Pinckney v. Dunn

The opinion of the Court rvas delivered by

The declaration in assumpsit charged the defendant, as factor, with not accouniing for cotton received by him from the plaintiff for sale, and contained a count upon account stated and the money counts. Plaintiff consigned to the defendant, *322a factor in the city of Charleston, cotton for sale. The cotton was shipped by defendant, through a mercantile house in Charleston, to Liverpool, and was there sold. In February, 1862, the defendant received in Charleston an amount in Confederate money, including, the proceeds of the cotton sold in Liverpool. The amount due the plaintiff could not then be ascertained for the want of an account of the sales. In consequence of his inability to get such account sales, defendant did not render his account until 1868. The blockade of the port of Charleston, from 1862 to 1865, is assigned as, in part, the reason of the delay. The account showed a balance in plaintiff’s favor. The jury, by the direction of the Circuit Judge, rendered a verdict for plaintiff for such balance, which was subsequently reduced, for the purpose of correcting the conversion of Confederate into United States values. This verdict, as amended, must be regarded as in conformity with the account rendered by the defendant. The real question in controversy arises out of the fact that, subsequent to the receipt of the proceeds of sale by the defendant, and prior to the rendition of his account, the Confederate money became valueless. The defendant claims, substantially, that the proceeds of sale, in the form of Confederate money, remained in his hands at the risk of the plaintiff. On the other hand, it is claimed that the factor was in default for not accounting'at a day that would have enabled the plaintiff to realize value from such currency.

Had the verdict depended upon the question of a due accounting on the part of the defendant, the facts should have been submitted to the jury; while, in point of fact, the verdict was rendered in obedience to the instructions of the Judge.

It appears by the case, however, that the defendant failed to establish that he had held these proceeds apart from his other funds as the property of the plaintiff, so as to cast the risk of their loss upon him. The ease states that it was proven that the Confederate money received in 1862 had been deposited by defendant in bank, and that he had always a balance to his credit in bank during the war, until bank deposits of Confederate money became valueless. The inference is warranted that he used the proceeds of sale in his business, and, having taken the advantage of its use, would naturally be chargeable with the risk attending such use.

The account rendered in 1868 forms the basis of plaintiff’s demand in this action. It throws the burden of a defence upon the defendant, who is bound to show that the proceeds of sale were lost *323under circumstances throwing the risk of loss exclusively upon the plaintiff. To do this he must show that the proceeds remained in his hands as the property of his principal, and that he was not in default in an unreasonable detention of such proceeds, whereby the loss was occasioned. If he fails on either point to present a state of facts that would authorize a jury to find a verdict in his favor, the Court was justified in directing a verdict for the plaintiff.

It is only necessary, to consider whether the Confederate money received in 1862 was Avholly or in part the property of the plaintiff, and retained that character down to the time of the loss.

Goods consigned to a factor for sale, or their proceeds, so long as they are capable of being identified, remain, in his hands, the property of the consignor, subject to any lien of the factor for ad,-vances, commissions and expenses. When the proceeds consist of notes, or money in bags, it is to be regarded as the property of the principal, (City Council vs. Duncan, 3 Brev., 386,) and this character is not lost, though they come into the hands of the personal representatives of the factor after his decease, (Veil vs. Mitchell, 4 Wash. C. C., 105,) or of his assignees for the benefit of creditors.— Thompson vs. Perkins, 3 Mason C. C., 232.

The correlative proposition that extends the equity of this rule to the protection of the factor is, that the factor, holding and treating the property consigned, or its proceeds, in whatever form they may be, as the property of his principal, apart from his own property and funds, is not chargeable with its loss, happening without his fault. Where a factor purchased, with the proceeds of sale, a good bill for remittance to his principal, and the bill was subsequently dishonored, he was held not to be liable, although he had a del credere commission. — Muller vs. Bohlens, 2 Wash. C. C., 378. His possession being in the nature of a trustee, his character as an agent, in dealing with the property, should appear in a clear light.— City Council vs. Duncan, 3 Brev., 386; Veil vs. Mitchell, 4 Wash. C. C., 105. If, on the other hand, the factor mixes the property with his own, or uses it indiscriminately with his own property or funds, or if he should speculate with or derive undue advantage from it, the principal may either seek satisfaction out of the whole estate with which his own lias become undistinguishably commingled, (Yates vs. Arden, 4 Wash. C. C., 526,) or may, at his election, treat his factor a.s a debtor for the amount thus misused. — Poulter vs. Cornwall, 1 Salk., 9.

So it was held when a factor' took, in payment for goods sold, a-*324promissory note payable to- himself, and, without instructions from his principal, put the note in judgment, but, before attempting to enforce the judgment, sued his principal, that he could not recover, for the reason that, having assumed to collect the note as his own property, he was bound to enforce his judgment. — Hamilton vs. Cunningham, 2 Brock., 350. The liability of the factor, in such cases, is in the nature of a breach of trust.— Cooley vs. Betts, 24 Wen., 203.

No objection-is made, in'the present case, of a want of due demand before suit brought. Nor is any question made as to the right of the factor to accept the proceeds of sale in Confederate currency. The only question is, whether the defendant hold the Confederate money, which he claims to represent the proceeds of sale, apart from his other property and funds, so as to throw the risk of its loss upon the plaintiff.

In the first place, the specific notes sought to be charged to plaintiff’s risk were never set apart from the aggregate sum that came into defendant’s hands. In the second place, the amount was placed in bank, as a general deposit, to the credit ■ of the defendant. The bills became the property of the bank, and the defendant received, in lieu thereof, a general bank credit, which he employed in his business.

The fact that he always had a balance in bank is of no importance. At most, it tends to show a foundation for a good credit as a merchant, strengthened by the possession of'plaintiff’s means. We hold that this was such a use of the property of the plaintiff as to place th.e risk of loss on the defendant. As he enjoyed whatever profit there was in the use of the money in his business, he should bear the risk attending such use.

It follows, therefore, that it is unimportant to the case to inquire whether the defendant unreasonably retained in his hands the proceeds of sale; and, therefore, if error was committed by the Judge in charging that the state of war and blockade furnished no excuse for delay in accounting, it was, at least’, innoxious, so far, at least, as the rights of the parties in the present case are concerned. As there was no valid defence to the plaintiff’s demand, the direction to the jury, to find a verdict for the plaintiff, was free from error.

The motion for a new trial must be denied.