Walters v. Western & A. R.

63 F. 391 | U.S. Circuit Court for the Northern District of Georgia | 1894

NEWMAX, District Judge.

The authorities riled by counsel for the receivers seem undoubtedly to establish the proposition that where a time draft is drawn by the consignor of goods, and attached to a bill of lading for the goods, and the draft is sent to a bank for collection at the place to which the goods are consigned, an acceptance by the drawee entitles him to have the bill of lading delivered to him; the reason given for this ruling- being that the consignee is expected to sell the consigned goods in order to realize funds with which ,to take up the draft by the time it matures. National Bank of Commerce v. Merchants’ Nat. Bank, 91 U. S. 92; Woolen v. Bank, 12 Blatchf. 359, Fed. Cas. No. 18,026; Bank v. Wright, 48 N. Y. 1;. Bank v. Luttgren (Minn.) 13 N. W. 151; Erwin v. Harris, 87 Ga. 335, 13 S. E. 513. The difficulty about the application of that proposition to the present case is that the drafts here are sight drafts, and the reason upon which those cases rest does not apply; second, the facts of thiTtransaction here are otherwise entirely different from those in the cases which have been cited ;as authority for the proposition above referred to. In the case at bar the draft was drawn on G. B. Everett & Co., and was paid by the intervener, the Capital City Bank, at the request of G. B. Everett ,& Co., and the money charged to their account. At the time of the payment of these drafts by the intervener, the goods seem to have been sold by Everett & Co. to Akers & Bros., and what is called on the one hand a promissory note, and on the other a mere agreement to purchase, was given by Akers & Bros. The following is a copy of one of the papers, all of the others being of the same character, except as to amounts, number of cars, and dates:

"‘$542.26. Due Dec. 16.

“Atlanta, Ga„ Oct. 6th, 1889.

“Forty-eight days alter date, we will pay to G. B. Everett & Co., on presentation of bills of lading for cars 1Sx12624, five hundred and forty-two 2S-100 dollars.

“Net,-. Int., 7.05.

“[Signed] Akers & Bros.”

The method of proceeding of the bank was to take this paper made by Alters & Bros., attach it to the bill of lading which covered the same cars of grain, and hold the same as security for Akers & Bros.’ obligation. It appears, also, that Everett & Co. continued to be bound to the bank, or at least that Arm so considered itself from other evidence in the case, which it is not deemed material to go into now. At all events, it is clear that the bank held the bills of lading as security for money advanced on the faith of the consignment covered by the various bills of lading.

It is said, applying the rule to be adduced from the authorities which have been referred to above as cited by counsel for the receivers, that, if an acceptor of a time draft is entitled to the bill of lading, equally so is the drawee when he pays off the bill of lading; and it is urged that when the Capital City Bank paid .the drafts, and sent the money on to the drawer, charging the same to Everett & Co., Everett & Co. were entitled to receive the bills of lading. Then it is said that.; Everett & Co. having sold the grain to Akers & Bros., the latter Arm were entitled to have the bills of lading turned over to them; and if the railroad company delivered the cars of grain to the persons who, in law, really had the bills of lading,, or ought to have liad them, they should be acquitted of any liability in the matter of injury to other persons. If the bank in this case had been paid the amount of the draft, and there had been no other transactions with them, then there might be some force in the position assumed for the receivers, but the additional facts appear which have just been stated. The bank paid the draft for Everett & Co.,, holding the bills of lading for the advance thus made, in connection with the paper made by Akers & Bros., copied above.

The whole question comes back to this: that the railroad company should have required the bills of lading to be given up before delivering the goods, and, when they allowed Akers & Bros, to receive these goods without at the same time receiving from them the bills of lading, they did so in violation of the rights of this intervener, who seems in the utmost good faith to have advanced the money upon the credit of the goods covered by the bills of lading, and of their being in possession of the railroad company. While It is conceded that bills of lading are not “negotiable instruments,”’ in the full sense of that term, still they do represent the goods which they cover, and may be taken as security for money advanced while the consignment is in the hands of the railroad company. Among the cases which might be referred to, the following are named, because they are supreme court decisions, and the doctrine they enunciate controlling: Conrad v. Insurance Co., 1 Pet. 386; The Thames,. 14 Wall. 98; North Pennsylvania R. Co. v. Commercial Nat. Bank, 123 U. S. 727. 8 Sup. Ct. 266, and cases therein cited. It is apparent that the bank would have been fully protected if the railroad company had required the bills of lading to be delivered, or had exercised any reasonable degree of diligence in ascertaining the person entitled to receive the goods before releasing possession.

The Friedlander Case, 130 U. S. 416, 9 Rup. Ct. 570, Can have no application here. There is no claim whatever that these bills of lading were accomplished. In the case of Inman, intervener,, against these same receivers (56 Fed. 369), the contention was that the bills of lading had been delivered up and reissued by the agent No claim of that kind can, of course, be interposed here.' What the Friedlander Case decided was that where the ag'ent of a railroad company fraudulently issued bills of lading for goods, when no goods had, in fact, been delivered, such agent goes entirely beyond the scope of his authority, and his principal (the railroad company) is not bound. It is held that his authority from the company is to issue bills of lading for goods delivered, and that that is the scope' and extent of his agency, and, when he goes beyond that, he cannot bind the company by his actions. It is unnecessary here t:o go into the facts of 1 he agency at Mclvors. a t which point these goods were delivered, and the method of Akers, as agent, and of Akers & Bros., in transacting (heir business, as they were fully discussed in the Case of Inman, supra, and further reference to the matter here would be a mere repetition.’

As to the question of demand, and as to whether or not Mr. Dickey, the general freight agent, was the proper official on whom to make demand, it is sufficient to say that .lie seems to have undertaken to represent the railroad company in the matter, and made no question whatever as to his authority to act in the premises. He was the general freight agent of the company, and from this designation it would seem .that he had general supervision over all its freight business, and really appears to have been the proper person, of all others, upon whom demand should have been made. If not, he at least should have referred the representative of the intervener to some one else who had authority to act in the matter. The exceptions must be overruled, and the report of the master be confirmed.