Case Name: RICHARD et al. v. ROYAL BANK OF CANADA
Court: United States Court of Appeals for the Second Circuit
Jurisdiction: United States
Decision Date: 1928-01-09
Citations: 23 F.2d 430
Docket Number: No. 121
Parties: RICHARD et al. v. ROYAL BANK OF CANADA.
Judges: 
Reporter: Federal Reporter 2d Series
Volume: 23
Pages: 430–434

Head Matter:
RICHARD et al. v. ROYAL BANK OF CANADA.
Circuit Court of Appeals, Second Circuit.
January 9, 1928.
No. 121.
Wesehler & Kohn, of New York City (J. Charles Wesehler and Walter T. Kohn, both of New York City, of counsel), for plaintiffs in error.
Zabriskie, Sage, Gray & Todd, of Now York City (Matthew J. Shevlin and Leonard P. Moore, both of New York City, of counsel), for defendant in error.
Before L. HAND, SWAN, and AUGUSTUS N. HAND, Circuit Judges.

Opinion:
AUGUSTUS N. HAND, Circuit Judge
(after stating the facts as above). The defendants question the decision below because: (1) Drafts were not presented to plaintiff; (2) there were no weight certificates; (3) the bills of lading were not indorsed "freight collect," but "subject to demurrage as per statement attached to original bills of lading only."
We find no merit in any of these points. The letters of credit did not require the drawing of drafts. They assumed that they would be drawn, but, had 'they been drawn by a seller of the iron, the defendants, who were financing Fogel in his purchases, could not have sued the drawers thereof. To be sure, the drafts would have served as vouchers, but the receipts furnished were as good. Likewise, as to the weight certificates, the weight is given on the invoices, and approved by the persons designated to approve the weight certificates. No possible purpose could bo served by having separate documents, although such appear to be more customary.
In regard to the indorsement on the bills of lading of "freight collect," the bills all show that the freight was to be paid by the consignee, and that was enough.
A still further objection is made in respect to the second letter of credit. The application for that letter of credit (Defendants' Exhibit D), already quoted, provides that it shall be—
"payable against on-board bills of lading, steamship Callabasas only, no. other steamer, unless authorized by us, freight collect, consigned to our order from San Pedro de Macoris to Philadelphia., consular invoice, receipted invoice, signed by Esteva and approved by Hyman Ehrlich, showing cost of material, transportation, handling charges, and commission; weight certificate, approved by Esteva and Ehrlich. No insurance necessary."
The second letter of credit (Plaintiff's Exhibit 36) provided that:
"The shipments must be completed and the drafts drawn on or before July 13, 1923. Drafts drawn under this credit are to be accompanied by the following documents, which are to be surrendered to the Royal Bank of Canada, New York, upon acceptance: A complete set of on-board bills of lading drawn to order, blank indorsed, showing cost of material, transportation, handling charges, and commission; weight' certificate, approved by Esteva and Ehrlich; consular invoice. Insurance to be effected by buyers."
Now it is said that the second letter of credit (Plaintiff's Exhibit 8) required presentation of on-board bills of lading, which should show cost of material, cost of transportation, and charges for handling and commission. It is true that the clause in the letter of credit seems to have been somewhat carelessly drawn, but wo cannot suppose that the insertion in bills of lading of all kinds of things which are never put in such documents was contemplated. "A complete set of" evidently did not refer to duplicate or triplicate bills of lading, but to a complete set of documents, 'and that is what we hold that the sentence really meant. In fact, the application for the 'letter of credit (Exhibit D), after specifying "on-board bills of lading" and saying that they shall be on the "steamship Callabasas only, no other steamer, unless authorized by us," and; that they shall bo "freight collect," goes on to say that the letter of credit shall be payable against "consular invoice, receipted invoice, signed by Esteva and approved by Hyman, Ehrlich, showing cost of material, transportation, handling charges, and commission; weight certificate, approved by Esteva and "Ehrlich."
Documents showing cost of material, handling charges, and an approved weight certificate were presented, and the receipted invoice and accompanying papers were signed by Esteva and approved by Ehrlich.
The cost of transportation did not appear, either on the bill of lading or other documents; but there is no sufficient reason for supposing that the word "cost," in the clause "showing cost of material," qualifies the word "transportation," which stands buttressed by a comma at either end. "Showing + transportation" may have meant that the set of documents should indicate the name of the ship, the route, and the terms of the contract of carriage. To be sure, this would leave little importance to the word "transportation," but its relation to the subject-matter is not clear, and we are not disposed to give it a signification which would defeat the plain tiff's rights to recover upon the second cause o£ action, where it is evident that no one, at least till after the time the answer was filed, dreamed that the documents should contain a statement of the amount of freight, or that they were defective, except in the absence of separate weight certificates.
It is to be noticed that clause eleventh of the .answer, which answers the allegation of the complaint alleging due presentation of the required documents, only specifies the objection that the plaintiff did not present to the defendants a weight certificate approved by Rafael Esteva and. Hyman Ehrlich. It is hardly to be thought, if the parties had regarded a statement of the cost of transportation as necessarily called for by the terms of the bill of lading, that the answer would Jiave particularly addressed itself to such a limited objection as absence of a proper weight certificate. The defendants' own interpretation of their agreement would seem to justify a practical construction of the contract which would render a statement of the amount of freight uncalled for.
Objection is also made to the niarginal notation on the bills of lading, "subject to demurrage as per statement attached to original bills of lading"; this on the ground that these bills of lading are not effective, because they do not contain the details regarding the demurrage. We find this objection hardly comprehensible, but in any event regard it as without merit.
The judgment is affirmed.