Wilson v. The Vidette

34 F. 396, 1888 U.S. Dist. LEXIS 41

• Court: District Court, S.D. Alabama
• Decided: March 20, 1888
• Status: Published

Opinion

Toumiis, J.,

(after dating facts as above.) A seller, who has sent goods to a buyer, at a distance, may stop them at any time before they reach the buyer, on the ground of the insolvency of the buyer. The right to do this is called the right of stoppage in transitu. Pars. Merc. Law, 60; 2 Benj. Bales, § 1229; Loeb v. Peters, 63 Ala. 243; 1 Pritch. Adm. Dig. 541. Nothing short of a bona fide sale of the goods for value, or the possession of them by the vendee, cun prevent the vendor’s right of stoppage in transitu. Loeb v. Peters, supra; Lesassier v. Southwestern, 2 Woods, 35. A notice of stoppage in transitu by the vendor to the carrier is sufficient to charge the carrier. And upon the vendor asserting his right to slop the goods, and demanding them of the carrier while the right of stoppage in transitu continues, the carrier is bound to redeliver them, and will become liable for a conversion of the goods if ho refuses to redeliver them to the vendor, and delivers them to the vendee. Iiis refusal to redeliver on demand is sufficient evidence of conversion. 1 Pritch. Adm. Rig. 541; 1 Pars. Ship}). & Adm. 522; 5 Wait, Act. & Ref. 615, and authorities there cited; Hutch. Carr. § 420. It is held by some authorities that in case of doubt as to the vendor’s right the carrier’s duty is to file a bill of interpleader. 1 Pritch. Adm. Rig. 514. And in 1 Pars. Shipp. <fc Adm. 522, it is said that if both vendor and vendee claim the goods of the currier, ho should ask an indemnity. There is, however, no legal obligation on either party to give such indemnity. But if it is asked and refused, and the carrier thereupon refuses to deliver the goods, the rightful claimant could recover them or their value; but nothing by way of costs or damages for the detention. But all the authorities agree that it is the duty of the carrier to redeliver the goods to the vendor on his giving notice of stoppage in transitu,, and making demand for them. And it is held that for his refusal to do so he is liable for a conversion of them. See authorities cited supra. Upon the exercise of the right of stoppage by notice to the carrier the buyer loses the right to take possession of the goods under the bill of lading. 2 Benj. Sales, § 1287, and note. The effect of the notice is to revest the vendor’s possession. 5 Wait, Act. & Ref. 016, 618; 2 Benj. Sales, § 1295. And the carrier has no right to say that 'he will retain the goods for delivery to the true owner after the conflicting claims have been settled. 2 Benj. Sales, § 1281; Story, Bailm. § 580. I have found hut one authority, and that a text writer, (Blackb. Sales,) which holds that the carrier delivers the goods to the vendor at his peril, and would probably be responsible to the vendee therefor if the stoppage was wrongful. But I have found'no case where a court has followed this rule. It is said in the case of The Tigress, Brown. & L. 45, (which is quoted with approval in the opinion of the judge in the case of The E. H. Pray, in 27 Fed. Rep. 474,) that “the vendor exercises his right of stoppage in transitu at his own peril; and it is incumbent on the master to give effect to that right so soon as he is satisfied that it is tbe vendor who claims the goods, unless he (the master) is aware of a legal defeasance of the vendor’s claim.” The seller, who stops the goods, takes the risk on himself, and if he stops them wrongfully, would doubtless be answerable for any damages the buyer should sustain thereby. 1 Pars. Shipp. & Adm., 518.

The question now considered is not whether the stoppage in transitu here complained of was wrongful, and what damages the libelants have sustained thérebv, but whether, (the goods having been stopped in transitu by the sellers,) the libelants can recover damages from the vessel for the non-delivery of the goods to them on the bill of lading. The libelants, in their libel, claim damages for a breach of contract in that the vessel refused to deliver the goods to them on their demand. The libel, however, shows that the vessel’s refusal to deliver the goods to libelants was because of the stoppage in transitu by the sellers, Tefft, Weller & Co., to whom the law made it the vessel’s duty to redeliver the goods on their notice. I have found but one dase directly in point, and that is a case just like this. There the vendee of a cargo of clay brought suit on a bill of lading against the vessel to recover damages for non-delivery of the cargo. One Hayes was the vendor, and before the delivery of the cargo to the libelant required the master of the vessel not to deliver it to libel-ant, asserting the insolvency of libelant and the non-payment of the price of the cargo. The court says:

“Here Hayes was the vendor of the goods; he had not been paid by the libel-ant; there was no legal defeasance of the vendor’s claim and the vendor demanded the goods upon the ground of the insolvency of the vendee. These circumstances justified the master in refusing to deliver the goods to libelant, and constitute a good defense to such an action as' this.” The E. H. Pray, 27 Fed. Rep. 474.

In the case of Schmidt v. The Pennsylvania, 4 Fed. Rep. 548, the report of the opinion of the judge trying the case is so meager that it is difficult to determine what his views were except on the question of damages. But it appears that the court held the detention of the goods by the vessel was wrongful, and that libelant was entitled to recover damages for such detention. This, doubtless, was on the ground that the claimant was the assignee of the bill of lading, and a purchaser for value; that there was a legal defeasance of the vendor’s claim, of which the master of the vessel had been informed, and the detention of the goods was •therefore wrongful. There the stoppage in transitu was conceded to have been wrongful, and was recalled, and the goods were in the possession of the vessel when the libel was filed. But however this may be, as the law makes it the duty of the vessel to redeliver the goods to the seller on notice by him of a stoppage in transitu, it seems to me there can be no lia-ability on the vessel for the performance of this legal duty, and it should not bo held liable in damages for a refusal to deliver the goods to the buyer. Besides, the libel shows that the libelants commenced an action of detinue for the goods before filing their libel. Are they not thereby concluded from maintaining this action, which is inconsistent and incompatible with the former remedy to which they resorted? Insurance Co. v. Cochran, 27 Ala. 228. My opinion is that on principle and the weight of authority this libel cannot be maintained; and as the exceptions to it raise the point here decided, it is unnecessary for me to consider the case on its merits.

The exceptions to the libel are therefore sustained, and the libel is dismissed at libelant’s costs.