Lickbarrow v Mason

 

(1787) 2 TR 63, 100 ER 35

 

COURT OF KING’S BENCH

 

1787 – Friday, November 9

 

 

Bill of lading – Negotiability – Passing of property

 

The consignor may stop goods in transitu before they get into the hands of the consignee, in case of the insolvency of the consignee: but if the consignee assign the bills of lading to a third person for a valuable consideration, the right of the consignor as against such assignee is divested. There is no distinction between a bill of lading indorsed in blank, and an indorsement to a particular person.

 

Reversed Ex Ch: Mason v Lickbarrow (1790) 1 H Bl 357, 126 ER 209.

New trial ordered by HL: Lickbarrow v Mason (1793) 4 Bro PC 57, 2 ER 39; Lickbarrow v Mason (1793) 6 East 20n, 102 ER 1191n, (Opinion of Buller J before HL).

Second trial: Lickbarrow v Mason (1794) 5 TR 683, 101 ER 380.

 

Note: In this case Court of King’s Bench decided in favour of the plaintiff after a demurrer to the evidence led by him, i.e. a plea that the plaintiff’s evidence even if wholly accepted did not entitle him to succeed. The decision of the King’s Bench was reversed by the Court of Exchequer Chamber sub nom Mason v Lickbarrow (1790) 1 H Bl 357, 126 ER 209, which found for the defendant. The House of Lords allowed an appeal by the plaintiff ordered a new trial: Lickbarrow v Mason (1793) 5 TR 367, 101 ER 206, HL –a note only of the decision of the House. The House of Lords had consulted the judges and the principal opinion of the judges was given by Buller J, and is set out fully in a note to Newsom v Thornton (1793) 6 East 17, 102 ER 1189. At the second trial the Court of King’s Bench was informed that the case was likely to proceed to the House of Lords again, and adhered to its earlier decision without discussion: (1794) 5 TR 693, 101 ER 380, KB. However, the defendant did not proceed with a second writ of error to the Exchequer Chamber and the case proceeded no further.

 

LICKBARROW AND ANOTHER v MASON AND OTHERS

 

Trover for a cargo of corn. Plea, the general issue. The plaintiffs, at the trial before Buller J at the Guildhall sittings after last Easter term, gave in evidence that Turing and Son, merchants at Middlebourg in the province of Zealand, on the 22d July 1786, shipped the goods in question on board the Endeavour for Liverpool by the order and directions and on the account of Freeman of Rotterdam. That Holmes, as master of the ship, signed four several bills of lading for the goods in the usual form unto order or to assigns; two of which were indorsed by Turing and Son in blank, and sent on the 22d July 1786, by them to Freeman, together with an invoice of the goods, who afterwards received them; another of the bills of lading was retained by Turing and Son, and the remaining one was kept by Holmes. On the 25th July 1786, Turing and Son drew four several bills of exchange upon Freeman, amounting in the whole to £477 in respect of the price of the goods, which were afterwards accepted by Freeman. On the 25th of July 1786, Freeman sent to the plaintiffs the two bills of lading, together with the invoice which he had received from Turing and Son, in the same state in which he received them, in order that the goods might be taken possession of and sold by them on Freeman’s account; and on the same day Freeman drew three sets of bills of exchange to the amount of £520 on the plaintiffs, who accepted them, and have since duly paid them. The plaintiffs are creditors of Freeman to the amount of £542. On the 15th August 1786, and before the four bills of exchange drawn by Turing and Son on Freeman became due, Freeman became a bankrupt: those bills were regularly protested, and Turing and Son have since been obliged, as drawers, to take them up and pay [64] them. The price of the goods so shipped by Turing and Son is wholly unpaid. Turing and Son, hearing of Freeman’s bankruptcy on the 21st of August 1786, indorsed the bill of lading, so retained by them, to the defendants, and transmitted it to them, with an invoice of the goods, authorizing them to obtain possession of the goods on account of and for the use and benefit of Turing and Son, which the defendants received on the 28th August 1786. On the arrival of the vessel with the goods at Liverpool on the 28th August 1786, the defendants applied to Holmes for the goods, producing the bill of lading, who thereupon delivered them, and the defendants took possession of them for and on account of, and to and for the use and benefit of Turing and Son. The defendants sold the goods on account of Turing and Son, the proceeds whereof amounted to £557. Before the bringing of this action the plaintiffs demanded the goods of the defendants, and tendered to them the freight and charges; but neither the plaintiffs or Freeman have paid or offered to pay the defendants for the goods. To this evidence the defendants demurred; and the plaintiffs joined in demurrer.

 

This was argued in last Trinity term by Erskine in support of the demurrer, and Manly against it; and again on this day by Shepherd in support of the demurrer, and Bearcroft contra.

 

Shepherd (a)1, after observing that, as the defendants were the agents of Turing and Son, the general question was to be considered as between the consignor and the indorsee of the bill of lading, contended, first, that, as between the vendor and vendee of goods, the former has a right to stop the goods In transitu, if the latter become insolvent before the delivery of them. And secondly, that such right cannot be devested by the act of the vendee’s indorsing over the bill of lading to a third person. The first question has been so repeatedly determined, that it is scarcely necessary to cite any authorities in support of it.

___

(a)1 As the second argument, with the judgment of the Court, comprehended every thing that was said upon the subject, the former argument is omitted.

___

 

[The plaintiffs’ counsel admitted the position.]

 

Then, in order to determine the second, it is material to consider the nature of a bill of lading. A bill of lading cannot by any means be construed into a contract on the part of the consignor to deliver the goods mentioned in it to the consignee: it is only an undertaking by the captain to deliver the goods to the order of the shipper. As between the consignor and consignee, it is a bare authority to the captain [65] to deliver, and to the consignee to receive, them. That this is the true nature of a bill of lading appears from all the writers upon mercantile law, as Molloy, Postlethwayte, and Beawes. If it be any other sort of instrument, it must be contended to amount to a contract by the consignor to deliver the goods to the consignee: but no such contract arises upon it, because the consignor is not even a party to it; and no action could be framed upon it against the consignor. Then, if it be only a bare authority to the one to carry, and to the other to receive, the goods, the consignee cannot transfer a greater right than he has; neither can the right of the consignor be divested by the act of the consignee. If a bill of lading be a negotiable instrument, and convey an indefeasible property in the goods, it must be so by the custom of merchants: but such custom is not to be found in any of the books treating upon the subject. There are cases which establish a contrary doctrine, in which the Courts have held that the rights of the assignees are the same as the rights of the original consignee. It cannot indeed be disputed but that, as between the assignee and the indorsee, the indorsement of a bill of lading is a complete transfer of the property which the consignee has in it: but the cases go no farther.

 

The case of Snee v Prescot (1743) 1 Atk 245, 26 ER 157, is precisely similar to the present. There the bill of lading was indorsed in blank, and afterwards indorsed over by the consignee to his assignees: those assignees were some of the defendants in that suit, and they stood in the same situation with the present plaintiffs. In that case, before the goods arrived, and after the indorsement of the bill of lading by the consignee, the consignee having become a bankrupt, the goods were stopped In transitu by order of the consignor by an indorsement of the bill of lading, which was left with him, to another of the defendants: there Lord Hardwicke decreed that the indorsement did not absolutely transfer the property in the goods, in the event of the consignee’s becoming a bankrupt before the arrival of the goods; that as the goods had been stopped in transitu by order of the consignor, he had a right to detain them till the sum which he was in advance to the consignee on account of them was paid; and that the surplus arising from the produce of the goods should be paid to the indorsees of the consignees.

 

Now unless Lord Hardwicke had been of opinion that the indorsement by the consignee did not absolutely transfer the property in the [66] goods, he would have decreed that the indorsees should have been first paid the money which they had advanced upon the credit of the bill of lading, and then that the surplus should have been paid to the consignor: but instead of that, he gave a priority to the consignor. This doctrine is not only laid down in a Court of Equity, but confirmed in a Court of Law in the case of Savignac and Cuff (a)1, where the same question was tried between the same parties as the present. There Selvetti, a merchant in Italy, consigned a quantity of skins to Lingham residing in London, and sent him a bill of lading indorsed in blank. Lingham, the consignee, indorsed it to Savignac for a valuable consideration at the invoice price, shewing him at the same time the letters of advice and the bills of parcels. The consignee not accepting the bills of exchange which the consignor had drawn upon him for the amount of the goods, the consignor indorsed the bill of lading remaining in his bands to Cuff, the defendant, with orders to seize the goods before they got into the hands of the consignee, which he did: and the action was brought against him by the indorsee of the consignee to recover the value of the goods. Wallace, Solicitor General, there argued that by the indorsement of the bill of lading the property was transferred. But Lord Mansfield was of opinion, that the consignor had a right to stop the goods In transitu in case of the insolvency of the consignee, and that the plaintiff, standing in the same situation with the original consignee, had lost his lien. Lord Mansfield was first of opinion that there was a distinction between bills of lading indorsed in blank and otherwise; but he afterwards abandoned that ground. But in that case, as the consignor had in point of fact received £150 from the consignee, there was a verdict for the plaintiff for that sum. So that the result of the verdict was, that the consignor was entitled under those circumstances to retain all the goods consigned, deducting only the sum which be had actually received for part. Both these cases establish the construction of the bill of lading contended for; and it is to be observed that the verdict in the latter one was acquiesced in. And indeed to construe it otherwise would be opening a great door to fraud, and would be placing the indorsee of a consignee of a bill of lading in a better situation than the consignee himself in case of his insolvency. Suppose the consignee assign over to a third person, who becomes insolvent before the delivery [67] of the goods, such assignee would then, notwithstanding his insolvency, have a right to get the goods into his possession; for if the act of indorsement absolutely divests the property out of the consignor, he can never afterwards get possession of the goods again; or else this consequence would follow, that the vendor would have a right to seize the goods in transitu till the indorsement, by which his right would be divested, and that by the act of insolvency of the indorsee it would be revested. This has never been considered to be the same sort of instrument as a bill of exchange; they are not assimilated to each other in any treatise upon the subject: nay bills of exchange are said to be sui juris. In their nature they are different; a bill of exchange always imports to be for value received; but the very reverse is the case with a bill of lading. For in few, if any, instances, is the consignor paid for his goods till delivery; and bills of exchange were first invented for the purpose of remitting money from one country to another, which is not the case with bills of lading.

___

(a)1 Sittings at Guildhall, Lord Mansfield CJ, Trinity Term, 1778.

___

 

As to the case of Wright v Campbell (1767) 4 Burr 2046, 98 ER 66, which may be cited on the other side, it will perhaps be said that the Court awarded a new trial only on the ground of fraud: but non constat that, if there had been no suspicion of fraud, a new trial would not have been granted. So that the law cannot be considered to have been decided in that case; for when a new trial is moved for, if the facts warrant it, the Court awards a new trial without going into the law arising upon those facts. In such cases the law is still left open to be considered on a different finding; since it would be nugatory to determine the point of law, which may not perhaps be applicable to the facts when found. At the most, there is only an inference of law to be drawn from that case, which is not sufficient to overturn established principles. Besides, this case is distinguishable from that; for there it appeared that the consignee was the factor of the consignor, and as such might bind his principal by a sale.

 

Bearcroft, contra. The question is, whether the bona fide indorsement for a valuable consideration of a bill of lading to a third person is not an absolute transfer of the whole property? This question is of infinite importance to the mercantile world, and has never yet been put in a way to receive a solemn decision in a Court of Law. For at most it has only been considered in a Court of Equity upon equitable principles, or at Nisi Prius in a [68] case, the correct state of which is to be doubted. The form of the bill of lading is material to be attended to in determining this case; it is, that the goods are to be delivered “to order or to assign;” therefore on the very face of the instrument there is an authority to the captain to deliver them to the consignee or to his assigns; and the question here is; who are his assigns? As between the consignor and consignee the rule contended for is not now to be disputed, since it has been confirmed by so many authorities; though perhaps it were much to be wished that it had never been established: but there will be danger in extending it farther. With respect to the case of Snee v Prescot, when it is considered who were the parties to the cause, in what Court, and upon what principles, it was decided, it will not be found sufficient to determine the present case. The actors, the plaintiffs, were not the innocent purchasers of a bill of lading; they were the assignees of a bankrupt, and prayed by their bill to get possession of the goods, notwithstanding they had not paid for them. But this is a case between the consignor and third persons who have paid a valuable consideration for the goods; that case was likewise in a Court of Equity, where the leading principle is, that he who seeks equity, must first do what is equitable; there too the decision was founded in some measure oil the custom of the Leghorn trade, and the construction of the statute relating to mutual credit; so that there were united a number of circumstances which, taken altogether, induced Lord Hardwicke’s decree, and which do not exist in the present case. And it is to be remarked that Lord Hardwicke, thinking it a harsh demand against the consignors, said “he would lay hold on any thing to save the advantage” which the consignors had, by regaining the possession of the goods before they got into the hands of the indorsees of the consignee.

 

Then as to the case of Savignac and that had not even the authority of a Nisi Prius determination; Lord Mansfield gave no opinion upon this question; for though he said there was no doubt but that, as between the vendor and the vendee, the former might seize the goods In transitu, if the latter became insolvent before they were delivered, yet there he stopped; so that the inclination of his mind may be presumed to have been against extending the rule. And after all, the whole circumstances of that case were left to the consideration of a jury. Since Lord Raymond’s time it has been taken to be clear and established law that a general indorsement of a bill of lading does transfer the property. And Holt, CJ then said,

 

“that a consignee of a bill of lading has such a property as that he may assign it over.”

 

It has now been contended that the right of the consignor ought not to be divested by the act of the consignee: but it is not by the act of the consignee alone; for the consignor has by his own act enabled the consignee to defeat his right. If he had been desirous of restraining the negotiability of the bill of lading, instead of making a general indorsement, he should have made a special indorsement to his own use. And then the holder of the bill of lading would have been considered as a trustee for the consignor. The custom of merchants has established that the delivery of a bill of lading transfers the whole property. Evans v Martlett (1697) 1 Ld Raym 271, 91 ER 1078; Wright v Campbell (1767) 4 Burr 2046, 98 ER 66, and Caldwell v Ball (1786) 1 TR 205, 99 ER 1053 (b). Then it has been said that a bill of lading is not transferable like a bill of exchange: but the custom of merchants has made that transferable which in its nature perhaps is not so; and the cases above referred to decide that point. Though a new trial in the case of Wright and Campbell was granted on a suspicion of fraud, and the law was not expressly adjudged; yet from what was said by the Court, it may be collected that no new trial would have been awarded if no fraud had existed; and the opinion of Lord Mansfield, as far as it goes, is expressly in point. But above all arguments public convenience ought to have a considerable influence in the decision of this question. By the constant course and the universal consent and opinion of merchants, bills of lading are negotiable; it is highly convenient to trade that they should be so; and if this case should be determined against the plaintiffs, one of the principal currents of trade will be stopped; besides, it will be a hardship on an innocent vendee.

___

(b) See Hibbert v Carter (1787) 1 TR 745, 99 ER 1355.

___

 

Shepherd in reply. Though there may be some hardship on the vendee if he be to suffer, yet the hardship would be equally great on the vendor, who would by a decision against him be compelled to deliver up the possession of his goods, though at the time of the delivery be knew that he should not receive any consideration for them. But convenience requires that, if one of these two innocent persons must suffer, the loss should [70] be sustained by the consignee. For when a vendor consigns his goods, be knows that by the general law he has a right to stop them In transitu, if the consignee become insolvent before delivery. But when an indorsee takes an assignment of a bill of lading, he takes it with a knowledge of, and subject to, that general right which the vendor has. Though the case of Snee v Prescot was determined in a Court of Equity, yet that Court could not alter the effect and nature of a legal instrument; which it must have done in that case if the right of an indorsee is to be preferred to the consignor. Suppose A. sends a bill of lading of goods to B. and the goods themselves are in fact never sent out of his possession; if the indorsement of the bill of lading can be said to transfer the property, the indorsee would have a right to recover the goods as against the original consignor, who had never parted with the possession of them. So that the rule contended for would not only divest the right which the consignor has to seize the goods In transitu, but would also compel him to part with his goods, without receiving any consideration, although he had never relinquished the possession. The meaning of the dictum of Lord Holt, in Evans v Martlett, is only that the consignee may assign over that right which he has. The case of Caldwell v Ball was merely a question between two solvent indorsees, both of whom had an equitable title; and that case only decided that he who first got possession of one of the bills of lading was entitled to the goods; and there too the Court determined in favour of him who had the possession.

 

ASHHURST J. As this was a mercantile question of very great importance to the public, and had never received a solemn decision in a Court of Law, we were for that reason desirous of having the matter argued a second time, rather than on account of any great doubts which we entertained on the first argument. We may lay it down as a broad general principle, that, wherever one of two innocent persons must suffer by the acts of a third, he who has enabled such third person to occasion the loss must sustain it. If that be so, it will be a strong and leading clue to the decision of the present case. It has been argued, that it would be very hard on a consignor, who has received no consideration for his goods, if he should be obliged to deliver them up in case of the insolvency of the consignee, and come in as a creditor under his commission for what he can get. That is certainly [71] true: but it is a hardship which he brings upon himself. When a man sells goods, he sells them on the credit of the buyer: if he deliver the goods, the property is altered, and he cannot recover them back again, though the vendee immediately become a bankrupt. But where the delivery is to be at a distant place, as between the vendor and vendee, the contract is ambulatory till delivery; and therefore, in case of the insolvency of the vendee in the mean time, the vendor may stop the goods in transitu. But, as between the vendor and third persons, the delivery of a bill of lading is a delivery of the goods themselves; if not, it would enable the consignee to make the bill of lading an instrument of fraud. The assignee of a bill of lading trusts to the indorsement; the instrument is in its nature transferable; in this respect therefore this is similar to the case of a bill of exchange. If the consignor had intended to restrain the negotiability of it, he should have confined the delivery of the goods to the vendee only: but he has made it an indorsable instrument. So it is like a bill of exchange; in which case, as between the drawer and the payee the consideration may be gone into, yet it cannot between the drawer and an indorsee; and the reason is, because it would be enabling either of the original parties to assist in a fraud. The rule is founded purely on principles of law, and not on the custom of merchants. The custom of merchants only establishes that such an instrument may be indorsed; but the effect of that indorsement is a question of law, which is, that as between the original parties the consideration may be inquired into; though when third persons are concerned it cannot. This is also the case with respect to a bill of lading. Though the bill of lading in this case was at first indorsed in blank, it is precisely the same as if it had been originally indorsed to this person; for when it was filled up with his name, it was the same as if made to him only. Then what was said by Lord Mansfield in the case of Wright v Campbell goes the full length of this doctrine:

 

“If the goods be bona fide sold by the factor at sea, (as they may be where no other delivery can be given,) it will be good notwithstanding the statute 21 Jac 1, c 19. The vendee shall hold them by virtue of the bill of sale, though no actual possession is delivered: and the owner can never dispute with the vendee, because the goods were sold bona fide and by the owner’s own authority.”

 

Now in this case the goods were [72] transferred by the authority of the vendor, because he gave the vendee a power to transfer them; and being sold by his authority, the property is altered. And I am of opinion that this right of the assignee could not be divested by any subsequent circumstances.

 

BULLER J. This case has been very fully, very elaborately, and very ably argued, both now and in the last term; and though the former arguments on the part of the defendant did not convince my mind, yet they staggered me so much that I wished to bear a second argument. Before I consider the effect of the several authorities which have been cited, I will take notice of one circumstance in this case which is peculiar to it; not for the purpose of founding my judgment upon it, but because I would not have it supposed in any future case that it passed unnoticed, or that it may not hereafter have any effect which it ought to have. In this case it is stated that there were four bills of lading; it appears by the books treating on this subject, that according to the common course of merchants there are only three; one of which is delivered to the captain of the vessel, another is transmitted to the consignee, and the third is retained by the consignor himself as a testimony against the captain in case of any loose dealing. Now if it be at present the established course among merchants to have only three bills of lading, the circumstance of there being a fourth in this case might, if the case had not been taken out of the bands of the jury by the demurrer, have been proper for their consideration. I am aware that that circum­stance appears in the bill, on which is written, “In witness the master hath affirmed to four bills of lading, all of this tenor and date.” But we all know that it is not the practice either of persons in trade or in the profession to examine very minutely the words of an instrument, which is partly printed and partly written; and if we only look at the substance of such an instrument, this may be the means of enabling the consignee to commit a fraud on an innocent person. Then how stood the consignee in this case; he had two of the bills of lading, and the captain must have a third; so that the assignee could not imagine that the consignor had it in his power to order a delivery to any other person. But I mean to lay this circumstance entirely out of my consideration in the present case, which I think turns wholly on the general question: and I make the question even more general than was made at the [73] bar, namely, whether a bill of lading is by law a transfer of the property? This question has been argued upon authorities; and before I take notice of any particular objections which have been made, I will consider those authorities. The principal one relied on by the defendants is that of Snee v Prescot; now, sitting in a Court of Law, I should think it quite sufficient to say, that that was a determination in a Court of Equity, and founded on equitable principles. The leading maxim in that Court is, that he who seeks equity must first do equity. I am not disposed to find fault with that determination as a case in equity; but it is not sufficient to decide such a question as that now before us. Lord Hardwicke has, with his usual caution, enumerated every circumstance which existed in the case: and indeed be has been so particular, that if the printed note of it be accurate, which I doubt, it is not an authority for any case which is not precisely similar to it. The only point of law in that case is upon the forms of the bills of lading; and Lord Hardwicke thought there was a distinction between bills of lading indorsed in blank, and those indorsed to particular persons: but it was properly admitted at the Bar that that distinction cannot now be supported. Thus the matter stood till within these thirty years; since that time the commercial law of this country has taken a very different turn from what it did before. We find in Snee v Prescot that Lord Hardwicke himself was proceeding with great caution, not establishing any general principle, but decreeing on all the circumstances of the case put together. Before that period we find that in Courts of Law all the evidence in mercantile cases was thrown together; they were left generally to a jury, and they produced no established principle. From that time we all know the great study has been to find some certain general principles, which shall be known to all mankind, not only to rule the particular case then under consideration, but. to serve as a guide for the future. Most of us have heard these principles stated, reasoned upon, enlarged, and explained, till we have been lost in admiration at the strength and stretch of the human understanding. And I should be very sorry to find myself under a necessity of differing from any case on this subject which has been decided by Lord Mansfield, who may be truly said to be the founder of the commercial law of this country. I hope to shew, before I have finished my judgment, that there has been no incon­sistency in any of his deter‑ [74] minations: but, if there had, if I could not reconcile an opinion which he had delivered at Nisi Prius with his judgment in this Court, I should not hesitate to adopt the latter in preference to the former: and it is but just to say, that no Judge ever sat here more ready than be was to correct an opinion suddenly given at Nisi Prius. First, as to the case of Wright v Campbell, that was a very solemn opinion delivered in this Court. In my opinion that is one of the best cases that we have in the law on mercantile subjects. There are four points in that case, which Lord Mansfield has stated so extremely clear that they cannot be mistaken. The first is, what is the case as between the owner of the goods and the factor; the second, as between the consignor and the assignee of the factor with notice; thirdly, as between the same parties without notice; and fourthly, as to the nature of a bill of sale of goods at sea in general. It is to be recollected that the case of Wright v Campbell was decided by the Judge at Nisi Prius upon the ground that the bill of lading transferred the whole property at law; and when it came before this Court err a motion for a new trial, Lord Mansfield confirmed that opinion; but a new trial was granted on a suspicion of fraud: therefore it is fair to infer, that if there had been no fraud, the delivery of the bill of lading would have been final. If there be fraud, it is the same as if the question were tried between the consignor and the original consignee. According to a note of Wright v Campbell, which I took in Court, Lord Mansfield said, that since the case in Lord Raymond, it had always been held that the delivery of a bill of lading transferred the property at law; if so, every exception to that rule arises from equitable considerations which have been adopted in Courts of Law. The next case is that of Savignac v Cuff; the note of which is too loose to be depended upon: but there is a circumstance in that case, which might afford ample ground for the decision; for I cannot suppose that Lord Mansfield had forgotten the doctrine which he laid down in this Court in Wright v Campbell. There he observed very minutely on what did not appear at the trial, that no letters were produced, and that no price was fixed for the goods: but in Savignac v Cuff 1 the plaintiff had not only the bills of lading and the invoice, but he had also the letters of advice, from which the real transaction must have appeared; and if it appeared to him that Selvetti bail not been paid for the goods, that might have been a ground for [75] the determination. The case of Hunter v Beal (a) does not come up to the point now in dispute; it only determines what is admitted, that, as between the vendor and vendee, the property is not altered till delivery of the goods. With respect to the case of Stokes v La Riviere (b), perhaps there may be some doubt about the facts of it: however, it was determined upon a different ground; for the goods were in the hands of an agent for both parties: that case therefore does not impeach the doctrine laid down in Wright v Campbell. It has been argued at the Bar, that it is impossible for the holder of a bill of lading to bring air action on it against the consignor: perhaps that argument is well founded: no special action on the bill of lading has ever been brought; for if the bill of lading transfer the property, an action of trover against the captain for non‑delivery, or against any other person who seizes the goods, is the proper form of action. If an action be brought by a vendor against a vendee, between whom a bill of lading has passed, the proper action is for goods sold and delivered. Then it has been said that no case has yet decided that a bill of lading does transfer the property: but in answer to that it is to be observed, that all the cases upon the subject, Evans v Hartlett, Wright v Campbell, and Caldwell v Ball, and the universal understanding of mankind, preclude that question. The cases between the consignor and consignee have been founded merely on principles of equity, and have followed up the principle of Snee v Prescot; for if a man has bought goods, and has not paid for them, and cannot pay for them, it is not equitable that he should prevent the consignor from getting his goods back again, if he can do it before they are in fact delivered. There is no weight in the argument of hardship on the vendor: at any rate that is a bad argument in a Court of Law; but in fact there is no hardship on him, because he has parted with the legal title to the consignee. An argument was used with respect to the difficulty of determining at what time a bill of lading shall be said to transfer the property, especially in a case where the goods were never sent out of the merchant’s warehouse at all: the answer is, that under those circumstances a bill of lading could not possibly exist, if the transaction were a fair one; for a bill of lading is an acknowledgment by the captain, of having received the goods on board his ship: therefore it would be a fraud in the captain to sign such a bill of lading, if he had not received goods on board; and the consignee [76] would be entitled to his action against the captain for the fraud. As the plaintiff in this case has paid a valuable consideration for the goods, and there is no colour for imputing fraud or notice to him, I am of opinion that he is entitled to the judgment of the Court.

___

(a)1 See (1789) 3 TR 465, 100 ER 679.

___

 

GROSE J. After this case has been so elaborately spoken to by my brethren, it is not necessary for me to enter fully into the question, as I am of the same opinion with them. But I think that the importance of the subject requires me to state the general grounds of my opinion. I conceive this to be a mere question of law, whether, as between the vendor and the assignee of the vendee, the bill of lading transfers the property. I think that it does. With respect to the question as between the original consignor and consignee, it is now the clear, known, and established law that the consignor may seize the goods In transitu, if the consignee become insolvent before the delivery of them. But that was not always the law. The first case of that sort was that of Wiseman v Vandeputt in Chancery (1690) 2 Vern 203, 23 ER 732, when, on the first hearing, the Chancellor ordered an action of trover to be brought, to try whether the consignment vested the property in the consignees; and it was then determined in a Court of Law that it did: but the Court of Equity thought it right to interpose and give relief; and since that time it has always been considered, as between the original parties, that the consignor may seize the goods before they are actually delivered to the consignee in case of the insolvency of the consignee. But this is a question between the consignor and the assignee of the consignee, who do not stand in the same situation as the original parties. A bill of lading carries credit with it; the consignor by his indorsement gives credit to the bill of lading, and on the faith of that money is advanced. The first case that I find, where an attempt was made to introduce the same law between the consignor and the indorsee of the consignee, is that of Snee v Prescot; but as my brother Buller has already made so many observations on that case, it would be but repetition in me to go over them again, as I entirely agree with him in them all, as well as in those which he made on the other cases. Therefore I am of opinion that there should be judgment for the plaintiff.

 

Judgment for the plaintiff .

 

***