Thacher v. Moors

Field, J. It is convenient to consider this case, in the first instance, as if Jones originally had no interest in this wool, and had none at any time except what he derived from the plaintiff, and then to consider what is the effect upon the rights of the parties of the facts, that the wool was originally bought by Fessenden “upon joint account with Jones, under an arrangement between them, by which Fessenden was to buy the wool of the farmers in Vermont, and Jones was to find the money (either furnishing it himself or procuring some one else to advance upon the wool) and have control of the sale of it in Boston, and the profits were to be divided between them,” and that Jones under this arrangement procured the advances to be made by the plaintiff, and furnished other money of his own, and retained his interest in the wool until the sale of it by the defendant. Disregarding then this interest of Jones, the plaintiff was the consignee of the wool for sale on account of Fessenden, to whom he had made advances; the wool had been shipped to him for sale, and railroad receipts and invoices sent him; the wool had been received, and, by the plaintiff’s orders to the railroad — 163 — company, had been delivered to a truckman and stored in the lofts of Jones. The report finds that “ Jones had no authority from the plaintiff to sell said wool as a factor or consignee, but said wool was entrusted by the plaintiff to Jones as a warehouseman, for the purposes of sale, and with authority as broker to receive offers for and to negotiate sales of the same, to be reported to and settled by the plaintiff, in whose name the bills of sale were made, and who collected the price.” The meaning of the clause that the wool was entrusted by the plaintiff to Jones as a warehouseman, for the purposes of sale, as qualified by the words which follow, and other words of the report, is that the wool was stored with Jones in order that it might be sold, and that Jones was authorized as a broker to negotiate sales, to be reported to the plaintiff, the terms of which were to be settled by him. Jones had no express authority to make and conclude sales himself, and, as a warehouseman, he had no such implied authority. He was not therefore either a “ factor or other agent entrusted with the possession of merchandise for the purpose of sale,” within the meaning of the Gen. Sts. c. 54, § 2. (And this section does not give validity to a pledge. Michigan State Bank v. Gardner, 15 Gray, 362.) Nor was he “ a person entrusted with merchandise, and having authority to sell or consign the same,” within the meaning of the Gen. Sts. c. 54, § 3. In these sections the words “ for the purpose of sale,” and the words “ having authority to sell,” mean much the same thing; which is, that in the one case the factor or other agent is entrusted with the possession of the merchandise “for the purpose of sale ” by him, so that he can himself make a sale and transfer the title to the merchandise; and, in the other, that the person entrusted with the merchandise has, as a person so entrusted, authority given him to sell or consign it. The same construction must be given to similar words in § 4. See Stollenwerck v. Thacher, 115 Mass. 224; Nickerson v. Darrow, 5 Allen, 419. A warehouseman who is also a broker, with authority only to receive offers for merchandise stored with him as warehouseman, and report them to his principal, who concludes the sale, if any is made, is not within the provisions of either of these sections. — 164 — The pledge of this wool to the defendant, therefore, is not protected by the statute; and the facts show that it was made by Jones without any authority from the plaintiff, and without any acts done by the plaintiff whereby the defendant was misled into the belief that Jones had any such authority, whether as owner or otherwise. The fact that he found the wool in the store of Jones, which he knew was used by Jones “ to store wool as a warehouseman for other persons, and also wool belonging or consigned to himself,” does not bring the case within the decisions upon ostensible or apparent ownership. Neither the railroad receipt nor the invoice was delivered by the plaintiff to Jones, but both were retained by the plaintiff; and Jones, so far as it appeared to the defendant, was no more the ostensible owner of this wool than of any other wool stored with him as warehouseman. The assertion of Jones that he owned the wool was incompetent, as evidence of ownership, against the plaintiff, and could not enlarge his authority as agent. Mussey v. Beecher, 3 Cush. 511. Stollenwerck v. Thacher, ubi supra. There remains to be considered the effect upon the rights of the parties of the interest which Jones had in the wool. It is perhaps not important to determine exactly the respective rights of Fessenden and Jones under their agreement; but we assume that Fessenden and Jones were partners in this adventure, with the right in Jones as against his copartner of controlling the sale of the wool in Boston; and, for the purpose of considering the principal questions in this case, we shall treat Jones as the general owner. It is argued that, as Jones was the general owner, and had all the rights of an owner' to sell or pledge the wool, the lien of the plaintiff was lost by the plaintiff’s delivering possession of it to Jones in the manner and under the circumstances which have been stated in the report. Whatever the authority of Fessenden, under his agreement with Jones, may have been to consign the wool to the plaintiff, it is plain that, if the plaintiff had retained possession of the wool, he would have had a valid lien upon it for his advances against Jones, both by virtue of the Gen. Sts. c. 54, § 1, and by the general principles of law, because Jones had procured the consignment to be made to the plaintiff, and by his acts was estopped from setting up, against — 165 — the plaintiff, any title to the wool inconsistent with the validity of the lien acquired by the plaintiff as consignee. The interest of the plaintiff in this merchandise was that of a consignee for sale who had made advances upon it, and his rights and duties in most respects are well defined in the law. The possession of a warehouseman, although he has a lien for his charges, is not inconsistent with the possession of the consignee, and it is in accordance with the usage of commission merchants to store merchandise consigned to them in warehouses. A consignee’s rights in the merchandise are not lost by putting the merchandise in the warehouse of another person, to be stored until it can be sold. The plaintiff never intended to relinquish his lien, or even to put the property into the possession of the owner; but it is argued that, as he did intend to put it into the possession of Jones, who was the owner, although the plaintiff did not know it, this union of possession and general property in Jones enabled him to convey a good title to an innocent pledgee for value. No decided case has gone so far as this. It has not even been decided in this Commonwealth, that, if the plaintiff had known that Jones was the owner of the merchandise, the deposit of it in good faith with him as a warehouseman, with authority to negotiate sales as a broker, to be concluded by the plaintiff, would have enabled Jones to vest a good title in an innocent purchaser by a sale made by him on his own account. Macomber v. Parker, 14 Pick. 497. Walker v. Staples, 5 Allen, 34. Thayer v. Dwight, 104 Mass. 254. See Casey v. Cavaroc, 96 U. S. 467; Clark v. Iselin, 21 Wall. 360; Thompson v. Dolliver, 132 Mass. 103. In this Commonwealth, although a sale of personal chattels is not valid against a subsequent purchaser, without delivery, yet, if there has been a delivery, possession by the vendor is only evidence of fraud, and the sale is not void against a subsequent purchaser, unless fraud in fact is proved. Zuchtmann v. Roberts, 109 Mass. 53. Ingalls v. Herrick, 108 Mass. 351. Thorndike v. Bath, 114 Mass. 116. Dempsey v. Gardner, 127 Mass. 381. In conditional sales, possession by the vendee does not enable him to convey a good title to a purchaser. The cases here and elsewhere are numerous where the pledgee has lost his lien by — 166 — delivering the pledge to his pledgor, to be used by him or to be held by him for his own use, or to be held by him with a right to substitute other property for that originally pledged; but possession obtained by the pledgor by force or fraud has never yet been held to destroy the lien of the pledgee, unless the delivery, although fraudulently obtained, was with the intention on the part of the pledgee that the pledgor might treat the pledge as his own property. The mere fact that the pledgor has possession, so that in him the possession and the general ownership are united, does not, as matter of law, destroy the lien of the pledgee, without regard to the circumstances under which, or the purpose for which, the possession was obtained. Macomber v. Parker, ubi supra. Walcott v. Keith, 2 Foster, 196. To hold that the union of possession and general property in the same person, however acquired, necessarily destroys the special property of a consignee of merchandise, would enable warehouse-men, who hold merchandise in store for commission merchants, to buy in the title of their consignors, and thus obtain full control over the disposition of theu merchandise stored, without the authority or knowledge of the consignees. In all the cases cited by the defendant * in which it has been held that the lien of a pledgee was lost, the property pledged had been delivered to the pledgor by the pledgee, knowing him to be the pledgor, and the pledgor had been authorized to hold the property, or to make some use or disposition of it for his own benefit in a manner inconsistent with keeping it solely as agent, and for the benefit, of the pledgee, except the case of Geddes v. Bennett, 6 La. An. 516, and there the circumstances were such as in the opinion of the court to estop the plaintiffs from claiming their lien, even if they had one, which it seems they had not as against third persons, because the provisions of the Code of Louisiana had not been complied with. — 167 — But it is unnecessary to consider what would be the result, if the interest which Jones had in the merchandise had been known to the plaintiff. The want of such knowledge is decisive. The plaintiff cannot be held to have intended that Jones should exercise any of the rights of ownership over the merchandise on account of his delivery of it to him, because he did not know that Jones was an owner, and it was not a consequence naturally to be expected from delivering the merchandise to him to be stored that it would come into the possession of the general owner; and in no legal sense can the plaintiff be said to have voluntarily delivered the merchandise into the hands of the general owner. In the absence of any act or conduct which, in law, prevents a consignee of merchandise for sale from setting up his rights of property by reason of an apparent ownership or authority to sell which he has conferred upon another, those rights are lost only by his dealing with the merchandise in a manner inconsistent with the bailment, or inconsistent with his possession and preservation of the- merchandise solely for the purpose of sale under the consignment, or by dealing with it in such a manner that an intention to abandon or relinquish his rights can be inferred. In this case there has been no such dealing with the merchandise, and no such intention can be inferred. The right which. Jones had as owner to sell his interest in the property, subject to the right of the plaintiff, is not an authority to sell within the meaning of the Gen. Sts. c. 54. That chapter has no reference to the right of an owner of merchandise to sell as owner, but to the authority to sell given to consignees, factors, agents, or other persons entrusted with the possession of merchandise. See Jenkyns v. Usborne, 7 Man. & G. 678; Fuentes v. Montis, L. R. 3 C. P. 268, and L. R. 4 C. P. 93. The rulings of the justice before whom this case was tried were therefore correct; and the defendant has converted the wool to his own use. It was a conversion when the wool was taken from the possession of Jones by order of the defendant, under a claim of a right of property in it, and was stored with Drake and Company, subject, and deliverable only, to the order of the defendant. Stanley v. Gaylord, 1 Cush. 536. Moody v. Blake, 117 Mass. 23. Bearce v. Bowker, 115 Mass. 129. — 168 — The justice before whom the case was tried found for the plaintiff, and reported the case to the full court, with the statement that, “ if the plaintiff was entitled to recover, by agreement of parties, the case was to be sent to an assessor to determine the plaintiff’s damages, according to the rules prescribed by the court.” The ordinary rule of damages is the market value of the property at the time of the conversion, with interest from that time, and a consignee of merchandise is entitled to recover full damages, and is responsible over to his consignor for any balance remaining after satisfying his claims upon the property. Ullman v. Barnard, 7 Gray, 554. Whether the amount of the damages, thus estimated, is greater than the amount of the money for which the plaintiff had a lien on the property, the report does not show; and, if so, whether the defendant has so far succeeded to the rights of the owners that he is entitled to retain or deduct from these damages the surplus which remains after satisfying the claims of the plaintiff, the report does not enable us accurately to determine. See Chamberlin v. Shaw, 18 Pick. 278, 283; Spoor v. Holland, 8 Wend. 445; Ingersoll v. Van Bokkelin, 7 Cow. 670. In accordance with the terms of the report, an assessor must be appointed to assess damages as of the full value of the property ; but, if desired by the defendant, he may have authority, as auditor, to hear and report any facts, in addition to those found in this report, bearing upon the right of the defendant to retain the surplus, if any, remaining after satisfying the claims of the plaintiff upon the property. Ordered accordingly. Footnotes [*] The defendant cited on this point Bodenhammer v. Newsom, 5 Jones (N. C.) 107; Geddes v. Bennett, 6 La. An. 516; Way v. Davidson, 12 Gray, 465, 467; Walker v. Staples, 5 Allen, 34; Kimball v. Hildreth, 8 Allen, 167; Thompson v. Dolliver, 132 Mass. 103; McFarland v. Wheeler, 26 Wend. 467; Black v. Bogert, 65 N. Y. 601; Farmers & Mechanics’ Bank v. Logan, 74 N. Y. 568; Day v. Swift, 48 Maine, 368; Collins v. Buck, 63 Maine, 459; Casey v. Cavaroc, 96 U. S. 467, 485; Tatham v. Andree, 1 Moore P. C. (N. S.) 386.