Moss v. Old Colony Trust Co.

• Decision Date: 14 September 1923
• Citation: 246 Mass. 139,140 N.E. 803
• Parties: MOSS et al. v. OLD COLONY TRUST CO.
• Court: United States State Supreme Judicial Court of Massachusetts Supreme Court

246 Mass. 139

140 N.E. 803

MOSS et al.

v.OLD COLONY TRUST CO.

Supreme Judicial Court of Massachusetts, Suffolk.

Sept. 14, 1923.

Exceptions from Superior Court, Suffolk County; F. W. Fosdick, Judge.

Action of contract by Jacinto Moss and others against the Old Colony Trust Company for the amount of drafts drawn under a letter of credit and not paid. Finding for defendant, and plaintiffs bring exceptions. Exceptions overruled.

The trial court found generally in favor of defendant, and also found specially that plaintiffs did not perform the conditions requried to be performed by the terms of the credit, and that their nonperformance was in matters which were vitally material, and also that there was no contract between plaintiffs and defendant. Plaintiffs excepted to rullings on evidence, and to the court's rulings and refusals to give requested rulings.Gaston, Snow, Saltonstall & Hunt, of Boston (Joseph Wheless, of New York City, of counsel), for plaintiffs.

Jeremiah Smith, Jr., and Pillsbury, Dana & Young, all of Boston, for defendant.

RUGG, C. J.

This is an action of contract by merchants resident in Buenos Aires, Argentina, who seek to recover damages against the defendant, a banking institution of this commonwealth, arising from its refusal to accept and pay four drafts aggregating over $2,000,000 drawn by them on the defendant under a letter of credit issued by it in their favor. The conditions out of which the case arises were the great scarcity of sugar in the United States during a part of 1920, with consequent exceptionally high prices. During that period purchases or contracts for the purchase and import of sugar from countries from which hitherto sugar had not been procured were made. After the middle of that year there was a great drop in the price of supar and resultant loss to those who had it on hand bought at the earlier prices.

The case was tried before a judge without a jury, who made a general finding for the defendant and also full and complete findings of facts covering many aspects of the conflicting contentions of the parties. The evidence, which was both documentary and oral, is reported in full. The case comes before us on numerous exceptions to rulings of law refused and granted.

There was a request for a general finding for the plaintiffs for the full amount claimed. This presents purely the question of law whether the finding for the defendant can be supported on any reasonable interpretation of the evidence with legitimate inferences therefrom. The general and special findings of the judge in an action at law are to stand if warranted in law upon any possible view of the evidence. It is not the function of this court in an action at law to pass upon the weight of the evidence even though reported in full. The only question for us to decide on that phase of the case is whether upon the evidence, with all rational inferences which might be drawn therefrom, the findings can be sustained. The general finding is conclusive if there is any evidence to support it. Sparhawk v. Sparhawk, 120 Mass. 390, 392;Bailey v. Marden, 193 Mass. 277, 279, 79 N. E. 257;Vahey v. Bigelow, 208 Mass. 89, 92, 94 N. E. 249;Seager v. Drayton, 217 Mass. 571, 572, 105 N. E. 461;Timberlake v. Order of the Golden Cross, 208 Mass. 411, 419, 94 N. E. 685,36 L. R. A. (N. S.) 597;Evans v. County of Middlesex, 209 Mass. 474, 479, 95 N. E. 897;Atlantic Maritime Co. v. Gloucester, 228 Mass. 519, 522, 117 N. E. 924;Commercial Credit Co. v. M. McDonough Co., 238 Mass. 73, 78, 130 N. E. 179.

The rule in equity is different, where on appeal with full report of the evidence it is the duty of this court to decide the case upon its own judgment of the evidence, giving only due weight to the findings theretofore made, and not reversing them unless plainly wrong except in instances where the evidence is documentary, in which cases this court stands in the place of the trial judge in respect to drawing inferences of fact from the evidence. Lindsay v. Bird, 193 Mass. 200, 201, 79 N. E. 263;Harvey-Watts Co. v. Worcester Umbrella Co., 193 Mass. 138, 143, 78 N. E. 886;Proter v. Howes, 202 Mass. 54, 56, 88 N. E. 445;Hayes v. Penn Mutual Life Ins. Co., 222 Mass. 382, 386, 111 N. E. 168;Attorney General v. Amercian Legion of Honor, 206 Mass. 158, 160, 92 N. E. 136;Rious v. Cronin, 222 Mass. 131, 134, 109 N. E. 898;Glover v. Waltham Laundry Co., 235 Mass. 330, 333, 334, 127 N. E. 420;Knowles v. Knowles, 205 Mass. 290, 294, 91 N. E. 213. That principle has no application to the case at bar because this is an action at law and not a suti in equity.

The letter of credit on which this action is founded was in the form of a cable message from the defendant to the British Bank at Buenos Aires, dated June 15, 1920, and delivered on June 16, 1920, copy being transmitted by the latter to the plaintiffs, The copy differing in a few slight and immaterial details from the cable, was in these words:

‘Advise Moss & Co. we open irrevocable credit No. 1475 their favor $2,150,000, U. S. currency account E. R. Sherburne Company, Boston, available sight drafts on ourselves covering shipment from Buenos. Aires during June-July of 5,000 tons sugar net shipping weights price $430, U. S. currency per 10,000 kilos c. i. f. New York export duty and all taxes payable by shippers. Credit expires 30th October. Documents required: Commercial and consular invoices, inspection certificate of United States Chamber of Commerce, Buenos Aires, certifying sugar equal to fine American standard granulated sugar, negotiable B/Ladings showing Argentine government export license, marine war risk insurance certificates showing loss payable in New York-one consular invoice and B/Lading to be forwarded by bank negotiating direct to us and certificate attached to draft.’

On receipt of this copy on June 16, 1920, Mr. Moss, the one of the plaintiffs having charge of this transaction, perceived that the letter of credit did not correspond with his understanding of what its terms were to be under the plaintiffs' contract with the E. R. Sherburne Company. He therefore went to the British Bank in Buenos Aires and discussed with its second manager the general situation and the particular differences between the cable letter of credit and his understanding of what it ought to be under his contract with Sherburne. These differences were: (1) The credit letter stated that the shipping weights were net, whereas the contract called for gross weights; (2) the credit letter stated the price to be $430 for 10,000 kilos, whereas the contract price was $430 per 1,000 kilos; (3) the credit letter was silent as to any option by plaintiffs to ship a kind of sugar known as pile, instead of granulated, whereas their contract with Sherburne gave them that option. After this conference Mr. Moss agreed that the second manager should cable to the defendant a message, which he saw and understood before it was sent, of the tenor following:

‘Your cable fifteenth Moss state sold 430 dollars American per thousand kilos gross weight not per ten thousand kilos quality Moss option not granulated only.’

This was sent on June 17, 1920. In the meantime, on June 16, 1920, the defendant sent to the British Bank to be transmitted to the plaintiff cable:

‘Refer ours fifteenth credit 1475 advise Moss certificate from Chamber of Commerce must mention without lumps.’

On June 18, 1920, reply to the British Bank cable of the day before was sent by the defendant in these words:

‘Your cable seventeenth Moss price 430 American dollars per 1000 kilos. Our clients require sugar equal quality and description Standard American Granulated sugar.’

Both these cables were immediately transmitted to the plaintiffs, who made no reply to either.

Antecedent facts in this connection were that the plaintiffs had on June 4, 1920, obtained from the Argentine government a license good for 90 days to export 21,500 tons of sugar. There could be no export of sugar from Argentina without a license, which was very difficult to obtain, and the refineries with whom the plaintiffs dealt had no such license. At about the same time the plaintiffs procured from two Argentine refineries so-called ‘options' to buy sugar equal in quantity to their export license. They also had engaged steamship freight space for export of 11,000 tons and had begun on June 11, 1920, to load sugar, and had on June 16, 1920, completed loading 2,000 tons of sugar on the steamship Balzac at Rosario, an Argentine port about 180 miles above Buenos Aires on the Parana river, from which all the sugar here in question was shipped. They also had arrangements with the United States Chamber of Commerce for inspection and certificates as to chemical analysis, weight, color, dryness, and conditions of containers of the sugar to be shipped on the Balzac. It had been the intention of the plaintiffs previous to the receipt of the letter of credit to ship this sugar to New York on consignment. They had sold several thousand tons to others than Sherburne, and they had the contract with Sherburne to sell that house 5,000 tons, performance of which had been held in abeyance pending arrangement by it according to its contract of proper credit for their pay. Upon receipt of the defendant's cabled letter of credit on June 16, 1920, the plaintiffs decided to appropriate to the Sherburne contract the 2,000 tons of sugar loaded on the Balzac, which until then they had intended to ship to New York on consignment.

Mr. Moss, on June 16, 1920, after the receipt of the letter of credit, had conversation with each of the managers of the sugar refineries, with which his firm had contracts, purporting to take up the ‘options.’ No evidence was offered as to the law of Argentina. The judge did not find that the ‘options' and the acts thereunder imposed any liability on the plaintiffs before the title to specific lots of sugar was transferred to the plaintiffs. He did find that after such...