Colgate v. Pennsylvania Co.

• Decision Date: 13 April 1886
• Citation: 6 N.E. 114,102 N.Y. 120
• Parties: COLGATE v. PENNSYLVANIA CO.
• Court: New York Court of Appeals Court of Appeals

102 N.Y. 120

6 N.E. 114

COLGATE

v.PENNSYLVANIA CO.¹

Court of Appeals of New York.

April 13, 1886.

Appeal from order general term supreme court, First department, modifying and affirming judgment for plaintiff.

William C. Gulliver, for appellant.

William G. Wilson, for respondent.

FINCH, J.

Whether, before the statute,-2 Rev. St. (6th Ed.) 230,-the difference in bills of lading between those drawn ‘to order’ and those ‘billed straight’ to the consignee alone, created a difference in the duty and right of the carrier in respect to delivery, we do not think it important to consider, since we agree with the courts below as to the decisive effect of the statute upon the facts in controversy.

The defendant transported the oil under bills of lading which constituted the contract between shipper and carrier, and served also as evidences of title, the transfer of which would transfer the property. That result would follow even though no words of negotiability were contained in the instrument, and its transfer with an intention to pass the title would give the holder an ownership of the property. By that process the plaintiffs became the owners of the oil, and, on showing that fact by producing the bills of lading which were indorsed over to them by the consignee, they had a right to call upon the carrier for the property. The latter defends by showing a delivery to the consignee in ignorance of the plaintiff's right, but without the production and cancellation of the bills of lading. Such delivery was in accordance with the written words of the contract, but not according to its terms as modified by the express command of the statute. That forbids a delivery except upon the production and cancellation of the bills of lading, and interpolates into every such instrument that imperative condition, and makes such condition an element of the contract as perfectly as if therein written. It gave to the bills of lading under which the oil was carried this construction:that the carrier should deliver to the consignee provided he produced and canceled the bills of lading.

The primary object of the statute was to insure delivery to the party actually entitled, and close the door upon opportunities for fraud resulting from delivery in ignorance of the true ownership. The carrier delivered to the consignee in disregard of the statutory prohibition; and that cannot be a good delivery which the law expressly forbids. Obe dience to the statute would have prevented the injury which happened. The consignee had parted with the bills of lading and his consequent right to the property, and the delivery to him was to one not the owner, and having no right to receive it. There is no hardship in the rule. If the carrier does not desire to obey its requirements, he may stamp his bills of lading with the words ‘not negotiable.’ In that shape they warn the purchaser that the carrier will deliver to the consignee, and not be bound by a transfer of the bills. But if he issues them without that warning, he is bound to know that they may have passed into other hands, and become the property of others than the consignee, and that his duty and his contract is to deliver to him who produces and cancels the evidence of title.

The appellant argues that the act does not forbid delivery to the consignee where that delivery is stipulated; but aims only to protect against ‘spent bills,’ or such as...