Case ID: ny-st-rep_58/html/0638-01.html
Source: Caselaw Access Project
Author: {"author": "Bartlett, J.", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

Erastus K. Burnham, Resp’t, v. Cape Vincent Seed Company, App’lt.
    
    
      (Court of Appeals,
    
    
      Filed, April 10, 1894.)
    
    1. Warehouseman—Receipts—Section 633 of Penal Code.
    Section 633 of Penal Code is designed to protect the bona fide holder of negotiable warehouse receipts, and not the acceptor of a draft drawn against the consignment, where he takes the cargo from the possession of the warehouseman without his permission.
    
      2. Same.
    Where the acceptor fails to pay the draft drawn against the consignment and the warehouseman pays it on demand from the holder for the cargo, which the acceptor had taken without his permission, and the draft with the warehouse receipt was duly transferred to said warehouseman, he is entitled to recover from the acceptor the amount of the draft.
    Appeal from judgment of the general term of the supreme court in the fourth judicial department, entered upon an order made December 9th, 1892, which affirmed a judgment in favor of plaintiff entered upon a verdict, and also affirmed an order denying a motion for a new trial. This action was brought, among other things, to recover the amount of a draft drawn by R R Cole, and accepted by the defendant in payment for a cargo o£ peas, which was paid by plaintiff and transferred to him by the Ontario Bank, on which it was drawn. The facts, so far as material, are stated in the opinion.
    
      E. 0. Emerson, for app’lt; N. F. Breen, for resp't
    
      
       Affirming 49 St. Rep. 918.
    
   Bartlett, J.

Tins is an appeal from a judgment affirming a judgment in favor of plaintiff on the verdict of a jury at Jefferson county circuit, and from an order denying a new trial. The plaintiff was a warehouseman residing at Cape Vincent- in this st'ite. On' the 2d of October, 1890, one Cole, a seed dealer at Kingston, Ontario, shipped from that port to Cape Vincent, by steamer “ Khartoum," a cargo of peas consigned to the Ontario Bank of Kingston, care of plaintiff. On the 3d of October, 1890, said cargo arrived in Cape Vincent and was deposited in plaintiff’s elevator, and a warehouse receipt was issued and delivered to Cole stating that the peas were held subject to the order of the Ontario Bonk of Kingston. Cole thereupon drew a ninety days’ draft against this consignment on defendant, which was duly accepted October 13, 1890, the defendant to have possession of said cargo on payment of the draft, the warehouse receipt to be held as security meanwhile. Cole then attached the warehouse receipt to the draft and procured discount by the Ontario Bank. The defendant failing to pay the draft when due, the Ontario Bank demanded of plaintiff the cargo of peas held by him as security for its payment. The plaintiff claimed that the defendant, after accepting the draft, had, without authority, taken possession of the peas; he, therefore, paid the draft, and thereupon it was duly transferred to him by the Ontario Bank, together with the warehouse receipt. The plaintiff then brought this action, setting up in his complaint three causes of action, viz.: first, on the draft so paid; second, for value of certain peas received by defendant and never accounted for, but no part of the cargo in question; third, for storage of the cargo of peas involved in the first cause of action. The main contest was over the first cause of action. The defendant denied that it had received any portion of the cargo of peas stored as security for the payment of the draft; also alleged that plaintiff had parted with the custody of said cargo in violation of § 633 of the Penal Code which forbids warehousemen to deliver to another property covered by a receipt, and for that reason could not maintain this action. The question of fact as to whether the defendánt had taken from the custody of the plaintiff, without his permission, and before the maturity of the draft, the cargo of peas held as security for its payment, was properly submitted to the jury, and their verdict in favor of plaintiff is conclusive. ^

The defense based on plaintiff’s violation of § 683 of the Penal Code has no foundation in fact or in law. The section referred to is designed to protect the bona fide holders oí negotiable warehouse receipts by inflicting a severe penalty on warehousemen who wrongfully deliver to third parties property covered by the receipts. In the case at bar the plaintiff held the cargo of peas as security for the Ontario Bank, and if, before the bank’s debt was paid, he had wrongfully delivered it to the defendant, he would have been criminally liable under § 633 of the Penal Code, and the bank could have proceeded against him in a civil action for damages. Colgate v. The Pennsylvania Co., 102 N. Y., 120; 1 St. Rep,, 166; First National Bank of Cincinnati v. Kelly, 57 N. Y., 34. The facts in this case show that the. section quoted has no application. The plaintiff before this action was commenced had paid the claim of the Ontario Bank and was subrogated to all its rights as against the defendant; his cause of action was on the draft although inartificially pleaded ; the defendant, by the verdict of the jury, is found to have received the cargo of peas which was covered by the warehouse receipt held by the bank, and there is no reason, in morals or in law, whv it should not pay the draft accepted in payment for property it Las reduced to possession. As to the second and third causes of action it is unnecessary to discuss them in detail; it is sufficient to say that the verdict of the jury is warranted by the evidence. The judgment must, therefore, be affirmed unless the exceptions in the case dislose errors of law calling for reversal.

The defendant’s counsel took a large number of exceptions to the charge of the trial judge and to his refusals to charge as requested, but they are disposed of by the view we take of this case on the merits. There were numerous exceptions taken during the trial, all of which have been examined. We are of opinion that none of them requires special comment unless it be the exception to receiving in evidence a certain telegram sent by defendant’s vice-president, J. H. Howard, to Cole, the consignor of the cargo of peas in question. The objection was made that this telegram was not sufficiently proved to entitle it to be read. Assuming the telegram to have been improperly received, it worked no prejudice to the defendant, as its counsel had previously introduced in evidence a letter from Howard to Cole dated the day after the telegram and referring to it, and repeating an offer therein contained of partial payment on the amount due Cole from the defendant for said cargo of peas. The judgment and order appealed from are affirmed with costs.

All concur, except O’Brieít, J., not voting.

Judgment accordingly.