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JOURNAL OF MERCANTILE LAW.
DELIVERY OF COTTON. We publish below, from the New Orleans Della, the opinion and judgment of Judge Eggleston in the case of BUCKNER, Stanton & NEWMAN vs. DELANY, Rice & Co. Buckner, Stanton & Newman,
Fifth District Court. Delany, Rice & Co., et al.
About the 6th day of March, 1860, the defendants purchased of the plaintiffs 980 bales of cotton for nine-and-one-half cents per pound, making a sum total of $40,520 44. The cotton bad various planters' marks upon it, and several hundred bales were weighed on the 12th of March, several hundred bales on the 14th of the same month, and 144 bales were weighed on the 15th of the same month. The defendants were informed by the plaintiffby a letter of the 15th of March, that they would have the list of the cotton inspected, and requested their attendance.
Each party selected a broker to inspect the list, and on examination they rejected 188 bales of the list as mixed. The plaintiff's on the 19th of the month iniormed the defendants they would deliver the merchantable and unrejected bales, and would substitute 188 bales of similar quality in place of the bales rejected as unmerchantable. Two brokers selected for the plaintiffs 188 bales of cotton of better quality, and on the 21st March the plaintills sent a notice to the defendants to come forward and receive the residue of the list of cotton remaiping undelivered, and if they failed to comply, they would sell the 980 bales, and bold them responsible for the loss and damages.
On the 28th March, 1860, the whole 980 bales, composed of that portion of the cotton sold, which was not rejected, and the 188 bales substituted for the same number rejected by the brokers, were sold at five-and-five eighthe cents, which lest a difference between the two sales of $3,732 15. It is for this difierence, together with some incidental charges and expenses, that the plaintiffs seek to hold the defendants responsible.
The sale was one by sample of cottons of various grades and qualities classed, and at an average price of nine-and-a-half cents agreed to be paid per pound on each bale.
Conceding that the plaintiffs have succeeded in their efforts to establish a mercantile custom or usage existing in this city, which authorizes the vendor of cot. ton to substitute in the place and stead of bad cotton sold by him a like quantity of other cotton of good or better quality, still such a custom or usage, bowever firmly established among merchants, can exert no controlling influence over a legal tribunal, seeing that it is in opposition to an explicit and imperative precept of the Code, and both the parties have not tacitly or expressly given their adhesion or concurrence to it. Customs and usages of trades and occupations are never permitted to subvert the positive enactments of the legislative powers, or the clear expression of legislative will. The legislation of the law making department of the government is paramount to and supreme over the enactments of any body of men, however intelligent and respectable they may be in their appropriate walks and pursuits in life. (4 Rob. R., 385.)
The articles of the Code with which the custom conflicts are 2450, 2452, 2466, 2467, and 2518. These require the vendor to deliver to the vendee the thing or things sold, and give no authority to the former to put one thing in place of another. The case must repose upon legal principles applied to the special facts developed on the trial independent of all local customs or commercial usages.
The plaintiffs, as it appears from their petition, took back the entire lot of cotton sold by them to the defendants, and sold 792 ba'es of it, and 188 bales of the cotton substituted to the like number of bales rejected from the lot of 980 bales, originally sold, which made up the original 980 bales. and sold them, expressing their determination to hold the vendee responsible for the deficit in price, if any there should be. This resumption of the cotton by the vendors and resale of it, it seems to me, to be a dissolution and rescission of the original sale, and disable them from maintaining this action for any difference in the price produced by the two sales. For, if there bad been a valid sale by them to the defendants, as they allege, and there was no resiliation of it, the vendors no longer possessing any title to the cotton, could sell and convey now to another.
They ceased to have any title which they could part with as it bad passed from them to the vendees, the defendants therein. But this subsequent sale of part of the original and the substituted cotton established one of two things, either that there originally was no sale to the defendants, or that if th're had been one, the plaintiff bad subsequently annulled the sale, and resumed the title to and possession of the cotton.
The idea cannot be entertained for one moment that they wilsully and deliberately seized upon and sold the cotton of the defendants, their original vendees. Such a supposition would accuse them of injustice, not to say of a worse offence, which their high position in the commercial world repels.
There is, then, but one other conclusion to which the mind can be conducted, and it is this, that they revoked the sale, took the cotton back as owners or factors of the planters, and sold and delivered it, as such, to SPANGENBERG, the second vendee.
If they were not the owners, how came they in the possession of the cotton, wbich they aver they had sold and delivered to the defendants? If they were not the owners, how came it to pass that they sold and delivered it to SPANGENBERG ? For the sale of a thing is the highest prerogative of ownership of a thing. It indicates, in unmistakable terms, the beliet of the vendor that he is the owner of it, or is authorized by the owner to dispose of it.
I therefore infer, from the concurrence of the physical element of possession, or the judicial or civil element of sale, that the original sale was annulled and undone, and in consequence the paistiffs have no legal recourse against the defendants for any deficiency resulting from the resale of the cotton. Will it be urged that the plaintiffs notified the defendants they would hold them responsible for a deficit on the resale which they intended to make? To this it may be replied, that when they took back the cotton and set aside the sale, all the parties were replaced in their primitive position, and things stood as if nothing bad occurred. The plaintiffs were owners, or factors holding the cotton to sell to any one desirous of buying, and the vendees were free from any obligation to fulill towards them. If the plaintiffs intended to attach as a condition to the annulment of the sale and the resumption of the cotton that they would sell it and hold the defendants liable for the deficit, before this coulù be done, and be made obligatory on the latter, they must have assented to it, and the testimony shows none.
They could not, by the action of their individual will, engraft such a condi. tion upon the annulment and resale, and oblige the defendants in opposition to their will and without their concurrence.
The dissolution of a sale by the parties is a contract, and if I am correct in the hypothesis that the parties expressly or tacitly made one, the plaintiff could interpolate no clause upon it, nor add any stipulation to it, without the assent and will of the other party. But did the plaintiff sell the 980 bales said to be the defendants'?
From their own allegations it appears that they sold but 792 bales of the cotton of the 980, which were transferred to the latter, and to make up the 980 sold them, they took 792 of them and added 188 new bales, which were put in the place of the like number rejected by the brokers as unmerchantable. Where are the 188 bales of the old lot of cotton? They took possession of them, and what has been done with them? Unless the identical 980 bales sold to the de.
fendants were sold a second time, how can it be ascertained if any deficit exists betweer the two sales? The cotton sold to SPANGENBERG was not the cotton sold to the defendants.
The plaintiffs, in my opinion, have failed in making out a legal demand against the defendants, and must pay the costs of their snit. Other questions of bigh import arise in the case, but I abstain from their discussion and solution, as the suit is terminated by the decision of the question discussed. Judgment for defendants with costs. A true copy.
II. B. EGGLESTON, Judge. E. D. LOVETT, Deputy Clerk.
MARINE INSURANCE-BREACH OF WARRANTY IN MARINE POLICY-WHEN ONLY
Before the New York Court of Common Pleas-General Term. Charles Day, plaintiff and respondent, vs. the Orient Mutual Insurance Company, of New York, defendants and appellants.
STATEMENT of Facts From PrintED RECORD.—The policy on which the action is brought was a time policy on the schooner Alice Day, for one year from March 26th, 1856, at noon, to March 26th, 1857, at doon. It contained the following stipulation or warrant by the assured :—“Warranted not to use ports or places in Texas, except Galveston, nor foreign ports and places in the Gulf of Mexico."
The vessel insured, while the policy was in force, went to the port of Coatzacoalcos, in the Gulf of Mexico, in violation of the warranty." "She returned in safety, and was destroyed by the perils iusured against, at Apalachicola, on the 31st August, 1856."
The plaintiff had applied to the deserdants for permission to use the port of Coatzacoalcos, and it had been expressly refused ; the defendants, however, offer. jog at the same time to cancel the policy and return the premium for the unexpired time.
She did use the port, and carried from it a cargo of mahogany. This port is a dangerous one, and the cargo objectionable. The jury found the fact tbat the vessel insured went to the port of Coatzacoalcos in violation of the warranty in the policy.
Judge Brady delivered the following opinion :—The policy upon which this action was brought, was upon the schooner Alice Day for one year from the 26th Marck, 1856, at noon, to March 26th, 1857, at noon. It contained a warranty as follows: Warranted not to use ports or places in Texas, except Galveston, por foreign ports and places on the Gulf of Mexico.” By a subsequent agreement, 12th April, 1857, for the additional premium of one per cent, perinission was given to make a voyage from New Orleans to Vera Cruz. The schooner went to Vera Cruz, thence to Coatzacoalcos, in the Gulf of Mexico, thence to Boston, and thence to Apalachicola, where she belonged, and was there destroyed by a storm. The plaintiff claims to recover, because the policy was a time policy, and the deviation occasioned by the voyage and to Coatzacoalcos, was only temporary and did not subsequently affect tbe risks insured against. For the first of these propositions we are referred to the case of the Union Insurance Company rs. Tyson, (3 Hill, 118;) but Cowen, J., states in the beginning of the opinion, “ It is in the nature of the policy in question that it limits the vessel to po geographical track.” It is impossible, therefore, to make out a defence on the ground of a deviation in the ordinary sense of the word. But, assuming the policy in question to be a time policy, the geographical track is declared and the voyage to Coatzacoalcos was a deviation and in violation of the warranty. The question which arises upon these facts is, whether the defendants are discharged by the deviation? There was no pecessity for the deviation. It was voluntary, and discharged the underwriters. Their discharge does not depend upon any
supposed increase of risk, but wholly on the departure of the insured from the contract of insurance. The assured has no right to substitute a different risk. (Phillips on Ins., 109, 483; Robinsons rs. Marine Ins. Co., 2 John. Rep., 89; Huet rs. the Phænix Ins. Co., 7 Johns. Rep., 363; Robertson vs. the Coal Ins. Co., 8 Johns., 491; Duncans us. Sun Fire Ins. Co., 6 Wend., 488; Maryland Ing. Co. rs. Le Roy, 7 Cranch, 26 ; Hartley vs. Buggin, 2 Doug. 39 ; Child vs. Sun Mutual Ins. Co., 3 Sandford, 26 ; Ketile rs. Wiggin, 13 Mass., 68; Coffin vs. Newburyport Mutual Ins. Co., 9 Mass., 436, 449.) In the case of Robinson vs. the Columbian Insurance Co., supra, the brig Ohio was insured from New York to the island of Teneriffe, and for an additional premium of two per cent, permission was given to proceed from Teneriffe to the Isle of Way and Bonavista, and at and from thence to return to New York. The vessel arrived safely at Teneriffe, but was refused permission to enter or land any part of the cargo until after performing a quarantine of forty days, because her bill of health was not certified by the Spanish Consul at New York. The master being unable to land bis cargo determined to seek another port, and went to Madeira, which was the nearest port, where he arrived, landed, and sold the cargo. The vessel afterwards proceeded to the Isle of Way, and sailed from thence to New York. During her passage she met with very bad weather which much injured her, and sustained further injury by striking on a shoal near Great Egg Harbor, and finally arrived at New York, per curiem. * There was no necessity for going from Teveriffe to Madeira. It was sailing on a different voyage from the one insured. It was a voluntary deviation from the voyage mentioned in the policy. Nothing but necessity or apprehension of danger could excuse his departure from the usual and direct route to Bonavista." The judgment should be reversed.
Hilton, J.--Coatzacoalcos was one of the prohibited ports mentioned in the policy. and the plaintiff in express terms warranted against its use. The voyage there was voluntary, after the defendants had positively refused permission to go, and had accompanied the refusal with an offer to cancel the policy and return the premium for the time unexpired, so that iusurance might have been obtained elsewhere.
But notwithstanding all this, the voyage was made, and there cannot be the slightest doubt that, bad the vessel been lost, while absent upon it, the defeudants would not have been answerable--and it is equally clear, both on principle and authority, that going upon it was a plain breach of the warranty contained in the policy, and put an end to the liability of the defendants as underwriters. (See Keitell rs. Wiggin, 15 Mass. 68.)
In contracts of ivsurance, a warranty is regarded as very much like a condition precedent, and which, if violated, avoids the policy, and no recovery can thereafter be bad upon it. (Mcad is. Northwestern Insurance Co., 3 Seldon 530 ; Duncan is. Sun Fire Insurance Co., 6 Wend. 488, 49 4; Westfall vs. Hudson River Fire Insurance Co., 2 Kern, 289. In the language of Mr. Justice Johnson in Maryland Insurance Co. vs. Le Roy, 7 Cranch, 26 ) " The discharge of the underwriters from their liability such cases, depends not upon any supposed increase of risk, but wholly on the departure of the insured from the policy of josurance.” The law attaches no importance to the degree of such violation, or the consequences arising from it, and its materiality or immateriality signifies nothing, the only question being as to the fact of the violation, and when that is shown a recovery is precluded. DeHalm vs. Hartly, 1 term R. 343. Kemble us. Rhinelander, 3 John cases, 134. Phillips on ins. 181, 211.
From these views it follows that going to Coatzacoalcos being a clear breach of the warranty, from that time the policy ceased to cover or protect the vessel, and her subsequent return in no way revived or restored the defendants' original obligation as underwriters. (See Westfall vs. Hudson River Fire Insurance Co., 2 Duer. 490, 496.)
I therefore concur with Judge Brady, that the defendants are entitled to judgment.
COMMERCIAL CHRONICLE AND REVIEW.
BUSINESS OF TUE MONTH-IMPORTS-EXPORTE-WHEAT-CROPS-LARGE WHXAT DELIVERIES-CORX
ELEMENTS OP DEMAND EXPORTS AND PRICES FOR JULY-COTTON AND HARVESTS-SUPPLY TOO LARGE-NO SPECULATION-WEST SELLS ALL ITS SURPLUS-NO HOME DEMAND-RAILROAD SECURITIES-RATES OF MONEY-FALL IN VALUE-SPECIE-FOREIGN BILLS-SPECIE SHIPMENTE-CALIFORNIA BILLS-UNITED STATES MINT-ASSAY-OFFICE-CURRENT OF PECIE-BANK RESERVEBANK DISCOUNTS-REPRESENTATIVE VALUE-THE INFLATION OF PRICES-LEGISLATIVE ENACT
The business of the month has been large and on the whole satisfactory, although there are many who underrate it, as compared with the more sanguine anticipations that had been entertained. The imports at the port have been large, but less so than last year, but the accumulation in warehouse has been less than then. The exports of domestic produce from the port, as will be seen in the tables an. nexed to this article, have been unusually large for the month and since January, and these have, in addition to the considerable quantities of cotton that have been exported, comprised, in flour and wheat, 6,400,000 bushels of wheat, an excess of 5,000,000 over last year, and also 1,669 000 bushels of corn, an excess of more than 1,500,000 bushels over last year. In produce there has also been a considerable increase. This circumstance bas grown out of the threatening aspect of the barvests abroad, and the now apparent certainty that the Uni. ted States will be required to supply a large proportion of the importation into Great Britain. These are large every year, but in years of inferior crops they swell to a quantity equal to one-third of the whole wheat crop of the Union. The crops of the Western States are this year represented on all sides as enormous, as well of corn as of wheat, and the means of transportation are now so well diversified, and in such good working order, that there can be no drawback upon the deliveries, as there was in the years 1847–8, when every conveyance was taxed to its utmost to convey food to the seaports and Europe. The crop of wheat in Ohio, Indiana, Michigan, Illinois, Iowa, Wisconsin, Minnesota, New York, and Canada West, is unprecedentedly large. A Western authority makes the following estimate of the movement of the wheat crop, which estimate, so far as the Lake Michigan ports are concerned, is based on the full receipts of previous years. For Lake Erie ports the estimate is made from the movement already commenced, and from exports of previous years.
From August 1st to November 15th, exclusive of Sundays, is pipety days ; for which time this prospective movement is estimated :Cleveland 1,800,000 Chicago....... 6,750,000 Green Bay.... 135,000 Huron & Milan 270,000 Milwaukee.... 6,300,000 St. Joseph.. 72.000 Sandusky. 900,000 Waukegan. 135,000 i Canada West.. 1,350,000 Fremont. . 270,400 | Kenosha.
180,000 Toledo . 2,700,000 | Racine ...
270,000 Total bush.. 22,077,000 Detroit... 900,000 | Sheboygan. 45,000
This is a larger movement by 10,000,000 of bushels than bas ever been exported from the Lake regions and Canada West, in any one year, from August 1st to the close of navigation.
The corn crop far exceeds in proportion the productive yield of wheat.