Dodge v. Meyer

61 Cal. 405, 1882 Cal. LEXIS 635
CourtCalifornia Supreme Court
DecidedSeptember 27, 1882
DocketNo. 7,241
StatusPublished
Cited by25 cases

This text of 61 Cal. 405 (Dodge v. Meyer) is published on Counsel Stack Legal Research, covering California Supreme Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Dodge v. Meyer, 61 Cal. 405, 1882 Cal. LEXIS 635 (Cal. 1882).

Opinions

Thornton, J.:

In the year 1874, and prior thereto, E. E. Morgan’s Sons were factors and commission merchants, and doing business as such in the City and County of San Francisco. They were extensively engaged during the period referred to in chartering ships, and transporting wheat and other produce to European ports, to be there sold for account and risk of the owners of such property. The plaintiff and his assignors were farmers in the interior of the State, engaged in raising wheat. The Court finds a full assignment to the plaintiff by the owners of the several lots of the wheat, and all rights and causes of action against defendant.

In 1874, the plaintiff and his assignors made an arrangement with Morgan’s Sons for shipping certain wheat owned [410]*410by them to England, and its sale there. The terms of such agreement were as follows:

Morgan’s Sons were to charter a certain ship, to wit, the ship Star of Scotia, especially for the farmers (the plaintiff, and his assignors), and therein to ship for them their wheat to England, the farmers to retain control thereof as to time, place, and terms of sale, and as to whether the wheat was to be sold afloat prior to arrival in England, or on arrival there, or be stored and held there for a market—the factors (Morgan’s Sons) to pay the inland freight to the ship’, and shipping charges, putting the wheat on board ship, and if desired, make to the farmers severally such further advances in money, on their respective lots of wheat, as in the aggregate, with the inland freight and charges, would amount to twenty dollars per ton of the wheat; Morgan’s Sons to attend .to making sales of the wheat, at such time and place as directed by the farmers, and in remuneration for such services, they (Morgan’s Sons) were to receive a stipulated interest on the advances made, and a commission on the price realized when the wheat should be sold.

These farmers sent forward from the interior their several lots of wheat to Morgan’s Sons in September and October, 1874, who received them at divers times between the first of September and the sixteenth of October, 1874. Morgan’s Sons had during the period last named chartered and had ready for loading in the bay of San Francisco five ships, viz., St. Charles, Star of Scotia, El Dorado, Oberon, and Twilight, and on receipt of the lots of wheat above mentioned, instead of loading them all on the ship Star of Scotia, they were without the knowledge of these farmers put on board the five several ships whose names are given above. They also, without the knowledge or consent of either of the farmers who owned the several lots of wheat, agreed to pay a different and generally higher rate of freight than that agreed on with the owners of the wheat.

In June, 1874, Morgan’s Sons had procured special letters of credit from several merchants and bankers in England, and among others from Eathbone Bros. & Co. and Brown, Jansen & Co., whereby the former were authorized to draw their drafts at sixty days’ sight upon the parties issuing the letters [411]*411of credit, to amounts specified therein, against shipping documents, viz., invoice bills of lading and policy of insurance for wheat shipped at California, at the rate of forty-two shillings and sixpence per quarter cost, freight and insurance; the documents to be surrendered to the drawees of the drafts against their acceptances.

In the same year, and after the obtaining of these letters of credit, Morgan’s Sons became indebted to the defendant Meyer, and before any of the wheat above referred to had been forwarded to them for shipment they made arrangements with Meyer to use the wheat which they expected to receive and to comply with the credits in the following manner: They (Morgan’s Sons) to ship the wheat to England, take out bills of lading therefor in their own name, and draw against them as provided in the credits, and to secure acceptance thereof to said Meyer, to pledge the wheat by delivering to him the bills of lading, indorsed by them in blank, accompanied with the other shipping documents, and Meyer, on acceptance of the drafts, to deliver to the drawees thereof, for their security and reimbursement, the shipping documents above mentioned. Meyer was to make advances to Morgan’s Sons from time to time as required, and credit them with the drafts as fast as they were drawn and delivered to him by Morgan’s Sons. Morgan’s Sons were when this, arrangement was made insolvent, and did not expect to have any wheat of their own for shipment. They relied wholly on the arrangement made with Meyer to carry out the agreement made with the farmers to ship their wheat as above detailed. Meyer knew all the time the facts above stated, but the farmers knew nothing of the letters of credit or their terms.

When the wheat to be shipped had been placed on board the vessels, Morgan’s Sons procured from the master of each ship bills of lading in their name. The bills of lading were made out for the whole or the major part of each cargo, and none were taken in the name of either of the farmers; but Morgan’s Sons had included in the bills of lading the several lots of wheat owned by the farmers and shipped for their risk and account with wheat of other persons, and so mingled their wheat that it was in no manner distinguishable from the entire mass of the cargo. The bills of lading represented [412]*412Morgan’s Sons as the shippers, and provided that the wheat mentioned in them should he delivered to the order of Morgan’s Sons or their assigns on the arrival of the ships at their several ports of destination in Europe.

Morgan’s Sons were indebted to Meyer in divers sums of money, to them lent and advanced by Meyer prior to the times the wheat of the farmers was received by them, and while the shipments of the wheat were being made, Moyer advanced to them further sums of money from time to time, to he by them used in their business, in anticipation of the delivery to him by them of the drafts to be drawn on the parties in England, who had issued the credits above mentioned, against the wheat shipped, in pursuance of the arrangement above stated.

The course of business between Morgan’s Sons and Meyer, is thus stated in the findings of the Court below:

"As loans and advances were made from time to time by defendant to E. E. Morgan’s Sons, promissory notes were given by said Morgan’s Sons to defendant for the amounts so loaned or advanced. As the wheat was being put into the ships from day to day, said E. E. Morgan’s Sons took from the mates of said vessels 1 mates’ receipts’ for the quantity loaded, and delivered said mates’ receipts to defendant as his security for said loans and advances, and the said promissory notes; and when said ships were loaded, and bills of lading receivable, an accounting was had between said E. E. Morgan’s Sons and defendant, the mates’ receipts were delivered to the masters of the ships and bills of lading taken from the masters by said E. E. Morgan’s Sons in them firm name, and to their own order.
" Immediately upon receipt of each of said bills of lading, E. E. Morgan’s Sons drew their draft against the wheat therein mentioned, and in conformity with the terms of said letters of credit procured a policy of insurance upon the cargo represented by such hills of lading, and made an invoice of said wheat and indorsed the draft, hill of lading, policy of insurance and invoice, all in blank, and delivered the same to defendant.

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Bluebook (online)
61 Cal. 405, 1882 Cal. LEXIS 635, Counsel Stack Legal Research, https://law.counselstack.com/opinion/dodge-v-meyer-cal-1882.