Court Opinion

ID: 7191151
Source: CourtListenerOpinion
Date Created: 2022-07-24 16:56:51.840201+00
Date Added: 2024-06-11T16:16:11.485913
License: Public Domain

Dissenting Opinions.
Spencer, J.
I can not concur, with the majority of the court in this case. The plaintiffs, merchants of New Orleans, bring this suit by attachment against the defendant, and garnishee certain funds in the hands of the New Orleans and Jackson Railroad Company.
They allege that the firm of J. W. Mitchell & Go., of Goodman, Miss., consigned to tnem, and that the defendant receipted for, ten bales of cotton on the eighteenth of- December,-1869, thirty-three bales on the first of January, 1870, six bales on the fifteenth of January, 1870, and eight bales on the twenty-fourth of January, 1870 ; that the receipts or bills of lading of said railroad for said cotton were transmitted to them, and that they on the faith thereof, and in the usual course of their business, made advances to said Mitchell & Go. to the full value of said cotton; that the said Central Railroad failed to deliver to them according to the tenor of said bills the following list of bales of thé weights and value following:
*4602 bales cotton, A J, January 1, weighing 1030 lbs.
1 bale cotton, E C; January 1, weighing 590
1 bale cotton, JBL, weighing 465
6 bales cotton, J J G, weighing 2505
1 bale cotton, C C, January 5, weighing 390
1 bale cotton, S R in a square, January 24, 425
2 bales cotton, E H in a square, Dec. 18, ’69, 820
14 6225 lbs. © 23fc.=1478 43.
They therefore ask .judgment for the said sum of $1478 43, with1 interest and with privilege on the property attached.
The defendant answers by a general denial, and specially alleges that ten (10) of the fourteen bales sued for, to wit: six marked “J J G,” two marked “A J,” and two marked “E H” in a square, were not in fact delivered to or received by defendant as stated in said receipt of January 1,1870, and that it was an error on the part of the person signing said receipt to include said ten bales therein; that said receipt should have been for twenty-three (23) bales only, and that defendant is liable under said receipt for twenty-three bales only; and that defendant duly delivered or accounted for the twenty-three bales for which it was liable; and as to the remaining four bales sued for, two of them, marked “E C” and “SR” in a square, were actually delivered to plaintiffs, and the other two marked “JB L” and “ C C ” have been fully settled for with plaintiffs by defendant permitting them to retain two, other bales marked “ J T,” which were delivered to plaintiffs in error, instead of to W. B. Thompson, the consignee, who was paid for the said two bales marked “J T.”
There was judgment in favor of plaintiffs for $Í273 32 and defendant appeals.
It is admitted that plaintiffs correctly state the weight and value of the cotton. The two bales marked “JT” are shown by plaintiffs’ account sales to have netted two hundred and five dollars, which was by plaintiffs carried to the credit of J. W. Mitchell & Co. The defendant was clearly entitled to credit for these two bales, and as they stood in lieu of two belonging to Mitchell & Co., which were lost, Mitchell & Co. were, of course, to be credited with their proceeds. Any other course would have made plaintiffs clear gainers of these two bales. ¥e see no reason why plaintiffs should complain. The evidence clearly shows that Mitchell & Co. did not ship them to plaintiffs, who produce no bill or receipt of the railroad for them. The district judge correctly credited defendants with their proceeds.
I presume, by oversight the district judge failed to credit defendant with the two bales marked “SR” in a square and “E C,” which the testimony of Hunt, one of the plaintiffs, admits were delivered or ac*461•counted for. Their weight was 1015 pounds, which at 23f cents amounts to §241 06, for which defendants should have credit.
There remain, therefore, only ten bales in controversy, to wit: Two marked “A J,” six marked “ J J G-,” and two marked “ E H ” in a square.
The defendant says that by error double receipts were given for these bales, once on the eighteenth of December, 1869, and again on the first of January, 1870, by including them in the receipt for thirty-three bales, and, we think, evidence establishes that allegation. The two receipts, when compared, show it. The one of the eighteenth of December is for these ten bales, and that of the first of January bears ten bales, of the same numbers and marks. Besides, the defendant’s agent at Goodman swears positively to the fact, and satisfactorily explains how it happened. He also states that Mitchell some time after admitted the error, saying his books only disclosed one lot of cotton bearing the same brands. If this controversy were between the shipper and the defendant, there would be no room to doubt the right of defendant to relief. But the plaintiffs allege, and prove, to my satisfaction, that in the course of their business and on receipt and faith of these bills of lading, they advanced in good faith to the shipper thereon to the full value of the cotton represented by them. The receipt of the bills was by law equivalent to the receipt of the cotton, so far as related to plaintiffs’ rights for advances made. The law in the interests of commerce, and in order to give security to business transactions, nas thrown peculiar guards around the rights of persons .advancing money on such bills. To allow the carrier to dispute the truth of his bills in the hands of innocent parties who in good faith had advanced upon them, would be to destroy all confidence, upon which commerce so much depends. We understand the better opinion to be that “ as between the shipper and carrier a bill of lading is open to explanation and correction; but that as between the carrier and a third person holding it for a valuable consideration it is not.” See Dickerson vs. Seelye, 12 Barb. 102: Parsons Mercantile Law, 347.
The case of Buckingham vs. Freeman, 18 How. 188, has been referred to as announcing a different doctrine. But upon an examination, we do not think so. In that case the owner of a vessel agreed to sell it to John Holmes, reserving mortgage and lien for the unpaid price. John Holmes gave up the entire control of the vessel to his son, Sylvanus Holmes, who was doing a commercial business under the name of S. Holmes & Go. The son, S. Holmes, appointed the master, whom he induced to fraudulently sign bills for an invoice of flour, upon which S. Holmes & Go. got advances from the plaintiffs, who, upon non-delivery of the flour, libeled the vessel, claiming a lien on it. The original owner (vendor) intervened, claiming that his rights were superior to libelants’. The court say the questions are, have the libelants a lien on the vessel *462under the maritime law, and is the general owner estopped from showing the truth, as against a bona fide holder of the bills procured from a master'by fraud of an owner pro hac vice. The court seems to predidate its decree rejecting the claims of libelants, on the grounds that they have no lien under the admiralty law, and that the master who signed the bills was not the agent of the claimant, the original owner (vendor); that the real owner, the claimant, was not personally liable for the bills, and by the admiralty law the vessel was bound only when he was.
We are aware that there has been, and perhaps still are, conflicting opinions as to the extent of the liability of carriers toward third persons taking or advancing upon their bills of lading; and that the prevailing doctrine in England is that they are not liable for goods not actually delivered to their agents. But we have seen that at least some-high American authority lays down a different doctrine, which, however, is not every where accepted in this country. It may therefore be fairly said that the question is not a settled one here, and we think it our duty to accept that view which seems most in consonance with our own laws, and best calculated to give security to commerce.
In the case at bar the defendant does not dispute the authority of its agent at Goodman to sign bills of lading. Nor, indeed, could it successfully do so; for it would indeed be strange if a carrier could hold out to the public that a certain person was its agent to receive goods for transportation, and for months execute the contracts of affreightment made by him, and then, when loss or damage results from the negligence of that agent, dispute his authority. It is a proper occasion to apply the familiar rule, commended alike by law and reason, that “ when one of two innocent persons must suffer, he, who, by occasioning the confidence, has created the loss, shall bear it. 3 An. 400; 4 An. 19. The question as to the extent of the powers of the master of a ship under the maritime law I do not feel called upon to discuss, as I think there is a clear distinction between that question and the one in this case, which relates to the authority of a railroad station-agent. Nor am I disposed to perplex myself with the long discussions and subtle distinctions of the writers on this subject. I think the statutes of. our own State indicate with clearness the line of decision for us.
The act of 1868, No. 150, after forbidding the execution of warehouse receipts or bills of lading for goods or merchandise, unless the same shall have been actually delivered or shipped, and denouncing heavy penalties for violation of the prohibition, extending even to punishment for five years in the Penitentiary, proceeds, in its sixth section, to provide that the holder of such receipts or bills of lading shall be decreed owner of the merchandise described therein.
*463Section nine provides that “ all receipts, bills of lading, vouchers, or other documents, issued by any * * * boat, vessel, or railroad * * * as by this act provided, shall be negotiable by indorsement in blank, or by special indorsement, in the same manner and to the same extent as bills of exchange and promissory notes now are.”
The animus of this statute is unmistakable. It was intended to protect both the carriers and the public — the former by punishing any persons in their employ for issuing false bills of lading or receipts, and the latter by putting such bills or receipts upon the same footing as commercial paper, and protecting the holder in good faith with all the privileges and immunities given to bills of exchange and promissory notes. I feel constrained therefore to hold that the agent of defendant, at Goodman, had authority to sign bills of lading for his principal, and that that bill, in the hands of the plaintiffs, can not be shown to have been given for a larger amount than defendant received. I think the judgment appealed from, less the credit stated herein, should be affirmed.
DeBlanc, J.
Instead of giving but one bill of lading for twenty-three bales of cotton actually delivered, defendant’s acknowledged agent gave two bills of lading, one in December, 1869, the other in January, 1870, for all together thirty-three bales.
In the course of their usual business, on the faith of these bills of lading, plaintiffs advanced the full value of the cotton which said agent thus declared to have been received and shipped.
Eor every act of the agent, performed by him within the scope of his authority, the principal is bound. In this case, the bill of lading was signed by one expressly employed to sign those bills. Eor his errors who must suffer? Is it those who, deceived by the error, have disbursed and advanced their money, dr is it the principal, who vouched for and guaranteed a proper and correct exercise of the delegated authority, a strict and faithful discharge of every duty imposed by the mandate? The principal’s signature to the bill of lading would not have more effectually bound him than did the signature of his chosen, his recognized, agent.
He is bound under the general rule; he is also bound under the act of 1868. Under that act the bill of lading, as a bill of exchange or a promissory note, “may be transferred by indorsement, and any person to whom the same may be transferred shall be deemed and taken to be the owner of the produce dr commodity thereon specified, so far as to give validity to any pledge, lien, or transfer made or created by .the holder of the same. That no printed or written condition or clause inserted or attached to *464any bill of lading, which in any way limits the liability imposed by this act, shall have any effect or force whatsover.”
Through its agent, the railroad company certified to plaintiffs that thirty-three bales of cotton had been shipped. On transfer to them of that certificate they advanced the entire value of the cotton, which, according to the agent’s declaration, had been delivered to, received, and shipped by defendant. . If, under these circumstances, the company is not liable, a carrier’s agent, without receiving a single bale of cotton, may attest that he has received one thousand bales, discount the bill of lading, retain the proceeds of the discount, do this under color and by virtue of his agency, and not bind his principal!
In this case there was no intention of deceiving plaintiffs. This we admit, but, so far as third parties are concerned, what difference would there be between the error or fraud of an agent ? If not liable for the error, the company would not be liable for the fraud, and the bill of lading would lose its value, become a snare, a suspected and dangerous instrument.
To decide the question presented it is useless, it seems, to refer to the jurisprudence of other States; we have but to open and read the statute of 1868. It was enacted for the express purpose of fixing, in and for Louisiana, the legal value of a bill of lading. With the provisions of that law planters and merchants are now conversant. The bill of lading has the value of a sale, the stipulation of which can not be changed, can not be limited, except in one way, that indicated in the statute; that is by the words “ not negotiable ” plainly written or stamped on its face. No other reservation, written or printed, shall have any force or effect whatsoever. These are the terms of the statute.
The law of 1868 was enacted in the interest of commerce; it created one of the most important branches of our credit; it secures the most legitimate transaction; it sanctioned, legalized, and perfected a fair but imperfect custom which prevailed before its adoption, and it is by far wiser and more equitable than the vacillating and doubtful jurisprudence of other States. It guards against carelessness and error, against surprise and deceit, against forgery and fraud. If, as to third parties, it could be explained or contradicted, the bill of lading, though negotiable, could but seldom be negotiated.
If, as provided in the law of 1868, the carrier can not take advantage of any written or printed reservation attached in advance to a bill of lading, of a reservation apparent to all, how could it be allowed to take advantage of that which not only is not written, printed, or apparent, but which, if admissible or admitted in evidence, would entirely or partially contradict the absolute terms, the positive figures of a bill of lading ? For icstance, were the agent to write across the bill the declaration that *465the principal is not responsible for the quantity thereon specified, would that declaration justify the delivery of less than the expressed quantity? Most assuredly not.
As to the holder of a bill of lading, the only inquiries should be, does the instrument bear the signature of a real, a recognized, a proper agent ? If it does, then did that recognized agent appear to have acted within the scope of the delegated authority ? If he did, the instrument, whether delivered through error or fraud, is binding on the carrier. The error •or fraud of an agent is not to be visited on the victims of his negligence or infidelity, but on those who created the trust; otherwise the negotiable instrument shall cease to be, as it now is, a letter of credit, a proclamation, to every purchaser or transferee, that all it contains is right,
Eor these, and the reasons by him alleged, I concur in the opinion delivered by his honor, Mr. Justice Spencer.