Weed v. Boston & M. R. R

• Decision Date: 27 April 1925
• Citation: 128 A. 696
• Parties: WEED v. BOSTON & M. R. R.
• Court: Maine Supreme Court

128 A. 696

WEED

v. BOSTON & M. R. R.

Supreme Judicial Court of Maine.

April 27, 1925.

Report from Supreme Judicial Court, Aroostook County, at Law.

Action in trover by John R. Weed against the Boston & Maine Railroad. On report. Plaintiff nonsuited.

Argued before CORNISH, C. J., and PHILBROOK, DUNN, MORRILL, WILSON, and DEASY, JJ.

C. P. Barnes and Nathaniel Tompkins, both of HoultOn, for plaintiff.

Cook, Hutchinson & Pierce, of Portland, for defendant.

DUNN, J. On report. Trover against the terminal road for the misdelivery of merchandise. The case antedates both the Negotiable Instruments and the Uniform Bills of Lading Acts.

The action must fail. At the time of the asserted taking and conversion, the plaintiff was without property and possession in the personalty, having conveyed the same to his bank. These are the facts of the story:

An Aroostook county dealer consigned from his home station to himself at Nashua, N. H., on June 20, 1916, one carload of potatoes, under direction that his prospective purchaser, the concern of Holbrook, Marshall & Company, be notified when the consignment was arrived.

Next, the shipper drew his "on arrival" draft on the Holbrook company, payable to the order of the bank in which the drawer was of the regular customers, for the amount of $970.47, the invoiced value of the potatoes. The bill of lading which the initial carrier had issued was indorsed by the plaintiff, in blank, and attached to his draft. Then the draft, with the bill attached, was deposited to the credit of the plaintiff at the bank. The deposit was not treated as a collection item but as unconditionally as if the credit of $968 extended therefor were cash. The credit was available at once to the depositor's check.

Eventually the freight was at Nashua, whither plaintiff went on being informed that the "notify consignee" had refused the shipment. Plaintiff found the car on the siding at the warehouse of the aforesaid Holbrook, Marshall & Company, where the common carrier had set it. The seals were broken, the doors of the car open, and some of the potatoes missing. Who took or what was done with the missing or the rest of the potatoes is not directly in the record.

Sixteen days afterward the bank charged back the draft to its depositor; such practice being customary on dishonor by a drawee, as the drawer-depositor all along knew. From time to time, during the interval between the crediting and the debiting of the draft, the depositor checked against his bank account, but the balance in his favor was never less than the amount of the deposit, though he was at liberty to have withdrawn all. Claim for damages was made within the time limitation of the bill of lading, that is, within four months of the relied-on delivery of the property, and little less than six years from that delivery the instant action was begun.

If the proof be accepted as sufficient of conversion, and the defendant argues on the premise that wrongful dominion was exercised by it over the property, though it; does not concede and the court is not deciding the rather narrow question of fact, then there are defensive aspects of the case which stand forth in bold relief, whereof but a single one need occupy attention.

Trover is a possessory action wherein the plaintiff must show that he has either a general or special property in the thing converted and the right to its possession at the time of the alleged conversion. Jones v. Cobb, 84 Me. 153, 24 A. 798; Weeks v. Hackett, 104 Me. 264, 71 A. 858, 9 L. R. A. (N. S.) 1201, 129 Am. St. Rep. 390, 15 Ann. Cas. 1156; Gilpatrick v. Chamberlain, 121 Me. 561, 118 A. 481; 26 R. C. L. 1131; 38 Cyc. 2044. This statement is more or less elemental. It is but generalization. And generalizations do not get anywhere. The strength of any proposition lies in its application.

When the bill of lading was indorsed and delivered to the bank, the title to the property that the bill described and of which it was universally symbolic passed to the transferee quite as completely as it could have been passed by deed and delivery of the potatoes themselves. Winslow v. Norton, 29 Me. 419, 50 Am. Dec. 601; Robinson v. Stuart, 68 Me. 61. Of course, in any case of this kind, the real character of the transaction shall govern. And the chief criterion for determining the substantive nature is the true intention of the parties. Of controlling consequence, however, is how the dealing was, and not how it might have been. In the absence of evidence manifesting an intention to the contrary, as the situation is here, the effect of the indorsement and delivery of the bill was that of making the bank the rightful owner of the potatoes. Weyand v. Atchison, T. & S. F. R. Co., 75 Iowa, 573, 39 N. W. 899, 1 L. R. A. 650, 3 Am. St. Rep. 504.

And when, at the same time, and without distinguishing the matter from the usual and ordinary one with any depositor, the bank took for deposit the obligation of the draft, and the depositor had the right, once the credit entry was carried to his account, to draw the whole, or any part thereof, without awaiting payment of the draft, the doing was consistent with and indicative of a sale and purchase, in which as with money so deposited the draft became the property of the bank, as a holder for value in due course. The bank could have sold the draft, or might have lost it, or neglected collection, or otherwise done with it as it chose, without violating any right of the depositor, under its absolute contract with him to pay his checks to the extent of the credit. Had the draft been wrongfully converted, the bank could have maintained an action for the value, or it might have replevied it; had the draft been stolen, the theft would have been of the property of the bank; if the bank had refused payment of the depositor's check, it would have been liable; it would have been chargeable in trustee process had the fund been attached; and had the affairs of the bank become involved the negotiation would not have been rescindable.

No dissent from the general doctrine, that the passing of title to negotiable paper upon a transfer thereof to a bank by which upon deposit it is credited to the depositor's account or is to be credited when the proceeds are collected rests fundamentally in intent, is intended. But the design and meaning of the parties must, in some measure, in every case as to the true purpose of the business, be determined on the circumstances. The theory is that the accustomed relation between a bank and its customer, where there is no definite understanding as to the ownership of paper whereof the depositor has credit with the right to check, is that of debtor and creditor, rather than of principal and agent, or trustee and beneficiary under a trust. And hence the physical thing becomes the property of the bank, impressed with no trust, and which it may dispose of at its pleasure, bound only to pay an equivalent sum to the depositor upon his demand or order. Thus was it that Massachusetts reasoned and concluded. Taft v. Quinsigamond Nat. Bank, 172 Mass. 362, 52 N. E. 387. And New York so decided. Craigie v. Hadley, 99 N. Y. 131, 1 N. E. 537, 52 Am. St. Rep. 9; Illinois, American Trust & Savings Bank v. Gueder & P. Mfg. Co., 150 Ill. 336, 37 N. E. 227; California, Gonyer v. Williams, 168 Cal. 452, 143 P. 736; Kansas, Scott v. McIntyre Co., 93 Kan. 508, 144 P. 1002, L. R. A. 1915D, 139; Maryland Auto & Accessories Co. v. Merchants' Bank, 116 Md. 179, 81 A. 294; Vermont, Walker v. Ranlett Co., 89 Vt. 71, 93 A. 1054; Washington, Nat. Bank v. Hines, 112 Wash. 352, 192 P. 899; Wisconsin, Aebi v. Bank of Evansville, 124 Wis. 73, 102 N. W. 329, 68 L. R. A. 964, 109 Am. St. Rep. 925. And adjudications elsewhere second decision, too.

Legal saliency is patent in the Virginia case of Fourth Nat. Bank v. Bragg, of report in 127 Va. 47, 102 S. E. 649, and informingly annotated in 11 A. L. R. 1034. It was there held, to borrow the phraseology of the annotator's headnote, that a bank which credits the amount of a draft to a depositor, and permits him immediately to draw against it, becomes the...