Corry v. Sylvia y Cia

• Decision Date: 23 April 1915
• Docket Number: 831
• Citation: 192 Ala. 550,68 So. 891
• Parties: CORRY v. SYLVIA Y CIA.
• Court: Alabama Supreme Court

68 So. 891

192 Ala. 550

CORRY v. SYLVIA Y CIA.

No. 831

Supreme Court of Alabama

April 23, 1915

Appeal from Circuit Court, Mobile County; Samuel B. Browne, Judge.

Action by Sylvia y Cia. against Joseph W. Corry for deceit in the sale of a ship and the freight to be earned by her on her then voyage. Judgment for plaintiff, and defendant appeals. Affirmed.

The case was tried on counts 3, 4, 5, 6, and 7 as amended, and the plea of the general issue. Demurrers to the seventh and ninth counts were overruled, and demurrers to all of defendant's special pleas, except plea H, were sustained and these rulings are severally assigned as error.

Count 7 is as follows:

"Plaintiff claims of defendant the further sum of $25,000 for deceit in the sale of a ship or vessel and the freight accruing upon the voyage of said ship or vessel, upon which freight defendant had at the time of said sale caused to be drawn by the master of said ship and indorsed to another a disbursement note or draft for pounds sterling3,853. 1 s. 10 d. sterling, by which said draft or note there was pledged for the payment thereof said ship and her freight, and there was assigned to the holder thereof all of the lien and claims against the freight, vessel, and owners which the master of said ship had, with the power to take in his name all steps necessary to enforce the same, and by which said note or draft the consignees at the port of discharge were instructed to pay said draft and deduct the amount thereof from the freights due said vessel, and it was provided that in case of nonpayment the holder should also be entitled to the benefit of all liens in law, equity, or admiralty which the master or owners of the vessel were entitled to against any part of the cargo or its owners for freight, compress, or other charges on the vessel or master at the port of loading, and that said claim should have priority over all others that might be presented against said freight and vessel."

Count 9:

"Plaintiff claims of the defendant the further sum of *** damages for that *** on the 12th day of July, 1913 defendant sold to plaintiff for the sum of $33,810 a ship named Hermanos, and the freight then accruing on the then outward voyage, and the defendant fraudulently concealed from the plaintiff the fact that the defendant had caused a disbursement note or draft for pounds sterling>3,853. 1 s 10 d. sterling to be drawn by the master of the ship payable to his own order and indorsed to another, by which said note or draft there was pledged for the payment thereof said ship and her freight, and there was assigned to the holder thereof all of the liens and claims against the freight, vessel, and owners which the master of the ship had, with the power to take in his name all steps necessary to enforce the same, and by which said note or draft the consignees at the port of discharges were instructed to pay said draft, and deduct the amount thereof from the freight due said vessel, and it was provided that in case of nonpayment the holder should also be entitled to the benefit of all liens in law, equity, and admiralty which the master or the owners of the said vessel were entitled to against any part of the cargo or its owners for freight, compress, or other charges on the vessel or the master at the port of loading, and said claim should have priority over all others that might be presented against said ship or freight. And plaintiff believed that the defendant had the right to sell them said entire freight of about $18,000, and upon said belief paid him said sum of $33,810 agreed on as the purchase price of said vessel and freight, all to plaintiff's damage in the sum of $25,000."

Plaintiff's evidence tended to show that defendant represented to plaintiff that all debts against the ship had been paid, and that defendant never at any time informed plaintiff of the existence of the disbursement note or draft by which the ship's freight was assigned to the holder, and the ship herself pledged for its payment, and that plaintiff had no knowledge or notice of such a transaction. Defendant's evidence, on the other hand, tended to show that he had informed plaintiff of the draft and debts prior to the comsummation of the sale. The bill of sale, dated July 12, 1913, after describing the ship Hermanos, contains the following:

"To have and to hold the said vessel unto the said Sylvia y Cia., their executors, administrators, and assigns to their own proper use and benefit forever. And I, the said Joseph W. Corry, do avow myself to be the lawful and true owner of 65 shares in the Norwegian ship Hermanos, that I have full power, good right, and lawful authority to dispose of said vessel in the manner aforesaid, and that I will warrant and defend the same against the lawful claim and demands of all persons whomsoever. I, Joseph W. Corry, do further warrant that the said ship Hermanos is free of all debt and incumbrances up to and the crossing of the Pensacola, Fla., out of bay bar on this her present voyage cargo laden for Rio de Janeiro, S.A. The freight accruing to the ship Hermanos on this, her present outward voyage, is made a part of this sale, and I, Joseph W. Corry, do transfer in its entirety, amounting to about $18,800, to Sylvia y Cia., together with marine insurance," etc.

The disbursement draft drawn by the ship's master on June 30, 1913, with the knowledge and approval of defendant, is as follows:

"Ten days after arrival (or upon collection of the freight if sooner made)

of the Norwegian barque Hermanos under my command at the port of Rio de Janeiro or any other place at which her voyage may terminate, I promise to pay to the order of myself the sum of pounds sterling3,853. 1 s. 10 d. sterling, in approved banker's demand bills on London, for value received, for necessary disbursements owed by me any my vessel at this port, for the payment of which I hereby pledge my vessel and her freight, and I hereby assign to the legal holder of this obligation all my lien and claim against freight, vessel, and owners, with power to take in my name all and any necessary ships to enforce the same; and my consignees at port of discharge are hereby instructed to pay this obligation and deduct the amount thereof from the freight due said vessel. In case of nonpayment the holder shall also be entitled to the benefit of all liens in law, equity, or admiralty which the master or owner of said vessel may be entitled to against any part of the cargo or owners for freight, compress, or other charges on cargo paid by the vessel or master at port of loading. This claim to have priority of payment over all others that may be presented against said freight and vessel. My vessel is now lying at the port of Pensacola, loaded with lumber and ready to sail for Rio de Janeiro. Signed in triplicate; one being accomplished, the others to stand void."

The court's oral charge was in part as follows:

"Now, gentlemen of the jury, when a person sells another person personal property without disclosing any want of power or right to make the sale, and without putting the other party upon inquiry with regard thereto, he impliedly represents that he has the power and right to sell the property, and if you find from the evidence that defendant sold to plaintiff the ship Hermanos, and the entire freight accruing to the ship on her outward voyage, without giving them notice or disclosing to them that a disbursement note or draft had been given upon the freight sufficient to consume all or nearly all of such freight, and that by such note the freight and the ship were pledged to the payment thereof, and that defendant knew at the time he made the sale that such note or draft had been given, and if you further believe from the evidence that plaintiff could not know or had notice that such disbursement note or draft had been given, and was induced by an implied representation of defendant that he had the right and power to sell and dispose of the outward freight, then defendant was guilty of a deceit with regard to the sale of the freight; and if you further believe from the evidence that defendant further represented that the ship was free of incumbrances, when, in fact, such disbursement note or draft had been given, and that plaintiff did not know of it, and was induced by the representations of defendant that the vessel was free of incumbrances to make such purchase, then defendant was guilty of deceit in the sale of the vessel also; and if defendant was guilty of such deceit with reference to the freight and ship, and plaintiff was by such receipt induced to purchase said ship (through the purchase of all of the shares of stock of the owners thereof), together with the outward bound freight accruing upon the ship, and were damaged thereby, you ought to find a verdict for plaintiff for such an amount of damages as it actually sustained, and you would be justified in adding to such damages such sum as you think proper, based upon the evidence to punish defendant for the deceit perpetrated by him."

The following is charge 3 given for plaintiff:

"If the jury believe from the evidence that defendant on or about July 12, 1913, induced plaintiff to pay him $33,810 for 65 shares of stock in the Norwegian sailing ship Hermanos, and the entire freight accruing to said ship on her then outward voyage to Rio de Janeiro, by representing to plaintiff that such freights amounted to $18,800, and that the ship was free of incumbrances, without disclosing to them that a draft had been drawn against such freight although defendant knew that a draft had already been drawn by the master of said ship against said freight for pounds sterling3,853. 1 s. 10 d. sterling, and that this was equivalent to more than $18,000 American money, and that

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