Castanola v. Missouri Pac. R.
Castanola v. Missouri Pac. R.
Opinion of the Court
In this case the plaintiffs sue defendant for the nondelivery of 25 boxes of tobacco. The facts developed by the evidence are substantially ás follows:
About the last of January, 1884, (I think the 28th,) a member of the firm of Turnley Bros. & Co., grocers, residing and doing business at Galveston, Texas, came to this place, (San Antonio,) and contracted with this plaintiff for 25 boxes of “Drummond Horseshoe Tobacco.” That about the sixth of February thereafter, Turnley Bros. & Co. gave to the agent of the Drummond Tobacco Company an order for tobacco; 25 boxes to be consigned to Turnley Bros. & Co. at San Antonio, Texas; also a number of boxes to be shipped to them at Galveston. On the eleventh day of February, the Drummond Company shipped the tobacco, as ordered by Turnley Bros. & Co., and taking from the railroad company (defendant) two bills of lading, one stamped “Original” and the other “Duplicate.” The duplicate bill, together with the invoice, was transmitted to Turnley Bros. & Co., and the original bill of lading was attached to a 60-days draft, drawn by the consignors upon the consignees, and sent through a bank to Turnley Bros. & Co. for acceptance.
Turnley Bros. & Co., upon the receipt of the duplicate bill of lading, delivered the same to plaintiff, indorsed, without date, as follows: “Deliver to H. Castanola & Son.” Signed. “Turnley Bros. & Co.,” — which duplicate bill of lading, together with an invoice of the tobacco, amounting to S270.50, payable in 60 days, or 2 per cent, off for cash, reached Castanola & Son, February 20, 1884. On the next day, plaintiff remitted to Turnley Bros. & Co. the amount of the invoice, less 2 per cent. off. Turnley Bros. & Co. refused to accept the draft attached to the original bill of lading, and same was returned to the Drummond Tobacco Company, and on the twenty-fourth of February, 1884, Turnley Bros. & Co. failed, and on that day it became publicly known that they had failed, and the Drummond Tobacco Company ordered the goods stopped in transit. On the 27th plaintiff presented the duplicate bill of lading to defendant, and was told that they also had a letter from Turn-ley Bros. & Co., notifying it of the transfer of the tobacco to plaintiffs. On the twenty-ninth of the same month, plaintiffs again demanded the tobacco, and were told by the defendant’s agent that the goods had been stopped in transit by thé Drummond Tobacco Company, and the tobacco shipped back to St. Louis, and delivered to the Drummond Tobacco Company. It is evident that Turnley Bros. & Co. were in failing circumstances at the time they gave the order for the goods to the Drummond Tobacco Company.
The plaintiffs bring this suit, and seek to recover of defendant the valqe of the goods, claiming to be an innocent purchaser for value.
The question first presented, then, is, is the purchaser, in the eyes of the law, the owner of the goods, by virtue of his having the duplicate
In the cases to which my attention has been called the term used is, where the bill of lading has boon transferred to an innocent purchaser for value, etc., using the singular number. As I have said, these bills of lading are not strictly negotiable, but were assignable, and in some respect likened in the commercial world to original and duplicate bills of exchange. It will hardly be contended, however, that a prudent man would purchase a duplicate bill of exchange without first having ascertained that the original had not been paid. The fact that the second bill of exchange is presented suggests and gives notice that there is an original, which, if paid, renders the duplicate of no value.
Ought this rule to be applied here, either in determining which is or what constitutes the bill of lading, or with reference to the bona Jules of the purchaser. It is evident that the consignors did not intend to part with title to the goods unless Turnley Bros. & Co. accepted the draft drawn upon them, — see Daniel, Neg. Inst. (2d Ed.) § 1734; and if this controversy were between the consignors and the consignees there would be but little difficulty.
This case illustrates the facility with which a consignee who is disposed to defraud the consignor can effect his purpose, if it be held that the duplicate bill represents the goods, and that its transfer to a purchaser takes thereby the legal title to the goods. I am unable to
The judgment is therefore for the defendant, with costs.
¡Notwithstanding that Judge Turner’s decision strikes one as being right and reasonable, I have had considerable difficulty in agreeing with it, because there are in the books some dieta, if not, in fact, several decisions, that seemingly, at least, conflict with the views expressed by the learned judge. Tor example, Mr. Smith
Inquiries of leading bankers in Chicago, however, confirm Judge Turner’s conclusion Jhat it is highly imprudent to buy or make advances upon a “duplicate” bill of lading without requiring production of the “original,” or at least an account of the same, if it should lie lost. At the First FTational Bank the officials say: “We deal in bills of lading to the extent of $20,000,000 a year, and invariably require the original bill to be produced. Under no circumstances would we make advances upon amere ‘‘duplicate’ bill of lading; it would bo assuming a risk altogether unbusiness-like. ” Similar views were expressed at the Chicago National, the Commercial National, the Canadian Bank of Commerce, and the Corn Exchange National Bank. The manager of the branch of the Bank of Montreal was especially emphatic. “Why,” said he, “the bill of lading is negotiable; we should certainly require the original to be produced before making advances, ” — thus clearly implying that, in liis opinion, the transferee of an original bill might acquire rights to,the property to which the right of a bank making an advance upon a “duplicate” would be subordinate. In this apparent conflict of opinion between eminent text-writers and practical business men, I have examined the cases, including those upon which the conclusions of the text-writers are based, to ascertain (1) whether they warrant the broad, unqualified conclusion that the first bona fide indorsee for value of any of the parts of a bill of lading takes the goods; and (2) whether, if so, such cases are not distinguishable from that
1. Does the first transferee in good faith, without notice and for value, of any part of a bill of lading, take the goods, of which it is a symbol, against all subsequent transferees? Thompson was a planter in Jamaica, heavily indebted to Caldwell & Co., in Liverpool, who were secured by mortgage of Ins estate. lie was also heavily indebted to France & Co., in Liverpool. Thompson's agent in Liverpool was one Fairbrother. In March, 1785, Thompson shipped in the Tyger, owned by France & Co., and commanded by Ball, a large consignment of sugar and rum. He took three bills of lading from Ball. The first of these bills covered the whole cargo, and ordered delivery to Messrs. Thompson and Ifairbrother, or their assigns. While this bill was in Thompson’s possession in Jamaica, the other two were drawn for different parts of the cargo, but together making up the whole cargo, and ordered delivery to the order of the shipper or his assigns, and were indorsed by Thompson as follows: “Deliver the within to Messrs. Thompson and Fairbrother, provided they engage to pay the net proceeds to Messrs. France and nephew, otherwise deliver them to the order of James France and nephew, on account of Coppell and Goldwin. The last-named persons were agents of France & Co. in Jamaica, and to them were delivered those two bills of lading, while Thompson still held possession of the first bill. Thompson then sent the first bill to Fairbrother, with a letter notifying him somewhat vaguely of having indorsed the other two bilks to Coppell and Goldwin. Without communicating this notice to them, Fairbrother assigned the first bill to Caldwell & Co. In the mean time, Coppell and Goldwin forwarded their two bills to France & Co., and on arrival of the Tyger in Liverpool, both Caldwell & Co. and France & Co. demanded the goods of Ball, the master. He refused to deliver to Caldwell, who 1 hereupon brought trover against Ball. It was held that both Caldwell & Co. and France & Co., being bona fide holders of the bills, for value and without noticie, the goods wore to be awarded to whoever had obtained first the legal title and possession, which was decided to be France & Co., tlie second and third bills having been given to their agents, Coppell and Goldwin, and the goods being in their vessel before the first bill was transferred 1o Caldwell.
In this ease, it appears to have been the second and third parts, which, being first transferred, carried tlie title against a subsequent transferee of the first bill.
In Meyerstein v. Barber,
The form of the bill of lading does not appear in the Caldwell Case, supra, but in Meyerstein’s Case it is shown that each part contain ed the usual clause, “one [part] of which being accomplished, the others to stand void.” These cases certainly appear to sustain the position of the text writers quoted above, that the transfer of any part of a bill of lading passes the property covered thereby. And perhaps a good reason for giving to the parts of a bill of lading all the force of originals, is suggested by the suq>reine court of the United States in deciding that each part of a bill of exchange is an original.
“On the other hand, great inconveniences might arise from compelling the plaintiff to produce the other parts of the set, or to account for their non-production, as he might not be able, satisfactorily, to 'prove that they had not been negotiated,’or that they had been lost.' In short, if the plaintiff, before he could recover, were required to produce or to account for all the parts of the set, he would be obliged, in every case where the bills had been transmitted by different conveyances abroad, to arm himself with proofs of every stage of their route and progress, until they should come back again into his hands, as preliminaries to his right to recover upon their being dishonored. Such a requirement would create most serious embarrassments in all commercial transactions of this sort; and instead of bills drawn in sets being a public convenience, they would be greatly obstructed in their negotiability, since the rights and the remedies of the holder might be materially impaired thereby.” This argument seems to me to be just as forcible when applied to bills of lading drawn in sets as to sets of bills of exchange.
2. Is the case decided by Judge Turner distinguishable from those above given, so as to take it out of the rule established by the latter? There are two kinds of bills of lading commonly issued by railway carriers: one kind, a document containing the names of consignee and destination, describing the goods, and formulating the contract of carriage and delivery, together with the conditions made a part of it. This is the ordinary “inland” or “domestic” bill of lading, and is given in all ordinary shipments where a bill of
This is the provision upon which rests the whole theory that each part of such a bill of lading is an original. Tho bill of lading contained such a clause as this in Meyerstein’s Case, above, and from the fact that the bills in The Caldwell Case, supra, were maritime bills, it may be fairly presumed that they contained a similar clause, although this does not appeal' in the report of tho case. .Now the word “duplicate,” written on the ordinary “inland” railway bill of lading, can hardly be fairly held to so plainly import originality like tho broad, explicit clause in the maritime or “export” railway bill. I know that some decisions and dieta impute the force of an original to a duplicate. Thus Burrill says of duplicate: “That which is doubled or twice made; an original instrument repeated. A document which is the same as another in all essential particulars. Tindal, C. J., 7 Man. & G. 93; Maule, J., Id. 94. Sometimes defined to be the copy of a tiling; but, though generally a copy, a duplicate differs from a mere copy in having all the validity of an original.”
But a well-established popular meaning of duplicate is, “that which exactly resem liles or corresponds to something else; hence a copy, a transcript, a counterpart;”
A case bearing upon the point is Glyn, Mills, Currie & Co. v. East & West India Dock Co.
In deciding this case, Judge Field said: “If it is said to be a hardship on the defendants that they should be liable for delivery upon the production of the second part of the bill of lading, without any knowledge of a previous in-dorsement, it may be observed that they had the remedy in their own hands, as the part so produced was conspicuously marked ‘ Second,’ and they had only to require the'production of the ‘First’ part, which, as is well known, is usually sent to the consignee, and, in case of the non-production of it, to take an indemnity before delivery.”
“Indeed, that is the course pursued by the defendants in their East India trade, in which the original bills of lading only are accepted, and in case of loss, the defendants require satisfactory proof of title and an indemnity; thus showing that, in that trade, at least, precautions are taken which, if taken by the defendants in the present case, would have protected them against loss. If the law were held to be different from the result at which I have arrived, the consignee who had sold or dealt with goods to arrive would only have to avail himself of his almost necessary earlier knowledge of the arrival of the goods, to anticipate, by production of his bill of hiding, any production by the indorsee of the original, previously indorsed, and thus most seriously affect the transaction of any such dealings, which are effected solely in reliance upon the shipping documents.”
On the whole, I am constrained to believe that the principal ease is well decided, because (1) if the bill of lading, as may be fairly presumed from the fact that the shipment was “inland,” was an “inland” form, it is not within the rule applicable to maritime or “export” bills, the accomplishment of any part of which avoids all the others. (2) If the transfer of a mere duplicate bill of lading will pass the property, then the way is opened for the negotiation of every “duplicate” issued, and the perpetration of gross frauds thereby. (3) To require a seller or pledgeor of goods in inland transit to produce the “original” bill of lading or to account therefor, and show by other means a good title in himself to the goods, is not an onerous requirement, but one easily and quickly met. Ordinarily, the seller or pledgeor can quickly procure the original bill of lading; if he cannot, apd has yet a good title, he can give a bond of indemnity. (4) The common practice of bankers and merchants requires the production of the “original,” with which prudent custom Judge Turner’s decision is in wholesome accord. Adelbert Hamilton.
Mercantile Law, 302; citing Gurney v. Behrend, 3 El. & Bl. 622, aud Gilbert v. Guignon, L. R. 8 Ch. App. Cas. 16.
Benj. Sales, & 1224.
Barber v. Meyerstein, L. R. 4 Eng. & Ir. App. (H. L.) 3.7.
Caldwell v. Ball, 1 Term R. 205.
L. R. 2 C. P. 38.
Meycrstein v. Barber, L. R. 2 C. P. 38.
Barber v. Meyerstein, L. R. 4 Eng. & Ir. App. (H. L.) 325.
Barber v. Meyerstein, L. R. 4 Eng. & Ir. App. (H. L.) 336. See, also, Skilling v. Bollman, 6 Mo. App. 76; Michigan Cent. R. Co. v. Phillips, 60 Ill. 191; Railroad Co. v. Wagner, 65 Ill. 198; Vandover v. Wilmot, 10 Ben. 223; Zachrisson v. Ahman, 2 Sandf. 68; Gurney v. Behrend, 3 El. & Bl. 622.
Downes v. Church, 13 Pet. 205; and see Bank of Pittsburgh v. Neal, 22 How. 46. As to the bank upon which they are drawn, each part of a bill of exchangers an original. - The “second” or “third” will be paid without question upon presentation ; the only inquiry by the bank being of its own book-keepers as to whether it haspaid any other part besides t-liat presented. This is not saying, however, that aperson or bank, asked to discount a“ second ” or “third ” bill drawn upon another person or bank, may safely discount the paper without inquiry as to its counterparts.
Burrill, Law Dict. “Duplicate.”
Abb. Law Dict. “Duplicate;” citing Benton v. Martin. 40 N. Y. 345. See, also, Bouv. Law Dict. “Duplicate;” citing Onions v. Tyrer, 1 P. Wins. 346; Pemberton v. Pemberton, 13 Ves. 310; Roberts v. Round, 3 Hagg. Ecc. 548. See Lewis v. Roberts, 103 E. C. L. 29.
Webst. Dict. “Duplicate,” (4to Ed. 420.
Rapalje & L. Law Dict. “Duplicate;” Rawson, Pocket Law Lex.
5 Q. B. Div. 129.
Per Field, J., in Glyn, Milis, C. & Co. v. East India Dock Co. 5 Q. B. Div. 136.
Reference
- Full Case Name
- Castanola and others v. Missouri Pac. R. Co.
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- Published