Court Opinion

ID: 6688601
Source: CourtListenerOpinion
Date Created: 2022-07-20 21:35:06.819918+00
Date Added: 2024-06-11T16:01:01.906220
License: Public Domain

MeCOY, J.
(dissenting). I am unable to concur in the majority opinion because it seems to me that it is in violation of many fundamental rules and principles of law and equity and against good conscience and gives an unholy and dishonest effect to a special statute never intended by the makers thereof. The majority opinion admits that a true owner of grain, stored under the warehouse act, may recover from the warehouseman, the bailee, the stored grain, on the ground that the true owner of property ■ may pursue and recover the same in whosesoever hands he may find it; but denies that the warehouseman, who has voluntarily delivered the stored grain to a true owner can avail himself of that fact as a defense when sued in conversion by the bailor. It is impossible for me to come to the view that the Legislature, by the enactment of those portions of the public warehouse act, set out in the.majority opinion, ever intended that a tenant could, under the sanction of said law, deliver to a warehouseman, along with his own, the landlord's share of the grain, and could, by the taking of a warehouse receipt for the whole, including the land*618lord's share, in his own name, deprive such. landlord of the legal right to demand and recover from such warehouseman his share of such grain, and that it would not ibe a good defense for the warehouseman, when sued in conversion by the1 tenant 'bailor, that he had so delivered or accounted to the landlord. In taking the position that the true owner may pursue and recover his property and at the same time denying the warehouseman the defense of having attorned and accounted to the true' owner of the paramount title, when sued in conversion by the bailor, it seems to me that my associates have taken the anomalous and' unholy position of compelling the warehouseman to twice pay for the same grain. If there is an affirmance of the order and judgment appealed from that'is precisely what takes place in this case. The appellant has accounted to and paid the true owner of the paramount title, and now is again to be required to pay the respondent, who is a wrongdoer without title. Tt appears to be the view of the majority opinion that the purpose of the enactment of the warehouse law was to prevent the warehouseman frtfm being placed in the “unconscionable” position of being mulcted in damages by adverse claimants to the stored grain. If this really was one of the objects and purposes of the law the legislature most certainly shot-wide of the mark when they fixed it so a double recovery might be had against the warehouseman for the same grain. And it is just as illogical and unreasonable to hold that when the warehouseman has accounted and attorned to the rightful owner of the paramount title he cannot avail himself of that fact as a defense when sued by the bailor without right or title, who has wrongfully and fraudulently procured a storage receipt to be taken in his own name instead of the name of the true owner. The answer, to which the demurrer was sustained, in substance, alleged that-the true owner of the one-fourth share of said grain demanded the same of appellant, and that he paid and accounted to said true owner therefor; that respondent wrongfully and fraudulently procured the storage receipt "for such share to be issued in his own name. For the purposes of this decision’the allegations of this answer stand admitted.
Whatever may have been the purpose of the enactment of this warehouse statute it must 'be conceded that it is a special law designed to assist certain legitimate commerce. In this country *619it has long been an open debatable question whether such warehouse transactions constituted a sale or bailment, — whether the general law of sales or the general law of bailments was applicable. Some courts of last resort held one way, some another. I am of the view that the main objects sought to be accomplished by this enactment was the establishment of the bailment rule, without any intent to change or alter in any manner the general law of bailment, or without any intent to change or alter the general laws as to legal rights and remedies; or to change any other general law of the state. This seems to be the view taken by all courts that have directly passed upon the nature and effect of such statutes. After careful search I have found none to the contrary. It is apparent that the warehouse act of this state was largely copied from a similar act of the state of Minnesota. Gen’l Stat., 1878, p. 1012. In Daniels v. Palmer, 41 Minn. 116, 42 N. W. 855, the Supreme Court of that state, in passing upon the nature and scope of such statutes, said:
“Unless otherwise provided in plain terms its' several sections must be considered in connection with other statutes. By this law the relation of the parties to a transaction of this character are radically chang'ed (from sale to bailment), and with these new rights are furnished new remedies. But no sound reason can be advanced for holding that because the willful neglect or refusal before mentioned (to deliver the grain to the holder of the storage receipt) is declared a crime, or because relief is granted by statute which may result in the appropriation of the grain which has been deposited by one bailor to satisfy the claim of another, either or both of these persons are deprived of such other rights and remedies as previously existed at common law or by statute in case of the misappropriation or unlawful conversion of personal property. The -remedies specially created by the grain and warehouse law are not exclusive. They were intended to be and are auxiliary to those previously afforded.” It is clearly held in this case that the statutory bailment cannot be used as a means of misappropriating property so as to deprive parties in interest of the legal rights theretofore existing by statute or -common law. To the same effect is Collins v. Ralli, 20 Hun (N. Y.) 246, affirmed by Court of Appeals, 85 N. Y. 637. In the case of Holton v. Hubbard, 49 La. Ann. 715, 22 So. 338, it was held that the owner was *620not precluded from claiming his property where his agent had stored it in a publip warehouse ""and taken the storage receipt in his own name and then had pledged the receipt for his own individual debt. This was a case where the equities were much stronger against the warehouseman than in the case at bar. In that case it was contended that the warehouse act, which made the storage receipt negotiable, and the holder of the receipt the presumptive owner thereof, had repealed the general provisions of the Civil Code making void such acts of an agent bailor. In passing on that question the court, in substance, said, if it could be held that the public warehouse act intended to repeal these articles of the Civil Code it would be open to the objection of unconstitutionality because no such purpose was stated in the title; with the most careful consideration we are utterly unable to interpret legislative acts designed to assist legitimate commercial necessities so as to overthrow long settled principles and sanction what the law deems fraud. The South Dakota warehouse act became a law by Chap-. 99, Daws' of 1890. By consulting the title of that act it is apparent that no legislative intent existed to overthrow, repeal or change the general law of bailments; or to change the general law of agency; or to change the general law as to parties to civil actions, and the assignment of dioses in action; or to change the prior existing general law as to legal rights and remedies; or to change the general statutory measure of damage in' conversion actions. The majority opinion says that the Legislature, by section 495, established the common law rule that the bailee could not dispute the bailor’s title, but did not include the exceptions to the rule, and therefore the exceptions can-’ not be considered because they are not mentioned in the act. From the fact that the exceptions are not mentioned we of the minority opinion under the rules fo'r construing such statutes draw a directly opposite conclusion. We are of the view that the Legislature did not undertake in any manner whatever to legislate upon the subject of the exceptions to the rule, but left the law as to the exceptions as it formally existed. It must be kept in mind that 'the warehouse act in question undertook to specifically legislate upon a subject thereto previously regulated by general statute and common law rules. The rules of construction of statutes creating original laws are not applicable. The general rule for the con*621straction of such special statutes seems to be that no part of the previously existing general law will be interfered with or changed by the special act, excepting such changes as are expressly or necessarily implied by the act itself. 36 Cyc. 1144-11451 Collins v. Ralli, 20 Hun 246, S. C. 85 N. Y. 637; Bank v. Hurt, 99 Ala. 130, 12 So. 568, 19 L. R. A. 701, 42 Amer. St. Rep. 38 Cumberland Tel. Co. v. Kelly, 87 C. C. A. 268, 160 Fed. 316, 15 Ann. Cas. 1210. Where a statute is in effect an affirmance of a rule of the common law it is to be interpreted in accordance with the construction placed upon the common law, unless the contrary expressly appears from the special act. The change expressly sought to be ¡brought about by this warehouse act was to apply the law of bailment to a transaction theretofore, at common law, in many jurisdictions, held to be a sale. Under this rule of construction the legislature not having mentioned the subject of the exceptions in the warehouse act, left the exceptions to the rule that a bailee could not dispute the bailor’s title as they formerly existed at common law, and also left the act to be construed in conjunction with the previous law.
The plain force and effect of section 495, of the warehouse act, set out in full in the majority opinion, is that the bailee is estopped to dispute the bailor’s title, and is estopped to set up title in a third paiTy so far as the duties, liabilities and obligations of the -bailee are concerned. That is no more nor less than the common law rule. The common law rule was just as stout and just as conclusive against the bailee as the provisions of this section. Therefore section 495 is declaratory of, and has no more force or effect than the common law rule. As against the bailee setting up title-in himself, or in a third person for himself, section 495 conclusively presumes that the bailor has title, but there is clearly no conclusive estoppel, comprehended within this section, other than as against the bailee himself. An estoppel to dispute the bailor’s title by the bailee does not include and is not applicable to an estoppel against a true owner, or one claiming' under, him. Such an estoppel by judicial legislation cannot be read into this section 495. It must be observed that the appellant bailee by his answer is not claiming title in himself as bailee against the bailor respondent, but is claiming only under the title and authority of the true owner of the paramount title, with which he has properly connected, himself. Now what was the scope and *622meaning of the common law rule ? It meant simply this, and nothing more, that the bailee cannot set up title in himself; neither can he set up title in a third person for his own individual benefit, ■unless he connects himself with the title of such third person and defends in the shoes and in place of such third person. It is not a good defense for a bailee to merely allege that some third party has paramount title without in any manner connecting himself with the title of such third person; but it is a good defense where the bailee properly connects himself with the paramount title of the true owner and defends under the authority of that title. Williston on Sales, Sec. 421; 5 Cyc. 172, 173; King v. Richards, 6 Whart. (Pa.) 418, 37 Am. Dec. 420; Hale on Bailments, p. 34. The rule that a bailee cannot set up title in a third person has no application where the bailee has surrendered the property to the true owner on demand. The bailee in such case takes -the risk and has the burden of showing that the person to whom he surrendered the property was the true owner. Hale on Bailments, p. 34; Gerber v. Monie, 56 Barb. (N. Y.) 652; Biddle v. Bond, 6 Best & S. 225; 122 Eng. Reprint, 1179; Dodge v. Meyer, 61 Cal. 405; Transp. Co. v. Barber, 56 N. Y. 544; King v. Richards, 6 Whart. (Pa.) 418, 37 Am. Dec. 420.
Now, in what ways may the bailee properly connect himself with the paramount title in order to avail himself of the defense? When the property is taken from him by due process of law, or when he has voluntarily delivered the same to the owner of the paramount title, on demand. Bith-cr way is sufficient; one is just as effectual as the other. If section 495 will permit'of one of these ways it will permit also of the other, as there is no distinction in this warehouse act, from beginning to end, that would give preference to either one or the other of these two general methods of connecting- a bailee with the title of a true owner. The majority opinion admits that the true owner might maintain suit to recover the property from the bailee, but denies that he can voluntarily surrender possession on demand of the true owner. What the reason for this distinction is we are not informed by our majority brethren, but, according to the highest judicial authority of this country, it is a distinction without any difference. Hentz v. The Idaho, 93 U. S. 575, 23 L. E. D. 978.
It is not necessary that the bailee wait until judgment has *623been rendered against 'him ousting him from possession by virtue of the paramount title; he may shield himself from such suit by attorning to the paramount title, on demand, without suit. And the position of the bailee is precisely the same whether the bailor wás honestly mistaken as to the rights of the true owner, or whether he was acting in fraudulent derogation of them. The right of the recovery by the true owner against the bailee becomes fixed and has its inception and initiation in the demand, and after the true owner has once demanded the property of the bailee, if the bailee should then deliver the same to the bailor, he would still be liable to the true owner. Williston on Sales, Sec. 421; Transp. Co. v. Barber, supra; King v. Richards, supra. Hence, the reason that the bailee may shield himself from suit by attorning to the true owner upon his demand. This is all in consonance with the general statute of this state upon bailments. Civil Code, Secs. 1358 to 1362, and Sec. 98 Code Civ. Pr. The following authorities fully sustain this position: Hentz v. The Idaho, 93 U. S. 575, 23 L. Ed. 978; Biddle v. Bond, supra; Transport Co. v. Barber, supra; Hale on Bailments, p. 34; Williston on Sales, Sec. 421; 5 Cyc. 172; Gerber v. Monie, supra; Dodge v. Meyer, 61 Cal. 405. And there are numerous other eases and authorities to the same effect. Hentz v. The Idaho is one of the leading cases in this country tipon the proposition here involved. The learned court in that case, in substance, said: “If it be said that by accepting the bailment the bailee has estopped himself against questioning the right of the bailor, it may be remarked in answer, that this is assuming what cannot be conceded. Undoubtedly, the contract raises a strong presumption that the bailor is entitled, but it is not true that thereby the bailee conclusively admits the right of the principal. Plis contract is to do- with the property committed to him what his principal has directed, — to restore it 'or account for it. And he does account for it when he has yielded it to the claim of one who has right paramount to that of his bailor. If there be any estoppel it ceases when the bailment on which it is founded is determined by what is equivalent to an eviction by title paramount; that is, by the reclamation of possesion by the true owner. Nor can it be maintained as is argued in the present case that a carrier can excuse himself for failure to deliver to the order of 'the shipper only when the goods have been *624taken by legal proceedings, or where the shipper had obtained the goods by fraud from the true owner. It is true that in some of the cases fraud of the shipper has appeared, and it has sometimes been thought it is only in such a case, or in a case where legal proceedings have interfered, that the bailee can set up the jus tertii. There is no substantial reason for the opinion. No matter whether the shipper has obtained the possession he gives to the carrier by fraud practiced on the true owner or whether he mistakingly supposes he has rights in the property, his..relation to the bailee is the same. He cannot confer rights which he himself does not possess ; and if he cannot withhold the possession from the true owner, one claiming under him cannot. The modern and best considered cases treat as a matter of no importance the question how the bailor acquired the possession he has delivered to the bailee, and adjudges that, if the bailee has delivered the property to one who had the right to it as true owner, he may defend himself against any claim of the principal. And so, when the bailee has actually delivered the property to the true owner having a right to the possession, on his demand, it is a sufficient defense against the claim of the bailor.” In Biddle v. Bond, the learned court, in substance, said that upon principle there was no difference between cases in which the bailor in the first instance obtained possession of the g-oods by fraud, force or felony, and in cases in which he was only mistaken as to the rights of the true owner, for the bailor can confer upon his bailee no better title than he has himself. If the true owner demanded the property of the bailee and he refuse to deliver it he is at once liable for its conversion. It would be a hardship if the bailee might shield himself from an action for conversion by delivering the property to the true owner, if he could not show a delivery to the owner as a defense to the groundless claim of the bailor. In Gerber v. Monie, supra, it was held that in actions of replevin or trover by a bailor against a bailee the defendant could not set up- title or right in a third person, unless he connected himself with such right or title. In Transp. Co. v. Barber, supra, the Court of Appeals of New York said: “The best considered cases hold that the right of a third person to which the bailee has yielded may be interposed in all cases as a defense to an action brought bv the bailor subsequently for the property. When the owner comes and demands his property *625he is entitled to 'its immediate delivery and it is the duty of the possessor to make it. The law will not adjudge the performance of this duty tortious as against a bailor having no title.” In King v. Richards, 6 Whart, (Pa.) 418, 37 Am. Dec. 420, the learned court said:
“It may be correct enough to hold where the real owner of the property does not appear and assert his right to it, that the bailee shall not be permitted, of his mere motion to set up, as a defense against his bailor, such right for him. But it would be repugnant to every principle of honesty to say, that after the right owner has demanded the goods of the bailee, the latter shall not be permitted, in an action brought against him by the bailor, to defend against his claim by showing clearly that the plaintiff acquired possession of the goods fraudulently and tortiously or feloniously, without having obtained any right thereto.” There are numerous other authorities holding to the same effect as those from which quotations have been made. Palmtag v. Doutrick, 59 Cal. 168, 43 Am. Rep. 245; Jensen v. Eagle Ore Co. 47 Col. 306, 107 Pac. 259; 19 Ann. Cases, 519, and note; 33 L. R. A. (N. S.) 681, and note.
It seems to be clear from these authorities that there is in principle, and as a matter of fact, no material or substantial difference between the common law rule in relation to' the estoppel of a bailee to deny the bailor’s title, and,the effect of our warehouse act. It is apparent that whoever drafted said act well knew and understood the common law rules of bailment and endeavored to and did conform thereto. All the legal rights and remedies.of the bailor, bailee and true owner are carefully guarded, and under proper interpretation of this act, there would be no possibility of a double recovery in any case. By permitting, as the majority opinion does, the true owner to recover and reclaim his property in the hands of the bailee, and at the same time denying the bailee the defense of having thus accounted to the true owner of paramount title, places an “unconscionable” hardship upon the bailee, which is mentioned in Hentz v. The Idaho, Biddle v. Bond, and King v. Richards in no uncertain terms, and which the annotator, 5 Cyc. 173, note 66, terms an "anomalous” proposition.
*626The majority opinion says the bailee is in no danger of suffering through a double recovery for the reason that he can allow the claimant to bring suit, defend the.same, and if judgment goes against him and the property be taken from him, plead such involuntary surrender of possession and termination of bailment. In the first place the bailee in the case at bar is right up against a double recovery. In the second place, as we have already shown, there is no law in this state requiring the bailee to wait until judgment is rendered against him, before he can plead as a defense that the property has been taken from him by the true owner. He is not required to go to that trouble and expense. The only case we are able to find that holds to the rule that the bailee must wait until sued by the true owner and been ousted by a judgment before he is entitled fo plead such fact as a defense, is the case of Wheeler Co. v. Brookfield, cited in the majority opinion. We fully agree with the opinion in that case as applied to the facts there under consideration. In that case the bailee had surrendered the grain to the holder of the receipt long before the owner appeared and demanded possession. At that time the owner made demand the bailee was not in possession, and in that case the court held that the owner could not maintain conversion against the bailee after a delivery had been made to the receipt holder, — • that the law would protect the bailee from having to twice pay for the same grain. As applied to the facts in the case at bar the decision in the New Jersey case is wholly inapplicable; and in that case the court was construing a statute of the state of New Jersey, which in effect provided that the bailee should not deliver the stored grain to a third party unless ousted by suit. There is no such provision in the warehouse act in question nor elsewhere in the laws of this state. Under the logic and effect of the majority opinion where a thief deposited the grain and secured a storage receipt from the warehouse bailee, such bailee could not deliver the same to the true owner until after suit and judgment in favor of such true owner; if the bailee did happen to deliver to the true owner without suit, then the thief might recover as holder of the storage receipt, and such bailee be entirely! defenseless, _ and the thief would therefore have more rights under his storage receipt than he would if he still had possession of the grain. Hurt *627v. Bank, 99 Ala. 130, 12 So. 568; 19 L. R. A. 701; 42 Amer. Stat. Rep. 38; Collins v. Ralli, 20 Hun (N. Y.) 246.
There is nothing- in the provision of section 494 “and in no case shall grain so- stored be liable to seizure upon process of any court in.actions against such bailee, except actions by owners or holders of such warehouse receipt” which conflicts with the common law rule. This provision recognizes the distinction between the owner and holder of such receipt. That the owner may be one person and the holder another. The true owner of the property wrongfully placed in bailment would be the beneficial owner, although the receipt was issued in the name of another. If- it was intended that none but the holder of the receipt could maintain such action then the use of the words “owner or” was unnecessary. It will be observed that this provision is a limitation and relates only to who may be plaintiff against the bailee, and that this action i-s maintained by one of the parties authorized to bring suit against the 'bailee, and that there is no procedure in this action in violation of or in conflict with the provisions of this section. This section in no manner relates to what defenses the bailee may or may not interpose when sued by the owner or holder of the receipt. It would be unreasonable to suppose that t'he legislature intended to authorize the owner or holder of the receipt to maintain -suit against the bailee, and then say to the bailee you can have no defense whatsoever against such suit. There is nothing in this section 494, or elsewhere in the act, which, by the wildest stretch of the imagination, can be construed into saying that the bailee cannot voluntarily attorn or account to the true owner, and then set up- that fact as a defense against the bailor. We are of the view that the only limitation upon the matter of defense that may -be interposed by the bailee in -such suit is to be found in section 495. Section 487 of the act, in effect provides that the receipt shall be issued subject to the rights of the owner. The majority opinion construes this to mean subject to the rights of the receipt holder, but that could only be true where the receipt holder was also the true owner. Tin re is no language in this act which will forbid the bailee from delivering and accounting to the true owner, -or that would deprive him of the right of that fact as a defense when sued in conversion by a bailor on a groundless claim, with no other pre*628text of right than that he ivas the holder of the storage receipt. In order to hold otherwise you must read something into this statute that is not there. The provision of section 494 says that the grain shall not be seized under any process, etc.; this clearly Las no application to a conversion action. The majority opinion concedes that the true owner might maintain such action; then we say that it necessarily and logically results that one who stands in the shoes of the true owner may defend under the same right on which such owner might have instituted action.
To come back to the proposition that section 495 is declaratory of the common law rule and that the decisions under such rule are applicable to said section. The meat of the proposition is in the provision "so far as the duties, liabilities and obligations of the bailee are concerned,” the receipt shall be deemed "conclusive evidence” that the person to whom the same was issued is the owner of the grain. It is conceded by the majority opinion that this does not appfy to the true owner of the grain, that a true owner may maintain such suit, but that it only applies as beween the bailor and bailee,- — that it is not “conclusive” as to the rights or remedies of a true owner, but is “conclusive” against the bailee. That is precisely the holding under the common law rule— that as between the bailor and bailee the property is conclusively presumed to be the property of the bailor, but that the rule is not so broad in its conclusive effect as to affect the rights and remedies of a true owner, or the bailee when he defends, not under his own right as bailee, but under the right of the trite owner, with whose right the bailee has become connected. Under section 495 and also under the common law rule, the conclusive estoppel is limited by, relates to and is applied in connection with the “obligations of the bailee.” Now, what i-s the extent of the bailee’s contractual obligation under this warehouse act? It is to restore to the bailor a like quantity of grain, or account for it. Under a technical literal construction, as technical and literal as my majority brethren are seeking to enforce against the bailee appellant in this case, there is nothing in the warehouse act requiring the bailee to account for the grain. The literal language only says to restore it in like kind. .If the bailee was not in a position to restore it, in like kind, the bailor would have no remedy and by this avenue might be defrauded of his property, unless under the general com*629mon law he could compel the bailee to account for it under the word i!restore,” and therefore I am of the view that under the spirit and intent of the provisions of the warehouse act, although not under the letter of the act, the bailee should be required to account for the grain. The obligation of the bailee, under the warehouse act, is to restore or account for a like quantity of grain, and is precisely the same as the common law obligation considered in Hentz v. The Idaho, and in Biddle v. Bond. Now, is there any reason in the world, -by reason of anything that is contained in the warehouse act, that would prevent the bailee from accounting to the bailor in the manner referred to in Hentz v. The Idaho and in Biddle v. Bond? Respondent is asking appellant, not to restore a like kind of grain, but to account for it. He is in the accounting business against the bailee, and outside the technical literal wording of the warehouse act. From the standpoint of the majority opinion what is sop for the goose is sop for the gander. If appellant has already accounted to' him for it in a manner recognized by law and equity, why is it not a good defense to plead and prove that fact? “The bailee’s contract is to do with the property committed to him what his principal, the bailor, has directed,— to restore it or account for it; and he does account for it when he has yielded to the claim of one who has right paramount to that of the bailor. If there be an estoppel, to deny the bailor’s title, it ceases when the bailment on which it is founded is determined by what is equivalent to an eviction by title paramount, that is by the reclamation of possession by the true owner.” This is the direct holding in both Hentz v. The Idaho, and Biddle v. Bond. This doctrine seems to have been announced in Bacon’s Abr. 5 Cyc. 172, note 62. Section 494 declares the transaction to be a bailment, and it must be subject to the general law of bailment, unless this statute has established a different rule. No amount of jugglery in interpretation' or construction can read into this warehouse act anything touching upon the termination of the bailment, which overturns or is in conflict with this general rule or doctrine. No matter what the character of the bailment, nor how conclusive its effect, in other matters, unless there is some statute to prevent it, it is determined, terminated, finished and brought to a close when the bailee accounts to the true owner, which is, in effect, held to be an accounting to the bailor under his bailment *630obligation. There is no apparent reason why such accounting would not terminate the contractual obligation of the bailee under the warehouse act as well as under the common law rule. The effect of both obligations is the same. Under this rule and doctrine, it seems to me, there can be no possible escape from the conclusion but what the answer interposed b}r appellant, alleged a good and sufficient legal defense. The merits can be tried out on the trial whether the appellant, bailee did, in fact, yield and .account to the true owner. The policy of our law is that all causes should be tried out on the merits to the end that exact justice be meted out between man and man. If he did in fact account and yield to the true.owner then it necessarily follows that the claim of respondent is, as a matter of fact, groundless and unjust and he has no right in justice and fair dealing to recover. It is unjust and an inequitable -hardship to place on appellant when you kick him out of court with a just defense and compel him to twice pay for the same grain, and the last payment to a person not entitled thereto, and whose only claim is based upon a purely technical fiction. Some suggestion has 'been made that respondent-may have some lien or claim against appellant’s share of said grain. If such is the fact it can be adjusted on the trial where both parties may receive their just dues.
There is another "good ground, from which, as it appears to me, there is no possible escape, permitting the defense interposed by appellant. After appellant accounted to the true owner such owner then ceased to have any further interest in the subject matter of this action. If there had been no accounting to the true owner and this action had been commenced in its present-form, or as an action in replevin, the true owner, with a right of action in himself to recover his property or its value in whosesoever hands it might be found, had the right, under our statute, to intervene and set up his right against both -bailor and bailee. It is held in Bank v. Hurt, 99 Ala. 130, 12 So. 568, 19 L. R. A. 701, 42 Amer. Stat. Rept. 38, that a warehouse statute of the same nature as ours, -cannot and does not undertake to- give the holder of the receipt any better title to the property than would be given by the actual possession of the property itself. When the appellant accounted to and -paid the true owner for the share of the grain in controversy he thereby -became the. *631equitable assignee and subrogated to all the legal rights and remedies of the true owner, — by such accounting he became the real party in interest of the subject matter of this action, instead of being a mere bailee 'thereof. There is nothing in the warehouse act or in any other statute of this state that would prohibit and estop such bailee from acquiring such interest under the circumstances alleged. Whenever you hold that such bailee is estopped from acquiring such interest under the circumstances of this case, then you hold that the storage receipt gives better title than would the possession of the grain itself. If the actual grain was in the possession of respondent, can there be any reasonable question but what the true owner or his assignee or successor in interest might maintain an action for its possession or value ? ’ In Bank v. Hurt, the learned court said: “We cannot conceive that it could have been within the contemplation of the Legislature that the provisions of the statute would enable a thief, by depositing’ the stolen property with a warehouseman, and obtaining a receipt for it in due form, to confer upon an innocent purchaser for value and in good faith a claim to the property which would prevail against that of the true owner.” . The case of Collins v. Ralli, 20 Hun 246, affirmed by the Court of Appeals, 85 N. Y. 637, holds to the same effect. Now, we have seen in Hentz v. The Idaho and in Biddle v. Bond and in some other well considered cases, that the legal position is precisely the same whether the bailor fraudulently stole the property from the true owner,. or ■was onhr mistaken as to the title of the true owner. The appellant is defending as the successor in interest of the true owner, and not as a bailee under the provisions of the warehouse act. That bailment had been terminated by what was equivalent to eviction by title paramount. The appellant is -setting up no right or title in himself as such bailee, but is defending solely under the title and authority of the true owner. The right under which, he is making this defense is wholly without the “conclusive” effect of section 495. The same transaction (accounting to the true owner) which terminated the bailment, also, at the same time, freed appellant from the ‘!conclusiz'e,! effect of the zvarehouse statute, by extinguishing the obligation. ■ The majority opinion says that the bailee cannot thus be freed from this conclusive effect of the act without violating another provision of the act. We of the mi*632nority in all seriousness would like to know just what other part of the act has thus been violated that would prevent the bailee from pleading and showing that he had accounted to the bailor and satisfied the obligation to return or account for the grain. Our view, under the authorities cited, is that when the bailee accounted to the true owner he in fact and legal effect accounted to the bailor. Such is the direct holding in Hentz v. The Idaho, Biddle v. Bond and the excerpt from Bacon’s Abridgement, heretofore quoted. The obligation of the bailee, under the act and under the storage receipt, was to return or account for the grain. Does this warehouse act in any manner undertake to limit or say in what manner this accounting shall be made? We think not. When the bailee has legally accounted and satisfied the obligation of this storage receipt, ordinarily, in any other case, it would extinguish the obligation. We fail to comprehend why there should be a different rule applied to this particular case. Ordinarily when a party has paid and satisfied his legal obligation it ought to be a good defense, whether the obligation was the result of statute or simple contract. What sacred halo surrounds this warehouse aot, that it is not subject to the ordinary rules of construction and interpretation? We will concede for the sake of the argument that the -bailee, under no possible circumstances, under this warehouse act, could dispute the bailor’s title, yet, we think that would not prevent the bailee from setting up the defense, when sued by the bailor in conversion, that he had previously legally accounted to the bailor, and thereby satisfied, terminated and extinguished the obligation which constituted the bailor’s cause of action. Disputing the bailor’s title is one thing; pleading an accounting and extinguishment of plaintiff’s cause of action is an entirely different thing. Disputing the ¡bailor’s title has no application to or connection with the question of such accounting, being based upon entitrely different grounds. Such an accounting is not an exception to the rule that the bailee cannot dispute the bailor’s title; but is wholly outside such rule. Such accounting terminates the bailment relation because it extinguishes and satisfies the bailee’s obligation, just the same as the payment of a note .extinguishes and satisfies the obligation of the maker thereof. Such accounting has no application to the rule that the bailee cannot dispute the bailor’s title. Hjale on Bailments, p. 34. We do not think that the de*633fense of'having accounted to the bailor is in violation of any part, of this act; if it is, then there would be nothing in the world to prevent the bailor from recovering a dozen or more times for the same grain from .the bailee, just so long as the bailee would keep on paying. Under the construction given to this act by the majority opinion the bailee never could avail himself of the defense of having satisfied, by an accounting to the bailor, the obligation to restore the grain. Now, we are not discussing the wisdom of this act at all; but are contending that it should be interpreted under the ordinary rules of construction, in the light of and in connection with surrounding pre-existing laws upon the same subject. (36 Cyc. 1144-1145), and for the accomplishment of the purpose for which it was expressly enacted, viz., to establish a bailment relation instead of a sale. We are opposed to what seems to us to be an inapplicable, technical and hide-bound construction, which reads into this act “straw-men” not to be found therein, and which creates distinctions and differences where -there are none, and which construction entirely loses sight of the spirit and intent of the law and produces an unholy and 'dishonest result. The majority opinion carries the conclusive effect of section 495 beyond all reasonable bounds and makes it apply to a defense wholly foreign and outside the question of the disputing of the bailor’s title, — the defense here involved has nothing to do> with his title.
We agree with the majority opinion that the bailee may avail himself of the provisions of sections 97 and 98 of Code Civ. Pr., hut to stick to the text, our contention is that -there is nothing in these sections either, as there is nothing in the warehouse act, which prevents the bailee from interposing the defense in question. It will be observed that said section 98 clearly implies that when the bailee knows to whom the property rightfully belongs he may deliver the same to the rightful owner, the statutory provision being that when the bailee is “unable to determine” to whom it belongs he may deliver the same into court as provided by these sections of the statute.
Again, we are of the view that the warehouse act never intended to repeal or overturn well established general rules in relation to agency. The respondent was at least a self constituted agent or trustee of the trite owner of the said one-fourth share of *634grain in delivering the same to appellant and taking a receipt therefor in his own name. The true owner still remained the beneficial owner. Under such circumstances the bailor could not be heard to say that the deposit was not made for the benefit of the true owner. In Gates v. Thede, 91 Ill. App. 603, and under a warehouse act, where grain was delivered to a public warehouse by the owner’s agent, and storage tickets wrongfully taken in the name of. the agent, and where the warehouseman redelivered the grain to the true owner on demand, it was held that the agent could not thereafter maintain conversion against the warehouseman. In Hale on’ 'Bailments, p. 32, the rule is stated that a bailment by an agent is a bailment for the principal, and a redelivery may Lc made to the principal direct.
The measure of damage in conversion is fixed by statute in this state. Secs. 2286, 2315 and 2330 Civil Code. Respondent’s actual damage was the value of the three-fourths interest owned by him, with interest. After the owner of the other one-fourth interest had made demand on the bailee, and had been paid for his share of the grain, the respondent could only recover the value of what belonged to him. Grain being something that can be divided without injury is subject to the aliquot share rule as between tenants in common, under which each is entitled to and may recover his proportionate aliquot share, and the same rule does not apply as to things which are indivisible, as between tenants or owners in common. Hence, the true owner was entitled to demand and receive from appellant his one-fourth share in said grain regardless of the other three-fourths.
■The majority opinion is opposed by every rule of reason — ■ by every principle of right and justice. 'It is opposed by every text writer who has ever written on ’the subject. It is-opposed by the highest judicial authority in this country and in England. The most careful and diligent research will fail to reveal a single reason or authority to sustain it. The demurrer should have been overruled and the order appealed from .should be reversed.
SMITH, P. J., concurs.