
    Freeman C. Chapman v. Henry A. Kent and others.
    Toll & McArdle, merchants in Ohio, by an agreement in -writing, sold to the plaintiff 1Í4 sacks, containing about 80,000 pounds of wool, which they had previously shipped to the defendants, in New York, upon the following terms: The wool to be weighed in New York by a city weigher; the plaintiff to pay all charges for transportation and insurance, and for storage and cartage in New York, and none other; to pay 30 cents per pound for the wool, and 62j-cents a piece for each sack. The plaintiff paid |8,000 on account, and agreed to pay the balance on the delivery of the wool to him in New York. If any of the wool should have been sold by the defendants, before the agreement was presented to them in New York, the sale to plaintiff to be limited to balance, in their hands.
    
      Held, that this agreement was executory and contingent, and transferred no title to the plaintiff that could enable him to maintain an action for the wrongful conversion of the property.
    Toll & McArdle, being largely indebted to defendants, agreed, in consideration of further advances to be made by defendants, to ship to them wool and property enough to balance their account, and the defendants agreed to this, and made . the advances, with the understanding that the goods to be shipped should be sufficient to satisfy, not only what was then due, but all claims against Toll & McArdle that might subsequently accrue.
    
      Held, that by virtue of this agreement and understanding, the defendants acquired a lien upon all goods subsequently shipped to them by Toll <fc McArdle from the time of their shipment, and that this lien was not limited to their advances on each shipment, but extended and was available to the satisfaction of the general balance due to them from Toll & McArdle.
    (Before Doer and Slosson, J.J.)
    Feb. 23, 25, 1854.
    This action was brought to recover damages for an alleged wrongful conversion by the defendants of 174 sacks of wool, of which the complaint averred that the plaintiff was the owner, and demanded judgment for $12,000.
    The answer of the defendants denied the title of the plaintiff, and the wrongful conversion charged, and averred, that the wool in question had been consigned to them by the firm of Toll & McArdle, merchants in Ohio, and that the defendants, as consignees and factors, and under an agreement with Toll & McArdle, had a lien thereon,- and on the proceeds thereof, for the purpose of satisfying a balance due to them from Toll & McArdle, exceeding the sum of $10,000, and which arose from the advances made by them upon and against consignments from Toll & McArdle.
    The plaintiff averred in his reply that, for the purpose of satisfying any possible claim or lien of the defendants, he had tendered to them before the commencement of the suit, and when he demanded from them the delivery of the wool, the sum of $6,000, and that they refused to receive the same and deliver the wool; and he averred, upon belief, that the sum so tendered exceeded the amount of the advances, if any, -made by the defendants on account of the wool.
    In January term, 1852, the cause, by the consent of the parties, was duly referred to Alvin C. Bradley, Esq., as sole referee, and in January, 1853, the referee made the following Report:—
    
      To the Superior Court of the City and County of Hew York.
    I, the undersigned, the Eeferee appointed to hear and determine the matters in controversy in this cause, respectfully report as follows:—
    1st, as to facts:—■
    The defendants were in June, 1850, and for a long time before had been, grocery and commission merchants in the city of Hew York. Toll & McArdle, of Eepublic, Ohio, had, for a long period, been their customers. Their way of doing business was, in substance, thus :—The defendants sold them goods always at four months’ credit, and accepted drafts drawn by them. Toll & McArdle, on the other hand, shipped the defendants property for sale, and made remittances of cash or securities which were, when received, credited to them in general account, without any reference to the question whether the credit for merchandise sold had expired or not, the books being kept correct by the allowances of interest.
    In April, 1850, Toll & McArdle had, in this way, become indebted to the defendants in the sum of $3,324/^%-, then actually due, besides $2,643T°/S in accommodation acceptances of the defendants for them, then outstanding unmatured. This balance they were at that time unable to pay, but they stated that by the defendants advancing them the means to buy wool during the wool season, they could, by paying part in cash for the wool, be able to collect in many of their old accounts, and thus ship to the defendants, during that summer, wool and property enough to balance their account. This the defendants agreed to do, with the understanding between them that Toll & McArdle were to ship goods enough to balance not only what was due, and falling due at that date, but for all claims that might subsequently accrue, and thus balance the accounts.
    In pursuance of this arrangement, Toll & McArdle drew, and the defendants accepted,.between April and 15th June, bills to the amount of $5,602T'yL. The latter then refused to accept further, and suffered a draft for $2,000 to be protested. In the meanwhile, however, Toll & Me Ardle had made remittances to the amount of about $2,300, but had also, in other ways, besides drafts, added to their indebtedness, so that at all times, between the 20th of June and the commencement of this suit (July 5th, 1850), there was a balance against them, including acceptances not yet matured, of not less than $9,000.
    But on or before the 21st of June, 1850, Toll & McArdle had purchased a large quantity of wool, the property in controversy, and had. shipped it from Tiffin and Republic, Ohio, marked as follows, to wit:—47 sacks marked [E.], and the residue marked Toll & McArdle, all to the care of Kent, Poag & Co. (the defendants), New York. On that day they made the following contract with the plaintiff:—■
    “We have this day sold all our lot of wool, about thirty thousand pounds’ weight, to F. C. Chapman, upon the following conditions:—Said wool is contained in one hundred and seventy-four sacks, or upwards, which have been shipped from Tiffin and Republic, Ohio, marked as follows, to wit:—47 sacks are marked [E.], and the remainder are marked Toll & McArdle, all to the care of Kent, Poag & Co., New York. Said lot of wool is to be weighed off in New York by a city weigher, by whose weights we agree to settle. Said Chapman is to pay all transportation charges and insurance, which have or may accrue upon said lot of wool from the time it was put on cars, at the points from starting, until said wool arrives at • New York, and is also to pay the storage and cartage in New York on all that arrives there previous to the 25th of the present month, but is not to pay any commissions, or any other charges on said wool in New York, except as specified above. Said wool has been insured at the office of Kent, Poag & Co., New York. Said Chapman is also to pay us thirty cents per pound for said wool, and sixty-two and. a half cents a-piece for each sack. We have received from said Chapman upon said lot of wool three thousand dollars, and he is to pay, or cause to be paid to us, or our agents in New York, the balance due to us on said wool as fast as weighed off and delivered to him in New York. We also agree to deliver, or cause to be delivered to the said Chapman, so soon as he shall arrive in New York, all the above-named lot of wool that has arrived there at that time, and the balance as fast as it arrives there, or forfeit and pay to the said Chapman the sum of two hundred and fifty dollars, in addition to the money and interest which the said Chapman has paid to us on said lot of wool. The same being for his trouble and expenses in attending to said wool.
    “ In case that any of the above-mentioned wool has - arrived and been sold by Kent, Poag & Co., before this is presented to them, then the said Chapman is to have the balance on the above specified terms.
    “Tom & McAbdle.
    “ Sandusky, June 21st, 1850.”
    Appended to which was an order or request, of which the following is a copy:—
    “ Republic (0.), June 21st, 1850. “Messrs. Kent, Poag & Co., Hew York:
    “ Gent.,—Please deliver over to the bearer, F. C. Chapman, all our wool consigned to you, by his paying to you the balance due to us on said wool, as specified in the annexed writing, and his complying with the terms therein contained, and oblige,
    “Yours truly,
    “Toll & MoAjrdle.”
    The plaintiff paid to Toll & McArdle $3,000, as stated in the agreement.
    The wool subsequently all came to the actual possession of the defendants. On the arrival of the plaintiff in Hew York he claimed from the defendants the delivery of the wool to him in pursuance of the contract and the order. To this the defendants refused to accede, but claimed to hold the property and to sell it for the payment of all their balance due, and to grow due, against Toll & McArdle ; of the amount of this balance, as well as the nature of the claim, the plaintiff was then distinctly informed. Subsequently, and on the 29th of June, 1850, the plaintiff demanded, or caused to be demanded, the delivery of the wool, in pursuance of the contract and order, and tendered at the same time the sum of $6,300 (and offered to pay more, if more were necessary), to coyer any charges, advances, or just liens which the defendants had on the property, exclusive of the previous indebtedness of Toll & Mc-Ardle.
    The defendants declined to accept the tender and to deliver the property.
    The defendants afterwards sold the property at fair market prices, and after applying the proceeds to the credit of Toll & McArdle, the latter were still indebted to them in a small sum,
    . which, after the commencement of this suit, was discharged by the proceeds of other property of Toll & McArdle, received in the latter part of July, and in August, 1850, leaving a balance the other way of about $900, which still stands to their credit.
    On these facts, I am of opinion, and do decide, that the defendants had lawful right to retain the said property as security for all the demands then running in their favor against Toll & McArdle; that they justly refused to deliver the same to the plaintiff on his said demand thereof, and that therefore they have not wrongfully converted the same to their own use, and that the defendants ought not be adjudged to pay any damages by reason of the premises to the plaintiff, but that judgment be entered in favor of the defendants with costs of suit.
    A. 0. Bradlet.
    Flew York, January 21st, 1853.
    The plaintiff in due time filed exceptions to this report, and judgment having been entered thereon in favor of the defendants for the sum of $310 68, for their costs and disbursements, he appealed therefrom to the General Term. Upon this appeal the exceptions to the report of the referee were now argued.
    
      A. Child, for the plaintiff, appellant,
    contended that upon the facts found by the referee, the plaintiff was entitled in law to recover the value of the property in dispute, and rested his argument upon the following points and authorities.
    I. The title to the property in question, it having been purchased by Toll & McArdle, was, on the 21st of June, 1850, in them. It was never transferred to the defendants, nor delivered to a carrier for them, but was shipped by Toll & McArdle, as their own property, marked with their own names, except forty-seven bags marked L, and was simply consigned to the care of the ‘defendants. It was then all of it in cars or boats between Ohio and Hew York, none of it having arrived. Toll & McArdle then had the right to control it, and to sell it.
    II. Toll & McArdle having, the right to control and sell this property, did in fact sell it to the plaintiff, on the 21st of June, 1850, who thereby, and by his subsequent tender and offer, acquired a title to it. 1. The contract was specific as to the property sold. It was not a quantity to be ascertained of a larger parcel, but an entire certain parcel. “ All our lot of wool,” &c., “ contained in sacks,” &c., “ which have been shipped,” &c. 2. It was absolute as to the terms of sale,—three thousand dollars of the purchase money being paid, and a specific agreement being made as to the time and mode of settlement for the remainder of the price, and an express direction in pursuance of it being given for its delivery. The title passed to the plaintiff. (2 Black. Com. 446; Portland Bank v. Stacey, 4 Mass. 661; Putnam v. Dutch, 8 Mass. 287; Ingraham v. Wheeler, 6 Conn. 277 ; 2 Kent Com. 492.) 3. The ascertaining of the amount by a city weigher in Hew York, was merely an agreed mode of settling for the purchase price, and not an act to bé done by the seller to complete the contract, within the class of cases where title has been held not to pass in consequence of the incompleteness of the contract by the seller. There was nothing to be done on his part; he sold the property, and the offer and tender of the plaintiff was tantamount to a performance by him, and his right to the possession became perfect. (Crofoot v. Bennett, 2 Com. 249; Burk v. Davis, 2 M. & S. 397; Olyphant v. Baker, 5 Den. 379; Downer v. Thompson, 2 Hill, 137; Bates v. Conklin, 10 Wend. 389; Fitch v. Beach, 15 Wend. 221.)
    HI. The defendants had no lien on this property which entitled them to retain it and convert it to their own use.'-1. As to any particular lien, if there was any, it was discharged by the plaintiff’s offer and tender.. 2. As to any general lien, it could only be for a debt due from Toll & McArdle, and upon property in the defendants’ hands, belonging to them, but it could not attach to this property, which had been conveyed- to the plaintiff, before it came into their hands. If Toll & McArdle bad no title, the defendants could have no lien. • 3. Assuming that the defendants, from their course of business, might have had a right to retain any property of Toll & McArdle in their, hands, for a debt due to them, no lien could attach to other property of theirs before coming into their hands, nor deprive Toll & McArdle of their right to dispose of their property while in their own hands or under their own control, at pleasure. 4. There was no custom shown, as the .foundation of a general lien,.nor was there anything in the defendants’ dealings with Toll & McArdle, which give them such a lien, (the only two legal grounds, except by express contract, for the existence of a general lien), on any property, for the debt due in April, 1850, or their acceptances then unmatured, or for their subsequent acceptances. They trusted the personal credit of Toll & McArdle, and had no right of lien on property which had or thereafter should come into their hands. (2 Kent, 634, 637; Houghton v. Mathews, 3 Bos. & Pav. 485-494; Bleadon v. Hancock, 4 Car. & Payne, 152,19 C. L. 317; Bushforth v. Hadfield, 7 East. 224.) 5. There was nothing in the understanding of April, 1850, as to acceptances, which gave them any such right of lien; on the contrary, whatever- was the import of that understanding, it was broken and discharged by the defendants’ refusal- to abide by it. There was never any contract giving them a lien on this .property or any right to the possession of it".
    TV". If the defendants were entitled to retain the property at all, they were not entitled to retain it, for the full amount, and the plaintiffs should have had judgment for the excess of the. value of the property over and above the amount for which they were so entitled to hold it, which should have been ascertained.'
    
      C. Jones, for the defendants (respondents), claimed an affirmance of the judgment with costs, and argued as follows.
    It being conceded that the referee correctly found the -facts in this case, the only question raised by the appeal, is, whether he committed any error in his conclusions of law.- It is submitted that he did not, because—
    
      I. The respondents were commission merchants, and factors of Toll & McArdle. By the course of business, and the relation existing between them, the former had not only a lien upon the wool for their advances, but could also hold it for the balance due them. (Story on Agency, § 376 ; Paley on Agency, 128-9; 2 Kent Com, 640; Hudson v. Granger, 5 Barn. & Ald. 27; Knapp v. Alvord, 10 Paige, 205.)
    H. The respondents also had a right to hold the wool, by virtue of the agreement entered into between them and Toll & McArdle in the month of April, preceding its shipment.
    IH. The wool having been shipped to and having actually come into the possession of the respondents, under the agreement entered into between them and Toll & McArdle, and the agreement having thus been executed, Toll & McArdle had no title to the wool, or at most could only demand its delivery on paying the amount of their indebtedness to the respondents, which was over $9,000.
    IY. Ho title passed to the appellant by the contract made by him with Toll & McArdle. 1. The contract under which he claims title was executory merely, and was never executed. 2. The offer of the appellant to perform, did not operate as a transfer of title, or as an execution of the contract, but at most only places the appellant in a position to bring an action against Toll & McArdle, on the contract itself for its breach. (McDonald v. Hewitt, 15 Johns. R. 349 ; Rapelye v. Mackie, 6 Cow. 250; Outwater v. Dodge, 7 Cow. 85 ; Russell v. Nicoll, 3 Wend. 112; Ward v. Shaw, 7 Ib. 404; Hanson v. Myor, 6 East. 614.)
    Y. The remedy of the appellant is against Toll & McArdle. If the respondents violated their duty in refusing to execute the contract, they are responsible to Toll & McArdle, their principals, and not to the appellant.
   By the Court. Slosson, J.

The contract of sale between Toll & McArdle and the plaintiff of the wool in question was executory merely, and an absolute right to the possession of the property was not by it transferred to the plaintiff. That this was the true character of the agreement is manifest from several of its provisions. The delivery of the wool was to take place in the city of Mew York, on the arrival of the goods, and the price was then to be paid. The wool after its arrival was to be weighed for the purpose of determining the amount of the price. Moreover, the quantity sold could not be ascertained until the arrival of the plaintiff in Mew York, for if, in presenting the order for its delivery to the defendants, any of it should appear to have been sold by them, the sale to the plaintiff was to be reduced to the balance which might remain unsold. All these were things to be done and ascertained before the right to the property became perfect in the plaintiff, and are made, in express terms, conditions of the contract. That the parties perfectly understood that an actual delivery in Mew York might not be possible, and that the whole transaction was contingent in its character, is further manifest from the fact of their expressly providing for the event of a non-delivery, in which event the defendants covenant to forfeit and pay to the plaintiff the sum of $250, besides refunding to him what he had paid on account of the price agreed upon and interest. Were there no other ground of defence, we do not see how the plaintiff can, under such an agreement, and by virtue of it only, none of its conditions being complied with, be said to have acquired such a right to the possession of, or such a title to, or property in the wool in question, as will enable him to maintain this suit. (Rapelye v. Mackie, 6 Cow. 250; McDonald v. Hewett, 15 J. R. 349; Russell v. Nicoll, 3 Wend. 112.)

But we are clear that the defence must prevail on another ground. The defendants having, under the agreement between themselves and Toll & McArdle, of April, 1850, made advances to that firm, and the wool in question having been actually shipped to them, as we must intend, in pursuance of that agreement, acquired a vested interest in the property from the moment of its shipment, which the subsequent sale to the plaintiff could not divest. It was a part of the understanding upon which the advances were to be made by the defendants, that Toll & McArdle were to ship goods enough to balance not only what was due from them to the defendants at that time (April, 1850) on account of their previous transactions, and what was falling due at that date, but for all claims that might subsequently accrue, and thus balance the accounts; in other words, goods were to be shipped to cover the entire advances and claims of defendants, accrued, accruing, and to accrue, and until this was accomplished every shipment to them by Toll & McArdle, not specially restricted or qualified, was a shipment, in effect, to meet their debt to the defendants, and the title became perfect in the latter, as qualified vendees, from the moment the goods were put in the hands of the forwarders. The Referee has found that at the date of the sale to plaintiff (21st June), and up to the commencement of this suit, the balance due defendants from Toll & McArdle was about $9,000. The tender, therefore, by the plaintiff of $6,300 was not énough; indeed, it was expressly made to exclude the previous indebtedness of Toll & McArdle, and was intended to cover only such advances, charges, and lien as defendants might have, or claim, in respect to the wool itself.

Whether the defendants could have retained the wool, by virtue of their general lien as factors or commission merchants, it is not necessary to decide. It is enough that their right to retain the property was perfect under the agreement of April, 1850.

The refusal of defendants to make further acceptances for Toll & McArdle, after 15th June, and their allowing one of their drafts for $2,000 to return protested, does not alter the legal rights which they had acquired under the agreement of April, by virtue of their advances previous to that date, and which amounted to nearly $6,000. The amount of acceptances, under which they were to come, had not been determined by the agreement of April, and it was necessarily a matter of discretion with defendants; they were not bound, in the absence of an agreement to that effect, to accept indefinitely as to amount, and without respect to the amount of the accruing shipments to meet their acceptances. It is enough that they agreed to accept, and did accept to a large amount, to give them an absolute right in, and right to retain, the goods shipped to them by Toll & McArdle, until the whole amount due them was paid. (Grosvenor v. Phillipps, 2 Hill, 147.)

The claim for the balance due to Toll & McArdle, now in the hands of the defendants, is manifestly groundless, since it appears, from the report of-the Eeferee, that this balance is from the proceeds of goods subsequently sold, not of those claimed by the plaintiff. Had it been otherwise, the balance could not have been recovered in this action, which turns solely upon the question of a wrongful conversion.

The judgment entered upon the report of the Referee must be affirmed with costs.  