Atlantic Coast Line Railroad v. Luke & Fleming

93 S.E. 286, 20 Ga. App. 761, 1917 Ga. App. LEXIS 1076
Court of Appeals of Georgia·Decided August 3, 1917·No. 8302·Published

Opinion

Bloodworth, J.

The court did not err in overruling the demurrer on each of the grounds thereof. As the plaintiff in error specially urges that because the railroad delivered to the assignees of the bill of lading “all and the very same cotton it received from the shipper,” it should be relieved of liability, especially as the bill of lading had in it the words, “Weight subject to correction,” and “it was only quasi-negotiable, that is, assignable as to the property itself, not as to the quality of the goods,” we will discuss this proposition only. A bill of lading is not strictly a negotiable instrument, but rather a symbol or representative of the goods themselves. Section 4134 of the Civil Code of 1910 is as follows: “When a bill of lading is attached to a draft drawn on a third person, it will be treated as security for the draft, and neither title to the goods, nor right to the bill of lading, will pass to the drawee until, as required therein, he accepts, or accepts and secures, or pays the draft as the case may be.” In the case of American National Bank v. Georgia Railroad Co., 96 Ga. 665 (23 S. E. 898, 51 Am. St. R. 155), Chief Justice Simmons said: “The law seems to be, that where an agent has authority to issue bills of lading and does issue one with certain representations contained therein, and the bill of lading is negotiated to an innocent third person, the railroad company, as between itself and such third person, is estopped to deny the representations made in the bill of lading. Under these decisions it is immaterial that the bill of lading is not [762] negotiable in the strict sense of the term. A representation in a non-negotiable chose in action, when acted upon, is, according to the .usual rule applied in eases of estoppel, held to be equivalent in all respects to one made in the ease of a negotiable paper. Some of the decisions referred to are also put upon the ground that where one of two innocent parties must suffer from the wrongful act of a third party, the law casts the burden of loss upon him by whose act, omission, «r negligence such third party was enabled to commit the wrong which occasioned the loss. The superior equity is with the bona fide assignee who has parted with his money upon the faith' of the recitals contained in the bill of lading. 2 Am. & Eng. Enc. of Law, Bill of Lading, p. 227, and cases cited: Bank of Batavia v. Railroad Co., 106 N Y. 195 [12 N E. 433, 60 Am. R. 440]; Howard v. Tucker, 1 Barn & Adol. 713; Armour v. Michigan Central R. Co., 65 N Y. 114 [22 Am. Rep. 603]; St. Louis R. Co. v. Larned, 103 Ill. 293; Brooke v. R. Co., 108 Pa. St. 529 [56 Am. Rep. 235]; Wichita Savings Bank v. R. Co., 20 Kan. 519; Sioux City R. Co. v. First Nat’l Bank, 10 Neb. 556 [7 N. W. 311, 35 Am. Rep. 488]; Coventry v. Great Eastern Ry. Co., 11 Q. B. Div. 776; Abbott’s Law of Merchant Shipping (13th Lond. ed.), p. 565, and cases cited. A very large proportion of the business of the country is founded upon transfers of bills of lading; and if the transferee were required at his peril to ascertain from the carrier whether the representations made in the bill of lading are true or not; it would practically put an end to this class of transactions. The better and safer rule is, to hold that the carrier who issues the bills of lading is bound by the representations of his agents. Mr. Justice Miller, in discussing this subject in the case of McNeal v. Hill, Woolworth’s U. S. Circuit Reports, p. 96 [Fed. Cas. 8914], says: ‘As civilization has advanced and commerce extended, new and artificial modes of doing business have superseded the exchanges by barter and .otherwise which prevail while society is in its earlier and simpler stages. The invention of the bill of exchange is a familiar illustration of this fact. A more modern, but still not recent invention of like character, for the transfer, without the cumbersome and often impossible operations of actual delivery or articles of personal property, is the indorsement or assignment of bills of lading and warehouse receipts. Instruments of this kind are sui generis. [763] From long use and. trade they have come to have among commercial men a well understood meaning, and the indorsement or assignment of them as absolutely transfers the general property of the goods and chattels therein named as would a bill of sale, . . . If the warehouseman gives to the party who holds such receipt a false credit, he will not be suffered to contradict his statement which he has made in the receipt, so- as to- injure a party who has been misled by it.’ Horton, C. J., in the case of Wichita Savings Bank v. Railroad Co., supra, says: ‘Where one advances money on a bill of lading or buys the property therein set forth, by taking a transfer of such instrument absolutely, the only evidence which he has of the quantity .of goods which he has bought or advanced money on may be the statement contained in the bill of lading. Indeed, one of the main uses of bills of lading of grain, at this day, is to afford shippers opportunity to obtain advances, upon their shipments when they may and probably will be used with commission merchants, or at some bank,.to obtain advances of money. In the most of cases this result is almost certain to follow.’” See also Askew v. Southern Railway Co., 1 Ga. App. 80, 81 (58 S. E. 242).

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Atlantic Coast Line Railroad v. Luke & Fleming, 93 S.E. 286, 20 Ga. App. 761, 1917 Ga. App. LEXIS 1076 (Ga. Ct. App. 1917).

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