Union Nat'l Bank v. Rowan

• Citation: 23 S.C. 339
• Parties: UNION NATIONAL BANK v. ROWAN.
• Decision Date: 01 August 1885
• Court: United States State Supreme Court of South Carolina

23 S.C. 339

UNION NATIONAL BANK

v.ROWAN.

Supreme Court of South Carolina.

Aug. 1, 1885.

1. A draft for a sum stated, drawn by a seller against a buyer in favor of a national bank, by whom it is discounted or purchased, with the bill of lading attached, passes title to the goods therein mentioned to the bank; and the bank may recover them, upon dishonor of the draft, from a sheriff who had seized the goods as the property of the seller under attachment subsequent to the purchase by the bank.

2. A draft so drawn is a bill of exchange, and its purchase by a national bank is not beyond the powers conferred by acts of Congress upon national banks.

Before COTHRAN, J., Richland, July, 1884.

The opinion states the case.

Mr. W. S. Monteith, for appellants.

Messrs. Clark & Muller, contra.

The opinion of the court was delivered by

MR. JUSTICE MCIVER.

The facts of this case, so far as necessary to a proper understanding of the points raised by this appeal, are substantially as follows: The defendants, Lorick & Lowrance, merchants, doing business in Columbia, ordered from Hord Bros. & Co., dealers in grain and provisions in Chicago, a lot of bran and oats. At the time of the shipment of these articles Hord Bros. & Co. drew drafts on Lorick & Lowrance for the price thereof, which were either discounted or sold to the plaintiff, upon the security of the bills of lading which, at the same time, were endorsed by Hord Bros. & Co. and delivered to plaintiff. These drafts were sent by the plaintiff, with the bills of lading attached, to its agent in Columbia, the Carolina National Bank, to be presented to the drawees for acceptance, and when so presented were not accepted. When the bran and oats reached Columbia they were seized by the defendant, Rowan, as sheriff, under a warrant of attachment sued out by the defendants, Lorick & Lowrance, on a claim which they alleged was due them by Hord Bros. & Co., growing out of some previous transactions. Thereupon this action was brought by the plaintiff to recover possession of the bran and oats.

It is not denied that the endorsement and delivery of the bills of lading to the plaintiff passed the title and right to the possession of the articles mentioned therein to the plaintiff, provided the transaction was valid and legal, and this having been done prior to the seizure under the warrant of attachment, the plaintiff would have a right to recover. It is contended, however, by the appellants that under the national banking law of the United States, the plaintiff had no authority to purchase the drafts with the bills of lading attached, and that, therefore, the transaction was ultra vires, illegal, and passed no title to the plaintiff. Accordingly the Circuit Judge was requested by the defendants to instruct the jury, “that it was for the jury to decide whether plaintiff purchased or discounted the drafts, and that if they came to the conclusion that the plaintiff purchased the drafts with the bills of lading, then the transaction was ultra vires, and the plaintiff could not recover.” To the refusal of this request defendants duly excepted, and by their exceptions, the first having been abandoned, practically raise two questions...