Union Stock Yard & Transit Co. v. Mallory, Son & Zimmerman Co.

41 N.E. 888, 157 Ill. 554

• Court: Illinois Supreme Court
• Decided: October 11, 1895
• Status: Published

Opinion

Mr. Justice Magruder

delivered the opinion of the court:

This is an action of trover, brought by the appellee, Mallory, Son & Zimmerman Company, an incorporated company of live stock commission merchants, doing business at the stock yards in the city of Chicago, against the appellant, the Union Stock Yard and Transit Company, to recover the value of twenty-seven head of cattle, alleged to have been converted by the appellant. In an action of trover, which is a possessory action, the plaintiff must recover upon the strength of his own title and not upon the weakness of his adversary’s title; and he must show not only a tortious conversion of the personal property by the defendant, but also that, at the time of the alleged conversion, he had the right of property, general or special, in the chattels converted, and also the possession, or a right to the immediate possession thereof. There must be a concurrence both of the right of property, general or special, and of the actual possession or the right to immediate possession, and this concurrence must exist at the time of the conversion. (Davidson v. Waldron, 31 Ill. 120; Forth v. Pursley, 82 id. 152; Owens v. Weedman, id. 409; Montgomery v. Brush, 121 id. 513; Frink v. Pratt, 130 id. 327; 26 Am. & Eng. Ency. of Law, p. 744).

There is evidence in the record tending to show, that the title to the cattle had passed out of appellee when the alleged conversion took place, and that both the right of property and the right of possession were in Bussell, when the cattle were delivered by appellant to Fleischman, or to Holmes & Pattison at Fleischman’s request. On May 13, 1890, which was Sunday, Bussell in Detroit telegraphed to Fleischman at the stock yards in Chicago to buy a load of cattle for him. Early on'the next morning, Monday, Ma}r 14, 1890, Fleischman went to Zimmerman, a member of the appellee company, and told him of the telegram thus received from Bussell. Fleischman and Zimmerman together visited the cattle pens of appellant between nine and ten o’clock on that morning, and there looked at several bunches of cattle held for appellee by appellant, and agreed on the price of twenty-seven head of cattle. Zimmerman caused the cattle so selected to be taken by one of his employees to the scales in the yard, and weighed by appellant’s weigh'master, who made out the scale tickets, showing the number and weight of the cattle, and the names of the seller and of the person to whom they were weighed. The scale tickets are in evidence, and show the names of and of Bus-sell, and are signed by the weighmaster of appellant. Fleischman was present when the cattle were weighed, or when Zimmerman directed them to be carried to the scales to be weighed. The scale tickets were taken to appellee’s office, and there appellee made out and signed and delivered to Fleischman an order on appellant to deliver to Bussell the twenty-seven head of cattle. On the same day Fleischman presented this order to appellant, and appellant delivered to him the cattle. It was not the business of appellant to buy and sell cattle, but the appellant operated the stock yards; and its business is to receive stock and weigh it, and see that it is properly fed and watered. Appellee’s business was to sell stock on commission, and sometimes buy it on order, and it had been engaged in that business at the stock yards for some twenty-two years, having dealings with appellant every day in the year except Sunday. Fleischman also had been buying stock for more than a year at the stock yards for Bussell and other parties, and had had dealings with appellee before May 14, 1890.

The testimony of both Zimmerman and Mallory, the former being the salesman of appellee, and the latter its treasurer and manager, is that there was a sale of the cattle to Bussell when the delivery order was given to Fleischman, and that appellee then extended upon its books a credit of a few days, or perhaps a week, to Bussell. There was a symbolical delivery of the cattle by appellee to Fleischman, and, therefore, an execution of the contract of sale. When the vendor delivers to the purchaser, or to the purchaser’s authorized agent, an order upon the vendor’s bailee to deliver the goods sold to such purchaser or agent, there is a constructive delivery of the property; and the delivery of the order vests the purchaser with the indicia of ownership, and has” the same effect in transferring the title to the property as the delivery of the property. (McCormick v. Hadden, 37 Ill. 370; Burton v. Curyea, 40 id. 320; Webster v. Granger, 78 id. 230; Tuxworth v. Moore, 9 Pick. 347; Carter v. Willard, 19 id. 1). It follows, that the title to the cattle passed from appellee to Bussell; and, if the title remained in Bussell at the time of the alleged conversion of the property, then this action was improperly brought in the name of appellee, and cannot be maintained.

If there was a conversion, it must be regarded as having taken place on May 14, 1890, when the cattle were delivered by appellant to Fleischman, and not on June 18, 1890, when appellee made a formal written demand upon appellant for the possession of the property. In trover, demand and refusal do not necessarily constitute the conversion, but are only evidence of it. A conversion is any unauthorized act, which deprives a man of his property permanently or for an indefinite time, and, when such a conversion has taken place, a demand is not necessary. A wrongful assumption of the ownership of property may be a conversion in itself, and render a demand and refusal unnecessary. Demand and refusal are evidence of conversion when the defendant is in such a condition, that he can deliver the property if he will. (Johnson v. Howe, 2 Gilm. 342; Bruner v. Dyball, 42 Ill. 35; Hiort v. Bolt, L. R. 9 Exch. 86; Hawkins v. Hoffman, 6 Hill, 586; 41 Am. Dec. 767, and notes). It is not claimed by appellee, that appellant delivered the cattle to Fleischman on May 14, 1890, with any evil intent, or from any improper motive, or that it thereby acted with a want of good faith. If appellant was then guilty of a conversion, it must be because it parted with the cattle through mistake, or negligence. It was certainly justified at that time in regarding Bussell as the owner of the cattle and entitled to the possession thereof, and in concluding that the right of property and of possession had both passed from appellee. The trial court refused to instruct the jury, at defendant’s request, that, to maintain this action, the plaintiff must recover on the strength of its own title to the cattle, and show in itself either a general or special property therein, and that, at the time of the alleged conversion, it had not only the right of property in the cattle, but also the right to the immediate possession of the same.

It is claimed, however, that the sale from appellee to Bussell through Pleischman was fraudulent. Pleischman is alleged to have been a special agent and not a general agent of Bussell. A general agent is one who is authorized to do all acts connected with a particular business or in a particular place, while a special agent is one who is empowered to act only in a specific transaction. (Me-chem on Agency, sec. 6; 1 Am. & Eng. Ency. of Law, page 349). Pleischman is said to have had no authority to buy cattle for Bussell except when he received an order to buy a particular lot of cattle, and that his authority to make purchases of cattle was limited to the particular order received by him. It is then contended, that he received an order by telegraph sent on May 13, 1890, to buy cattle; that, on May 14,1890, he bought a lot of cattle from another party than appellee, and shipped them to Bussell, and drew on Bussell for the purchase money, and that Bussell paid for the cattle so purchased and shipped to him. Appellee contends, that Pleischman had exhausted his authority to buy for Bussell when he told Zimmerman that lie had an order from Bussell, and that he obtained the cattle from appellee without having any authority from Bussell to do so, and without having any intention to pay for the same, and that his conduct in thus obtaining the cattle from appellee and subsequently selling them to Holmes & Pattison, instead of shipping them to Bussell, was a fraud on appellee.

Whether the purchase of the cattle from appellee was made by Pleischman before or after the other purchase was made by him, may be considered doubtful under the evidence, if it were proper to consider the evidence. If he bought of appellee under tbe order received by him and before his authority was exhausted, then it cannot be said that there was any fraud in the original purchase of the cattle from appellee, but only in the subsequent disposition of them to Holmes & Pattison.

It may be conceded, however, that the question, whether the sale of the cattle by appellee to Bussell was fraudulent or not, was a question of fact to be determined by the jury under proper instructions, and that the judgment of the Appellate Court establishes the fraudulent character of the sale as between appellee and Bussell or Pleischman. Bussell denies, that he gave Pleischman any authority to buy this particular lot of cattle from appellee. One, who holds out another as his agent to act for him in a given capacity, and, by his habits and course of dealing, justifies the inference that such other is authorized to act as his agent, whether it be in a single transaction or in a series of transactions, will not be heard to deny the agency to the prejudice of an innocent party, who has been led to rely upon the appearance of authority in the agent. (Mechem on Agency, secs. 83, 84). Whether or not Bussell’s conduct towards Pleischman was such as to justify appellee in dealing with Pleischman as having authority to act for Bussell, is a question which seems to be immaterial except so far as it concerns the validity of the sale, because this is not a suit by appellee against Bussell. Nor does the question here arise whether or not Holmes & Pattison were bond fide purchasers of the goods from Pleischman, as this is not a suit against Holmes & Pattison. This suit is brought by appellee against the appellant, its bailee or agister, charging the latter with having improperly delivered the goods to Pleischman when the delivery order directed them to be delivered to Bussell.

Where a sale of goods is made through the fraudulent representations of the purchaser, or where the fraud in the sale arises from the intention of the purchaser not to pay for the goods, the sale is voidable only, and not absolutely void. (8 Am. & Eng. Ency. of Law, pages 791, 822, 823; Benjamin on Sales, bk. 3, cbap. 2, sec. 433.) The sale being voidable, it results that the vendor may rescind it if he so elects. But this rescission must be made before other rights acquired in good faith have intervened. If, before the vendor exercises his election, the vendee makes a transfer to an innocent third person for a valuable consideration, such third person will hold the property as against the original vendor. (Brundage v. Camp, 21 Ill. 330; Fawcett v. Osborn, 32 id. 411; Butters v. Haughwout, 42 id. 18 ; Chicago Dock Co. v. Foster, 48 id. 507; Doane v. Lockwood, 115 id. 490; Farwell v. Hanchett, 120 id. 573; 2 Schouler on Personal Prop. secs. 408, 409; Benjamin on Sales, sec. 433 ; 26 Am. & Eng. Ency. of Law, page 786, and, notes).

In the case at bar, it is indisputably shown, that the appellee exercised no election to rescind the sale before the cattle were delivered to Pleischman upon the order given to him by appellee. “The title of the fraudulent purchaser is subject to be divested, at the election of the seller, within any reasonable time after the fraud is discovered.” (Doane v. Lockwood, supra). Here, the fraud was not discovered until after the alleged conversion took place. This being so, the title was still in Bussell at the time of the conversion, and had not become re-vested in appellee by rescission.

We are, therefore, inclined to hold, that the jury should have been instructed upon this subject in accordance with defendant’s request as above indicated.

It is said, however, that the point as to the existence of the title in Bussell at the time of the conversion is merely technical; and that it is immaterial whether appellant should be made to respond for the value of the cattle to appellee or to Bussell. Without conceding that there is any force in this suggestion, we will notice some of the other errors assigned.

By the fifth instruction given for the plaintiff, the jury were told that “proof of the fact, if it be a fact, that Bussell had on former occasions recognized Fleischman as- his agent in making purchases of cattle for him is not sufficient to charge him, or justify the Union Stock Yard and Transit Company in delivering cattle to Fleischman for Bussell when they had an order from the plaintiff to deliver to Bussell himself, without proof that, at the time of the transactions in question, the plaintiff had knowledge of such former recognition.” The court refused to give the fifth instruction asked for the defendant which is as follows:

“The jury are instructed that a person dealing at a particular market will be taken to have dealt according to the custom and usage of that market, and if he employs another to act for him in carrying on business dealings at such market, he will be held as intending that the business should be conducted according to the general usage and custom of such market; and this is the rule, whether he in fact knows of the custom or not.”

It is assigned as error, that the court gave the fifth instruction asked by the plaintiff, and refused the fifth instruction asked by the defendant. In connection with these instructions it may be noted, that the defendant below offered in evidence six orders on appellant for the delivery of cattle to Bussell, signed by different commission merchants at the stock yards, and delivered to Fleischman, which orders were endorsed in the handwriting of Fleischman in the same manner in which the order for the twenty-seven cattle signed by appellee was endorsed, and upon the presentation of which orders to appellant the cattle therein named had been delivered to Fleischman or to Pattison & Holmes. The court refused to admit the orders in evidence, and this refusal is assigned as error. The object of introducing these orders was to show, that Fleischman had been in the habit of presenting to appellant orders directing cattle to be delivered to Bussell, and of endorsing the orders and receiving the cattle and shipping them or selling them; and that it was the usual custom at the stock yards to transfer the title to the cattle by endorsement of the delivery orders, and that cattle were delivered upon such orders to the party therein named or to his known agent. The ground, upon which the court refused to admit the orders, was that the plaintiff was not shown to have had knowledge of them; and the necessity of such knowledge by the plaintiff is also set up in the given instruction No. 5.

The instruction was correct in requiring knowledge of the orders by the plaintiff, so far as they bore upon the question whether or not Pleischman was Bussell’s agent to purchase the cattle, and had authority to make the contract of sale with appellee. Upon this subject counsel for appellee cite the case of Maxey v. Heckethorn, 44 Ill. 437. There, Heckethorn sued Maxey and Howard for cattle alleged to have been purchased by one Hewitt as Maxey’s agent. It was sought to hold the defendants there liable on the ground, that, in previous transactions, they had recognized Hewitt as their agent or as Maxey’s 'agent, and it was held that Maxey’s recognition of previous acts of purchase for him by Hewitt was not sufficient to charge Maxey and Howard, in the absence of proof that the plaintiff, before he sold to Hewitt, was cognizant of the facts. Unless the previous transactions were brought home to the knowledge of Heckethorn, he could not claim that he sold the stock to Hewitt as Maxey’s agent because of said transactions. So, here, it may be said that Bussell could not be held liable to appellee for the purchase of the cattle by Pleischman as his agent because Bussell had recognized previous purchases of cattle made for him by Pleischman, unless it was shown that plaintiff had knowledge of such previous purchases. Appellee could not be held, without such knowledge, to have relied upon such previous purchases as showing Pleischman’s agency. But all this has reference to the right or authority of Pleischman to make a contract with appellee for the purchase of the cattle ; it concerns only the validity of the contract of sale. But, so far as appellant is concerned, the question is, not whether Pleischman was Bussell’s agent to buy the cattle of appellee, but whether, after the purchase of the cattle was made, Pleischman had authority, to receive them as Bussell’s agent. Appellant had nothing to do with the purchase of the cattle. When the delivery order was presented, appellant had a right to suppose that appellee had made a valid sale of the cattle to Bussell, and had determined that Pleischman had proper authority from Bussell to buy them. The only question for appellant to consider was this: the cattle having been sold to Bussell and he being the rightful owner, has Pleischman authority to receive them for Bussell, and ought they to be delivered to Pleischman for Bussell. It is easy to see, that the agency of Pleischman is to be looked at in two aspects: first, was Pleischman Bussell’s agent to buy the cattle? — this was a question for appellee to settle; second, after the cattle were bought, was Pleischman Bussell’s agent to receive the cattle? — this was a question to be determined by appellant. If, in previous transactions with appellant, Bussell had recognized Pleischman as his agent to receive cattle already boug'ht by him, appellant might be justified in dealing with Pleischman as Bussell’s agent for such purpose. In such case, the knowledge of appellee as to transactions, previously had with appellant showing Pleischman’s agency to receive cattle already bought, was not material. The knowledge of appellee was only material as to previous transactions tending to show Pleischman’s authority as agent to make contracts for the purchase of cattle. There is thus a plain distinction between the question of Pleischman’s agency to buy cattle as related to the validity of the sale thereof, and the question of Pleischman’s agency as to the delivery to him of cattle which had already been bought. Whether Pleischman was a general or special agent, the evidence tends very conclusively to show, that, when he had an order from Bussell to buy cattle, and after he had bought them in pursuance of such order, he had full authority to receive them from the stock yards company upon the presentation to that company of a proper delivery order. We are, therefore, inclined to think, that the fifth instruction given for plaintiff was erroneous, in so far as it makes the justification of appellant in delivering the cattle to Fleischman dependent upon appellee’s knowledge of Fleischman’s agency; and that the six orders in question should have been admitted in evidence; and that the fifth instruction asked by defendant below should have been given. The latter instruction conforms exactly to the ruling made by this court in Samuels v. Oliver, 130 Ill. 73. The usages of a particular trade or business are properly admissible for the purpose of interpreting the powers given to an agent. (Phillips v. Moir, 69 Ill. 155; National Furnace Co. v. Keystone Manf. Co. 110 id. 427).

The liability of the appellant was that of bailee or agister. Agisters of cattle are only bound for the exercise of ordinary care. (Umlauf v. Bassett, 38 Ill. 96; Story on Bailments, 443). The degree of care exercised is a question of fact for the jury. (Mansfield v. Cole, 61 Ill. 191). The ordinary rule is that, if a bailee deliver goods to the wrong person, although innocently or by mistake, he is liable as for a conversion. (Schouler on Law of Bailments, p. 119; Ala. & Tenn. River Railroad Co. v. Kidd, 35 Ala. 209). And if one man, who is intrusted with the goods of another, puts them into the hands of a third person contrary to orders, he is liable. (Parker v. Lombard, 100 Mass. 405). But it is not a conversion if the bailee, being intrusted with the possession merely, transfers the possession according to the directions of the person from whom he received it. (Parker v. Lombard, supra). Nor will trover lie where the conversion is with the knowledge or consent of the plaintiff. (Tousley v. Board of Education, 39 Minn. 419). Where the property is to be delivered by an ordinary bailee, and not by a carrier, the liability is only for proper diligence and care in the preservation and delivery of the property; and the question whether the defendant has been negligent in the delivery of the property is a question of fact for the jury. (Price v. Oswego and, Syracuse Railroad Co. 50 N.Y. 213; Benjamin on Sales, sec. 437; Heugh v. London & N. W. Railway Co. L. R. 5 Exch. 51; McKean v. McIvor, L. R. 6 Exch. 36; Clough v. London & N. W. Railway Co. L. R. 7 Exch. 26).

' The trial court refused to give the seventh instruction asked by the defendant below, which told the jury, that, in the matter of the care and delivery of the cattle, the defendant was only required to act with reasonable care and diligence, and in accordance with the usages and custom of carrying on business at the Union Stock Yards. We think that this instruction should have been given.

For the errors herein mentioned, the judgments of the Appellate and circuit courts are reversed, and the cause is remanded to the circuit court for further proceedings in accordance with the views herein expressed.

Reversed and remanded.