Western Transportation Co. v. Marshall

| N.Y. Sup. Ct. | Feb 3, 1862

By the Court,

Leonard, J.

Where the owner voluntarily delivers the possession of merchandise to a vendee, subsequent bona fide purchasers from such vendee, and those incurring liabilities and making advances on the faith of such possession, or standing in the relation of bona fide purchasers, are entitled to protection against the claims of the former owner, although the sale be conditional and the purchase price has not been paid.

So also evidence or indicia of the ownership of merchandise in writing, transferred by assignment or delivery, as the nature of the instrument or usage may require, may be sufficient evidence of the sale and delivery of merchandise.

A custom existed in the city of Mew York at the time of the transáetion in question here, undisputed so far as the evidence shows, whereby the holder of the half bill (so called) of the measurer or officer who has measured grain shipped on board of a vessel for transportation, is entitled to a bill of lading for the grain, mentioned in such half bill, on its production to the agent or owner of the vessel.

In the present case, a large amount of grain had been delivered by the plaintiffs, or their agents, from a canal boat, on board a vessel at the port of Mew York, belonging to the defendants Marshall & Co., or for which they were the agents, for the account of Meyer & Eee as purchasers, to be paid for in cash, on delivery, and a measuring officer had been employed, and had measured and screened the grain as it had been put on ship board from the canal boat. The measurer had also delivered his bill and the half bill to the sellers for measuring and screening the grain, stating also the quantity. The sellers, who were the agents of the plaintiffs, soon after receiving the measurer’s certificate of quantity, and the half bill, sent them, together with their own bill for the price of the grain, to the purchasers, Meyer & Eee.

These facts are not disputed, and in my opinion they constitute a voluntary delivery of the grain by the plaintiffs, through their agents, to the purchasers, although the cash had not been paid.

It is true the plaintiffs might still rescind the sale, as to Meyer & Eee, if the purchase money should not be immediately paid. Meyer & Eee became, however, by the voluntary delivery to them of the half bill, after the grain had been so placed on ship board, the possessors thereof, in such manner that all persons having transactions with them concerning the grain, in good faith, without knowledge of, or reason to suspect the existence of, any fraud in obtaining the grain, were entitled to be protected.

This conclusion is further corroborated by the fact, that the sellers did not call on the purchasers for payment till two full days had elapsed after they had so delivered the measurer’s half bill and certificate; and that the sellers on the third day received the bank check of the purchasers, Meyer & Eee, in payment, which was not presented at bank till the next day thereafter; thus voluntarily giving to the purchasers four days’ credit after full delivery on ship board, with the possession of the measurer’s half bill, constituting such indicia of title as, by the custom prevailing at blew York, entitled the holders to a delivery to them of bills of lading for the grain. It was not claimed by the plaintiffs that the grain, or the measurer’s half bill, had been obtained from the sellers by any trespass or felonious act j which, had such fact existed, would have been fatal to the defense.

It is undoubtedly true that no certificate, receipt or bill of lading of a common carrier, warehouseman, or other bailee, can be made to operate so as to divert the title to merchandise from the true owner; unless some other party has obtained the possession of the merchandise, or the customary indicia of title thereto, by the direct and voluntary consent of the real owner. But a bill of lading will carry the title of the merchandise therein mentioned, to any bona fide purchaser of such bill, without knowledge or reason to suspect the existence of fraud or other malpractice on the part of the shipper in obtaining such possession, although the shipper had actually obtained the merchandise or the indicia of title thereto by fraud, not however amounting to a felony or trespass.

Applying these principles to the present case, it will be found that the defendants Marshall & Co., on behalf of the vessel and owners, executed a bill of lading to the plaintiffs’ vendees, Meyer & Bee, and thereby incurred a liability in respect to the said grain; and that the defendants Morgan & Sons advanced money on the security of the said bill of lading after the defendants Meyer & Bee came to the possession of the grain, and the measurer’s half bill and certificate therefor, in the manner above mentioned, and that they stand in the relation of bona fide purchasers to the extent of the liability incurred, and the advances made as aforesaid, and are entitled to the protection afforded by law to such purchasers. No indemnity has been offered to these parties, but the plaintiffs claim to recover against them in disregard of, or rather denying to them any rights, as purchasers or lien holders.

[New York General Term, February 3, 1862.

The defendants Marshall & Co., and Morgan & Sons, are entitled to judgment in their favor, with costs.

Ingraham, Leonard and Qlerke, Justices.]