at its absolute discretion, and in such manner and at such times as should be thought fit, all or any part of the goods represented by any shipping documents held by the bank, and apply the net proceeds thereof, in payment of all bills, etc., and in liquidation of any debts or liabilities of Burns to the New Zealand Bank. The bank was handed by Burns the bill of lading, invoices, and insurance policies. On February 7 the New Zealand Bank credited the general account of Burns with £ 20,000 to meet the draft Burns was paying on account of the Fiji Planters. The account of Burns was thus credited with the full amount of the draft of Burns on Wills, drawn by Burns on account of the shipment of copra. The course of business between Burns and the New Zealand Bank was such that if a bill was drawn in connection with the sale of goods, and documents accompanied the bill of exchange and the New Zealand Bank discounted the same or made an allowance on the same, an invoice, bill of lading and insurance policy invariably accompanied the bill of exchange. The bill of lading was indorsed: "John Burns Company, Limited, Robt. Burns, Managing Director, as agents of the Fiji Planters Cooperative Association, Limited." This was a general indorsement according to custom so that the bill of lading could be negotiated by delivery.
The New Zealand Bank sent to the Canadian Bank of San Francisco for "collection and credit" through the London office of the New Zealand Bank the draft for £ 20,000 drawn by Burns on Wills, which it had obtained as herein stated. On March 24, 1921, the Canadian Bank received the letter from the New Zealand Bank inclosing draft, the invoices, custom certificates, insurance policy, and bill of lading for the copra, accompanied by the following letter: "Auckland 9th February, 1921. For favour of collection and credit through our London office I enclose herewith our remittance: — BB 777 John Burns Co. Ltd. £ 20,000 at sight, dated 8th February, 1921. The draft is supported by invoice, custom certificate, insurance policy for £ 50,000 and bill of lading for 589 tons 12 cwt. of copra per Barq Narwhal. £ 50,000 the balance of insurance is covered by consignee's instructions: — Second of exchange will reach you *322 by later mail, together with duplicate documents. Kindly advise date of payment direct to this office and to our London office." The "Narwhal" reached San Francisco April 14, 1921. Rothchild inspected the captain's log-book, found the date of loading, rejected the cargo and refused to pay therefor. This led to considerable correspondence by cable and otherwise between the Bank of New Zealand, the Canadian Bank, the Canadian Bank with Wills, relative to the sale of the copra. Wills also cabled Burns.
So far as pertinent, the cablegrams and letters are as follows: On April 20, 1921, the Canadian Bank to which all the papers relating to the cargo had been forwarded by the New Zealand Bank cabled the New Zealand Bank as follows: "Your 777 drawee states documents should be surrendered unconditionally as buyers reject cargo. Wills says cannot act unless given free hand. Instruct." At the same time Wills cabled Burns: "Bank will only release on impossible conditions. Imperative you should arrange surrender of documents unconditionally immediately. Otherwise we cannot proceed in accordance with contract." On April 20th Burns cabled Wills: "What unreasonable guarantee do bank want? We have asked Miller to see you. Give him full particulars." On April 22d the New Zealand Bank cabled the Canadian Bank as follows: "Do not surrender documents unconditionally. Burns instructs Wills must give a guarantee that all proceeds copra up to £ 20,000 sterling handed over to you towards the payment of draft." On April 22d, Wills cabled Burns again: "Bank demand guarantee payment total proceeds twenty thousand pounds. Cannot agree to. We are prepared to pay them proceeds after deducting all charges and expenses." On April 22d Mr. Mitchell for the Canadian Bank wrote Wills as follows: "San Francisco, Cal. April 23d, 1921. (Should be April 22nd, 1921.) Re. Draft Burns Co., on Yourselves £ 20,000. Referring to the draft we have received from the National Bank of New Zealand, Ltd. Auckland, for £ 20,000 against shipping documents per `Narwhal' we beg to advise that we have to-day received the following cable in regard thereto: `Our 777 do not surrender documents unconditionally. Burns instructs Wills must give a guarantee, that all proceeds copra up to £ 20,000 sterling handed over to you towards the payment draft Burns have telegraphed G.J. *323 Miller to watch their interests. Will probably interview you.' In this connection we understand that you will give us a guarantee to hand us the proceeds of the copra less freight, commission, insurance, arbitration fees and allowances, which may be made by the arbitration, legal and handling charges, and we would be obliged if you would kindly confirm this understanding in order that we can submit it to the National Bank of New Zealand, Ltd., Auckland, by cable." On the same day, Wills wrote the Canadian Bank, in reply thereto, the following letter: "We have to acknowledge your letter of to-day's date, which advises us of the cable you have received from the National Bank of New Zealand, Ltd., Auckland, in connection with the draft on the cargo of copra per the `Narwhal.' As advised you on the telephone, we cannot agree to the stipulation made by the National Bank of New Zealand, Ltd., whereby we guarantee to remit you the proceeds for the copra of £ 20,000. Mr. G.J. Miller has called on us and we have explained the situation to him thoroughly in the same manner as we have done with your good selves, and we beg to advise you that we are ready to comply with the last paragraph of your letter, to give you a guarantee to hand you the proceeds of the copra less charges as set forth in yours under reply. As you will readily understand, any expenses in connection with the cargo of the `Narwhal' must be for account of Messrs. John Burns Co., Ltd." Following which the Canadian Bank on April 26th wrote Wills as follows: "Referring to our letter of 23rd April and yours dated 22nd April, re draft of John Burns Company, Ltd., on your good selves for £ 20,000, we beg to hand you herewith shipping documents covering cargo of copra in bulk, per Schooner `Narwhal' and in consideration thereof would you be good enough to give us a guarantee to hand us the proceeds of this copra less freight, commission, insurance, arbitration fees and allowances, legal and handling charges." On April 27, 1921, Wills replied as follows: "In reply to yours of even date, we have to acknowledge receipt of the documents for the cargo of copra in bulk per the Schooner `Narwhal' and we hereby guarantee to hand you the proceeds of the sale of this copra, less freight, commissions, insurance, arbitration fees and allowances, legal and handling charges," in connection with the cargo sent Wills, etc. *324
All the documents relating to the cargo were thus placed in the hands of Wills authorizing him to proceed with the sale thereof by the plaintiffs and turn over the proceeds to the Canadian Bank for the benefit of plaintiffs. Wills proceeded with the sale, paid all the bills, expenses, charges, commissions, etc., and rendered a statement to the Canadian Bank thereof showing the net proceeds of the cargo to be the sum of $17,888.48, and at the same time delivered to the Canadian Bank a check or bill of exchange in the following words: "Voucher No. ____. In full settlement of undermentioned bills. Proceeds from `Norwhal' copra Due John Burns Co., Ltd. Net 17888.48 George Wills Sons, Limited, 230 California Street, San Francisco, California. Aug. 16, 1922. Pay to the order of Canadian Bank of Commerce — $17,888.48 (seventeen thousand eight hundred eighty-eight dollars forty-eight) For George Wills Sons, Limited, A.H. Anderson. To the British American Bank, 11-3 San Francisco, Calif. John Baxter." Immediately thereafter the defendant in this action, as sheriff of the city and county of San Francisco, under a writ of attachment, issued in an action begun by Wills against Burns, served upon the Canadian Bank a notice of garnishment, under and by which the defendant purported to garnishee all moneys and credits in the hands, or under the control of the Canadian Bank belonging to Burns. To this notice of garnishment the Canadian Bank made reply that it had no funds or credits belonging to Burns. Thereafter the check herein referred to was accepted by the British American Bank, but never cashed by the Canadian Bank or credit therefor given to the plaintiff, the New Zealand Bank. Thereafter, and on or about the twenty-first day of November, 1922, the New Zealand Bank served a notice upon and filed with the defendant a third-party claim, notifying the defendant that the plaintiff, the New Zealand Bank, claimed the check and the proceeds represented thereby. Subsequently the check referred to was indorsed by the Canadian Bank, and on or about the twenty-eighth day of December, 1922, delivered to the custody of the sheriff, accompanied by a letter of that date referring to the garnishment served upon the Canadian Bank on the sixteenth day of August, 1922, and among other things stated: "That the Canadian Bank of Commerce received the said check and the funds represented by said check for the *325 account of the National Bank of New Zealand, Ltd., and for your information you are advised that the National Bank of New Zealand, Ltd., claims to be the owner of and entitled to the possession of the said check and the funds represented by said check. The Canadian Bank of Commerce does not care to assume the responsibility of determining who is the owner of the said check or who is entitled to the proceeds represented by said check, and it is therefore accordingly placing the said check in your possession and under your control, pursuant to the levy of the writ above mentioned, but with the express reservation and understanding that in so doing the Canadian Bank of Commerce of San Francisco refuses to recognize that the said check and the funds represented thereby, or any part thereof, belong to John Burns Company, Limited." The third-party claim of the plaintiff was again served upon the defendant and the defendant required of and obtained of Wills an indemnity bond. Wills having obtained judgment against Burns, took out an execution, acting under which, the check referred to was cashed and the money represented thereby turned over to Wills on account of its judgment against Burns.
Thereupon this action was begun by the plaintiff against the defendant for the conversion of said check and for the recovery of the sum of $17,888.48, the value thereof.
The trial court found that on the sixteenth day of August, 1922, the check or bill of exchange was delivered to the Canadian Bank of Commerce by the drawer thereof for the account of the National Bank of New Zealand and that the plaintiff was the person beneficially interested in said check and entitled to the moneys represented thereby and that the British American Bank on that date stamped upon the face of said check or bill of exchange its certificate of acceptance, that the check was not voluntarily delivered by the Canadian Bank to the sheriff, but was delivered to the sheriff in pursuance of the garnishment, and that the defendant was notified that the check and the funds represented thereby belonged to the New Zealand Bank. The trial court also found that the defendant wrongfully converted said check and likewise wrongfully applied the proceeds thereof in satisfaction of the judgment held by Wills against Burns. The court further found that while the bill of exchange was made payable to the Canadian Bank, the Canadian Bank *326 represented the Bank of New Zealand for the purpose of collecting the check and the proceeds represented thereby; that the Bank of New Zealand was the owner of said bill of exchange and the only one entitled to receive the proceeds. The court further found that the defendant wrongfully refused to deliver said personal property or the proceeds thereof to the plaintiff, and, as a conclusion of law, the court determined from the facts found that the plaintiff was entitled to judgment in the sum prayed for, and judgment was entered for the plaintiff in the sum hereinabove mentioned.
Upon this appeal the defendant sets forth nine distinct allegations of error upon the part of the trial court, on every one of which defendant insists the judgment of the trial court should be reversed: 1. When the Canadian Bank delivered the indorsed check to the sheriff, respondent irrevocably lost any lien or title it had to the check or bill of exchange; 2. That when respondent surrendered the bill of lading and other papers relative to the shipment of the cargo of copra to Wills, it lost its lien, if any, upon the copra and the proceeds to be derived therefrom; 3. That if respondent retained any lien when the bill of lading was delivered to Wills, it was lost when Wills sold the copra to the El Dorado Oil Works; 4. That the draft on Wills was taken for collection only and was not discounted by the New Zealand Bank; 5. That no third-party claim was served upon the appellant after his reception of the indorsed check; 6. That the third-party claim served by respondent did not comply with section
[1] We will consider these assignments of error in the order above set forth. By reference to the letter dated December 28, 1922, it will be noticed that the Canadian Bank of Commerce did not surrender the check as the property of Burns, nor without giving to the defendant notification of the fact that it had not received said check as the property of Burns. There is nothing in the transcript which indicates that the New Zealand Bank authorized the Canadian Bank *327
to deliver the check or bill of exchange to the defendant. The transcript does show that the same attorneys acted for the Canadian Bank who appeared in behalf of the plaintiff in this action. Whatever action the Canadian Bank may have taken with relation to the check, its liability, if any, is fixed by the garnishment. As stated in Marshall v. Wentz,
The record which we have heretofore cited amply entitled the trial court to find that the Canadian Bank, in surrendering the check or bill of exchange to the sheriff, was acting in its own behalf, and not in the scope of its agency for the New Zealand Bank, irrespective of whether the Canadian Bank did or did not act voluntarily. That the action of the Canadian Bank, whether voluntary or involuntary, in this particular, or whether acting without or under compulsion of order of court is outside the issues to be decided in this case and does not affect plaintiff's title appears, when the rule set forth in 28 C.J., page 303, section 455, is applied, to wit: "The garnishee being a mere stakeholder, it is well settled that he may relieve himself of liability by payment of the amount owing by him, or delivery of the property of defendant in his possession, to the officer serving the writ. But the garnishee is not compelled to make such payment or delivery, this being a matter of privilege with him. However, under some statutes the court may require the garnishee to turn over to the court, or to the sheriff or like officer . . . An order of court for a garnishee to pay money *330 attached into court decides nothing with regard to the right of claimants to the money." And, as stated in section 64, 37 C.J., page 340: "Where a lienor is wrongfully deprived of or disturbed in the possession of the property, he may maintain trover and conversion for its value." In this particular we may call attention to the findings of the court that the Canadian Bank of Commerce indorsed the check or bill of exchange at the suggestion and request of the defendant and delivered said check or bill of exchange into possession and under the control of the defendant pursuant to the levy, notice of attachment, etc. As a summary of the law relative to appellant's first alleged error, it may be stated that the act of the Canadian Bank delivering the bill of exchange or check into the custody of the sheriff, without the direction so to do by the New Zealand Bank could not convert the ownership of the New Zealand Bank and its right of possession to the bill of exchange, and the proceeds thereof, into property belonging to Burns. This being true, whether the Canadian Bank should have proceeded according to the sections of the Code of Civil Procedure relating to the determination of conflicting claims, or, as said in volume 4, section 132, California Jurisprudence, page 249, becomes wholly immaterial, as the liability or nonliability of the Canadian Bank does not affect the rights of any of the other parties to this action.
[2] Did the surrender of the bill of lading and other paper relating to the shipment of copra to Wills for the purpose of making sale thereof affect the lien of the plaintiff upon the cargo, or its rights to the proceeds arising from the sale thereof? Section 2026 to
Again, as said in 25 C.J., section 149, page 416: "As in other agencies, the factor holds the goods of his principal and their proceeds when sold in the character of a trustee, and in the absence of statutes which furnish protection to persons dealing with factors, if the factor wrongfully disposes of the goods or proceeds, the principal may follow and recover them whenever he can trace them as distinct from those of the factor, into whosoever hands they may come, except a bona fide purchaser for value. . . ." If the goods cannot be had their proceeds may be recovered.
As said in section
In support of its second assignment of error, appellant cites the case of Treadwell v. Davis,
[6] Assignment of error No. 3 that the plaintiff lost its lien, if any, to the cargo of copra and the proceeds, by reason of the sale thereof, is so closely connected with assignment No. 2 that the authorities which we have cited are about to consider determine the holding which should be had concerning both of them. As supporting assignment No. 3, appellant cites the case ofMaier v. Freeman,
[7] Appellant's fourth assignment of error that the bill of exchange was taken by the New Zealand Bank from Burns for collection only is based, apparently, upon the assertion that the weight of the testimony is contrary to the findings of the court. The law seems to be well-settled that if a check or bill of exchange is taken for collection only by a bank, the bank does not take title, but acts merely as a collection agent and that the property in the check or draft remains in the depositary and that the relation arising from the transaction is not that of debtor and creditor but that of principal and agent. (3 R.C.L. 633.) It is sufficient to say that the record discloses sufficient testimony, if believed by the trial court, to warrant the holding that the New Zealand Bank discounted the draft drawn by Burns, and the fact that it was sent to its agent, the Canadian Bank in San Francisco, for collection does not contravene the statement of witness that the check was discounted. It would only go to the effect that the Canadian Bank did not rediscount the draft, but simply accepted the same and acted therein in relation thereto as the collection agent of its principal, the National Bank of New Zealand. Under this state of the record, we do not deem it necessary to extend the length of this opinion by quoting the testimony bearing upon this assignment set forth in the respondent's brief, in support of the findings of the trial court.
[8] Assignments 5 and 6 will be considered together: That no third-party claim was served and that the third-party claim, as served, did not comply with section
There is nothing in the section requiring that the third-party claim be served at any particular period of time after the attachment or garnishment, from which it would seem to follow that such claim may be made at any time before the sheriff has converted the property by sale, or by other means has subjected it to the satisfaction of the plaintiff's demands. That is, the third party will not be allowed to sleep upon his rights until the sheriff has placed himself in a position where it is impossible for him to deliver the property to the third-party claimant or obtain an indemnity bond from the attaching creditor saving him harmless from the claims of third parties. The fact that the check was turned over after the sheriff made return upon the attachment does not release the attachment or garnishment. In the case at bar the sheriff acted upon the third-party claim and demanded and obtained from the attaching creditor a bond of indemnity. This court has held in the case of Brinkley-DouglasF. Co. v. Silman,
[9] As to the seventh assignment of error that the complaint did not sufficiently allege the services of a third-party claim, we may state that it is generally held to be sufficient to set forth the instrument according to the legal tenor or effect thereof. (21 Cal. Jur. 45; Smith v. Jaccard,
In support of the allegation that the findings are insufficient to support the judgment assigned as the eighth reason why reversal should be had herein, nothing further is set forth in the briefs than the questions which we have herein been considering, which we deem a sufficient answer to the eighth assignment without restatement.
[10] Finally, the appellant insists that the plaintiff, having neither title nor right to possession of the check, was not in a position to maintain this action. This position is assumed on the theory that the relation of debtor and creditor existed between the Canadian Bank and the New Zealand Bank and not one of principal and agent. In this *341
particular, we may call attention to the fact that the appellant, in his opening brief, strongly argues that the relation between the Canadian Bank and the respondent was that of principal and agent and that, therefore, the New Zealand Bank having voluntarily, through its agent, delivered the check to the defendant, could not maintain any action for the conversion of the check, or of its proceeds, irrespective of the ownership of the property. To show that what is here stated correctly indicates the theory of the case adopted by the appellant in the first instance, we quote the following from his opening brief: "The relation between the respondent and the Canadian Bank was that of principal and agent. As far as respondent is concerned, the Canadian Bank was merely acting as its agent for collection. Such being the case, the Canadian Bank had no authority to accept anything but money from Wills. Instead of money, the Canadian Bank accepted from Wills a check which it had certified. This was not a completion of its agency to collect and not until completion of collection can it be said that the proceeds had come into the possession of the respondent." In support of this position appellant cites the cases of Henderson v. O'Connell,
We may here state the record shows that the Canadian Bank never cashed the check which it received and never deposited to the credit of the New Zealand Bank in its account any funds represented by the check. That in so far as any act is shown to have been taken or performed by the Canadian Bank in relation to charging itself either with the check or with any funds represented thereby, it assumed and acted only in the capacity of a collection agent, receiving property for the benefit of its principal. Appellant calls attention to section 1818 and section
The check, though payable to, and placed in the possession of, the Canadian Bank of Commerce, represented a liquidated claim of the National Bank of New Zealand against Wills Sons. And when Wills Sons attached the check or the credit represented thereby, the status of affairs was little different from what it would have been if Wills Sons had assigned to someone for collection its claim against Burns Co., and then had had that assignee attach, as property of Burns Co., the net proceeds of the sale of the copra in the hands of Wills Sons really owing to the National Bank of New Zealand.
The Canadian Bank represented the National Bank of New Zealand as an agent to collect the indebtedness; and the mere fact that the Canadian Bank received, and at the time of the levy held, a check as conditional payment cannot alter the ownership of the National Bank of New Zealand in the credit represented by the check, or prevent that bank, as the real beneficial owner, from having recourse to an action of conversion to recover the value of its property.
As was said by Lord Ellenborough in Stephens v. Elwall, 4 Maule S. (Eng.) 259, "a person is guilty of conversion who intermeddles with my property and disposes of it; and it is no answer that he acted under the authority of another who had himself no authority to dispose of it."
Agreeing with appellant, as set forth in his opening brief, that the Canadian Bank at the time of its reception from Wills of the check or bill of exchange representing the proceeds of the cargo of copra guaranteed by Wills to be turned over pursuant to the direction of the New Zealand Bank, through its representative, the Canadian Bank, is correct, and that all the circumstances supported this conclusion, it is only necessary to cite a few authorities to confirm the rights of respondent to maintain this action. In section 19, page 1043, of volume 24 Cal. Jur., the text-writer sets forth the general rule as to the right to maintain trover in the following language: "To enable one to recover for the conversion of personal property, he must have had a general or special ownership of the property at the time of the tort. Legal title is not necessary; any special valuable interest in the property accompanied with the right of possession is *345 sufficient. Actual possession of a chattel at the time of its conversion will sustain trover, except as to the true owner or one claiming under him, even though the title be conceded to be in a third person. So also one who has a present right to possession may maintain the action. Manifestly, however, one cannot maintain the action where he had neither possession, right of possession, nor any title in the property claimed at the time of the conversion."
In 28 Am. Eng. Ency. of Law, page 661, second edition, we find the following: "An agent may be guilty of the conversion of chattels intrusted to him by his principal so as to render him liable in trover to the principal, or the action may be maintained by the principal against third persons who wrongfully acquire the property from the agent. Unless the principal is entitled to possession of the chattels as against the agent he cannot, of course, as against the latter, maintain trover therefor; but a wrongdoer who takes the chattels from a factor cannot set up the lien of the factor in defense to an action of trover against him by the principal."
There is also another principle which applies to this proceeding and gives the respondent a right of action. The fact that the check or bill of exchange was not applied by the Canadian Bank to the uses and purposes of the respondent as theretofore directed. This principle is stated in section 440 of the Law of Conversion by Bowers, to wit: "From the cases cited it is gathered that a general owner of a chattel cannot maintain trover therefor during the continuance of a definite term for which he has parted with possession; but where a bailee, during the term of the bailment, has put the chattel to a different use from that for which it was bailed, the owner thereupon becomes entitled to immediate possession . . . and may maintain trover for its conversion." [11] The control of the Canadian Bank, as the agent of the respondent and the special property of the Canadian Bank, if any, in and to the check or bill of exchange was for the express purpose of applying the proceeds of the sale of the copra to the discharge of the indebtedness of Burns to the New Zealand Bank, evidenced and created by the bill of exchange theretofore discounted by the New Zealand Bank at the inception of the transaction out of which this controversy arises, and when the check or bill *346
of exchange evidencing the proceeds arising from the sale of the cargo of copra was placed in the possession of the defendant it was in contravention of the rights of the respondent and gave rise to an immediate cause of action on the part of the plaintiff herein. That the Canadian Bank may have rendered itself liable by turning the check or bill of exchange over to the defendant does not militate against either the ownership of the proceeds of the sale of the copra, or the right of the respondent to maintain this action. As to the cargo of copra, the rule is clear that the pledgee, to wit, the respondent, if considered only as a pledgee, has the right to maintain trover for the conversion thereof. (Bowers on the Law of Conversion, secs. 392, 393.) The latter section deals with the right of the pledgee to maintain trover against third persons. While there are some cases to the contrary, notably the case of Herring v. Tilghman,
Buck, J., pro tem., and Finch, P.J., concurred.
A petition by appellant to have the cause heard in the supreme court, after judgment in the district court of appeal, was denied by the supreme court on April 15, 1927.