Schaeffer v. Macqueen

The general rule, that where the possession of goods is obtained by a fraudulent purchase, though they may be reclaimed from the vendee, they can not be recovered from a third person, who has obtained them in good faith, has not been disputed by the counsel for the defendant. It is claimed, however, that there is a distinction where the fraud is of such a character as would justify and sustain a prosecution under the statute for obtaining goods by false pretenses; that such a case must stand on the same ground as larceny, and it being clear that, in case of larceny, the true owner is not deprived óf his goods, though they have come into the hands of a purchaser in good faith, a like rule should govern where goods have been obtained by false pretenses.

It is a general rule that “ no one can transfer to another *456a better title than lie has himself.” No man can be divested of his property without his own consent, or the operation of law, in which latter case, indeed, it has been said his consent is implied. Consequently, it is the general rule that even the honest purchaser, under a defective title, can not hold against the true proprietor. Rut to this general rule there are well-recognized exceptions, some founded in public policy, or proceeding from' the nature and quality of the particular species of property, and others on the conduct of the owner of the property, as making it unfair or unjust that he should reclaim the property in the hands of an innocent party; and in these last cases, as in the case of being deprived of property by operation of law, he may be said to have consented, or at least, placed himself in such a position that he can not dispute his assent.

To the first class of these exceptions belong coin, hank bills, and negotiable securities. To these, though they have been lost or stolen, a good title may be asserted by a fair owner, who has obtained them in the ordinary course of trade and business. To the second class belong cases “where an owner, with the intention of sale, has in any way parted with the actual property of his goods with his own consent, though under such circumstances of fraud or error as would make that consent revokable, and authorize a rescission of the sale as against such vendee;” and also cases where an owner “ has, by his own voluntary act or consent, given to another such evidence of the right of selling his goods as, according to the custom of trade or the common understanding of the world, usually accompanies the authority of disposal;” or, as it has been expressed, “has given the external indicia of the right of disposing of his property;” 20 Wend. 267, 280, Saltus v. Everett. In both these cases a purchaser in good faith can retain the property, because the owner has, by his own direct voluntary act, conferred upon the person from whom such a purchaser derives title, the apparent right of property, as owner, or of disposal as an agent"; Id. 279.

*457The distinction between such cases and the case where goods are found or stolen, is obvious. It has been said that “ the distinction between fraud and felony is this: in one case, the man who parts with the property makes a contract in fact; in the other, he does nothing;” 70 E. C. L., 10 C. B. 919, 923, White v. Garden. In the same case, it is said: “ There is a very obvious distinction between the cases of goods obtained by felony and fraud or false pretenses. A contract for the sale of goods, though obtained by fraud, is perfectly good, if the party defrauded thinks fit to ratify it;” and following the language of the same authority, it appears to me that the defendant here intentionally parted with his property in the shoulders, when he caused them to be delivered to Bailey, and it is not competent for 'him, after the plaintiff has, by his act, been induced to part with his money, to turn round and say the contract, as between him and Bailey, was null and void, and that Bailey had no property, and, therefore, could pass none to the plaintiff; Id. 927.

Such is, I think, the rule that must govern this case, unless something can be found in the statutes of the State requiring a different one to be adopted. I am satisfied that there is no statute that was intended to have, or can have, such an effect. The case cited from the New York Reports, 14 Wend. 31, Andrew v. Dieterich, which is supposed to place the obtaining goods by false pretenses on the same ground as when they have been stolen, proceeds on the idea that it is made a felony. The reasoning in that case shows that it can have no application as authority in this State. The mere fact that obtaining goods by a false pretense is made punishable, is not sufficient to change the rule. Indeed, the legislation of our State, even if it may not be held to embrace .this case, strongly shows that the rights of parties standing in a position strikingly analogous to that of the present plaintiff, were intended to be secured and protected.

Taking all the facts of the case together, it might be fairly argued that the defendant assented to the obtaining, *458by Bailey, of the bill of lading, with a view that a draft should be negotiated and money raised to pay for the article which was the subject of the contract. The defendant expected payment only in this mode, and to carry it into effect, substantially intrusted Bailey with the possession of the property. If this view be correct, then the case might fall under the provisions of the “act to prevent fraudulent practices,” passed March 12, 1844; Swan, 278. This act expressly secures the right of the plaintiff', as against the true owner, to the extent of the money he advanced.

It might also be fairly claimed, under the general provisions of that statute, that, as the defendant had empowered Bailey to ship the goods as his own, the consignee must be protected in his lien. It would be a fraud upon him were it otherwise, and against such a fraud it was the intention of the statute to protect.

But, in any view, no intention can be drawn from the legislation of the State to change or affect the general rule, and under its operation' the right of the plaintiff’ must be protected. There will, therefore, be a finding in his favor.

Judgment for plaintiff.