Court Opinion

ID: 6737312
Source: CourtListenerOpinion
Date Created: 2022-07-20 23:19:29.883177+00
Date Added: 2024-06-11T16:01:50.094187
License: Public Domain

On Petition for Rehearing.
Appellant has filed a petition for rehearing in which he strenuously contends that this court should follow Plano Mfg. Co. v. Jones, 8 N. D. 315, 19 N. W. 338, rather than St. Anthony & D. Elevator Co. v. Dawson, 20 N. D. 18, 126 N. W. 1013, Ann. Cas. 1912B, 1331. We must decline to do so but will set forth our reasons, which in the interests of brevity we had omitted from the original opinion.
From the very earliest time there had been a dispute as to whether a person who delivered grain to a public warehouseman and took therefor a storage receipt had parted with his title to the grain. This dispute arose naturally from the difficulty of identifying the grain so *20stored. Some authorities held such a transaction to be a sale because, as they say, the identical grain cannot be returned. Other authorities held the deposit to be merely a bailment and the fact that the identical grain cannot be returned is immaterial in view of the fact that a like amount of the same kind and grade answers every requirement of the r'eturn.
Those courts which held that the depositor had parted with his grain, of necessity held that no action could be maintained for its conversion. This for the very good reason that a man who has no wheat cannot maintain an action against somebody else for converting it. It might be said in passing that those decisions were made in the absence of statute upon the subject. In North Dakota by § 8, chap. 126, Sess. Laws 1891 it was provided: “Whenever any grain shall be delivered to any person, association, firm, corporation or trust, doing a grain, warehouse or grain elevator business in this state, and the receipts issued therefor, providing for the delivery of a like amount and grade to the holder thereof in return, such delivery shall be a bailment, and not a sale of the grain so deliveredAfter the enactment of this statute the question was not an open one in North Dakota. Notwithstanding this fact, in 1899 the case of Plano Mfg. Co. v. Jones, supra, was decided upon the theory, that such delivery was a sale. We have examined the briefs filed in that case and find that said statute was not called to the attention of the court at that time and was, undoubtedly, entirely overlooked. When the case of St. Anthony & D. Elevator Co. v. Dawson, 20 N. D. 18, 126 N. W. 1013, Ann. Cas. 1912B, 1337, was decided, the correct rule was adopted; although that case did not in so many words overrule Plano Mfg. Co. v. Jones, it did so by necessary implication.
As authority for our position, we refer to a note in 91 Am. St. Pep. 220, from which we quote: “By far the most important transactions coming under the head of bailment are those which have to do with the deposit of grain in warehouses. It needs no authority to support the statement that when wheat is delivered at a warehouse to be stored, and the identical wheat is to be returned, the transaction is a bailment. Thé difficulty arises when it is mingled with other wheat. In this connection, there are two lines of decisions, one holding it a mere bailment and the other a contract of sale. ... [Case cited and digested.] *21This the court held to be a contract of bailment, and it has been so held by numerous other authorities. [Cases cited.] In such cases, the relation existing between the depositors is that of tenants in common of the mass, each being entitled to so much thereof as his share bears to the whole amount; and the fact that the identity of the mass is continually shifting, by being added to and taken from, does not alter it. [Cases cited.] The reasons for this rule were thus well stated in Rice v. Nixon, 97 Ind. 97, 49 Am. Rep. 430: 'The rule which we accept as the true one is required by the commercial interests of the country, and is in harmony with the cardinal principle that the intention of contracting parties is always to be given effect. It is not unknown to us, nor can it be unknown to any court, for it is a matter of great public notoriety and concern, that a vast part of the grain business of the country is conducted through the medium of elevators and warehouses, and it cannot be presumed that warehousemen in receiving grain for storage, or depositors in intrusting it to them for that purpose, intended or expected that each lot, whether of many thousand bushels, or of a few hundred, should be placed in separate receptacles; on the contrary, the course of business in this great branch of commerce, made known to us as a matter of public knowledge and by the decisions of the courts of the land, leads to the presumption that both the warehouseman and the depositor intended that the grain should be placed in a common receptacle and treated as common property. This rule secures to the depositor all that in justice he can ask, namely, that his grain shall be ready for him in kind and quantity whenever he demands it. Any other rule would impede the free course of commerce and render it practically impossible to handle our immense crops. It is reasonable to presume that the warehouseman and his depositor did not intend that the course of business should be interrupted, and that they did not intend that the almost impossible thing of keeping each lot, small or great, apart from the common mass, should be done by the warehouseman. If the warehouseman is not bound to place grain in a separate place for each depositor, then the fact that he puts it in a common receptacle with grain of his own and that of other depositors does not make him a purchaser, and if he is not a purchaser, then he is a bailee. In all matters of contract the intention of the parties gives character and effect to the transaction, and in such *22a case as this the circumstances declare that the intention was to make a contract of bailment and not a contract of sale.’ [Oases cited and digested.] The other view holding that where grain has been mingled with that of others, whether with the depositor’s consent or by custom, and an equal amount of like grain is to be returned, it is a sale, is also supported by eminent authority. [Oases cited.]”
It might further be said that any one interested can obtain possession of an ordinary storage receipt issued under § 3112, Oomp. Laws 1913, and will see that such storage receipt does not obligate the warehouseman to purchase the grain nor to pay- any sum therefor. True, warehousemen will usually purchase such grain, but the storage ticket does not obligate them to do so. As the St. Anthony & D. Elevator Co. v. Dawson Case is sound in principle, we follow it. The petition for rehearing is denied.