#### Morris Spiegel, Respondent, *v.*The Pacific Mail Steamship Co., Appellant.

(Supreme Court, Appellate Term,

February, 1899.)

Pledge of a bill of lading by consignee — Carrier must notify Mm that the consignor has taken the goods by legal process.

A carrier, whose bill of lading has been pledged by the consignee for a loan with authority to the pledgee, in case of default, to apply the goods themselves towards payment, cannot lawfully thereafter surrender the goods to the sheriff, on a requisition in replevin from the consignor, without giving any notice of the process to either consignee or pledgee, and, if it does so surrender them, cannot escape paying their value to the pledgee, to whom the consignee has defaulted, upon mere proof that the goods were taken from its possession by virtue of legal process.

Appeal from a judgment rendered in the Municipal Court, in the city of New York, borough of Manhattan, first district, in favor of the plaintiff.

Clifford Seasongood, for appellant.

Abraham I. Elkus, for respondent.

Leventritt, J.

On the 14th day of April, 1892, one John .Grellin shipped, on a steamer of the defendant company, ten barrels of brandy to the firm of Saitta & Co., of New York city, and the defendant thereupon issued its bill of lading in the usual form, conditioned for the delivery of the brandy to Saitta & Ob., or to their assigns, upon the payment of the freight charges.

On the 3d day of May, 1892, Saitta *&*Co., the consignees, obtained a loan in the sum of $1,300 from the plaintiff and thereupon, having indorsed in blank, deposited with him, as collateral security for the repayment of said loan, certain bills of lading, including the one in question; and at the same time executed and delivered to the plaintiff an agreement providing in the event of default, for the application by the plaintiff of the brandy to the repayment of the loan.

Saitta *&*Co., having failed to meet their obligation as agreed, the plaintiff between the 6th and 8th days of July, 1892, tendered *415to the defendant the agreed amount of freight charges and demanded the delivery to him of the brandy. The defendant having refused to comply, the plaintiff on the 1st day of July, 1898, instituted this action to recover the value of the brandy.

To the plaintiff’s complaint the defendant orally pleaded a general denial, the Statute of Limitations and *res adjudicata.*To sustain its contention, the defendant offered evidence of the surrender by it, in the month of May, 1892, of the brandy in controversy to the sheriff of the city and county of Hew York in obedience to a requisition issued to him in an action of replevin, brought against the defendant by the shipper John Crellin; and to sustain its contention in that behalf submitted the affidavit, requisition and return in that action. It appeared that the defendant had yielded to the writ and that the sheriff had on the 27th day of May, 1892, delivered the brandy to John Crellin.

At the close of the trial, the defendant insisted that having delivered the property under the compulsion of legal process it was exonerated from liability to the plaintiff, and, further, that more than six years having elapsed since the plaintiff’s cause of action accrued, the Statute of Limitations applied.

The contention of the defendant, that its compulsory submission to the replevin process relieved it from all responsibility, gives rise to the main question to be determined upon this appeal. While it is well established, that the defense of *jus tertii*is available to a common carrier, it is equally well settled that the carrier does not discharge his obligation to the consignee, with whom he has made the contract, by simple delivery to the officer, or by standing idly by until the process has impounded the goods and through it the adverse claimant has appropriated them by the judgment of the court. Robinson v. Memphis *&*C. R. Co., 16 Fed. Repr. 57. It has been intimated that the carrier must defend the title of his bailor against adverse claims — or what is equivalent, surrender at his peril to any but a paramount owner — and that he can find relief only by resort to a court of equity, by a bill of interpleader, where there is a controversy concerning the ownership. Banfield v. Haeger, 45 N. Y. Super. Ct. 433; Willner v. Morrell, 40 id. 222, 226.

The current of authority is, however, that the carrier shall give notice to the consignee if he is to be protected by legal process against the consequences of nondelivery, some eases holding that such notice must be immediate. The authorities in this state sus*416tain the principle that a bailee for reward cannot relieve himself of responsibility, for failure to deliver the property of the bailor when called for, simply by showing that the property was taken out of his custody under the authority of valid legal process, but he must also show that he gave notice of that fact to the owner.

In Bliven v. Hudson R. R. R. Co., 36 N. Y. 403, it is said that seizure by legal process excuses the carrier “ provided the bailor is promptly notified of such taking.”

In Scrantom v. Farmers’ *&*M. Bank, 24 N. Y. 424, 427, we find the following language: *“*It is doubtful whether the bailee has a right to yield to regular legal proceedings without defending or at least notifying the bailor of such proceedings.” To same effect: Western Trans. Co. v. Barber, 56 N. Y. 544; Bliven v. H. R. R. R. Co., 36 id. 403; Roberts v. Stuyvesant Safe Dep. Co., 123 id. 57; Van Winkle v. U. S. M. S. S. Co., 37 Barb. 122;. Livingston v. Miller, 48 Hun, 232.

Ho evidence was introduced upon the trial of the case at bar upon the subject of notice or effort to give notice either to the consignee or to the plaintiff of the replevin proceedings or of delivery thereunder by the defendant to the sheriff, but the defendant assumed that the mere production of the records of that suit constituted a good defense. Such records alone are insufficient to establish the defense here interposed. Mierson v. Hope, 32 H. T. Super. Ct. 561.

The conclusion follows that in view of the omission to give notice, the mere taking by legal process does not exonerate the defendant from liability.

There is no force in the contention that the Statute of limitations defeats the plaintiff’s claim, as the cause of action arose upon demand made between the 6th and 8th days of July, 1892, and this action was admittedly instituted on the 1st day of July, 1898.

The judgment must be affirmed, with costs.

Fbeedmait, P. J., concurs.

Judgment affirmed, with costs.