H. C. Schrader Co. v. A. Z. Bailey Groc. Co.
H. C. Schrader Co. v. A. Z. Bailey Groc. Co.
Opinion of the Court
The A. Z. Bailey Grocery Company, the appellee, commenced this action against the Commercial Savings Bank & Trust Company for breach of contract, and for money had and received on the 9th day of December, 1912. The Bank & Trust Company, on the 10th day of January, 1918, filed an affidavit alleging, “that on November 29, 1912, they [it] received a draft from the Heard National Bank of Jacksonville, Florida, drawn by H. C. Schrader & Co. on A. Z. Bailey Grocery Company for the sum of $396.00, which sum of $396.00 was paid this defendant by the said A. Z. Bailey Grocery Company, to wit, November 29th, 1912. Shortly after this time this defendant was notified by A. Z. Bailey Grocery Company to hold said money, stating that the carload of oranges, which was the consideration of the above set forth draft, was defective and unfit for market,” and that the Heard National Bank and H. C. Schrader & Co., of Jacksonville, Florida, without collusion with it, claimed the money in custody, which was deposited with the clerk of the court with the affidavit, and, under the provisions of section 6050 of the Code, prayed that notice issue to the Heard National Bank and H. C. Schrader & Co., that they be ■ substituted as defendants and be compelled to litigate with the plaintiff as to the ownership of the money paid into court, and that it (the bank) be discharged from liability.
The uniform holding is that the purpose of the statute (Code 1907, § 6050) is to afford a defendant, against whom an action is pending upon a contract for the payment of money, where one not a party to the suit claims this money, a simple remedy to be relieved of liability by bringing the claimants together and compelling them to litigate, and “is a short method for accomplishing the purposes of a bill of interpleader in equity, and applies only when the facts would authorize a resort to a bill of interpleader in equity.” — Davis v. Douglass, 12 Ala. App. 581, 68 South. 528; Stewart v. Sample, 168 Ala. 270, 53 South. 182; Coleman v. Chambers, 127 Ala. 615, 29 South. 58.
After the issuance of notice to the alleged claimant as provided by the statute, the court is authorized to determine whether the case presented is one for interpleader; and, if so, to substitute the suggested claimant in lieu of the original defepdant. — Stew art v. Sample, supra. The effect of this order, if the statute has any force at all, is to compel the substituted defendant and the plaintiff to litigate between themselves as to the right in the money paid into court. The money, when paid into court, is in custodia legis, and the suit partakes of the nature of a proceeding in rem; and the judgment is not only conclusive as between the adverse claimants to the funds, but also of their right to further pursue the original defendant. — Johnson v. Maxey, 43 Ala. 521; McNamara v. Provident Sav. Life Assur. Soc., 114 Fed. 910, 52 C. C. A. 530; Ford v. Lilly, 5 B. & Sd. 885, 2 N. & M. 662, 27 E. C. L. 372; Washington L. Ins. Co. v. Laurence, 28 How. Prac. (N. Y.) 435. The appearance of the appellant was therefore involuntary; and by persistently insisting that the case was not one for interpleader, it saved the right to have the order reviewed on appeal. — Evans Marble Co. v. McDonald, 142 Ala. 130, 37 *650 South. 830; Ashby Brick Co. v. Ely & Walker Dry Goods Co., 151 Ala. 272, 44 South. 96.
Being under no duty to perform the contract of sale, after the payment of the draft it had no right to withhold the remittance of the proceeds of the draft at the plaintiff’s request, and in doing so breached a duty which it owed the drawer of the draft, if, in fact, it was not guilty of a conversion of the proceeds of the draft.
It is essential to the right to require others to interplead in a pending action that the original defendant occupy the position of a disinterested stakeholder; and it should appear that he is ignorant of the rights of the parties upon whom he calls to interplead, or, at least, that there is a doubt as to which claimant the debt belongs so that he cannot safely pay to one without risk to the other. — Crass v. Memphis & C. R. R. Co., 96 Ala. 447, 11 South. 480. And where it appears that the original defendant is a wrongdoer as to either of the claimants, his right to require inter-pleader does not exist. — Conley v. Ala. Gold Life Ins. Co., 67 Ala. 472; Coleman v. Chambers, supra.
The original defendant, by disclaiming any interest in the debt and paying the money into court, conclusively refuted the fact that it was the transferee and owner of the debt. This is the fact that distinguishes the case of Haas v. Citizens’ Bank, supra, from this case, and Cosmos Cotton Co. v. First National Bank of Birmingham, supra.
The affidavit showing on its face that the original defendant was not entitled to require the appellant to interplead, the court *651 erred in substituting the appellant as a defendant, and requiring it to interplead over its protest. — Stewart v. Sample, supra.
The court, therefore, erred in striking the plea or claim of appellant as amended, and in limiting its claim to the statement that it claimed the money on deposit in court. However, under this claim the appellant was allowed to fully present its theory of the facts, and the error appears tó be without injury.
There is no pretense of fraud in the case; but the evidence tends to show that the door of the car was partly open, and that the oranges were packed and shipped in damp,, cold weather, and that the condition of the oranges was possibly the result of the concurring negligence of the shipper and the carrier.
*652 The plaintiff contends, and offered some evidence to sustain the contention, that before unloading the car, its president called Lyle, the. broker, and Lyle advised it to accept the car, and gave the assurance that the seller would adjust the difference resulting from the defects in the shipment. However, the undisputed evidence shows that Lyle had no authority to bind the seller; that his relation to the transaction was that of broker; and that he was as much the agent of the purchaser as the seller.
The undisputed evidence showing that some of the oranges were not “good merchantable” oranges,, the purchaser was under no obligation to accept the shipment. The seller undertook to deliver at Decatur one carload of good merchantable oranges, and by tendering the car laden in part with oranges that were not good merchantable oranges it breached its contract. “When the vendor sells an article by a particular description, it is a condition to his right of action that the thing which he offers to deliver, or has been delivered, should answer the description.” — Berij. on Sales (17th Ed.) § 600.
The obligation imposed on the seller to deliver “good merchantable oranges” was therefore not a collateral obligation — a warranty — but a condition precedent to the seller’s right to sue for the price. — Benj. on Sales, § 645. “The maxim of the common'law, caveat emptor, is the general rule applicable to sales, so far as quality is concerned. The buyer (in the absence of fraud) purchases at his risk, unless the seller has given an express warranty, or unless a warranty be implied from the nature and circumstances of the sale. * * * So far as ascertained specific chattels already existing, and which the buyer has inspected, is concerned, the rule of caveat emptor admits of no exception by implied warranty of quality.” — Benj. on Sales, § 644.
There is no pretense that the seller was guilty of fraud; and there is no express collateral obligation that the oranges tendered were of the quality described in the contract; and the right of inspection which was fully exercised by the purchaser in this case before paying the draft excludes the idea of implied warranty as to quality. By accepting the shipmnt after inspection, the purchaser in this case waived noncompliance on the part of the seller, and in lieu thereof accepted the assurance of Lyle that the seller would adjust the matter. On the undisputed evidence Lyle was without authority to bind the seller, and though his assurance of *653 adjustment afforded the purchaser no indemnity, it could not hinder appellant’s recovery.
The appellant, and not appellee, was entitled to the affirmative charge.
Reversed and remanded.
Addendum
ON REHEARING.
It would be an anomaly in judicial procedure to hold that the plaintiff may object to the interpleader, and in the same breath hold that the third party who is to be brought in and substituted for the defendant has no such right, and unless the plaintiff objects the right of the third party against the original defendant will be foreclosed. Such a holding would open a door to fraud and collusion through which the plaintiff and the original defendant could compel the innocent third party to litigate when and where they might determine, without right of objection or review ; and the doctrine that if the defendant who invokes inter-pleader has incurred an "independent liability to either of the *654 claimants,” and does not “stand perfectly indifferent between them,” he canhot compel interpleader (Stewart v. Sample, supra), would be futile. Suppose the original defendant has incurred an independent liability to the third party suggested as claimant; can he defeat that independent liability by interpleader ? No. Yet, if the third party can be compelled to come in and litigate without the right to question the right of the original defendant to require interpleader, the judgment will conclude his right against the original defendant.
The case of Frith & Co. v. Hollan, 133 Ala. 583, 32 South. 494, 91 Am. St. Rep. 54, seems to have been a sale by description, without inspection, the goods being shipped at the purchaser’s request, and when the goods were delivered to the carrier at the initial point of shipment the title passed from the seller to the purchaser. — McCormick v. Joseph, 77 Ala. 240; Robinson v. Pogue, 86 Ala. 261, 5 South. 685. And by receiving the goods when they reached their destination the purchaser deprived the seller of no right. In the case in hand the title to the oranges did not pass until after they were inspected and accepted by the Bailey Grocery Company, and, as we have said, the Bailey Grocery Company was under no obligation to accept them; yet it could not accept the oranges after inspection, in the absence of a stipulation in the contract for such contingency, and deprive the shipper of its property in them without liability for the contract price. The application is overruled.
Application overruled.
Reference
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- H. C. Schrader Co. v. A. Z. Bailey Groc. Co. Claim Suit.
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