Court Opinion

ID: 3550866
Source: CourtListenerOpinion
Date Created: 2016-07-05 23:03:38.227228+00
Date Added: 2024-06-11T14:06:37.274744
License: Public Domain

FROM CHESHIRE CIRCUIT COURT.
Stoppage in transitu is the right which arises to an unpaid vendor to resume the possession, with which he had parted, of goods sold upon credit, before they come into the possession of a vendee who has become insolvent, bankrupt, or pecuniarily. *Page 458 
embarrassed. The term "insolvent," when it relates to the right of stoppage in transitu, means a general inability to satisfy obligations, evidenced by Stopping payment. In such a case the vendor is allowed to countermand delivery before or at the place of destination, and to resume the possession of the goods, according to that equitable principle in the law of contract by which one party may withhold on the other's becoming unable to give performance. It is nothing more than the extension of the right of lien which by the common law the vendor has upon goods for the price, originally allowed in equity, and subsequently adopted as a rule of law. The right is said to be favored and encouraged by courts of law for the purposes of justice, and for the solid reason "that the goods of one man should not be applied in payment of another man's debts." 2 Kent Com. 540; 1 Pars. Con. 595; Houston on Stoppage in Transitu 1-3; Atkins v. Colby,20 N.H. 154.
The essential ground of the right of lien is possession; that of stop page in transitu is non-delivery to the vendee. There may doubtless be a valid constructive delivery without actual tangible possession by the vendee, — and "in the variety and extent of dealing, which the increase of commerce has introduced, the delivery may be presumed from circumstances, so as to vest a property in the vendee. A destination of the goods by the vendor to the use of the vendee, — marking them or making them up to be delivered, or removing them for the purpose of being delivered, may all entitle the vendee to act as owners to assign, and to maintain an action against a third person, into whose hands they have come. But the title of the vendor is never entirely divested till the goods have come into the possession of the vendee. He has, therefore, a complete right, for just cause, to retract the intended delivery, and to stop the goods in transitu." Lord LOUGHBOROUGH in Mason v. Lickbarrow, 1 H. Bl. 364; Williams v. Moore, 5 N.H. 235.
In the case of Hunter v. Beale, cited in Ellis v. Hunt, 3 Term 166, Lord MANSFIELD was clearly of opinion that, although the goods might be legally delivered to the vendee for may purposes, yet as for this purpose there must be an absolute and actual possession by the bankrupts; they must have come to the corporal touch of the vendees, otherwise they may be stopped in transit. But in Ellis v. Hunt, Lord KENYON said, — "As to the necessity of the goods coming to the corporal touch of the bankrupt, that is merely a figurative expression, and has never been literally adhered to. For there may be an actual delivery of the goods without the bankrupt seeing them, — as, a delivery of the key of the vendor's warehouse to the purchaser." And in Dixon v. Baldwin, 5 East 184, Lord ELLENBOROUGH also disapproved of the ruling of Lord MANSFIELD in Hunter v. Beale, saying, — "The question is, whether the party to whose touch the goods actually come, be an agent so far representing the principal as to make the delivery to him a full, effectual, and final delivery to the principal, as contradistinguished from a delivery merely to a person acting as a carrier or means of conveyance to or on account of the principal, in a mere course *Page 459 
of transit towards him." 1 Pars. Con. 603, and cases cited. So, demanding and marking the goods by the vendee's agent at the inn where the goods arrived at their destination, has been considered a constructive delivery, defeating the right of stoppage in transitu. Ellis v. Hunt, before cited.
But delivery to a mercantile house merely for transmission to the vendee by a forwarding house does not take away the right of stoppage. Hays v. Morrill, 14 Pa. St. 48.
The possession of a carrier is not such actual possession of the vendee or consignee as takes away the right of stoppage. "This," said LAWRENCE, J., in Bothlingk v. Inglis 3 East 395, "has been repeatedly determined."
And if goods are shipped for a particular port, or forwarded to a particular place, thence to be sent by another ship or other conveyance to the vendee, and a wharfinger or a middle-man receives them on their first arrival for the purpose of forwarding them to the vendee, the vendor's right of stoppage continues until the goods have recalled the possession of the vendee. Mills v. Ball, 2 Bos.  Pull. 457; Ellis v. Hunt and Atkins v. Colby, before cited.
In such circumstances it might happen that it would be proper and necessary to submit to the jury such questions as whether the wharfinger or middle-man received the goods as the vendee's agent, to take possession of them for his benefit as owner, or as his agent only to forward them to him, or to keep them for the vendor. Houston on Stoppage in Transitu 122; Reynolds v. The Railroad, 43 N.H. 580.
If the wharfinger or middle-man, or any other person, be the actual agent of the vendee, beyond the duty and position of such person as a mere wharfinger, carrier, or forwarder, the possession of such agent would be as effectual a bar to the right of stoppage as the actual manual possession of the vendee. Dixon v. Baldwin, before cited; Harman v. Anderson, 2 Camp. 243; Lucas v. Dorien, 7 Taunt. 279; Atkins v. Colby, before cited; Houston on Stoppage in Transitu 114.
Applying these principles, what is the condition of the case before us? It is conceded that the vendees were insolvent, and that this fact first became known to the plaintiffs after the shipment of the goods. It is not contended (and upon the facts it cannot be) that the Cheshire Railroad were the agents of the vendee for the purpose of receiving the delivery or possession of the goods. While standing upon the Surry track they were still in the possession of the carrier, undelivered, and in a state of detention by the railroad, according to their custom and contract with reference to demurrage. Demurrage is a condition of detention and delay beyond the ordinary time for unloading or delivery. See Bouv. Law Dic.
In this condition of the goods it is not claimed that there was any understanding or agreement that the railroad corporation should hold them as warehousemen or agents of Barnes  Co. The case of Smith v. The Railroad, 27 N.H. 86, cited by the defendants, is therefore not in point. Nayler v. Dennie, 8 Pick. 198. *Page 460 
Howland was a "general truckman," and notwithstanding he had had a general order to take anything he might find for Barnes  Co. at the depot and bring it to the store, that order cannot be said to have continued after the store had been abandoned and all its contents removed, the traders having absconded. Moreover, the case finds that there was no evidence of any authority in Howland to act as the agent of Barnes  Co. for the purpose of taking possession of the shingles; and it was admitted at the trial that in taking possession of them and removing them he acted under the direction of the attaching officers and not as agent of Barnes 
Co. Barnes  Co. having no agent to receive or forward the goods, having themselves departed to parts unknown, the ultimate destination of the goods being unaccomplished and unknown, it can, in no sense, be considered that the goods had come to the possession of the vendees.
Such being the facts as proven or admitted, and no exception being taken to the instructions of the court upon the subject of constructive delivery and possession, I fail to discover any error in the proceedings of the court below, and am clearly of opinion there should be judgment upon the verdict.
The case mainly relied upon by the defendants Dixon v. Baldwin, before cited, — is very clearly distinguishable from the present in this respect: that the consignees had specially appointed the Metcalfes their agents to receive the goods from the carriers at Hull, and forward them to an ultimate destination prescribed by the cosignees; and in that case, upon the principles which I have stated, the transit was properly regarded as terminated, so far as the vendors were concerned, upon the intervention of the Metcalfes at Hull.
CUSHING, C. J., and SMITH J., concurred.
Exceptions overruled.