Hobbs v. The Steamboat Interchange

Harrison J., delivered the opinion of the court. On the 29th day of May, 1855, the plaintiffs in error sued out of the clerk’s office of the circuit court of Ohio county, an attachment against “the owners of the steamboat Interchange:, a vessel navigating the Ohio river,” for money owing from such owners to the plaintiffs. The attachment was levied on the boat then in possession of the defendants in error, who claimed to be the owners of the boat, and they executed bond with security and released the boat from the custody of the sheriff. On the 18th of May, 1856, the defendants in error appeared in the circuit court and filed their petition, stating that they were the owners of the boat. On the 11th day of July, 1859, the parties appeared by their attorneys, and by their consent the court proceeded to try the cause in lieu of a jury; the court having heard the evidence, rendered judgment for the defendants and dismissed the attachment. The plaintiffs took a bill of exceptions to the opinion of the court, in which the facts proved on the trial are certified. It appears that in the year 1854, the boat was built for the Central Ohio railroad company, a corporation of the State of Ohio, under an arrangement between that company and the Baltimore and Ohio railroad company, by which the boat was to be used in transferring freight and passengers across the Ohio river between Benwood in Virginia and Bellair in Ohio. The hull of the boat was constructed by the defendants for the Ohio company, and the engines and other machinery Were made and put on board the boat by the plaintiffs for the Ohio company; the boat was built at Wheeling. For the engines and other machinery, the Ohio company became indebted to the plaintiffs in the sum of money for which the attachment issued. After the boat was finished and equipped — 61 — for tbe service 'for which it was built, the Ohio railroad company on the 15th of January, 1855, sold and delivered the boat to the defendants, and executed to them a bill of sale in the following words: “ This deed, made the 15th day of January, in the year 1855, between the Central Ohio railroad company, party of the first part, and John Finh and Andrrn Wilson, parties of the second part: witnesseth, that the said party of the first part in consideration of the sum of 16,500 dollars to it paid by said parties of the second part, the receipt whereof is hereby acknowledged, hereby grant unto said parties of the second part the steamboat Interchange, her cabin, hull, engines, furniture and equipments, as she now is in the Ohio river, at the railroad landing at Bellair, in Belmont county, in the State of Ohio. ■ In testimony whereof said Central Ohio railroad company hath hereto caused its corporate seal to be affixed, and signed by John H. Sullivan, its president, the day and year above written. J. H. Sullivan, President, Central Ohio railroad company, [seal.]” And at the same time the parties entered into an agreement in these words: “ Memo, of an agreement made and entered into this 15th day of January, 1855, at Bellair, in Belmont county, in the State of Ohio, between the Central Ohio railroad company by John H. Sullivan and S. B. Ilosmer, a committee duly appointed and authorized by the board of directors of said company of the first part, and John Finh and Andrew Wilson, of Ohio county and State of Virginia, of the other part. “ The said Central Ohio railroad company, by the committee before named, has this day sold and conveyed unto the said John Finh and Andrew Wilson the steamboat called the Interchange, her engines, furniture, tackle and equipment, as she now lies in the Ohio river, at the landing of Bellair, Belmont county, Ohio. In consideration whereof the said Finh and Wilson agree to pay to said railroad company, in three instalments, payable, six, twelve and eighteen months — 62 — after date, with, interest from this date, such sum as shall be ascertained and awarded to be the cost of said boat to said company, by James 8. Wheat, the referee mutually chosen by said parties, said cost to be the aggregate of the bills incurred by said company for the building, equipping, and fitting out and furnishing said boat as she now lies, and the said Fink and Wilson to have the benefit of any credits on time given to said company for any part of said bills: it being agreed by said Fink and Wilson that if the nett profits of said boat shall be realized faster than the said payments shall mature, as hereinbefore provided, that then the amount of such profits shall be applied as received to the liquidation of said payments of the purchase money of said boat. It is also further understood and agreed that the notes of said railroad company, made and delivered to said Fink and Wilson for account of their work and materials on said boat, shall be delivered up to said company as part of the purchase money thereof; and that any claims and debts that hayo lawfully accrued against the said boat, either for building, equipping, furnishing or running thereof, when satisfied or paid by said Finlc, and Wilson, shall be credited to them as payments on the purchase money of said boat. In consideration of the guarantee hereinafter given on the part of the said Central Ohio railroad company, they, the said Fink and Wilson, agree to transport across the Ohio river between Bellair and Beracood, Bellair and the city of Wheeling, or Bellair and Momdsville or Elizabethtown, as may bo required by the officers or agents of said railroad company, ho far as the capacity of said boat or the state of the navigation of the Ohio river shall permit, for the space of three years from tho date of this agreement, all freight, passengers, baggage and mails of the United States, which shall be delivered on the vrestern bank of the Ohio rivpr from the Central Ohio railroad, or shall be delivered or received on the eastern bank af the Ohio river, at either of the points before mentioned, to be carried or transported on said Central Ohio railroad, said freight, passengers, baggago and mails to be -at. all times carried safely and expeditiously, and having the — 63 — priority and preference over any and all other business that may be offered to said boat. “In consideration whereof the said Central Ohio railroad company agrees that said Fink and Wilson, for each and every ton of freight loaded on said boat, transported across the Ohio river and unloaded from said boat, shall charge, claim and receive from the consignees not exceeding the following rates, viz: Between Bellair and Bemoood, fifty cents; between Bellair and wliat is called EofPs landing in the city of Wheeling, seventy-five cents; between Bellair and Mizabethtoion or Moimdsville, one dollar; or between any two points from Wheeling to Moundsvllb, directly across the Ohio river, fifty cents; the said charges for transporting said freight to bo collected in all cases from the owner or consignee thereof, unless otherwise specially agreed, to bo paid upon delivery. The same rates are to be charged for all freight delivered on board said boat and discharged from it in the cars in which it may havo been or shall thereafter he transported, the weight of the car not being included or charged; empty oars to bo transported freo of charge. In consideration of the guarantee hereinafter mentioned, the said Fink and Wilson agree to transport all passengers, baggage and mails from or for tho said Central Ohio railroad company free of charge, running tho said boat for that purpose at all times according to the schedule of the trains of the said railroad company, so as to secure as close a connection therewith as praeti cable; provided that the said Fink and Wilson shall havo tho right to charge and collect from each passenger between Bellair and the city of Wheeling or Moimdsville, a sum not exceeding twenty-five cents for the transportation of said passengor and baggage. “In consideration wheroof, tho said Central Ohio railroad company guarantees to said Fmk and Wilson the receipt of the. gross sum of seventy-five dollars per diem upon an average for each year, excluding Sundays and such days as said boat shall not maleo her regular trips from any cause, to enure, accrue or ho received to or by the said Fink and Wilson^ from freight to be offered or loaded on said boat at — 64 — the rates before mentioned, which may be destined for or have been transported over the Central Ohio railroad. The deficit of said guarantee to be ascertained at the end of each year and paid to said Fink and Wilson, by said Central Ohio railroad company. It being the meaning and intention of the parties hereto, that there shall be offered to said boat freight to and from said Central Ohio railroad, to an amount sufficient, at the rates before mentioned, to secure to the owners thereof, the daily average gross sum of seventy-five dollars for each year, excepting from computation Sundays and such days as said boat shall not make her regular trips; the said rates of charge to be collected by said Fink and Wilson, from the owners and consignees of said freight, at their own risks as is done by other common carriers. It is understood and agreed that the said Central Ohio railroad company may at any time annul and terminate this agreement, upon the payment to Fink and Wilson of the cost of said steamboat, as ascertained under this agreement, reserving to them the earnings of said boat and the advantage of the said guarantee, computed to the day of said re-purchase, in which event the said Fink and Wilson,, shall, by proper bill of sale duly acknowledged, re-convey the said steamboat to the said Central Ohio railroad company, free from any lien or encumbrance. "Witness the following signatures, the day and year first hereinbefore written. J. H. Sullivan, S. E. IIosmer, Central Ohio Railroad Company. John Fink, Andrew Wilson.” The sale bill was acknowledged before the surveyor of the port of Wheeling, by the President of the railroad company, the day of its date, and the surveyor endorsed on the bill the acknowledgement thereof. It does not expressly appear to have been recorded. That at the time of the issuing and levying the attachment, the boat was in the possession of the defendants, under their contract of purchase; that the Ohio railroad company was indebted to the — 65 — plaintiffs tbe sum of 4,396 dollars and 80 cents at tbe time the attachment issued, and was also indebted to tbe defendants for tbe construction of tbe bull of tbe boat. At the time tbe defendants purchased the boat, they knew the plaintiffs had so built tbe engines for tbe boat and that tbe Ohio company was indebted to tbe plaintiffs on that account, and that debt was one of tbe debts mentioned in tbe agreement. Upon this state of facts, this court is required to determine, whether tbe judgment of tbe circuit court shall be affirmed or reversed. Tbe plaintiffs in error insist in their assignment of errors, that tbe defendants Fink and Wilson bad not tbe absolute right of property in tbe boat; that tbe bill of sale and agreement amount only to a conditional sale; and in the argument of tbe cause tbe attorney for tbe plaintiffs suggests, that tbe sale bill and agreement constitute a mortgage, only, by tbe Ohio company, to secure all tbe debts incurred by it in building, equipping and fitting tbe boat for service; and that tbe debts due tbe plaintiffs and defendants, were secured by tbe mortgage and consequently tbe boat was liable to be taken under tbe attachment and sold for their debts. Tbe plaintiffs further insist that tbe bill of sale is not valid, because it has not been recorded in tbe offi.ee of the collector of customs at Wheeling, and not being recorded as required by tbe act of Congress passed July 20, 1850, found in Brightly’s digest 833, and 9 vol. laws U..S. statutes at large, 440, is not admissible and competent evidence to prove title to tbe boat in tbe defendants; that the want of registration of tbe bill of sale of tbe boat as required by that act, left the right of property in tbe Ohio company, and the boat liable to bo taken under the attachment. Tbe cause lias been ably argued in this court, and with tbe aid of that argument and the authorities bearing on tbe questions discussed, to which I have bad access, my opinion formed on careful and deliberate consideration of the subject is, that the judgment of tbe circuit court ought to be affirmed; and in obedience to tbe mandate of our state con — 66 — stitution, I proceed to give a brief and concise statement of my reasons for affirming the judgment. If the contract for the sale of the boat divested the right of property out of the railroad company, and vested it in the defendants, and the defendants were debtors for the boat to the railroad company, the plaintiffs misconceived their remedy for the recovery of their debt; they should have taken out their attachment, summoned the defendants as garnishees, and subjected the debt owing by them to the Ohio company, to the plaintiff's demand. The most satisfactory definition of a consummated contract for the sale of a personal chattel will be seen in IS Grattan, page 109, Chapman vs. Campbell; it is “where there is a contract for an immediate sale of a chattel, and nothing remains to be done by the vendor, as between him and the vendee, the vendor immediately acquires a property in the price, and the vendee a property in the goods, and then all the consequences resulting from the vesting of the property follows, one of which is, if it be destroyed, the loss falls on the vendee.” In this case the circuit court certifies that it was proved that on the 15th day of January, 1855, the Ohio company sold and delivered the boat to the defendants, who promised to pay therefor 16,500 dollars in instalments, and that the defendants were in (possession of the boat from the time of the contract, to the time of the levy of the attachment. I regard the bill of sale and the agreement as constituting the whole contract of sale; that these two documents establish the absoluto sale of the boat to the defendants, the price to be paid, and time, manner and means of payment, and ' nothing remained to be done by the Ohio company to perfect the contract and vest the title in the defendants. ¡Suppose the boat had been consumed by fire, or lost by flood, the day after the agreement was made, whoso loss would it have been? Surely not the Ohio company’s; it would have been the loss of the defendants; and according to the case of Chapman vs. Campbell, above cited, this is the test of ownership. — 67 — When the boat was delivered to the defendants, under the agreement, nothing remained in the vendor of ownership, either absolute or contingent, except the right reserved to rescind the contract; this has not been done. Could the Ohio company have maintained an action of detinue against the defendants, for the recovery of the boat, before it elected to rescind the contract? I apprehend not: sec 3 Leigh, 134. Nothing remained in the company after the date of the contract, that could be attached under this attachment. The boat was not the property of the Ohio company and liable to the plaintiff’s attachment, unless the act of Congress of 1850 regulating the registry of steamboats navigating the Ohio river rendered invalid the sale of the boat, notwithstanding the possession of the boat was taken by the purchasers under the contract of sale. I am of opinion it did not: and it was not so intended by Congress. The act expressly provides that no bill of sale of any vessel of the United States, shall be valid against any persons not having actual notice thereof, unless registered in the manner stated in the act. In this case, the defendants, from the time of the contract of purchase to the time the boat was levied on, were in continued actual possession of the boat, under their purchase: find such actual possession was notice, 'to all persons, of the right by which they held possession: 2 Tucker’s Com. 438-39. The registry act does not apply where possession of the goods is taken by the vendee: see Clark vs. Ward, 12 Grat. 440, 13 Grat. 630, where the registry acts are considered. The plaintiffs having notice of the bill of sale, arising from the possession of the boat, registry of the bill was not necessary to give them a valid title: Hozey vs. Buchanan, 16 Peter’s Rep. 215. The leading object of the registry act, is to avoid the injurious consequences of permitting the right of property to be in one when actual possession is in another. It was earnestly insisted by the attorneys for the plaintiffs, that the transactions between the Ohio company and the defendants, show the contract between them to be a mort — 68 — gage, and not an absolute sale. Suppose it be a mortgage, drawn up in due technical form, by which the legal title to the boat would be in the defendants, and the right of redemption in the Ohio company, can the plaintiffs, in the form of proceeding they have elected to pursue at law, obtain a judgment, or order, to sell the equity of redemption of the Ohio company? ¥e know the court of appeals of Virginia has determined that an equity of redemption in personal estate cannot be sold under a fi-fa. My opinion is, that the only remedy of the plaintiffs for the collection of their debt, under the facts and circumstances disclosed in the record, was by a bill in chancery against these parties; treating the Ohio company as nonresident debtors and the defendants as resident debtors to that company; or by attachment at law against the company, and summoning the defendants as garnishees, if they were indebted to the company. If the transaction be a mortgage, how could a court of law, in this form of proceeding, convene all the creditors whose debts were incurred by the company in building, equipping, fitting out and furnishing the boat, as stated in the agreement ? Our statutes authorizing attachments at law do not direct how such convention of creditors can be effected; the law courts have no such powers; but in a court of equity the proceeding in such cases is familiar. The judgment of the circuit court was affirmed with costs to defendants.