Court Opinion

ID: 6960922
Source: CourtListenerOpinion
Date Created: 2022-07-24 01:45:26.694398+00
Date Added: 2024-06-11T16:08:26.283421
License: Public Domain

Mr. Justice Dickey, dissenting: I can not concur in the views of the majority of this court as expressed in its opinion delivered by the Chief Justice. I think there was no error in the instruction in question. It is true, Paley said: “A power to sell, such as is possessed by a factor appointed for the purpose, can only be exercised by way of sale, and does not justify a disposition in any other manner. A factor, therefore, can not dispose of goods in the way of barter, and it is clearly settled that he has no authority to pledge the property entrusted to him. Nor is it of any consequence that the pledgee is ignorant of the factor’s not being the owner.” But in note (e) to this paragraph it is added, as a qualification, or, rather, limitation,- of these words, (though not inconsistent with them,) that, “if, however, the owner arms the factor with such indicia of property as to enable him to deal with it as his own, and mislead others, the factor in that case can bind the property by pledging it.” It is true, too, as stated by Story on Bailments, that “the general doctrine that a factor can not pledge the goods of his principal has been frequently recognizedbut this instruction in nowise invades this general doctrine. Of course the factor who pledges goods he has for the purpose of sale only, violates his duty, and he can not lawfully do so. It is also true that Kent has, in secs. 625-628,.inclusive, laid down the same doctrine quoted from Paley, that a factor can not pledge goods in his hands for sale alone, and that to pledge goods is “beyond the scope of the factor’s power,” and “is tortious,” but, he adds, “if the factor be exhibited to the world as the owner, with the assent of his principal, and by that means obtains credit, the principal will be liable.” But it is said in this case “ it does not appear that Bigelow thus obtained credit, but did so on his own representations and false statements." This, I think, is a misapprehension of the case at bar. The verdict in this case is in Horton’s favor. The facts, then, are to be taken as in accord with the evidence tending to support the verdict. Where evidence is found in support of the verdict, which is uncontradicted, we must treat it as absolutely true, and where the evidence is contradictory, we must assume that the jury found the weight of evidence to be in plaintiff’s favor. Examining the record by these rules, I think it does appear that Bigelow did obtain credit as the owner of these goods by reason of the fact that the factor was exhibited to the world as the owner with the assent of the principal. The case under the verdict as I understand it is this: Prior to July, 1875, E. A. Bigelow & Co. were a firm doing business in Chicago as dealers on their own account. They dealt in oils, cordage, rope, etc., for several months before the 19th of July, 1875, and bought their rope and cordage of Lawrence & Sons, of New York, and of others. Up to that day they did not do anything in the nature of a commission or brokerage business. On that day they made a special and secret contract with Lawrence & Sons to get their cordage and rope from them, in which it was agreed that Lawrence & Sons should manufacture and ship to Bigelow & Co. cordage, the prices to be governed by the list rate of the New York Cordage Manufacturing Association, and would allow them a discount of lj cents per pound from that list price, and that Bigelow & Co. would sell the same and report sales each month, and on receipt of sales Lawrence & Sons might draw at thirty and sixty days for the balance due them from such sales; that the goods so shipped shall be on consignment and not sold to Bigelow & Co., but should be the property of Lawrence & Sons, and held by Bigelow “as commission stock,” and subject to the order of Lawrence & Sons at any time; that they should be allowed at all times to examine the account of sales of Bigelow & Co., also their stock in store to see where their money and stock are; and it is declared Bigelow & Co. are acting as agents of Lawrence & Sons, and shall give full account to them or any information, thereby giving them “ full control of their own property;” that account of sales shall state actual prices sold at, and the difference between actual sales and the price of hemp in fifty bale lots, and the balance between that and the prices sold shall be retained by Bigelow & Co. as their commissions,—Bigelow & Co. to guaranty all sales made and pay over in thirty and sixty days from date of sales “the amount of the purchase price of such sales,” whether “the amount of such purchase price be received by them or not.” This arrangement was known to be in violation of the rules of the cordage association with which the Lawrences were connected, and for that reason it was desired to be kept as a secret from them. Accordingly, goods were shipped from time to time under this contract, and when shipped were charged on the books of Lawrence & Sons as so much sold to Bigelow & Co., and were invoiced by Bigelow & Co. as sold to them; and when received by Bigelow & Co. they were credited on their books as goods purchased from Lawrence & Sons (at the price fixed in the contract), and no change was made at the Chicago store in the sign, or mode of keeping books, or in any other way to indicate a commission business. This was known to the Lawrences. It is true, monthly accounts of sales made by Bigelow & Co. were made to Lawrence & Sons, stating the rates of their sales to customers, and price at which the goods were invoiced to them, and deducting the l\ cents per pound “as commissions.” So the business progressed. The book-keeper of Bigelow says this was not in fact a commission business, and Horton, who was about the store of Bigelow & Co. a great deal, never saw a sign or indication or heard an intimation that Bigelow & Co. were other than mere purchasers and owners of all these goods, nor does it appear that any persons other than the parties to the contract had the slightest intimation of a commission business. In September, 1875, one of the Lawrences being in Chicago had several talks with Bigelow, and gave him to understand that their special contract and profit should be kept a secret from the trade. But some of the manufacturers in the east got an inkling that there was some private and special arrangement between these parties, and appointed a committee to investigate charges, which had been made, that Lawrence & Sons had goods at Chicago on consignment. On October 20, 1875, Lawrence & Sons wrote to Bigelow & Co., of Chicago, requesting them to “ deny the same,” giving the names of the committee, and saying: “ They will want to see your stock likely, but don’t show it unless you have a little pile by itself; * * * they say the rope is consigned. We tell them the rope is bought and paid for same as others. Let us hear from you,” etc. And again, on the 26th of October, 1875, George Lawrence writes to Bigelow a familiar letter, saying: “ Our committee leave for Chicago to-night. * * They will ask many questions, among which will be, How do the Lawrenées sell you? Do you buy hemp and have it worked, or do they consign it to you? You, of course, get your hemp and have it worked, as all other large dealers do, and expect to so long as you do anything in it. * * * You must not pump worth a cent.” In January, 1876, while this business is going on in the same way, Bigelow, being indebted to Horton for unpaid money borrowed, procures from Horton a binding contract to extend the time of payment for a definite time, and a loan of an additional amount, and to secure the entire sum placed in his hands the rope and cordage in dispute as collateral security. Horton took possession, and in February Bigelow & Co. failed, owing Lawrence <fe Sons a large amount. Thereupon Lawrence & Sons took these goods from Horton by replevin. Before the time when Horton received these goods, and before the negotiation with Bigelow, he was told by Bigelow that he had an arrangement with the Lawrences by which his hemp was bought by the ton, and he paid for it and so much for the manufacture. He had before that time seen the invoices, and they said Bigelow & Co. “bought of Lawrence & Sons” such goods, etc.; and he made the loan on the faith of the ownership of the goods by Bigelow & Co., and without any intimation that they were in any sense factors, or that Lawrence & Sons were the owners of the goods. Now, when Bigelow told Horton that he bought his hemp by the ton and paid for the manufacture of it, and accomplished this through Lawrence & Sons, it was not merely “ his own representations and false statements,” but was the representation and false statements which Lawrence & Sons put in his mouth, by the letters of October, 1875, wherein they said: ' “ You, of course, get your hemp and have it worked, as all other large dealers do.” It is true that was said in view of an interview with the committee, but it is asking too much of Bigelow not only to •lie for them to the committee, but to tell a different story to other people, which would surely expose his falsehood. When a man sets in motion vicious instrumentalities, he can not claim immunity from any of the natural consequences of his act. Bigelow being told to tell that false story to the committee, most naturally, to give face to the story, Avas to be expected to say the same thing to every one to whom he should speak on the subject. Hence, this is such a case as that spoken of in the note in Paley, where it is said: “If, however, the owner arms the factor with such indicia of property as to enable him to deal Avith it as his own and mislead others, the factor in that case can bind the property by pledging it.” In fact, this is not the ordinary case of a factor to which the rules in favor of the owner so rigidly apply. A factor proper is one Avho sells for the profit of his principal, having really no interest in the transaction except his commissions. In this case, the supposed factor is the only one having any interest in the amount for which the property was to be sold. The position of the Lawrences, as to this property, was not in substance that of owners. The substance of the contract is a sale of the property to Bigelow & Co. at a fixed price, -for them to sell again for whatever profit they could get, for their own use, with an arrangement that the title should rest in Lawrence & Sons, for their own security, until a sale should be effected; and a further provision, that if successful sale could not be made, Bigelow & Co. might return the property in payment of their liability. The rules of law, as to factors proper, rest upon the necessities of commerce. Ho such necessity demands special protection to such a contract as this. As applicable to the proofs and the facts deducible therefrom in this case, as above stated, I see no error in the instruction held by my brethren to be vicious.