Gerrit Schimmelpennich, and Jan Adrian Toe Lear, Who Are Aliens v. William Bayard, William Bayard, Jun Robert Bayard, and Jacob Le Roy, Citizens of the State of

• Court: U.S. Supreme Court
• Citation: Gerrit Schimmelpennich, and Jan Adrian Toe Lear, Who Are Aliens v. William Bayard, William Bayard, Jun Robert Bayard, and Jacob Le Roy, Citizens of the State of, 26 U.S. 264, 1 Pet. 264, 7 L.Ed. 138 (1828)
• Decision Date: 01 January 1828
• Docket Number: NEW-YORK
• Parties: GERRIT SCHIMMELPENNICH, AND JAN ADRIAN TOE LEAR, WHO ARE ALIENS, v. WILLIAM BAYARD, WILLIAM BAYARD, JUN. ROBERT BAYARD, AND JACOB LE ROY, CITIZENS OF THE STATE OF

26 U.S. 264

1 Pet. 264

7 L.Ed. 138

GERRIT SCHIMMELPENNICH, AND JAN ADRIAN TOE LEAR, WHO ARE ALIENS, v. WILLIAM BAYARD, WILLIAM BAYARD, JUN. ROBERT BAYARD, AND JACOB LE ROY, CITIZENS OF THE STATE OF NEW-YORK.

January Term, 1828

THIS action was instituted in the Circuit Court of the United States, for the Southern district of New-York, upon nine several bills of exchange, drawn at Baltimore, at sixty days sight, by John C. Delprat, on the plaintiffs, carrying on business under the firm of N. & J. & R. Van Staphorst, merchants in Amsterdam, and endorsed by the defendants.

The cause was tried in April, 1825, and a verdict taken for the plaintiffs, for $32,275 95, being for the whole amount of their claim; subject to the opinion of the Court, upon a case agreed.

The Judges of the Court below, having divided in opinion on the following points, the same were certified to this Court, and the cause was argued upon the case agreed, and the points upon which there was a division of opinion, by the Judges of the Circuit Court.

1. Whether the authority of J. C. Delprat, to draw upon the plaintiffs, did or did not amount to an acceptance of the bills?

2. Whether the bills paid by the plaintiffs, supra protest, for the honour of the defendants, were drawn and negotiated, in conformity to the authority and instructions of the plaintiffs, to John C. Delprat?

3. Whether the plaintiffs were bound to accept and pay the bills in question, and whether the same having been paid by the plaintiffs, supra protest, for the honour of the defendants, the plaintiffs are entitled to recover the amount of the defendants?

4. Whether J. C. Delprat was a competent witness?

5. Whether the letter, offered by the plaintiffs in evidence, and rejected, ought to have been admitted?

6. Whether the plaintiffs are entitled to a judgment, on the verdict of the jury?

All the facts, with the correspondence between the parties, which were considered by the Court as necessarily connected with a full development of the case, are stated in the opinion of the Court.

The cause was argued by Mr. Ogden and Mr. Oakley, for the plaintiffs, and by Mr. Webster, and Mr. Ogden Hoffman, for the defendants.

For the plaintiffs.

This action is upon bills of exchange, drawn by Delprat, and accepted, supra protest, and paid by the plaintiffs, as they allege, for the honour of the defendants, who were the endorsers on the bills. It is admitted that the plaintiffs, being drawees of the bills, could accept and pay in this form; but it is claimed, that the bills were drawn under the arrangement between them and Delprat, and they were bound to accept them; that arrangement being a promise so to do.

This is the same question, as if the defendants in this suit had brought an action against the plaintiffs, on those bills, as accepted bills.

Does the authority to draw, create a promise to accept? It is admitted that the law of France is, that acceptance shall be on the face of the bill. The law of France is the law of Holland. We deny that the contract between the plaintiffs is such a promise to accept, as that, even if all its provisions and conditions had been complied with, any third party could have taken advantage of it.

As it related to the parties themselves, it was a good promise, when Delprat conformed to the provisions of the arrangement; but strangers had no right to avail themselves of this. The promise in the contract was made to Delprat, and was not assignable in its very nature.

It is only when the promise points to some bill drawn, or to be drawn, with such minuteness and certainty as to sums, time, and parties, as that it may be considered a complete transaction, and a finished agreement, that the promise can avail to the use of third parties; and then it does not so avail as a promise to accept, but as an actual acceptance.

There is no case of a parol promise to accept, being considered as an acceptance; and the doctrine has been already carried too far, so as to become the subject of regret. But there is no case which goes as far, as the plaintiff claims in this.

Cases cited, 3 Bur. 1663. 1 East, 98. 4 East, 57. Wynne vs. Raikes, 5 East, 54. Cooledge vs. Pavson, 2 Wheat. 66. Starkey, 411.

All those cases rest on the express promise to accept. Goodrich vs. Gordon, 15 John. 6. Why, if the authority to draw was a promise to accept, say, there was also a promise to accept?

The case of Cooledge vs. Payson, 12 Wheat. 66, before this Court, settled all the principles relative to an obligation to accept; and this case does not come within the rules of law there established. The principles decided by the Court in that case, were in the language of the Court:

'Upon a review of the case, this Court is of opinion, that a letter, written within a reasonable time before or after the date of a bill of exchange, describing it in terms not to be mistaken, and promising to accept it, is, if shown to the person who afterwards takes the bill on the credit of the letter, a virtual acceptance, binding the person who makes the promise.'

The decision of the Supreme Court of New-York, recognises the same principles. That case was——

Gordon was sending a sloop from New-York to Savannah, during war. Hogan wrote a letter of instructions, viz. 'should he be captured, ransom the vessel, as low as possible, not to exceed 2,000 dollars, and your draft on me will be duly honoured.' He was captured, and drew the bill, for ransom, within the sum, and gave the letter, with the bill.

Chief Justice Marshall says, 'the testimony is full evidence that this letter, at all times, accompanied the bill—that the bill was drawn on the faith of it;—and that it was on the faith of this letter that the plaintiff, who was an endorser, took the bill from the first endorser—and it would be a gross want of faith, now, to disclaim the captain's authority.

The arrangements between the plaintiffs and Mr. Delprat were personal to him, and could have no effect upon the transactions of others. They were to operate on the general business to be carried on between them, and their main object was, consignments to the plaintiffs. Mr. Delprat might purchase parts of cargoes, and they were willing to 'facilitate' all such commercial operations of his, as 'they could without prejudice to themselves.'

Under this arrangement, Mr. Delprat purchased and shipped goods, drew for them, and the proceeds of the shipments were carried to his account, and the bills paid, and charged to him. The defendants were not parties in those transactions, and they stood as mere purchasers of the bills in the market.

These transactions are similar to many others in the United States, and have never been considered as involving an obligation to accept the bills, of which a purchaser can take advantage. Such a responsibility, on the part of the drawees of a bill, would give to it a greater effect, when in the hands of an assignee, than it had before the transfer.

There is no usage making the authority to draw an acceptance. There is no case in which it has been ever so held; and it is inconsistent with the negotiable nature of bills.

The question, therefore, which has been raised, is met in its most imposing form, with an answer in the affirmative; when acting under such an arrangement as that between the plaintiffs and Mr. Delprat, could the plaintiffs take the goods shipped to them, and refuse to pay to a third person, the bills drawn upon those goods? It is considered they could; such is the mercantile law, and it cannot be otherwise.

Bills of exchange are purchased on the faith of the names upon them, and not under an expectation that there is a collateral obligation to pay them, on the part of the drawee. There is always an expectation, that the bills will be paid; but this expectation does not constitute a legal right against the drawee. In reference to the present bills, it appears from the testimony, that the defendants actually charged Mr. Delprat a commission for endorsing them, without which, they could not have been advantageously negotiated.

It is said, that the shipments were made in trust to pay these bills, and that the plaintiffs could not take the property free from the trust. Let this be so; but who can enforce the trust? Certainly not the assignees, as the trust is not assignable. To the drawer only, would the parties under such circumstances be answerable. The agreement made by the plaintiffs and Delprat, was never performed by him, in any case; and thus the danger is manifested, of giving to a stranger, rights which Delprat would not have had himself. No lien existed on the goods, by which the payment of the bills could have been enforced no such lien has ever been supposed to exist; all liens require possession in the party or his agent. The goods in this case went to Holland; the bills were sent to England; where is the possession to maintain the lien?

If the bills had been drawn upon particular shipments, and the invoices and bills of lading of the goods had been delivered with the bills, the plaintiffs being so advised, by Delprat; then they must have opened a particular account with the party holding the bills, and have paid them out of the shipments.

As to the suggestion of an equitable lien on the goods, for the payment of those bills; it cannot be contended, that the holder of the bills could follow the goods and enforce it. The law of Russia, gives a party a right to follow goods until he is paid, but this is not the law here. The policy of the English law, and that of all commercial countries, is, that the paper is disconnected with the property.

It is well settled law, that where goods are carried, under a permission to draw, the bills of lading being remitted fixes the property in the consignee, against the creditors of the consignor, although they get the goods. 1 Bos. & Pul. 563. 3 Chitty, 550. If A sends goods to B, and directs him to pay the proceeds to C, this creates no...