Case ID: ny-super-ct_45/html/0639-01.html
Source: Caselaw Access Project
Author: {"author": "Per Curiam.", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

DAVID DOWS, et al., Plaintiff and Respondent, v. HENRY P. KIDDER, et al., Defendants and Appellants.
    
    I. Sale and delivery on condition that title shall not pass until payment.—Rights of vendor.—Liability of purchaser from vendee.— Action.—Party.—Defense.
    1. Purchaser for value from vendee.
    
      (a) WHO IS NOT, SO AS TO BE PROTECTED AGAINST VENDOR.
    1. K. having agreed with A. (the vendee) to buy the bills of exchange on August 12, for $36,000, drawn against several bills of lading, including those of the property in question, paid A. $17,000, on account of the purchase, andfor the balance, say $18,000, drew Ms check toA.'s order, which A. took and immediately indorsed back to K., as security for what he (A.) might be found to owe him (AT.) on previous transactions, and K. passed it to the credit of A. in that shape, and thereafter received from A. the bills of lading against which the bills of exchange were drawn. Matters thus stood, as between K. and A., when the vendors to A. notified K. that the corn was' theirs, and demanded a return of it, or that K. should account for its value or proceeds.
    Held,
    that K. was not a purchaser for value as to the $18,000.
    
      (b) CONVERSION BY PURCHASER FROM VENDEE.
    1. What will constitute.
    1. If K., before demand on him, had transferred the title and control of the goods, it constituted a conversion, because he must, in that case, have himself received credit for them.
    (c) ACTION, WHAT PROPER IN SUCH CASE.
    1. Trover. An action in nature of trover is.
    1. Party, who not necessary.
    A. is not a necessary party.
    2. Defense, other parties claiming, when not.
    The facts that, after plaintiff's demand, other parties made similar claims in respect to the goods covered by the other bills of lading, present no defense.
    Before Curtis, Ch. J., and Freedman, J.
    
      Decided December 1, 1879.
    This is an appeal by defendants from a judgment entered against them in favor of plaintiff for $17,652.12, upon the report of a referee.
    The facts of the case, as found by the referee, are as follows:
    On July 24, 1876, plaintiffs agreed to sell to Thomas Atkinson, doing business under the name of Thomas Atkinson & Co., and said Atkinson agreed to buy of plaintiffs 50,000 bushels of sound Western mixed corn, as per sample, at fifty-five cents per bushel of fifty-six pounds, to be delivered during first half of August in prime shipping condition to buyer’s vessel or store, payment to be made in cash on delivery.
    On August 10 and 11, 1876, on request of said Atkinson, plaintiffs caused 24,869|| bushels of corn, of which they were possessed as owners to be delivered on board the bark Emilio Qiampa, then being at Brooklyn in the port of New York and bound to Cork for orders ; said corn was so put on board, for account and to be held for account of plaintiffs ; plaintiffs, as owners of said corn, according to the usual course of business, received, the return of the official weigher dated August 11, showing the delivery of the said quantity of corn on board said vessel; the price of said corn at the sale agreed on, with customary proportion of expenses, amounted to $13,802.61, for which a bill was rendered at the time of the delivery of the weigher’s return, as hereinafter mentioned, for payment to be made in cash ; on August 12, aforesaid, plaintiffs made a conditional delivery of said corn to said Thomas Atkinson, by delivering to him the said weigher’s return indorsed by plaintiffs, the condition-of such delivery being, by standing agreement between said Atkinson and plaintiffs, that the title to said corn should not pass by such delivery until the payment of the price in cash, which agreement was supplemented by a special promise at the time of delivery to give a check for the amount of the bill at,two o’clock of the same day ; the title papers for said corn were indorsed by plaintiffs and delivered to said Atkinson for the purpose of enabling Atkinson to procure bills of lading, in his own name, for the corn, and to prepare and sell his exchange drawn against the same; a check for the price of said corn was demanded by plaintiffs of said Atkinson on the same day, and was refused, and thereupon the return of the corn or of the bills of lading therefor was also demanded of said Atkinson, and refused.
    Said Atkinson, on the same day, publicly failed, and made a general assignment for benefit of his creditors.
    Said Thomas Atkinson, by means of the said weigher’s certificate, so indorsed to him by plaintiffs, procured from the master of said bark Emilio Ciampa bills of lading for said corn, three in number, in the name of Thomas Atkinson & Co., as shippers ; and on the same August 12, 1876, transferred the same to defendants, as security for three bills of exchange for £2,050 sterling, drawn by said Thomas Atkinson & Co. against said corn, and forming part of a parcel of exchange amounting to £6,725 sterling that day sold to defendants by said Atkinson at the aggregate price of §36,331.81.
    Defendants paid to said Atkinson, on account of said purchase of exchange, $17,000, and no more; by .the mail which closed at half-past one of that day defendants forwarded the said bills of exchange and bills of lading, with suitable indorsement or other transfer, to their agents or correspondents in London, McCalmont Brothers & Co., with whom defendants transacted business of this kind on joint account.
    Afterward, on the same day, plaintiffs notified dedefendants that plaintiffs were the owners of said corn, and demanded the same, or the bills of lading therefor, or that defendants should agree to account to plaintiffs for the value of the proceeds thereof.
    At the time of such demand, defendants had in their own hands, of the price of the said exchange, more than $19,000, being much more than the whole value of the said com.
    Defendants neglected and refused to comply with any of the said demands.
    The purchase of said exchange from said Atkinson by defendants was in the usual course of business ; the defendants paid in part for the said exchange, namely, to the amount of $17,000 only. At the time of the said purchase and of their receiving the said bills of exchange and bills of lading, defendants had no notice of the insolvency of said Atkinson, and no. reason to suspect such insolvency, and had no notice or reason to suspect that said Atkinson was not acting in his own behalf, and right and fairly and honestly, and in entire good faith, in respect to said exchange and the said corn, and then had no notice or reason to suspect that plaintiffs • had any interest in or claim upon said corn, or any part thereof.
    Pursuant to the sale of exchange above-mentioned, said Atkinson, at about eleven o’clock in the forenoon, or soon thereafter, of the said August 12, delivered to defendant sixteen bills of exchange, amounting, in the aggregate, to £6,725, all drawn against merchandise, among which were three bills, amounting to £2,050, drawn against the corn on board of the Ciampa.
    
    Atkinson delivered to defendants with such exchange all the bills of lading for said merchandise, including the bills of lading for the corn, and usual documents, except certain bills of lading representing bacon, and requested a check for $17,000 on account of the transaction, which defendants gave him.
    Soon thereafter the bills of lading for the bacon were delivered to defendants, and the transaction between defendants and Atkinson was complete, on Atkinson’s part.
    To complete the sale and purchase of the exchange, there remained to be paid by defendants to Atkinson the sum of $19,331.81, balance of the price of the exchange.
    About 2 p.m. the same day, Atkinson called at defendants’ office, and then received their check for said balance, $19,331.81, which he immediately indorsed and handed back to defendants, requesting that it be passed to his credit, as additional margin, to protect defendants from losses likely to occur on prior transactions, and defendants received the check so indorsed, and passed the amount to Atkinson’s credit, as requested.
    At the time when defendants so gave and received back the said check, they had no knowledge or notice of any claim, on the part of plaintiffs, to the corn in question.
    Thereafter, plaintiffs demanded of defendants the corn in question, or its value, and defendants refused to comply with the demand.
    Thereafter, namely, August 15, and on August 22, similar demands were made upon defendants by other creditors of Atkinson, for other merchandise purporting to have been represented by bills of lading accompanying the exchange, sold by Atkinson to defendants, as aforesaid, which demands amounted to $11,779.64.
    Plaintiffs’ demand was renewed on Monday, August 14, and that the defendants were willing, and offered to pay to plaintiffs the price of the exchange drawn against the corn, if Atkinson would consent; that Atkinson refused to consent, and thereupon defendants refused to pay to plaintiffs the price of such exchange, and retained j>ossession of the corn without agreeing to account for the same to plaintiffs.
    The market value of the corn on that day was fully equal to the aforesaid contract price.
    The referee wrote an opinion holding the propositions stated in the head-note.
    
      C. T. Rice, attorney, and of counsel, for appellant.
    
      C. Van Santvoord, attorney, and of counsel, for respondent.
    
      
       Note—See Farmer’s & Mechanic’s National Bank, &c. v. Hazeltine, ante, 576.
    
   Per Curiam.

The judgment should be affirmed, with costs, upon the opinion of the referee.