Case ID: ny-super-ct_22/html/0483-01.html
Source: Caselaw Access Project
Author: {"author": "Robertson, J.", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

James Patrick et al., Plaintiffs, v. Benjamin F. Metcalf et al., Defendants.
    1. The plaintiffs alleged in their complaint, that their assignors having chartered a vessel, earned freight, which the defendants, the consignees of the vessel, had collected and refused to pay over. The defendants in their answer denied that the plaintiffs’ assignors had chartered the vessel in any other way than by a charter-party, which provided that their right to any share of the freight should be contingent on the freight exceeding §25,000.
    
      Held, that this put in issue plaintiffs’ allegation of a charter, and that the plaintiffs must prove, either an unconditional charter, or that under the charter alleged by defendants the freight had exceeded $25,000.
    2. It seems, that one to whom a fund was rightfully payable, cannot maintain an action against another, who, merely as agent for an adverse claimant, has collected the fund on behalf of the latter, in disregard of notice from the former not to do so.
    (Before Robertson, White and Babbour, J. J.)
    Heard, June 2;
    decided October 11, 1862.
    This was an action brought by James Patrick and Alexander McDougal, to recover from the defendants, Benjamin F. Metcalf and Samuel Duncan, a certain sum of money received by the defendants from officers of the government of the United States, for the transportation of certain goods from Hew York to Mare’s Island.
    The complaint alleged that the plaintiffs were partners composing the firm of James Patrick & Co., and the defendants composed the firm of Metcalf & Duncan. That prior to July 5, 1859, a firm of Wells & Emanuel had chartered a vessel for a voyage from Hew York to San Francisco. That about that day they agreed with the United States naval storekeeper in Hew York, to transport certain goods from Hew York to the navy yard at Mare’s Island, for the sum of $1,882.84, freight and prim-age, at a certain rate of freight, to be paid to them in the City of Hew York, on the receipt of a certificate or other proper evidence of delivery at their destination. That in pursuance of such agreement, such goods being shipped on board of such vessel, Wells & Emanuel executed a bill of lading in duplicate or quadruplicate in the usual form, of which all but one was delivered to such storekeeper, and that one was retained by Wells & Emanuel as evidence of the agreement. That on the 21st of July, 1859, Wells & Emanuel assigned such bill of lading, and their rights therein, and their rights to such freight, and delivered such bill of lading and assignment to the plaintiffs, and directed the delivery of such freight to them, who had ever since continued sole owners thereof, and exclusively entitled to receive it. That the goods were transported to San Francisco, where they arrived on the 10th of March, 1860, and from thence conveyed by the plaintiffs to Mare’s Island. That in May following, the plaintiffs furnished to such naval storekeeper satisfactory evidence of the delivery of such goods at such navy yard; and he gave them a certificate that $1,849.97 was a correct charge therefor, against the United States Havy Department, and a bill for that amount was approved by the commandant of the navy yard at Hew York, and thereupon the plaintiffs became entitled to receive that sum from the United States government. That part of the sum last mentioned was due from such, government for transporting such goods from San Francisco to Mare’s Island. That the plaintiffs demanded the whole sum and the defendants forbade its payment, in consequence of which the navy agent refused to pay the same. That the defendants had notice of the assignment to the plaintiffs prior to August 20th, 1860, and the defendants were required to pay all the moneys they should receive for such freight to them, and that they would be held personally responsible therefor. That about the 17th of September following, the defendants wrongfully obtained from the United States navy agent at Hew York the sum claimed by the plaintiffs for transportation of such goods to the navy yard at Mare’s Island, and have been requested to pay the same to the plaintiffs, but have always refused.
    The defendants in their answer, controvert and put in issue the allegation in the complaint, as to a charter to Wells & Emanuel, of a vessel, except as stated in such answer; also, the making of any agreement with Wells & Emanuel for the transportation of goods, as set out in the complaint. They therein deny any shipment of such goods, according to such agreement, but aver their shipment by the United States storekeeper, under the charter set up in the answer, the execution of a bill of lading by the defendants, as agents of the master of such vessel, which was delivered to Wells & Emanuel, and the transportation of such goods under such bill of lading. They therein controvert the delivery of any bill of lading by Wells & Emanuel, and deny that it was binding on such vessel. They also therein controvert the assignment to the plaintiffs, and deny any right of Wells & Emanuel to pledge any bill of lading. They further admit therein that the plaintiffs were consignees of the ship at San Francisco, and as its agents, attended to the delivery of the cargo and collection of the freight, forwarded such goods to Mare’s Island, and received a certificate of due delivery thereof, except a small part, valued at thirty odd dollars, for which services they have "been paid by the owners of such vessel, $625; that the residue of the freight collected by them for such owners, did not amount to $25,000, but only to $22,900; the amount of freight for transporting such goods was $1,849 leaving $749 fof, and still due to make up $25,000. They also avdfc therein the refusal of the United States to pay the plaintiffs such freight or Dadmit any liability to them therefor; and the commandant of the navy yard approved a bill made out to the master of the vessel, whereby the ¡Navy Department became bound to pay such freight to such master, and the defendant received such sum as his agent. They deny the right of Wells & Emanuel to assign such freight.
    The charter set up in such answer, and which is the only one admitted thereby, was one made by Wells & Emanuel with the owners of the vessel, (the B. D. Metcalf,) by which it was agreed that such vessel should perform a voyage from Hew York to San Francisco ; that Wells & Emanuel should procure for her a cargo at a rate of freight so as to amount, in the whole, to $25,000; that bills of lading should be executed by the master, who should, through his consignees, collect the freight when earned, and apply the same to paying such sum of $25,000; and, if, after paying that sum and all expenses of loading such ship, chargeable to Wells & Emanuel, and a commission of five per cent to them, there should be any residue of freight money, it was to be equally divided between the owners .of the vessel and Wells & Emanuel.
    On the trial the plaintiffs produced an instrument in writing, dated July 8th, 1859, signed only by Wells & Emanuel, “for the captain,” purporting to be a bill of lading of the goods in question, as shipped on board of the B. D. Metcalf, bound for California, for certain freight, .amounting to $1,882 -nfo- A witness, one of the firm of Wells & Emanuel, (Amos G-. Wells,) testified that his firm ■procured from the United States naval storekeeper the freight mentioned in such instrument, and that the same was shipped on board of such vessel in the first part of July, 1859, and that they shipped other goods on their own account, being a general assorted cargo, and that the vessel sailed from Yew York in October, 1859; that the plaintiffs have a house in San Francisco; his firm made the negotiation with the naval storekeeper for the shipment of the goods; he also testified to the signature of his firm to the supposed bill of lading, and an indorsement by them thereon, made on the 21st day of July, 1859, directing the freight to be paid to the plaintiffs’ firm, and the payment of $1,500 to him, for such order, by that firm.
    It was admitted that such bill of lading was brought into Court from the naval storekeeper’s office. A clerk of the plaintiffs’ (Henderson) testified that one of- the plaintiffs delivered it to him about the end of April, 1860, and he took it to the naval storekeeper; afterwards obtained a port-warden’s certificate, and some days afterward freight bills in triplicate, certified by the commandant of the yard and the storekeeper, one of which was produced in the form of a bill against the United States Yavy Department; the certificate stated the charge to be correct; on it an order for such freight was indorsed, signed by Wells & Emanuel in favor of the plaintiffs. A clerk in the navy agent’s office (Blood) proved that the defendants claimed the amount of the freight soon after the delivery of the freight bills, and their prohibition of its payment to the plaintiffs, and that they received the amount in September, 1860, as attorneys of the captain of the vessel, upon a bill made out in his favor. The defendants’ counsel admitted the execution, by certain persons, of a bond of indemnity in favor of the United States, in which it was recited that it had been agreed to pay such freight to the master of the vessel on his giving indemnity. A notice, demanding the freight received of the defendants, was also proved to have been served on them on the 18th of August, 1860.
    The only evidence offered by the plaintiffs of any charter to Wells & Emanuel, was the allegation to that effect in the complaint; so also the only evidence of their causing the goods in question to be transported to San Francisco, and afterwards to Mare’s Island, at the expense of the plaintiffs, and of the receipt by the latter of certificates of due delivery, and of the amount of freight, consisted of the allegation in the complaint and admission in the answer to that effect, and of the furnishing of such certificates to the naval storekeeper at Kew York.
    A certificate of due delivery at Mare’s Island, indorsed on such bill of lading, was also read in evidence.
    The counsel for the defendants moved to dismiss the complaint, which motion was granted; and an exception which was taken to such decision was ordered to be heard first at General Term.
    
      George N. Titus, for the plaintiffs.
    I. The order of Wells & Emanuel indorsed upon this bill of lading, which was delivered to the plaintiffs in July, * 1859, was a valid, equitable assignment of this freight money, and entitled them to receive the same from the U. S. government, when earned.
    (1.) It was an order for value upon the government for the payment of this freight, in accordance with the agreement of its authorized agent. Kotice of this order (the order being indorsed on the bill of lading) was given to such agent by the plaintiffs in April, 1860. (2 Story’s Eq. Jur., § 1044; Lett v. Morris, 4 Simons, 607; Ex parte South, 3 Swanst., 392; Burn v. Carvalho, 4 Mylne & Craig, 690, 702; Yeates v. Groves, 1 Vesey, Jr., 280; Smith v. Everitt, 4 Bro. Ch., 64; Morton v. Naylor, 1 Hill, 583.)
    (2.) An assignment of freight, to be earned in futuro, is good in equity, and will be enforced against the party from whom it becomes due. (In re Ship Ware, 8 Price, 269; Douglass v. Russell, 4 Sim., 524; 2 Story’s Eq. Jur., § 1055.)
    (3.) Ko particular form is necessary to constitute an assignment of a debt in equity. Any order which makes an appropriation of it is sufficient. (2 Story Eq. Jur., § 1047.)
    
      The order in this case was a valid assignment of this freight money to the plaintiffs. (2 Story Eq. Jnr., § 1044.)
    II. Upon the delivery of this order to Mr. Herrick, the naval storekeeper at the Brooklyn Navy Yard, he and the government agents, having notice thereof, became
    accountable to the plaintiffs for the debt then due for this .freight. The money appropriated by the government for its payment, was a trust fund for the plaintiffs, upon which they had an equitable lien. (2 Story Eq. Jur., § 1041.)
    In equity the assignee of a debt may enforce its payment by action directly against the debtor, although he may not have assented to its assignment, (2 Story Eq. Jur., § 1057; Lett v. Morris, 4 Simons, 607, and cases cited under first point;) and against any third party, who, having no superior rights, may have obtained the money appropriated for its payment. (Story v. Lord Windsor, 2 Atkyns, 630; Shepherd v. McEvers, 4 Johns Ch., 136; Munsell v. Lewis, 2 Denio, 224; 2 Story Eq. Jur., §§ 1057, 1058, 1059; Bradley v. Root, 5 Paige Ch., 632, 641, 642.)
    III. In this case the defendants, without color of right, and with full notice of the assignment of this debt to the plaintiffs, intervened and obtained from the navy agent in New York the money appropriated by the government to its payment, which the plaintiffs were entitled to.
    For the amount so received by the defendants they are liable to the plaintiffs, at law, as well as in equity. (2 Story Eq. Jur., §§ 1055, 1056.)
    (1.) At law an action for money had and received, which is an equitable action, lies against a party who has obtained money which, in equity and justice he ought not to retain. (Munsell v. Lewis, 2 Denio, 224; Fairbanks v. Blackington, 9 Pick., 93; Heard v. Bradford, 4 Mass. R., 326; Allen v. McKeen, 1 Sumner, 317; Durdon v. Gaskill, 2 Yeates, 268.)
    (2.) No privity of contract between these parties is necessary to support this action, save that which results from the defendants having possession of this money, which they have not a right conscientiously to retain.
    
      The law, in such case, raises a promise that the receiver will pay, and that without a previous request. (1 U. S. Digest, (Assumpsit,) 285, § 415; Mason v. Waite, 17 Mass. R., 563; Hawley v. Sage, 15 Conn. R., 52; Norton v. Coons, 3 Denio, 130.)
    (3.) The defendants are liable to the plaintiffs for this freight money, although they may have claimed the same on behalf of the captain of the ship, and as his attorneys. They had notice of its assignment to the plaintiffs, and that they would be held responsible for this money before they collected it. (Garland v. Salem Bank, 9 Mass. R., 408; Frye v. Lockwood, 4 Cow., 454.)
    
      E. C. Benedict, for defendants.
    I. The complaint does not show a cause of action against the defendants. 1. Wells & Emanuel did not as'sign any claim against the defendants. They had no claim against them to assign. 2. The plaintiffs had no claim, except against the shipper, and that claim could not be released or impaired by the defendants. 3. Between the plaintiffs and the defendants there was no privity, connection, or relation. They were strangers. 4. If the defendants were entitled to the money,- they cannot be compelled to pay it to the plaintiffs. If they were not entitled to it they are only responsible to return it to the shipper from whom they got it. 5. If the plaintiffs were entitled to it from the shippers they are so still—the shippers having paid it to the defendants, did so in their own wrong, and could not set up that wrong against the plaintiffs’ right.
    II. On the proofs the <5ase is weaker than on the complaint. The pretended cause of action is disapproved.
    1. The freight did not belong to WellS & Emanuel, but to the owners of the vessel. 2. It was not collectible by Wells & Emanuel, but by Stetson, the master. 3. Wells & Emanuel had thus no right to collect the freight, or to assign it, or to order it paid to the plaintiffs. 4. It was not collected by the defendants, but by the owners of the vessel, through' Stetson, the master, for whom the defendants only acted as attorneys in fact. 5. Wells & Emanuel had no right to make and sign a bill of lading. The paper made and signed by them was not, in fact or in law, a bill of lading, and conferred no right on them to collect the freight. 6. The order to pay the money to the plaintiffs gave them no right to enforce the payment of the freight. It was but an order, and was not accepted by the captain, or the owners, or the defendants.
   Robertson, J.

There was no proper evidence in this case of any charter of the vessel in question, entitling the plaintiffs to any freight, and it was not pretended that Wells & Emanuel had any other authority to collect it than the charter in evidence. The allegation in the complaint, of a charter, was distinctly put in issue by being controverted in the answer. (Code, §§ 149, 168.) If the plaintiffs wished to avail themselves of the adrnission in such answer of a charter containing the particular provisions therein alleged, he should have read it, and it would then have been evidence for the defendant of such provisions, (Dorlon v. Douglass, 6 Barb., 451; Stuart v. Kissam, 2 Id., 493,) and its effect would be confined to the issue raised. (Robins v. Maidstone, 4 Q. B., 811.) The specific denial of any other charter but that admitted, puts in issue the existence of any other charter giving the plaintiffs the right to the freight. (Troy & Rutland R. R. Co. v. Kerr, 17 Barb., 581; Swift v. Kingsley, 24 Id., 541.) The charter set up in the answer, if it be the one relied upon by the plaintiffs, gave them no right to freight unless that exceeded 25,000 dollars and expenses, of which there was no proof in this case, and such.proof, upon that charter, the plaintiffs were bound to give.

There was evidence in this case, that Wells & Emanuel procured the freight for the vessel, and made the negotiation with the United States navy agent for the shipment of the goods in question to Mare’s Island, but they signed the bill of lading as agents for the captain, and only-claimed to be entitled as charterers to the freight. That bill of lading was only signed by Wells & Emanuel, and not by any officer of the United States government, and was kept in their possession until April, I860,- when they sent it to collect the freight on it from the government officers, and left it in the naval storekeeper’s office; no obligation was therefore imposed on the United States government or officers by that document; there was no evidence that they ever assented to its terms or agreed to pay Wells & Emanuel the freight; indeed, the agreement, if any, is professed to be made for the captain of the vessel. There was, therefore, no agreement by the naval storekeeper to pay them the freight established.

The answer also controverts and puts in issue any shipment of the goods in question, pursuant to any agreement with Wells & Emanuel, and avers they were put on board in pursuance of the charter set up in the answer, and a bill of lading given therefor, in the name of the master, by the defendants as his agents. This is far from admitting any liability by the United States officers to Wells & Emanuel.

The complaint alleges that Wells & Emanuel caused the goods in question to be conveyed to San Francisco, and from thence they were taken at the plaintiffs’ expense and by their procurement, to Mare’s Island, and delivered to the proper officers. The answer only admits that 'they forwarded them as agents of the ship, and alleges they were paid six hundred and twenty-five dollars therefor. It is true the defendants have not denied that they carried them otherwise than as agents, but the plaintiffs did not claim that their allegation was not controverted, but only that it was admitted.

Besides the defects in the plaintiffs’ evidence, there is a fatal objection to their recovery against the defendants. The latter claimed only as agents of the captain of the vessel, (Stetson;) the bill against the government was made out in his name; the receipt was signed by them as agents for Mm, and the bond of indemnity was given for the payment to him; it was the same thing as if the money had been paid into his hands. I do not see how any notice to them not to collect as such agents, can make them • liable. The money had no earmark in the possession of the United States officers; never became the plaintiffs’ until it was paid over to the captain; was not converted by the defendants as the plaintiffs’ property. If they are responsible, every clerk sent by his employer to collect a bill claimed as due to the latter, is responsible to a third party for the money he may receive, if he happens to know that such third party claims to be paid for the same services. I do not see that the defendants, having received the money for the captain, could interpose as a defense to a suit by Mm, that the plaintiffs were entitled to it, or how, having been employed by him, they could be converted into agents for the plaintiffs.

These considerations are sufficient for the disposition of the case; the remaining question of the right of a party to sue another, with whom he has no privity, for money paid the latter by a supposed debtor, upon an. adverse claim, if that debtor be the Federal Government, need not be considered. It may, however, be noticed that neither the case of Munsell v. Lewis, (2 Den., 224,) nor Bradley v. Root, (5 Paige Ch. R., 632, 641, 642,) if closely scrutinized, will be found to go that length; there was privity with those cases, between the claimants, and the question itself was not discussed. No authority or reason can be shown for any general principle that any one can sue another for money paid by a third person to the latter, on a claim of right by him, merely because the second claimant ought to have been paid the same amount, for the same cause, by the same person, where there is no pretense of trust or authority, by the recipient, for such new claimant.

For the reasons before mentioned, the judgment should be affirmed, with costs.

White, J., concurred in tMs opiMon.

Barbour, J. I concur in the conclusion; but only upon the ground that the plaintiffs failed to prove the "unconditional charter set up in their complaint.