Droste v. Wabash Railroad

Scott, J.: This is an appeal by defendant from a judgment entered upon a verdict in an action to recover damages for non-delivery of 300 tubs of butter. On October 23, 1907, the firm of Emerson, Marlow & Co. of Chicago drew drafts upon plaintiffs in New York for $10,200 and attached to them two bills of lading purporting to have been issued by defendant for 300 tubs of butter each. Only one carload of 300 tubs was delivered, and this action is for the value of the other 300 tubs. The principal question in the case is whether the bill of lading was issued by defendant or by any one having authority to bind it. In form the bill was that of defendant. It was signed “The Wabash Railroad Company, per JJ. G. Northrop—: O. Agent,” only the italicized words being in writing. Northrop was the general agent in Chicago of the American Refrigerator Transit Company, a concern owning refrigerating cars, which were transported over the lines of a number of railroad companies, including that of the defendant. The refrig [162] erator company apparently did not operate the cars, merely loading them and delivering them to the railroad companies to transport. The relations between the defendant and the refrigerator company were apparently close, although the precise nature of these relations was not shown. Northrop had an office adjoining those occupied by defendant and had connection with the general telephone system of the city through a private switchboard in one of the defendant’s offices. The defendant did not issue bills of lading for perishable freight except as delivered to it in refrigerator cars, and whenever an application was made to defendant to ship such freight and the applicant desired a bill of lading, he was referred to Northrop. The initial 0. following Northrop’s name on the bill of lading represented one Offenloch, a clerk or assistant of. Northrop, and it was he who actually signed the bill. What happened was this: Offenloch signed the two bills of lading and delivered, them to Emerson, Harlow & Co. before any butter was delivered to any one, and Emerson, Harlow & Co. at once attached them to drafts, which they discounted. at a Chicago bank. In due course the drafts with the bills of lading attached were presented to plaintiffs, who paid them. In point of fact only 452 tubs in all were delivered either to defendant or the refrigerator company. Of these 113 were replevied and 39 were put in storage, leaving 300 tubs, which were loaded in a refrigerator car, delivered to defendant for transportation, and ultimately received by plaintiffs. The action, therefore, is not one for the value of goods which have been actually received by the carrier, but is based, upon the proposition that the carrier, having issued a bill of lading, is estopped, as to defendants, from denying that it has received the goods. (Armour v. Michigan Cent. R. R. Co., 65 N. Y. 111.) It was, therefore, essential to plaintiff’s cause of action to show that the bill of lading was actually issued by defendant or by its authority, or, in other words, to show that Northrop was the agent of defendant and authorized to sign bills of lading in its behalf. There was absolutely no evidence that he was in defendant’s employ, and while it appeared that he had signed other bills of lading in the same way upon which deliveries were made, there was no evidence that defendant or any óf its responsible. [163] officers had knowledge of the fact. In this respect the plaintiff’s case failed and the complaint should have been dismissed. There were also reversible errors made in the admission of evidence. Plaintiffs were permitted, in order to establish agency, to introduce sixteen similar bills of lading which had been signed by Northrop or one of his assistants. They were not obtained from defendant, but from the custody of the agent of the Erie Railroad Company in the city of New York. It is manifest that the mere production of any number of bills of lading purporting to be issued by defendant, but signed by Northrop, would be no evidence of Northrop’s agency unless knowledge that he had signed or was in the habit of signing such bills was brought home to defendant, as it was not. The plaintiffs were also permitted to introduce, by way of proving an admission of Northrop’s agency, a letter written by themselves, after their claim for damages had arisen, to the general freight and passenger agent of defendant, in which they twice referred to “your Mr. Northrop.” The recipient of the letter acknowledged it in a purely formal letter making'no reference to the characterization of Northrop as “your Mr. Northrop.” In his charge the trial justice particularly called the attention of the jury to this letter and the reference in it to Northrop, and said: “ The plaintiffs say they never received any reply to the letter, and notwithstanding there seems to have been some direct notice given that the plaintiffs claim that this bill of lading was signed by Northrop, there has been no repudiation of that, so far as I have been able to discover, written by the Wabash Railroad Company to the firm of Droste & Snyder. It is needless for me.to go into all the details and all the circumstances from which you might infer agency.” The introduction of the letter and the comments of the j ustice thereon were duly excepted to. It is easy to see how prejudicial they must have been to the defendant, for the jury were charged in effect that they might infer an admission of Northrop’s agency from the failure of defendant to repudiate it on receipt of plaintiff’s letter.' This is not the law. “ ‘ While a party may be called upon in many cases to speak where a charge is made against him, and in failing to do so may be considered as acquiescing in its cor [164] rectness, Ms omission to answer a written allegation, whether by affidavits or otherwise, cannot be regarded as an admission of the correctness thereof, and that it is true in all respects. Reasons may exist why he may choose and has a right to remain silent and to vindicate himself at some future period and on some more opportune occasion.’ ” (Viele v. McLean, 200 N. Y. 260, 262. See, also, Gray v. Kaufman Dairy & I. C. Co., 162 N. Y. 388; Bank of B. N. A. v. Delafield, 126 id. 418; Thomas v. Gage, 141 id. 506.) Since, for the errors above noted, the judgment must be reversed, we deem it unnecessary to discuss the other exceptions which have been argued by counsel or upon the briefs. , The judgment and order should be reversed and a new trial granted, with costs to appellant to abide the event. Ingraham, P. J., McLaughlin and Clarice, JJ., concurred; Laughlin, J.> dissented. Judgment and order reversed, new trial ordered, costs to appellant to abide event. Order to be settled on notice.