Court Opinion

ID: 6353781
Source: CourtListenerOpinion
Date Created: 2022-06-24 18:31:14.454883+00
Date Added: 2024-06-11T15:49:37.188525
License: Public Domain

Opinion,
Mr. Justice McCollum :
The defendants were engaged in the business of receiving and selling wool on commission in the city of Philadelphia, and James R. Reid was a shipper of wool, doing business at Butte, Montana. On May 23, 1887, the defendants wrote to the plaintiff as follows: “We expect to have some business with Mr. James R. Reid when the wool season opens, in which *244case we will honor his drafts with bill lading attached.” On August 12, 1887, the plaintiff cashed Reid’s draft on the defendants for $4,007.80, with bill of lading attached for 22,285 lbs. of wool, shipped by Reid to defendants at Philadelphia, and on the next day a like draft for $2,752.97, with a like bill of lading attached for 14,951 lbs. of wool. The defendants refused to honor these drafts, or to receive the wool described in the bills of lading attached, on the ground that Reid, in drawing drafts for these amounts, had exceeded his authority. The drafts with the bills of lading attached were returned to the plaintiff, and at Reid’s instance the bills of lading were forwarded to Justice, Bateman & Co., wool merchants in Philadelphia, who had them indorsed by the consignees, delivered them to the carrier, received the wool described in them, and sold it in the market for its full value. The proceeds of this sale were received by the plaintiff, and were $1,480.82 less than the amount called for by the drafts. This action was brought to recover the difference.
The rights of the parties depend on the proper construction of the defendants’ letter. The plaintiff contends that it constituted an undertaking on their part to honor all drafts which Reid might draw upon them, with bill of lading attached, without regard to the value of the consignment.
It is averred in the affidavit of defence that the plaintiff knew that the business referred to in this letter was the shipping of wool for sale on commission ; that it was a usage of the trade for the shipper, when he consigned the wool to his factor, to draw on the latter for any amount not exceeding three fourths of the value or selling price of the wool at the time of its arrival at the place of its destination, and for the factor to make advances on the wool by paying these drafts. It is further averred that, “ it was understood by the plaintiff that the drafts to be honored by the defendants were to be honored on the security of the wool, bills of lading for which were attached to the drafts, and were not to exceed in amount the customary advances on such wool.”
A usage, if known to the parties to a transaction to which it relates, is obligatory, and, unless excluded by the terms of the contract, enters into and is regarded as a part of it, as much as though it had been written therein : Stultz v. Dickey, 5 Binn. *245287; Hursh v. North, 40 Pa. 241. ft is admissible to add incidents to a contract which are not inconsistent with its terms, and to ascertain the intention of the parties in reference to matters about which the contract is silent: Clarke’s Browne on Usages & Customs, 167. The usage described in the affidavit is not unreasonable, or in conflict with positive law. It does not contradict the terms of the instrument on which the plaintiff relies, but it explains them, and gives effect to the intention of the parties. The letter of the defendants must be read in the light of the usage known to the parties, and applicable to the transaction between them. When so read, it is fatal to the plaintiff’s claim for the overdraft. We think the affidavit presents a good defence to the action.
Judgment reversed, and procedendo awarded.