Millichamp v. First National Bank
Millichamp v. First National Bank
Opinion of the Court
The only question involved here is whether the respondent is liable for certain warehouse storage charges.
L. D. McCain and E. H. Burlingame were the owners of certain potatoes. They, were stored in the ware
Appellant asserts that the law is that the transfer of a warehouse receipt as collateral security for an indebtedness passes the legal title to the warehouse receipt and the property it represents and constitutes an actual delivery and change of possession of the property, and that the pledgee of such a receipt has both title and possession and he alone may sue for injury to, or conversion of, the property. A number of cases are cited in support of these legal propositions. On the other hand, the respondent contends that it became only a qualified owner and would be liable for storage only in the event it took some active steps to reduce the stored property to its possession or assumed control over it.
A careful consideration of the cases cited by the appellant convinces us that they do not support his view. They are cases where either the warehouse re
The correct rule, in our opinion, is laid down in Driggs v. Dean, 167 N. Y. 121, 60 N. E. 336, where the facts were almost identical with those here. The court said:
*178 “A person to whom a warehouse receipt has been transferred by endorsement and delivery as collateral security is vested with a qualified title which gives him a right to take possession of the property upon the surrender and cancellation of the receipt. The right that he acquires is not an absolute title, for the owner may redeem, and the right of possession is subject to the liens of the warehouseman for storage. ... A person therefore, who becomes a holder of a warehouse receipt as collateral security, does not, by reason of his having possession of the receipt, necessarily become bound for the storage of the property. It is true he has a qualified title, and he may, if he so elects, take or reduce the property to possession upon payment of the storage. He, however, is not bound to take possession of the property, or to pay the charges thereon. ’ ’
The court further held in that case that if the transferee of the receipt actually took possession of the property and gave directions concerning it he would be liable for the storage charges from the time of taking possession.
The same rule is laid down in Blakeslee’s Storage Warehouse v. Turgrimson, 176 Ill. App. 83, where the court very tersely said:
“The fact that Turgrimson had a lien on the goods in question did not make him liable for their storage. But if his acts and conduct indicated a purpose to take the control and management of the goods, he thereafter became liable for the subsequent storage of the goods.”
See, also, 40 Cyc. 452. There is nothing in our warehouse receipt statutes (Rem. Comp. Stat., § 3587 et seq.) [P. C. § 7141], which would lead us to a contrary conclusion. The judgment is affirmed.
Reference
- Full Case Name
- F. Stanley Millichamp v. First National Bank of Toppenish
- Cited By
- 2 cases
- Status
- Published