Hall v. Keller

• Decision Date: 11 January 1902
• Docket Number: 12,510
• Citation: 67 P. 518,64 Kan. 211
• Parties: HERBERT F. HALL et al. v. L. F. KELLER et al
• Court: Kansas Supreme Court

67 P. 518

64 Kan. 211

HERBERT F. HALL et al. v. L. F. KELLER et al

No. 12,510

Supreme Court of Kansas

January 11, 1902

Decided January, 1902.

Error from Marion district court; O. L. MOORE, judge.

Judgment affirmed.

SYLLABUS

SYLLABUS BY THE COURT.

TITLE AND OWNERSHIP -- Consignment of Grain -- Liability for Damages. A consignor of grain which was delivered to a railway company for shipment drew a draft on consignees, and attached thereto bills of lading issued to him by the carrier. The draft was indorsed and delivered by the payees together with the bills of lading, to a bank which paid to them the amount of it. The drawees accepted and paid the draft. Held, that neither the bank nor the payees were liable to the consignees of the grain (the drawees) for a failure of title in the drawer of the draft to the property shipped.

R. L. King, Thomas O. Kelley, and Karnes, New, Hall & Krauthoff, for plaintiffs in error.

Keller & Dean, for defendants in error.

SMITH J. All the Justices concurring.

OPINION

SMITH, J.:

This was an action brought by the firm of Hall & Robinson against Keller & Dean and the First National Bank of Marion, to recover the sum of $ 666 and interest. The facts in the case may be stated briefly: Keller & Dean, a firm of lawyers in Marion, brought several actions for different clients against a farmer in Marion county, and levied writs of attachment on about 2000 bushels of corn. The writs were served by one Jacob Konrath, a constable. While he had the corn in his possession, it was agreed between the parties to the actions that it should be shipped to Kansas City, in order to obtain the highest market price. Konrath loaded the grain into cars of the Chicago, Rock Island & Pacific Railway Company, and consigned it to the order of himself at Kansas City, and took a bill of lading for each car (four in number). On the following day he drew a sight-draft on Hall & Robinson, grain-dealers, in Kansas City, as follows:

"FIRST NATIONAL BANK OF MARION,

MARION, KAN., August 28, 1890.

"At sight, pay to the order of Keller & Dean $ 716 and no-100 dollars, value received, and charge to the account of JACOB KONRATH."

"To Hall & Robinson, Kansas City, Mo."

This draft was indorsed thus: "Pay to First National Bank of Marion, or order. KELLER & DEAN."

The amount of the draft ($ 716) was credited to Keller & Dean, on the books of the bank. The draft, with bills of lading attached, was then forwarded by the First National Bank of Marion to the American National Bank at Kansas City, indorsed by the former for collection. Upon its arrival there, Hall & Robinson accepted it for the sum of $ 666 only, notifying the drawer (Konrath). This change of amount was not objected to by the drawer or indorsers, and, for the purposes of this case, the draft may be treated as having been drawn for $ 666 in the first instance. The above amount was collected by the American National Bank from Hall & Robinson and remitted to the First National Bank of Marion.

On the day that the corn was shipped, Konrath wrote a letter to plaintiffs in error, as follows:

"LEHIGH, KAN., August 28, 1890.

"Hall & Robinson, Kansas City, Mo.:

"GENTLEMEN--I have shipped you to-day four cars corn, containing 2108 bus. of corn; have drawn on you $ 716, which you will please honor when presented. Sell it for the best you can and make return to me at Lehigh, Kan. Yours truly,

JACOB KONRATH."

"Corn is billed to my name. I indorse bill of lading."

The corn covered by bills of lading never reached Kansas City. It was replevied and taken from the possession of the carrier by another bank, under a paramount lien. It appears that the bills of lading were indorsed in blank by Jacob Konrath, the shipper. There was a judgment entered against the plaintiffs below for costs and they have prosecuted error here.

The determining question in the case is whether Keller & Dean and the First National Bank of Marion, under the facts stated, became liable to the plaintiffs in error for a failure of title in the property shipped. There are two decisions called to our attention which hold that a bank, by its act of cashing a draft payable to its order, with bills of lading attached, becomes the owner of the property and undertakes to carry out the contract made by the drawer (the shipper) with the drawee (the consignee). ( Landa v. Lattin Bros., 19 Tex. Civ. App. 246, 46 S.W. 48; Finch et al. v. Gregg, 126 N.C. 176, 35 S.E. 251, 49 L. R. A. 679.) In both of these cases the grain covered by the bills of lading attached to the drafts which the banks cashed was of inferior quality, and the banks were held liable to the consignees and acceptors of the drafts, after the same had been paid, for the difference in value between the good quality of grain which the consignor agreed to ship and the bad quality actually received. We are not favorably...