Gaither v. Myrick

9 Md. 118

• Court: Court of Appeals of Maryland
• Decided: June 15, 1856
• Status: Published

Opinion

Tuck, J.,

delivered the opinion of this court.

The appellant sued the appellee, to recover damages for losses alleged to have been sustained on the sales of flour shipped on board a vessel which sailed from Baltimore, for “Valparaiso and a market,” of which the appellee was part owner, master and supercargo. Misconduct, negligence, and consequent liability, are imputed to him in each and all of these capacities.

At the trial fourteen prayers were offered' by the appellant, all of which were refused, except the last. They involve the construction of the contract, and the extent and proper exercise of the discretion reposed in the appellee, under the circumstances by which he found himself surrounded, at his first port of destination, and afterwards in the progress of the voyage. The questions presented, in the argument, will appear by the statements and points filed, and we shall dispose of them in their order; first, however, stating generally the roles of law by which we suppose'cases of this kind to be governed.

The principles which regulate the conduct of factors abroad apply to supercargoes. Beawes’ Lex. Merc., 44, 47. Story’s Agency, sec. 33. They are liable for injuries to the employer, occasioned by the want of reasonable skill or of ordinary diligence, by which is to be understood “such skill as is, and no more than is, ordinarily possessed and employed by persons of common capacity engaged in the same trade, business or employment; and by ordinary diligence that degree which persons of common prudence are accustomed to use about their own business and affairs.” Story, sec. 183. They are also bound to good faith, and must exercise their judgment after proper inquiries and precautions, and, where they have a venture on the same ship, they are bound to exercise, at least, as much diligence and care, as to their factorage transactions, as they do as to their own private concerns. And they are chargeable for negligence if they sell without making proper inquiry, after having received notice of facts which ought to put a person of prudence on his guard. Ib., sec. 186. Russell on Factors & Brokers, 33, 34. As a general rule they cannot delegate their authority, any more than other agents, but exceptions may arise where the power of delegation is conferred by the necessity of the case, the usages of trade, or the law and customs of the country where the agency is to be executed. Story, secs. 13, 14, 34, a. 11 Howard, 209. Where, as in this case, the master is made consignee of the cargo, the duties and liabilities are as distinct as if confided to different persons. Story, sec. 41.

The responsibility of the defendant in his capacity of part owner and master alises from the sale of the ship, and the alleged improper delivery of the flour at Callao. It is the duty of the ship to convey the cargo according to the projected voyage, and this must be done by every reasonable and practicable method. “ Every act that is not properly and strictly in furtherance of this duty is an act for which both the master and owners may be made responsible.” Abbott on Shipping, 241. There are emergencies imder which a sale of the cargo and even of the ship may be justified, but the necessity of the case must require that course. This necessity may arise suddenly, and under circumstances that could not have been provided for. “In general, it may be said that, (in such a case,) the master is to do that which a wise and prudent man will think most conducive to the benefit of all concerned; — some regard may be allowed to the interest of the ship and its owners, but the interest of the cargo must not be sacrificed to it. Transhipment for the place of destination, if it be practicable, is the first object, because that is in furtherance of the original purpose: if that be impracticable, return or a safe deposit may be expedient. The merchant should be consulted, if possible. A sale is the last thing that the master should think of, because it can only be justified by that necessity which supersedes all human laws. If he sell without necessity, his owners, as well as himself, will be answerable to the merchant.” Abbott, 243. 1 Arnould on Insurance, 189, &c. Smith's Mercantile Law, 171, 292.

As to the construction of the contract: that is, the meaning of the words to “Valparaiso and a market,” we understand the counsel to agree that they must be interpreted according to the analogy of this case to one arising under a policy of insurance containing such a clause; and by this test, we think, they authorised the ship to visit such other ports, beyond the one named, as the appellee thought expedient, in the exercise of a sound discretion. Deblois vs. Ocean Ins. Co., 16 Pick., 303. Whether he was under any obligation to seek a market this side of Valparaiso, or to go there in the first instance, we need not decide, inasmuch as he did visit the named port, and no question is made on this part, of the case. These terms also imposed on the ship the carriage of the cargo until a market was found, or the goods left on deposit for sale under circumstances authorising such a departure from the original contract of affreightment. In the case of Richardson vs. London Ass. Comp., 4 Camp., 93, the goods in question were the investment of an East India captain, and the voyage was described in the policy to be, “ at and from London to Maderia, the Cape of Good Hope, and all or any of the ports or places in the East Indies, &c., until arrived at the last place of discharge on the outward voyage, with leave to exchange the goods in the course of the voyage.” The company’s cargo was discharged at Calcutta, (a place within the policy,) and the ship ordered with another cargo to Madras. The captain had also landed the whole of his investment at Calcutta and had disposed of a considerable part of it; but, being unable to sell the residue, he resolved upon a new market, and for this purpose reloaded it on hoard the ship for Madras; on which intermediate voyage she was lost. The question was, whether, under the terms of this policy, the risk still continued on the residue of the captain’s investment on board at the time of the loss, or whether it had ended at Calcutta? Lord Ellenborough held, that the risk had ceased at Calcutta, “ the last place of discharge on the outward voyage.” If, he said, “the company’s officers wish for the protection which is here sought; (that is, until the goods are finally disposed of in some market in the East Indies,) they must not limit the risk to the duration of the outward voyage, but extend it to the arrival of the goods to a market at their final port of discharge.” It is added by Mr. Arnould, (Vol. 1, 439,) “There can be no doubt that an insurance in such form would effectually protect the goods until actually disposed of in some foreign market.” If this be the liability of the insurers in such cases, it is clear that it is the ship’s duty to carry the cargo until disposed of.

We proceed to apply these principles to the case before us.

The first prayer was properly refused, because it submitted to the jury the finding of facts of which there was no sufficient evidence. One specification is sufficient. There was nothing from which the juiy could have found that the defendant did not make reasonable efforts to sell the plaintiff’s flour at a fair price, at some one or inore of the ports which he visited before he reached Callao. On the contrary, it was in proof that he had offered the flour at Arica, and, not satisfied with the prices there, said he was going to Lima, of which Callao is the outer port, because he had received advices of better prices at that place. In the absence of evidence of such negligence and misconduct, the law does not presume that he did not make reasonable efforts to effect sales at such ports as he thought it expedient to visit, as it was his duty to have done; and especially as that presumption is rebutted by the consideration that it was his interest, as part owner, to sell the cargo as soon as practicable. And, even if he could have made sales at Arica or elsewhere, he had a discretion to do so or not, provided it was fairly exercised. The nature of the voyage' — for a named port and a market — necessarily implied, as we have seen, that he was not bound to sell at the first or any other port, if he had reason to believe that he could find a better market by going further, and acted in good faith on such information. We may illustrate this view, (and the same applies to propositions presented by some of the other prayers,) by supposing that, with the advices he had received at Valparaiso before him, he had sold the plaintiff’s flour at Arica for the price offered, and had then sailed for Lima, and there sold his own flour at the higher price named in his advices. Would not the plaintiff have had good reason to complain that he had sold his flour at the wrong market? Yet, when he has acted upon the information received, and loss has occurred to the plaintiff, he is charged with negligence. Certainly the result should not alter the application of the principle.

Objections equally fatal apply to the second, third and fifth prayers. The second is based in part on the first, besides embodying other propositions of fact without evidence to sustain them, which we need not indicate.

The third is objectionable for the reason that there is nothing to show that the purchaser of the one hundred and fifty barrels sold at Arica, was willing or unwilling to have taken any of the plaintiff’s flour as part of the quantity he wanted. To fix liability on the appellee in this aspect of the case, could only be done by drawing an inference against his interest and duty, when there is nothing in his management of the cargo, up to that time, to show that he was not governed by a desire to promote the interests of all concerned. Flour is sold by the brand it bears, and there is no evidence that the purchaser at Arica wanted any other than the particular kind that he bought, and the plaintiff’s flour was not of that brand. Besides, this prayer imputes to the appellee not only gross negligence, but want of good faith to the owners of the cargo, against the presumption that an agent has done his duty until (he contrary appears. Corner vs. Pendleton, 8 Md. Rep., 337.

The motive attributed to the appellee, by the fifth prayer, for not selling all the flour at Arica, is not warranted by the proof, but in conflict with the only evidence on the point. Wysham proved that the appellee’s reason, as he informed him at the time, for not selling there at less than nine dollars and-a-quarter, was, that from information received, he expected to obtain ten or ten and-a-half at Lima. In the face of this proof, and in the absence of any sustaining the theory of the prayer, it was impossible for the jury to have found that he did not sell at Arica, because of an unwillingness to reduce the price of his own flour to an average less than he could obtain for the quantity which he actually sold.

In addition to the above views all the preceding prayers proceed, in part, on an assumed violation of duty which the law does not infer, denying to the appellee any discretion whatever; whereas, as we have seen, the doctrine is well settled, that persons in his capacity are often compelled to act in a manner which the law does not sanction, if access can be had, or information given to, and directions received from, the principal. If the law were otherwise, it is difficult to imagine that such agencies would be accepted at all, imposing liability for mere errors of judgment, committed in the honest exercise of discretionary powers.

We entertain, however, a different view of the propositions presented by the sixth prayer. The ship arrived at Callao on the 5th or 6th of October, as proved by Wysham and Dartnell. The appellee wrote, on the 13th, that the flour had kept perfectly sweet, that he had sold it at $8, and that the vessel also was then disposed of. Wysham proved that the vessel was sold to be delivered in ten days, and that after that sale the defendant caused all the flour to be landed bn the mole, when there was no storage for it, and that it was injured by such exposure, though, on this point, and as to the condition of the flour, at the time of arrival, there was conflicting evidence. One of the witnesses also stated that sample barrels were sent ashore which were tried, and the flour pronounced sour, and that the appellee had all the flour delivered on the mole, after he knew that the first purchase had been thrown up. Now, if the appellee had not discovered, on the 13th, that the flour was damaged — and that he had not is clear from his own letter — the inference is that he sold the vessel before the cargo had been landed, and, (according to the evidence of the mate,) that it was landed after he knew its unsound condition, and before he had macje a second sale, or obtained storage for it. Upon the state of case submitted to the finding of the jury by this prayer, if the appellee, landed the flour, “in order that he might be ready and prepared to deliver the vessel pursuant to the terms of the contract of sale,” and the flour was injured by such exposure on the mole, the plaintiff was entitled to recover for the loss resulting from such disposal of the cargo. Upon this hypothesis there was no excuse for landing the flour at all without having first made sale of it, or obtained proper storage; and the case is stronger against him, if, as he wrote, and Wysham states, the flour was sweet. The prayer ascribes a motive for the landing, to be found by the jury, inconsistent with the interest of the shippers, and merely looking to the interest of the ship-owners, and which, if true, was, to the extent of the damage thereby incurred, a sacrifice of the interest of the cargo to that of the owners of the vessel. Abbott, 243. We have seen that the ship may be sold under pressing emergencies, but there was no such necessity if the hypothesis of the prayer be correct. The counsel for the appellee adverted to the letter of Wysham So Co., in which it is said, “it is possible you may sell the vessel,” for the purpose of showing that the plaintiff knew, at the time of the shipment, that a sale was in contemplation. This letter had reference to a return cargo; we suppose that it was never imagined by any of the parties that the vessel would be sold before tire flour was disposed of. The ship may always be sold if the owner or the master choose to violate a duty. It cannot be prevented. But the power to sell is subordinate to the claim of the caigo to be carried and delivered according to the projected voyage; and that the owners of this cargo knew that the vessel might possibly be sold, can have no effect upon their claim for damages, if they incur loss by the sale. The obligation to carry the cargo is, generally, paramount to every other duty, and yields only to that “ necessity which supersedes all human laws.” Abbott, 243. True, the appellee had an interest in selling the ship, but he had also incurred an obligation to the plaintiff; and, as was said by Lord Ellen-borough, in 1 Campbell, 527, “No man should be allowed to have an interest against his duty.”

According to the rules governing the case as applied in disposing of the first prayer, we think there was no error in refusing the seventh. There was nothing to show that the conduct of the appellee, at Arica, was different from what a prudent and judicious owner would have done under the same circumstances, and with the same advices before him.

If, as stated in the eighth prayer, the defendant, not having found a market, had the flour landed, and placed, and left on the mole at Callao; and if it became damaged, before a sale could be effected, by reason of exposure there for six or eight days, it is very clear that he was liable for the consequences. This, however, was for the jury, about which there was evidence on either side.

We think the ninth prayer was properly refused. It is merely speculative as to losses that might have resulted from landing sour flour in violation of the local laws. But, as the flour was not seized and condemned under these laws, the plaintiff cannot be said to have suffered by an act subjecting the flour merely to the risk of being taken and destroyed, in the absence of proof that such violation of the law did place the defendant in the power of dealers in the article, whereby loss was actually incurred by the plaintiff.

The tenth, eleventh and twelfth prayers relate to the expenses of landing, reshipment and freight of the flour that was sent to Paita. It was the duty of the ship to have carried the flour to a market, or until finally landed under circumstances authorising a departure from the original contract, which, as we have said, had not occurred at Callao. Consequently the plaintiff was not liable for the freight from Callao to Paita. This prayer leaves out of view the sale of the vessel; but as the carrying of the cargo, according to the contract, is the master’s first duty, it lies on'the defendant to excuse himself for having forwarded part of the flour to Paita, on another vessel, and he cannot charge for such freight.

The eleventh and twelfth prayers ought also to have been granted, upon the hypothesis of the tenth. Until the flour was sold it ought not to have been landed. The landing without a previous sale, was such an act as to reheve the consignor of the flour from all liability for the charges of landing and reshipment.

The thirteenth prayer seeks to charge the appellee, as supercargo, for a conversion of the flour, by having sent it to Paita, for sale by another person. We have seen that emergencies may arise to render a deposit of the cargo necessary, as, for example, the sale of the ship, or the want of a market, because a sale cannot be made if a purchaser cannot be found; and other circumstances may arise justifying this course; and if the consignee acts in good faith, with reference to his predicament at the time, he ought not to be censured. The general rule is that the trust cannot be delegated, but this is not without exceptions. "The authority is exclusively personal, unless, from the express language used, or from the fair presumptions growing out of the particular transaction, or of the usage of trade, a broader power was intended to be conferred on the agent.” Story, sec. 14. Where the consignee is master, and this is known to the shipper, he cannot wholly abandon the latter duty to discharge that of supercargo. He must act in both, as far as possible, with reference to the interest of the respective principals. 1 Johns. Cases, 174, Day vs. Noble. 2 Pick., 615. There is nothing stated in the prayer to excuse the consignee; but it goes upon the ground that he abandoned his trust to another, merely on finding that the flour could not be disposed of at Callao. In this view, we think, the first branch of the prayer, if offered alone, might have been granted. But it went further, and asked to recover the value of the flour, if the jury found that some other person assumed to sell it in the absence of the defendant, and without his knowledge or approval of the terras of sale. Of course such a sale would not divest the title of the plaintiff; but it does not follow that the defendant would be liable, because another person wrongfully, and without his privity, had assumed authority to dispose of it. As an entirety the prayer was faulty and properly refused.

It follows that, dissenting from the rulings below on the 6th, 8th, 10th, 11th and 12th prayers, the judgment must be reversed, and a procedendo ordered.

Judgment reversed and procedendo ordered.