Huffman v. Henry Motor Co.

Morrissey, C. J. Plaintiff was engaged in the automobile business in the city of Omaha, and had in his employ Fred C. Hill, his brother-in-law, and, being desirous of taking the agency for the cars built by the Henry Motor Company without having his name appear in the contract, Hill, acting for plaintiff, entered into a written contract with the motor car company for the sale of that company’s cars. By the terms of this contract the dealer was to pay freight and all cost of transportation from the factory at Muskegon, Michigan, to Omaha, and it was provided that the title and ownership in the cars should remain in the motor car company until the purchase price was paid in full. The dealer contracted for not less than 50 cars. The contract recites that the sum of $200 was paid the manufacturer at the time the contract was made to apply on the first shipment. The plaintiff’s testimony fixes the amount at $300, and this is not disputed. On May 3, 1910, three motor cars were shipped to Hill, and on May 24, 1910, another shipment of three motor cars wrns made. On each of these dates a [518] draft for the purchase price was drawn by the manufacturer on Hill, and the bills of lading were assigned and delivered to the bank, and these drafts were cashed by the National Lumberman’s Bank of Muskegon, Michigan. The drafts with bills of lading attached were forwarded to the First National Bank of Omaha, and payment was demanded of Hill. He failed to make payment, and the six automobiles, loaded .in two freight cars, stood on the tracks from about June 1 until about August 1, when Mr. DeMange, an attorney for the motor car company, went to Omaha and made arrangements with Huffman, who now says that he is the assignee of Hill, but admits that the original contract was really made for his benefit, under which Huffman paid the freight, demurrage, cartage, etc., and on an order from the National Lumberman’s Bank to the First National Bank of Omaha the motor cars were placed in storage in a warehouse, and the warehouseman gave his receipt for the motor cars to the First National Bank, as agent of the National Lumberman’s Bank, and an arrangement was made whereby Huffman might redeem any one of the cars by paying one-sixth of the total sum of the drafts. Huffman subsequently took out one of the cars and paid the proper amount on the draft. The other cars remaining unsold, four of them were later shipped to Kansas City, Huffman assisting in making the shipment. The sixth and last car being ordered shipped to Kansas City, Huffman caused an attachment to be levied thereon to cover the $300 deposit which had been made, and the freight, demurrage, etc. Service was never had upon the motor car company, but the National Lumberman’s. Bank intervened, and filed an answer setting up its claim under the drafts with bills of lading attached.- The cause was tried in the county court, and the parties stipulated “that the right of possession to said motor car be tried in this action without the necessity of resorting to other actions, possessory or otherwise.” The court found that at the commencement of the action the intervener, the National Lumberman’s Bank, was the owner of the property and entitled to its possession. An appeal was taken to [519] the district court, where the same issue was tried to the court, with a finding and judgment in favor of the intervener, and plaintiff appeals. The only issue is between plaintiff and the National Lumberman’s Bank, and that is: The right to the possession of the car attached. The original contract made by Hill, in whose place Huffman stands, expressly provided that the ownership of the property should remain in the manufacturer until the dealer had paid therefor in full. It is clear, then, that at the time these automobiles were loaded in Muskegon, and the drafts drawn on the consignee with the bills of lading attached, the ownership was in the manufacturer. The indorsement and delivery of these bills of lading to the bank was in effect a delivery of the property (6 Cyc. 426; 4 E. C. L. 34, 35, 36), and the possession thus secured never passed from the bank. Under the contract of agency, plaintiff was bound to pay the freight, demur-rage, etc. His deposit of $300 was not such a payment on these cars as entitled him to their possession. DeMange was not the agent of the bank, but was the agent of the manufacturer. The National Lumberman’s Bank selected its own agent, the First National Bank of Omaha, and its telegraphic direction, which we find in the record, directed that it accept warehouse receipts for the six automobiles running to the bank in Omaha, as agent for the intervening bank, with receipts so arranged that the dealer might take out a car by paying the proportionate amount of the drafts. Huffman was bound to take notice of the interest of the National Lumberman’s Bank at the time he claims he was dealing with DeMange, because the bills of lading were attached to the drafts, which were payable to the intervening bank, and the bank’s interest and right of possession was apparent. While it is contended by Huffman that the cars were not according to the contract, and by the bank that Hill was unable to raise the money to meet the drafts, we are not called upon to decide any question between Huffman and the motor car company, for that company is not in court. The warehouse receipts, based [520] as they are upon the bills of lading, carry with them the right of possession. No error is found in the record, and the judgment is Affirmed. Rose, Sedgwick and Hamer, JJ., not sitting.