Clowney v. Rivers

• Decision Date: 03 July 1924
• Docket Number: 11536.
• Citation: 123 S.E. 759,129 S.C. 58
• Parties: CLOWNEY v. RIVERS, STATE WAREHOUSE COM'R.
• Court: South Carolina Supreme Court

123 S.E. 759

129 S.C. 58

CLOWNEY v. RIVERS, STATE WAREHOUSE COM'R.

No. 11536.

Supreme Court of South Carolina

July 3, 1924

Appeal from Common Pleas Circuit Court of Fairfield County; S.W. G Shipp, Judge.

Action by J. Spratt Clowney, Jr., against J. Clifton Rivers, State Warehouse Commissioner of the State of South Carolina. Judgment for plaintiff, and defendant appeals. Reversed, and a new trial ordered.

S. M Wolfe, Atty. Gen., and Jno. M. Daniel, Asst. Atty. Gen., for appellant.

Hemphill & Hemphill and J. C. McLure, all of Chester, for respondent.

MARION J.

In a case which appears to have been treated as an action for damages for the conversion of 12 bales of cotton, delivered to a state warehouse for storage, the presiding judge directed a verdict for the plaintiff. From judgment thereon the defendant appeals.

L. M Blair was manager of state warehouse No. 696, at Blairs, in Fairfield county. He was also president of a mercantile establishment at Blairs known as the Blair-Frazier Company. The plaintiff, J. Spratt Clowney, Jr., was a farmer in the same section of the county. In the year 1920, he appears to have been the owner of a plantation of 750 acres of land, upon which the Bank of Winnsboro held a mortgage to secure a loan incurred by Clowney for the purpose of paying the purchase price of the land. Upon Clowney's obligation to the bank, the Blair-Frazier Company was an indorser or guarantor. In 1920 Clowney ran a trading account for plantation supplies, fertilizers, etc., with the Blair-Frazier Company. On June 12, 1920, Clowney executed and delivered to the Blair-Frazier Company his note, together with chattel mortgage to secure same, for $2,350, due October 15, 1920. This mortgage, which will hereinafter be more particularly referred to, covered all cotton, etc., grown or raised, or to be grown or raised, during the current year on the mortgagor's plantation of 750 acres. On December 17, 1920, Clowney brought to Blairs 15 bales of cotton and delivered them to L. M. Blair. This cotton, according to plaintiff's contention, was "rent" cotton upon which there was no outstanding lien. Twelve bales of this cotton, as plaintiff claims, were delivered to L. M. Blair, as manager of the state warehouse, for storage, with instructions to deliver the receipt therefor to the Bank of Winnsboro. According to defendant's contention, these 15 bales were delivered to Blair as president of the Blair-Frazier Company, and that company then undertook as Clowney's creditor and agent to store 12 bales of the cotton in Clowney's name in order to place the warehouse receipt with the Bank of Winnsboro upon Clowney's representation that the bank had a prior mortgage lien on the 12 bales. Thereupon a warehouse receipt dated at Blairs, December 17, 1920, in the name of J. S. Clowney, Jr., was made out and signed by L. M. Blair, manager of local warehouse, and forwarded to Columbia for the signature of the state warehouse commissioner. A memorandum showing weights of the cotton was given Clowney, but no warehouse receipt was ever delivered to him. The receipt forwarded to Columbia was signed by J. Clifton Rivers, State warehouse commissioner, and returned to L. M. Blair, as manager of the local warehouse, at Blairs. L. M. Blair then, in order to comply, as he claims, with Clowney's instructions to turn the receipt over to the bank, indorsed Clowney's name on the back thereof and personally carried it to the Bank of Winnsboro. In response to inquiry, he was told by the bank that they had no mortgage or prior lien on this cotton. Blair then retained the warehouse receipt, and according to his testimony, about 10 days after his visit to the bank, he saw Clowney and notified him, in substance, that since the bank had no mortgage on this cotton, it was applicable to the mortgage of the Blair-Frazier Company and would have to be so applied. Over the signature of "J. C. Clowney, Jr. (B)," which had apparently been indorsed on the back of the warehouse receipt by L. M. Blair for the purpose of delivery of the receipt to Bank of Winnsboro, was written an assignment to Blair-Frazier Company. The receipt was delivered to the Blair-Frazier Company, and thereafter the cotton was withdrawn from the warehouse and delivered by the defendant to the Blair-Frazier Company. The warehouse receipt, indorsed by the Blair-Frazier Company, was surrendered and canceled.

The exceptions assign error (1) in the direction of the verdict for the plaintiff, and (2) in the refusal of defendant's motion for nonsuit.

The exceptions which assign error in the direction of the verdict will first be considered, and, to the extent deemed necessary, the points thereby raised will be covered in the following discussion. The plaintiff's position, sustained by the trial court, is that the evidence is open to no other reasonable inference than that 12 bales of the plaintiff's cotton passed into the custody of the defendant as state warehouse commissioner; that this cotton was delivered without plaintiff's authority to a third party, the Blair-Frazier Company; and that in delivering the cotton without the consent and authority of the plaintiff the defendant, in any view of the facts, was guilty of a conversion of plaintiff's property for which as warehouseman he is legally liable to respond in damages. Owing to the dual relationship of L. M. Blair as manager of the local warehouse and as president of the Blair-Frazier Company, the facts leading up to and preceding the withdrawal of the cotton from the warehouse present a somewhat confused situation. The evidence is open to conflicting inferences as to whether certain of Blair's acts are attributable to him as manager of the warehouse or as president of the mercantile company. But, in the last analysis, we think the circuit judge correctly held that the question of the defendant's liability turns upon whether there was a wrongful delivery of the property in his possession as bailee.

Whether there was a wrongful delivery depends upon whether the person to whom the delivery was made was entitled to the possession of the cotton. While a warehouseman cannot, for the purpose of appropriating goods to his own use, or of otherwise promoting his own advantage, dispute the title of the bailor, as a general rule he is justified in delivering stored goods to one who is entitled to the possession whether such person be the bailor or another. 27 R. C. L. 983, § 40. Where the warehouseman has delivered goods to another than the bailor, he is always entitled to the protection of the title of the person to whom such delivery has been made. The circuit judge, in effect, correctly so ruled, but held that inasmuch as it appeared as a matter of law that the chattel mortgage under which the Blair-Frazier Company had claimed and obtained the delivery of the cotton did not in fact cover the cotton stored, the delivery to that company was unlawful and constituted a conversion for which the defendant was liable. The question for determination is thus narrowed to whether, under all the evidence adduced, it conclusively appeared that the chattel mortgage in question did not cover the cotton stored.

The chattel mortgage of June 12, 1920, due October 15, 1920, under which the Blair-Frazier Company claimed and obtained possession of the cotton, contained the following provisions:

"Now, in order to secure the payment of said note, * * * I do hereby grant, bargain and sell unto the said Blair-Frazier Company the following crop and crops and goods and chattels, to wit: First, all the certain cotton, cotton seed, corn, peas, hay, etc., grown or raised, or to be grown or raised during the current year nineteen hundred and 20, upon about 750 acres of cleared land on or upon that certain plantation or tract of land situate in the said county of Fairfield and state aforesaid, now known as my land and containing in all 750 acres, and bounded as follows, to wit: By land of D. P. Coleman, S. T. Clowney & others. * * * The mortgagor hereby expressly declares that it is his intention and purpose that the crop and crops planted and growing and to be planted, grown, raised, made or harvested upon the above-described tract of land is, and shall become and remain, subject to the lien of this mortgage until same shall

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