author: Oakley, C. J.

text:
    Ransom Beman v. George Tugnot and others.
    It is sufficient in a pleading, to aver generally, that a contract sought to be enforced, is in violation of some municipal ordinance or enactment, when such ordinance or enactment is founded upon a statute. It is not necessary to plead the statute specially.
    A contract made in violation of a statute, having a merely local or municipal application, is as illegal as if the statute in question had been one of universal application.

      A contract to construct a roof upon a building in the city of New York, is void, and cannot be enfoi-eed, unless the same is to be fire-proof, and equally capable of withstanding the influence of fire, as slate, tin, copper, zinc, or any other fire-proof material, in accordance with the statute passed April 4, 1849. A roof constructed otherwise, is in violation of the statute, and no compensation can be recovered therefor.
    (Before Oaklet, Ch. J., Sandford & Campbell, J.J.)
    June 20, 28, 1851.
    This was an action commenced by the plaintiff, to recover from the defendants, the contract price for the construction of a roof on a house of the defendants, in' the city of New York. The complaint alleged the employment of the plaintiff by the defendants, to construct, and put a roof on a building belonging to them, situated in Twenty-first street; that the work was performed in pursuance of such employment, and claiming to recover therefor, the sum of one hundred and twenty dollars, and sixteen cents. The answer of the defendants admitted the construction of the roof, but stated that the plaintiff undertook to put on a fire-proof roof, and such as had been, or should be approved of by the Fire Department, and in accordance with the fire-laws of the city ; the answer further averred, that the roof constructed by the plaintiff, was not fire-proof, and was not such as had been approved of by the Fire Department; that the same was in direct violation of the fire-laws of the city, and in consequence thereof, had been removed by the defendants, in compliance with a notice to that effect received from the Fire Department, and another substituted in its place.
    The reply denied that the plaintiffs undertook or agreed to construct a fire-proof roof, but alleged that the same was fireproof ; the reply also objected to the sufficiency of that part of the answer, which alleged that the same “ was not fire-proof,” and “ was not «such as had been approved of by the Fire Department, and was in direct violation of the fire-laws of the city,” &c., on the ground that these allegations were immaterial, and constituted no valid defence to the action.
    The cause came on for trial on the 19th day of April, 1851, before Mr. Justice-, and a jury. On the trial, the counsel for the defendants, after having proved that the roof mentioned in the pleadings, was made of a certain composition, offered to prove that the same was not fire-proof, nor' equally capable of withstanding the influence of fire, as slate, tin, iron, copper, zinc, or any other fire-proof material, for the purpose of showing that the contract in question, and the work done thereunder, were in violation of the statute entitled, “An Act to amend an Act for the more effectual prevention of fires in the city of New York, and to amend the acts heretofore passed for that purpose, passed April 4,1849,” and therefore that such contract was void. To the admission of this evidence, the counsel for the plaintiff objected, upon the following grounds1st. That the statute had not been pleaded. 2d. That although the evidence offered,, should be given, the plaintiff would be entitled to recover, the said statute not being a general law, but a local or municipal regulation merely. 3d. That such evidence would not show that the contract in question was illegal or void.
    The court admitted the evidence, and the plaintiff's counsel excepted.
    The jury rendered a verdict for the defendants.
    J. W. Gilbert, for plaintiff.
    I. The evidence objected to was not admissible under the pleadings. (1.) The statute was not pleaded, but the city ordinance merely. (1 Bl. Com., N. Y. ed. 1844, 86, n. 21. Code § 163.) (2.) The statute does not require that roofs shall be fire-proof, and there is no averment that the composition of which the roof in question was made, was not equally capable of withstanding fire, as slate, tin, &c., or that it was not approved by the chief engineer. (Laws 1849, § 2, 96,198.)
    II. The prohibition of the statute is limited by the classes of persons upon whom penalties are imposed for the violations of it. These are, 1, owners; 2, master builders; 3, master carpenters. The plaintiff was neither. (Johnson v. Hudson, 11 East. 180; Foster v. Taylor, 5 B. & Ald. 898; Cope v. Rowland, 2 M. & W. 149.)
    III. A violation of the statute in question consists in the omission to roof or cover buildings in the prescribed way. If a roof, such as the statute prescribes, had been put on over the roof in question, there could be no pretence of any violation of the statute. But the plaintiff is not responsible for the omission to put on such roof, and therefore his contract does, not fall within the prohibition ; moreover, the offer of the defendants did not embrace proof of such omission. (Story on Cont. § 621-622.)

      Mr. A. F. Smith, for the defendants.
    I. The statute was sufficiently pleaded. (Goshen and Sharon Turnpike Co. v. Sears, 7 Conn. 86-92.)
    II. If the plaintiff wished to object that the answer did not sufficiently refer to or recite the statute, he. should have demurred. He neglected to controvert the answer ; his, objection! is now too late. (1 Chitty's Pleadings, 671; Rockfeller v. Donnelly, 8 Cow. R. 655.)
    II. If the answer is defective, the “substantial rights of the party are not affected,” and the court will disregard the error. (Code, § 173,176.) The plaintiff was not misled ; he was fully apprised of the defence, and came prepared to meet it.
    III. The contract and the work done were illegal, because contrary to and in direct violation of the statute. (Laws 1849, p. 118, 296; Story on Contracts, § 218 and c., § 159, 162; Langton v. Hughes, 1 M. and S. 593; Law v. Hodgson, 11 East. 300; Hunt v. Knickerbacker, 5 Johns. 327: 5 Term Rep. 242.)
    Y. The contract and the work done were equally illegal as if the statute in question had been one of universal application throughout the state. (Bell v. Quin, 2 Sand. S. C. Rep. 146.)
   By the Court.

Oakley, C. J.

The only question in this case arises on the bill of exceptions, as to the admissibility of the evidence offered on the part of the defendants. The court holds with the defendants, and sustains the positions assumed by their counsel in his points.

We consider the contract illegal, as being in violation of the statute.

Judgment for the defendants.


source: Caselaw Access Project

author: Duer, J.

license: Public Domain

text:
    James S. Pringle v. Jonas Phillips & Augusto Nesi.
    To maintain an action of replevin a previous demand of the property replevied is only necessary to be proved, where the defendant was an innocent bailee, or holder.
    A purchaser, chargeable with notice, from a person who had obtained the property from the true owner by fraud, is not within the rule; the possession of such a defendant is wrongful in its origin.
    Nor is a prior demand necessary to be proved, even when the action is in the detinet only, provided it is shown that the possession of the defendant was wrongfully acquired; nor does the form of the action exclude this proof.
    To warrant a recovery against a purchaser from a fraudulent vendee, the actual malajides of the defendant, i. e. his positive knowledge or belief, is not necessary to be proved.
    To charge the defendant with notice, it is sufficient to prove that the circumstances known to him were such, as ought reasonably to have excited his suspicions, and led him to inquire.
    A want of that caution and diligence which an honest man. of ordinary prudence is accustomed to exercise in making purchases, is, in judgment of law, a want of good faith.
    The recent eases in England, which require positive evidence of mala Jides in order to defeat the title of a purchaser for value, examined, and their authority denied. ■
    They are an unwarrantable alteration of the law, as established by a long series of decisions, and the doctrine they seek to introduce is dangerous, as well as novel.
    Held, that the questions whether the defendant Phillips was a purchaser for value, and without notice, had been properly submitted to the jury, and that their verdict against him would not be set aside as contrary to evidence.
    Exceptions overruled, and new trial ordered.
    (Before Saudsobk, Dmat, and Campbeli, JJ.,
    16th June;
    28 June, ’51.)
    This was an action of replevin in the detinet for the recovery of 62 bales of brown cotton sheetings. The suit was commenced in July, 1845, and was tried before Chief Justice Oakley and a jury, on the 13th, 14th, and 15th December, 1848.
    Upon the trial, the plaintiff, a merchant in Philadelphia, claimed to recover upon the ground, that one Jacobs, under cover of a purchase upon credit, had obtained the goods from him in Philadelphia, by false representations and with a fraudulent intent, and that in execution of the fraud, he had shipped the goods to the defendant Phillips, in this city; and that if Phillips had paid value for the goods, which was denied, he had notice of the fraud, and was therefore not entitled to protection. The right of the plaintiff to recover against him was the same as against Jacobs.
    The fraud of Jacobs in obtaining the goods from the plaintiff was very clearly proved ; so clearly, that it was, in the result, admitted by the counsel for the defendants. It was also proved that Phillips had made a large advance upon the goods by the acceptance and payment of two drafts drawn upon him by Jacobs. There was no evidence implicating the defendant Nesi. The cause, therefore, turned entirely upon the question, whether the defendant Phillips was chargeable with notice of the fraud of Jacobs.
    Upon this question there was a large amount óf evidence, oral and written, the details of which, as not connected with the questions of law considered and decided by the court, are omitted. It is sufficient to say that the evidence was far from proving the actual knowledge of Phillips, but in the opinion of the jury, and in the judgment of the court, it was sufficient to charge him with notice, upon the ground that the circumstances known to him were such as ought to have awakened his suspicions and led him to inquire. He had manifested a want of caution, which was equivalent to a want of good faith.
    When the plaintiff rested, the counsel for the defendant moved for a non-suit upon the grounds—
    1. That there was no evidence to connect the defendants with the fraud of Jacobs.
    2. That there was no evidence of a demand prior to the commencement of the action.
    The Chief Justice denied the motion, and the defendants excepted.
    When the testimony on both sides was closed, the motion for a non-suit, upon the grounds before stated, was renewed. It was again denied, and an exception taken to the denial.
    The Chief Justice then charged the jury—
    That Nesi was entitled to a verdict, as he was in no way connected with the transaction, but was engaged, in a separate business.

      As to Phillips he charged as follows :
    The counsel on both sides agree that Jacobs obtained possession of the goods by fraud ; and that the sale as between him and the plaintiff was void. The property being traced into the possession of Phillips, he is bound, under the circumstances, to show his title to it.
    He undertakes to do so ; and insists that he accepted and paid the two drafts that have been given in evidence ; and, if you shall find that Phillips did accept these drafts in good faith, upon the credit of the goods, without any notice of the fraudulent manner, in which Jacobs had acquired possession of the property, and without notice or knowledge of any facts or circumstances which ought to have put him on his guard, as a man of ordinary prudence, then his title thereto is established, and the loss must fall upon the plaintiff.
    The counsel for the defendant, Phillips, thereupon excepted to the said charge, and to so much of said charge as instructed the jury that before they could consider Phillips’ title to the goods established, they must find that he did accept the drafts in good faith, upon the credit of the goods, without any notice of the fraudulent manner, in which Jacobs had acquired possession of the property ; and also, to so much of said charge as instructed the jury that before they could consider Phillips’ title to the goods established, they must find that he did accept the goods, without notice or knowledge of any facts or circumstances which ought to have put him on his guard, as a man of ordinary prudence ; and his exceptions were duly noted.
    The jury acquitted the defendant Nesi, but found a verdict for the plaintiff against the defendant Phillips, for six cents damages and six cents costs, and they assessed the value of the goods replevied' at $2,332.
    Leave was given to the defendant to make a case, with. liberty-to turn the same into a bill of exceptions.
    Upon the case so made, a new trial was now moved for, on behalf of the defendant Phillips.

      J. Anthon, for the defendant,
    said that there was no doubt that the goods in question had been obtained from the plaintiff Pringle, by Jacobs,, with a preconceived, intention not to pay for them, and that consequently, as between Pringle and Jacobs, the sale was fraudulent and void, and passed no title, so that as against Jacobs, the plaintiff, it could not be- denied, might have maintained this action, without a previous demand of a delivery of the goods ; but he insisted that as Phillips gave a valuable consideration for the goods in the advance he made, and therefore came to the possession Iona fide, the action of replevin in the detinet to try the absolute title, could never be maintained against him without evidence of a prior demand, and upon offer to pay all his just charges ; and that, as it appeared from the case that this objection had been distinctly and repeatedly taken upon the trial, it ought now to be allowed by ordering a judgment of non-suit. He cited Cary v. Houghtaking (1 Hill 321), Barret v. Warren (3 Hill 348).
    The learned counsel then made and fully argued the following points.
    L That the defendant being a bond fide purchaser, in the law, from a vendee, whose possession was acquired by actual delivery from the true owner, and which was therefore not felonious, is entitled to hold the same against the true owner. (Parker v. Patrick, 5 D. and E. 175; Mowry v. Walsh, 8 Cow. 238; Saltus v. Everett, 20 Wend. 275; Lloyd v. Brewster, 4 Paige 540; Andrew v. Dietrich, 14 Wend. 31; Carew v. Hoffman, 22 Wend. 285.)
    II. The judge ought therefore to have so charged on this point, and a verdict would necessarily have been rendered for defendant, the bona fides of his purchase being unquestioned.
    III. The judge’s charge was therefore erroneous, when, instead -of so charging simply and plainly, he directed the jury that it was not enough that defendant had accepted the draft (and subsequently paid it) in good faith, but that he was bound to show that he had acquired possession of the goods, without knowledge of any facts or circumstances which ought to have put him on his guard, as a man of ordinary prudence. (Miller v. Race, 1 Smith’s Leading Cases, 260, and the note.)
    IV. . This qualification has never been extended beyond the case of title acquired to bills of exchange and promissory notes, lost or stolen, and has, of late years, with reference even to such property, been repudiated.

      In support of this last position the counsel referred to Cook v. Jacks, 5 B. and Ald. 909, and other cases, and also to Sitory on Bills, Ac.
    The counsel then proceeded to argue, that even upon the supposition that the case had been properly submitted to the jury, their verdict as against Phillips could not be justified,'and ■ ought to be set aside as against both law and evidence.

      F. B. Cutting, for the plaintiff,
    denied that the recent cases in England, upon which the counsel for the defendant evidently placed his chief reliance, ought to be followed, and he insisted that the ruling of the chief justice was in all respects in conformity to law, and the verdict of the jury amply justified by the evidence. He also contended, that as the jury had found that Phillips was not a bond fide holder, a demand of the goods prior to the commencement of the suit was unnecessary.
   By the Court.

Duer, J.

The motion'for a new trial must be granted, if either of the exceptions to the ruling of the chief justice was well taken, or we shall be of opinion that theverdict of the jury, upon the question submitted to them, was against evidence.

The first exception was to the refusal of the judge to non-suit the plaintiff. The ground of this exception is,' that there was no evidence that a delivery of the goods in controversy was demanded by the plaintiff, and refused by the defendants before, the issuing of the writ of replevin, and we were referred to several cases, as showing, that such a demand and refusal were necessary to be proved, to entitle the plaintiff to maintain his suit. The cases referred.to undoubtedly prove that where the goods replevied were in the possession of an innocent bailee, who neither knew, nor had any reason to believe, that they had been wrongfully, or fraudulently obtained, by the person from whom he received them, a demand, before the commencement of the suit, is indispensable ; but we cannot apply this rule to the present case without assuming in favor of the defendants the* principal question in dispute, namely, that they were holders for value, and without notice. If Ihey were, not only the refusal of the judge to nonsuit the plaintiff, but his charge to the jury, and their verdict, were certainly erroneous, and it will be our duty to order a judgment of nonsuit, or grant a new trial; but, on the other hand, if the defendants had not acquired a title as against the plaintiff, which they certainly had not, if they are chargeable with notice of the fraud by which the goods had been obtained, a demand, before the commencement of the suit, was no more requisite to be proved than had the action been, brought against Jacobs himself, the perpetrator of the fraud. As this exception, therefore, presents exactly the same question as that to the charge of the judge, its separate consideration is wholly needless. There is no force in the objection that the replevin is in the detinet only. It is well settled, that this form of the action is not an admission that the possession was lawfully acquired by the defendant, but that the issue may be maintained by showing his wrongful taking ; and that this evidence, when given, renders proof of a demand unnecessary. If the defendants are chargeable with, notice of the fraud, their reception of the goods was a wrongful taking, in the same sense as the purchase by Jacobs. (Cummings v. Price, 3 Hill 282; Price v. Van Dyke, 6 Hill 614; Stillman v. Squire, 1 Denio 327; Zachrisson v. Ahman, 2 Sand. S. C. R. 68.)

We proceed then to consider whether the cause was properly submitted to the jury, and if so, whether their verdict is sustained by the evidence.

It is not denied that the purchase of the goods by Jacobs was a deliberate fraud, and that as against him the plaintiff had a perfect right to rescind the contract, and reclaim the property ; but as the defendants made a large advance upon the delivery of the goods, as their security, it has been contended, that the only question that could properly be submitted to the jury, was, whether in their dealings with Jacobs they had acted with- good faith, or were themselves parties, or privy to the original fraud. The more recent decisions in England, it is said, have established the law, that the title of a holder for value, can only be impeached, by showing, that he was either a party to the wrongful act by which the property was obtained, or must have known of its existence ; and that whatever suspicions, in the exercise of ordinary prudence, he ought to have entertained, and however gross his negligence, in not inquiring into the facts, yet, unless the jury are satisfied of his actual knowledge, or belief,, he is entitled to their verdict. The cases upon which the learned counsel for the defendants relied, are Crook v. Jacks, (5 B. & Ald. 909,) Backhouse v. Harrison, (5 B. & Ald. 1098,) and Goodman v. Harvey, (4 Adol. & Ellis, 870,) and it must be admitted that they go to the whole extent of the positions which he advanced. In the- last of these cases, Goodman v. Harvey, it was held by the court of king’s bench, that actual mala fides was necessary to be proved, and found by the jury, and that except as bearing upon this question, proof, even of gross negligence, was immaterial—and by this decision Lord Denman said, . “ that the • last remnant of the contrary doctriné.- was swept away.” If these cases, therefore, must be regarded by us, as a just exposition of the law, and are applicable to the transfer of merchandise, as well as of- bank bills, or negotiable paper, the charge of the chief justice was certainly erroneous; and the demand of a new trial is not be resisted.

But with all possible respect for the learned tribunal by which these cases were decided, we cannot regard them, as evidence of the law, that we are bound to follow. The “ contrary doctrine” was, in our judgment^ too long, and too firmly established, by a series Sf decisions, and has too solid a foundation in principle, to be now overturned or shaken. As we cannot think, that the law, whether enacted by the legislature, or made known and established by prior decisions, may be altered at the pleasure of judges, we must adhere to the doctrine which the court of king’s bench has rejected ; and with this doctrine, the charge of the chief justice, we shall proceed to show, entirely corresponds.

He told the jury, that, “ as it was admitted that Jacobs had ’ obtained possession of the goods by fraud, and that the sale, as-between him and the plaintiff, was void, the defendant Phillips, into whose possession the property was traced, was- bound to show his title, which it was insisted he had done by his acceptance arid payment of the two drafts that had been given in evidence; that, if the jury should find that Phillips accepted the draft, in good faith, upon the credit of the goods, without any notice of the fraudulent manner in which Jacobs had acquired the possession, and without notice or knowledge of any facts or circumstances which ought to have put him upon his guard, as a man of ordinary prudence, then his title was established, and the loss must fall upon the plaintiff.” We do not understand these directions to the jury, as casting the whole burden of proof upon the defendant, Phillips. A.s the fraud of Jacobs was admitted, Phillips was doubtless bound to show, affirmatively, that the goods had been transferred to him for value, but he was not bound to show, negatively, that no facts or circumstances were known to him, that ought to have put him upon his guard, as a man of ordinary prudence ; nor could the chief justice have meant to instruct the jury, that they had a right' to found their verdict upon the mere absence, or insufficiency of such negative proof. The fair and reasonable interpretation of the charge, and the meaning in which, we doubt not, that it was understood by the jury, is, that in order to warrant them, in finding a verdict for the plaintiff, they must be satisfied from the evidence that had been given, that the defendant, Phillips, had actual knowledge of the fraud of Jacobs, or of facts and circumstances that, in the exercise of common prudence, ought to have awakened his suspicions, and led him to inquire ; assuming as a principle of law, that, upon the latter supposition, the neglect to inquire was equivalent to positive notice." And, until the recent decisions in the king's bench, such, it will appear, had been the uniform language of all the courts, and all the judges in England and the United States, with the single exception of a nisi prius decision of Lord Kenyon, (Lawson v. Weston, 4 Esp. 4) which has been since expressly, and in terms overruled.

The oldest case in the English books is Miller v. Race (1 Burr. 452), in which it was determined for the first time, that negotiable instruments are an exception from the general rule, that a person, who has himself no title to a personal chattel, can pass no title to another. The dispute related to a Bank of England note for ¿621, which had been stolen from the mail; and the court held that the plaintiff, to whom the note, after it had been stolen, had been passed, for a full and valuable consideration, In the ‘ usual course of business, was entitled to recover against a clerk in the bank, who had detained the note when presented for payment. But, Lord Mansfield, in delivering its judgment, laid stress upon the fact that there was no evidence of collusion, or of any unfair dealing, and remarked that, had the note been for ¿61,000 the case would have been suspicious, meaning, we. apprehend, that the magnitude of the note would then, by justifying suspicion as to the title of the holder, have rendered inquiry necessary. So in the next case, in the order of time, Grant v. Vaughan (3 Burr. 1516), in which a similar decision was made, in relation to a draft upon a banker, which had been lost ‘by the 'owner, Mr. Justice Wilmot, to guard against any mistake as to the grounds of the decision, was careful to remark, that the plaintiff, who had cashed the draft, “had acted with the greatest caution, and that there was no imputation or pretence of suspicion that he had any notice of its being lost.” It seems to us evident, that the term notice ” is here used by the learned judge in its full legal sense, that is, as embracing a knowledge of circumstances that ought to induce, suspicion or belief, as well as direct information of the fact; and it was plainly needless to advert to the caution with which the plaintiff had acted, if, however suspicious may be the circumstances, no degree or measure of caution is required.

Passing over the intermediate cases of Peacock v. Rhodes (Douglas 611), and Solomons v. Bank of England (13 East, 135), we reach the important and leading case of Gill v. Cubitt (3 B. & Cress. 466), in which the general question, as to the proper direction to be given to the jury, in all cases, in which a purchase without notice is relied on, as a valid title, was elaborately argued and was determined by the king’s bench, upon full deliberation. The action was brought by the plaintiff, claiming as the endorsee of a bill of exchange for ¿6500, against the defendant, as acceptor. It appeared, in evidence, that the bill had been stolen, and had been discounted by a clerk of the plaintiff, who was a bill broker, for a stranger, without inquiry. Upon the trial the Chief Justice Abbott submitted two questions to the jury : First, whether the plaintiff hpd given value-for the bill;. and, secondly, whether he had taken it under circumstances that ought to have excited the suspicion of a prudent and careful man ; telling them, that if they should be of opinion that the plaintiff had done so, notwithstanding that he had paid full value for the bill, the defendant would be entitled to their verdict. The jury, under this charge (which is substantially the same as .that of our chief justice, in the present case), found a verdict for the defendant, which the plaintiff, upon the ground of the misdirection of the judge, moved to set aside. Upon the argument of this motion, the plaintiff’s counsel relied chiefly -upon the decision of Lord Kenyon, in Lawson v. Weston, that it is sufficient for a person who has discounted a bill, to show that he paid value for it, and that, if satisfied with the names of the parties, he is not bound to inquire into the title of the person from whom he receives it. But all the judges were of opinion, that this decision was incorrect, and that the direction, which the chief justice had given to the jury, was entirely proper, and therefore concurred in denying the application for a new trial. The chief justice admitted that the case was not distinguishable from Lawson v. Weston, but expressed his regret that a decision, tending so manifestly to encourage speculation and fraud, had ever been made, and Bayley and Holroyd, Justices, (two of the ablest judges that, during the last century, have adorned the bench,) concurred in saying, that although the question of good faith is that which is commonly submitted to the jury, yet this question involves that of due caution',-and he who discounts a bill, w" •out using due means to ascertain whether it had been honesiiy obtained by the holder, takes it at his own peril. The elaborate opinion of Mr. Justice Bayley contains a critical examination of all the former -cases, for the purpose of showing that, with the exception of Lawson v. Weston, they were in perfect harmony with the judgment, then to be rendered. In Doan v. Welling, (4 B. & Cress. 330,) which was an action for the recovery of a lost check, the question, whether the defendant had received it, under circumstances that entitled him to its avails, was submitted to the jury, exactly in the same terms, as in Gill v. Cubitt, and the jury, being of opinion that the defendant had-not used due caution, found a verdict for the plaintiff. Upon a motion for a new trial, it was insisted by the defendant’s counsel, that the true question to have been submitted to the jury, was, not whether the defendants had acted with due caution, but whether they..had acted, mala fide; and while he -admitted that Gill v. Cubitt was against him, -he coi tended that it was at variance with prior decisions, and therefore ought not to be followed. But the argument of the counsel made no impression on the court, the chief justice declaring that his brethren, as well as himself, were entirely satisfied with their former decision.

The next case, and it is a very strong one, was in the common pleas, Snow and others v. Peacock and others (3 Bing. 406). The action was trover for a ¿6500 Bank of England note, of which the porter of the plaintiffs had been robbed. The note had been taken in exchange for smaller notes of the defendants, who were country bankers, by a clerk, from a person of whom he asked no questions, and knew and learned nothing, except the name which he gave. The clerk, however, who was a witness upon the trial, swore that he had no suspicion that the note had been stolen. One of the questions, which the Chief Justice Best left to the determination of the jury, was, whether the defendants had exercised due caution, and had observed the usual course of business in exchanging the note. The jury found a verdict for the plaintiffs, but added, that not the slightest suspicion attached to the motives of the defendants. The chief justice, in delivering his opinion, upon an application for a new trial, examined the subject in all its bearings upon principle, and upon the authorities; and we think, it would be difficult to find in the reports a more lucid and moré satisfactory judgment. A new trial, he said, had been moved for, upon the ground, that the only question that should have been left to the jury, was, whether the defendants had taken the bill, bond fide, and that want of caution. on their part was only to be received as evidence of mala fides J and it had been argued, that to permit any other question to be raised, would introduce great uncertainty; but he was clearly of opinion, that there was no foundation for the argument; no uncertainty could arise from a conflict in the decisions, since, he affirmed and subsequently proved, that the direction which he gave to the jury, “ was supported by the concurrent authority of all the decisions in bank,” nor could uncertainty arise from any difficulty in the application of the rule; that reasonable caution must be exercised, since every man in business is taught by his own daily experience what degree of caution ought to be used, and what inquiries to be made. He then proceeded to vindicate, upon the grounds both of justice and policy, the direction that he had given, and to show, by a careful analysis, of the cases, its entire harmony with all the prior adjudications. The views of the chief justice were sustained by all his brethren, in their whole extent, and a new trial was consequently denied.

The next case to which we shall specially refer, Baynes v. Foster (4 Tyrwhitt 65), arose in the Court of Exchequer, during the period when that court, under Lord Lyndhurst as chief baron, deservedly attained its highest authority. The plaintiff had placed certain bills of exchange, in the hands of bill-brokers, for the purpose of being discounted, and the brokers, without his knowledge or authority, had deposited them with the defendants, as a security for large advances- made to themselves. The question was, whether the defendants had taken the bills under circumstances which gave them alien against the plaintiff, until their advances were satisfied. The jury, being of opinion that due caution had not been exercised by the defendants in taking the bills, found a verdict for the plaintiff, which the court, being of the same opinion as the jury, refused to set aside. In delivering the judgment of the court, Lord Lyndhurst said, in substance, that although a person who advances money on the deposit of bills has by law a lien on them against the owner, even when the party making the deposit had. no authority to pledge them, yet the rule is subject to this condition, viz., that the party with whom the bills are pledged is ignorant of the limited authority of the person making the pledge, and has no reason to suspect that his authority is restricted. The question, therefore, was, whether the defendants knew, or had good cause to suspect, that the brokers had received the bills from their customers merely for the purpose of being discounted ? If they knew the fact, they had no right to receive the bills as a security at all; and if they had cause to suspect it, they had no right to take them, without previous inquiry. That the circumstances of the case were such as ought to have excited the suspicions of the defendants; and as they had chosen to take the bills without inquiry, they had taken them at their peril, and not having exercised due caution, must abide by the result. To the cases that have been cited we add the following :—Beckwith v. Carroll, 3 Bing. 444; Snow v. Saddler, 3 Bing. 610; Strange v. Wigney, 6 Bing. 677; Easly v. Crockford, 10 Bing. 243; Slater v. West, Dawson & Lloyd 15; Fancourt v. Bull, 1 Bing. N. C. 681—in all of which the principle is distinctly affirmed or plainly implied that the want of reasonable caution, on the part of a purchaser or bailee for value, in omitting to inquire, when just grounds of suspicion exist, deprives him of the protection to which he would otherwise be entitled, even in cases where his actual good faith is not questioned or doubted.

This review of the decisions justifies us in doubting whether, upon any question that has been at all a subject of litigation, we should be able to find a more entire consent of the authorities that we are accustomed, and in a measure, bound to follow ; and it may well excite our surprise that the judges of the king’s bench have felt themselves at liberty to repudiate a doctrine to which their predecessors, in all the courts, in the fullest conviction of its justice and expediency, had so long and so inflexibly adhered. Either the maxim that it is the duty of judges “ stare decisis,” must be exploded as groundless, or cases, which involve its flagrant violation, must be disregarded.

In the cases in our own courts, which relate to the transfer of negotiable instruments, the language of the judges, as to the necessity of caution, on the part of the holder, when he had cause to suspect the title which he received, is explicit and positive. In all the cases the question is stated as involving proper diligence, as well as good faith. In Wiggins v. Bush (12 John. 306,1815), the action was brought by the endorser of a promissory note against the defendants, as makers, and the court held that the plaintiffs had such information as ought to have led to the inquiry as to the manner in which the note had been obtained by the payee, and that their neglect to make this inquiry subjected them to all the consequences of the transaction between the immediate parties ; and as between the parties, the note was fraudulent and void, it followed that the plaintiffs could not be entitled to recover. The earliest case in the United States, so far as we have discovered, is Ayer v. Hutchings, which was decided in 1808 by the Supreme Court of Massachusetts (4 Mass. 370). It is not necessary to state the special circumstances of the case, but the rules which, as unquestionable law, governed its decision, were stated by that eminent judge, Chief Justice Parsons, with singular brevity and force. He said, that the maker of a promissory note cannot give in evidence against an innocent endorsee, who came honestly by the note, without any reason to suspect that it was not good, any illegality in the consideration, or fraud- in obtaining it—but where the endorsee receives the note under circumstances which might reasonably excite suspicion, he ought, before he takes, it, to inquire into its validity, and if he does not, he takes it subject to any legal defence that would defeat a recovery by the payee. Done v. Baldwin (12 Pick. 545), was also an action by an endorsee against the maker of a negotiable note. The court, upon the whole case, rendered judgment for the plaintiffs, but in delivering their opinion, Wildes, J., admits the principle that if the circumstances attending the transfer of negotiable paper are such, as ought to put an endorsee upon his guard, he is bound to inquire—and if he do not, he purchases at his peril.

In Hill v. Hale (8 Connec. 336), the case turned upon the question, whether the plaintiff, who was an endorsee for value of a promissory note, and whose actual good faith was not impeached, had .exercised due caution in receiving the transfer. The jury had found a verdict for the defendant, the maker of the note, which the supreme court of Connecticut set aside as not justified by the evidence, but in delivering its judgment, Hosmer, Chief Justice, stated that “ the law was well settled, that if an endorsee take a bill without due caution, and under circumstances which ought to have excited the suspicions of a prudent and careful man, the maker, acceptor, or prior endorser, may be let into his defence,” and he referred, among other cases, to Gill v. Cubitt, as sustaining the position. The verdict was set aside, upon the ground that the judge, upon the trial, had misled the jury by exacting from the plaintiff the utmost possible caution, instead of that reasonable caution which prudent men usually exercise. Vide also, Holmes v. Sharpas, 5 Binn. 469; Sandford v. Norton, 14 Vermont 228; Nicholson v. Patton, 13 Louis. 213.

There is another, and a numerous, class of cases resting upon the same principle, that he who ought to suspect is bound to inquire. We refer to the successive decisions, which have settled the rule that an endorsee for value of a negotiable instrument, which when endorsed had passed its maturity, takes it subject to any and every defence that could be successfully urged against his immediate endorser. This rule" is constantly applied without the slightest reference to the actual good or bad faith of the endorsee ; and we are not aware that any other reason for its adoption has ever been given, except that the mere circumstance, that the note or bill was over due, ought to have excited suspicion and prompted inquiry. It is thus that Chief Justice Parsons, and Chancellor Kent, explain and vindicate the rule, and we should seek in vain for the protection of higher authority. (4 Mass. 373; 3 Kent’s Com. 81.)

Nor is this all. It is evident upon a slight consideration, that the cases which we have cited," are only a special application of the general doctrine of constructive notice, and unless they are to be received as law, that doctrine, long established as it lias been, and extensively as it prevails, ought to be wholly abandoned. It is either unsound in principle, or is universal in its application ; and if it is justly applied to the transfer of real estate, the exemption of personal, would be a capricious anomaly.

The principle of the doctrine of constructive notice is, that’ when a person is about to perform an act by which he has reason to believe that the rights of a third party may be affected, an inquiry into the facts is a moral duty, and diligence an act of justice. Hence, he proceeds at his peril when he omits to inquire, and is then chargeable with a knowledge of all the' facts that by a proper inquiry he might have ascertained. This neglect is followed by all the consequences of bad faith, and he loses the protection to which his ignorance, had it not proceeded from neglect, would have entitled him. The cases are innumerable in which this doctrine has been applied in courts of equity to purchasers and mortgagees of real estate, and there are many in which it has operated to divest, the title of those whose actual good faith was unsuspected. The rule, that it is only purchasers for value and without notice, who, in certain cases, may oppose their title to that of the true owner, we have .always believed and must still believe, is the same in courts of law as of equity, and in both, we cannot doubt' that the term notice must receive the same interpretation. It must either be limited to strict knowledge, which is derived from positive information, or must be extended to that which the law imputes to him, who, having reason to believe or suspect, refuses or neglects to inquire. y

Nor is constructive notice an arbitrary doctrine, or an unwise attempt to enforce by law a rule of morality. It is founded upon a deep knowledge of human nature, and is justified by the soundest reasons of public policy. It will rarely happen that a knowledge "of the fraud, or other fatal vice, by which the title he received was infected, can be brought home to the purchaser by positive evidence, yet to release him in all cases from the obligation to inquire, is to determine that, in all cases, such evidence shall be given. On the other hand, when it is manifest to the minds of a jury that just ground of suspicion existed, we may be certain as a general rule, that the suspicion was felt by the purchaser, and that he chose not to inquire, because he was resolved not to know. Constructive notice may doubtless operate in some cases, to defeat the title of deceived and innocent purchasers, but its general effect is to reach those, who meant, by their voluntary ignorance, to cover their fraudulent intent; and it is in truth so essential to the protection of deceived and innocent owners, that to abolish it, would be to encourage, if not by the promise, yet by the certain hope of impunity, dishonesty, collusion, and fraud.

We are aware that Judge Story, in his treatises on bills of exchange and promissory notes, has quoted the more recent cases in the king’s bench, (Backhouse v. Harrison, and Goodman v. Harvey, etc.) with seeming approbation, and considers them as having overruled the opposite doctrine, which, he admits, had long prevailed (Story on Bills of Exch. 194, Story’s Prom. Notes, 177), and it is because he has done so, that we have bestowed more care upon the examination of this case, than, otherwise, we should have thought to be necessary. The alteration of the law, which the decisions in the king’s bench, if followed, would effect, is regarded by us, not merely as an unwarranted stretch of judicial power, but as erroneous in principle, a,nd dangerous in its consequences; and it is the apparent sanction that has been given to it by Judge Story, arid our just fear of the influence of his name, that have induced us to explain, so fully, the grounds of our decision.

In closing this discussion, we deem it scarcely necessary to notice the objection, that the decisions on which we rely, relate exclusively to the transfer of negotiable instruments, and that it is to such cases that the application of the principle which they establish, should be confined, since we cannot doubt that this principle, the necessity of reasonable caution, applies to the disposition of other personal chattels, not only with equal propriety, but, if there is any distinction, with an increased force. From an enlightened regard to the interests of commerce, the transfer of negotiable paper is regarded by the law with peculiar favor : and, from the time of Lord Mansfield, judges have displayed a marked anxiety, that no restraint, not plainly necessary, should be imposed upon its free circulation. And, hence it is, that the innocent purchaser, who has exercised due caution, may derive a valid title, even from a robber. No title, however, as against the true owner, can be given to goods that have been stolen or lost, yet, where the possession has been acquired from the owner by fraud, a subsequent disposition is not necessarily void. The transfer in such cases, is an exception from the general rule, “ that no person can give to another a better title than his own,” in the same sense, although by no means to the same extent, as in the transfer of bank bills, and other negotiable instruments. But, although a fraudulent vendee may pass a valid title, it would be unreasonable to suppose that the conditions, on the part of the purchaser, of a valuable consideration, of good faith, and of reasonable caution, are not, at least, as indispensable in the one case, as in the other ; nor have any arguments been offered, nor authorities cited, to show that such a distinction exists. For a very clear, though condensed statement of the entire law upon this subject, we shall content ourselves with referring to the able opinion 'of a distinguished senator, in the case of Salters v. Everett (20 Wend. 274, 286). He observed, that where the possession and the apparent right of property in goods, has been obtained by fraud, and they are subsequently sold, it is only the honest purchaser who buys for a valuable consideration, in the course of trade, without notice of any adverse claim, or of any circumstances which might lead a prudent man to suspect such adverse claim, who will be protected in his title against the original owner.” (Senator Verplanck’s opinion, ut sup. p. 277.) Whether the defendant Phillips was a purchaser entitled to protection under this definition, is the question that, in our judgment, was distinctly submitted to the jury.

As the exceptions to the charge of the judge, and to his refusal to non-suit the plaintiff,, must be overruled, the only question that remains, is, whether the verdict of the jury is sustained by the evidence, and this wé shall answer in few words.

Two of the judges are of opinion that no other verdict than that which was given, could properly have been rendered, and, although some doubts are felt by their associate, he is very far from thinking that the verdict is so plainly unsupported by proof, that the discretion of the court would be fitly exercised by setting it aside. The question was exactly one of those which jurors, generally speaking, are far more competent to decide, than judges, and, in such cases, it is only a verdict, which was the manifest result of haste -or prejudice, that ought to be disturbed.

The motion for a new trial is denied.


author: Sandford, J.

text:
    Ann Jennings v. Mary Ann Jennings.
    A trust created by a will, which may have the effect of suspending the power of alienation, during more than two minorities, is illegal and void, provided more than two of the minors are living at the death of the testator.

    Held, that such was the effect of the limitation in a-will, which in this case was set up by the defendant, as a bar to the plaintiff’s recovery.
    Upop this ground, the judgment at special term, in favor of plaintiff, affirmed.
    (Before Sandfobd, Mason, and Campbell, J.J.)
    (May 20; 21;
    June 21, 1851.)

    This was an action to recover the possession of one-sixth of certain lots of ground, in the city of New York. The plaintiff claimed title, as one of the children and heirs at law of Joseph Jennings, deceased, who died seized in fee of the premises in question.
    The defendant, the widow of Joseph Jennings, claimed title as devisee, under his last will and testament, which she set forth in her answer, and averred, to have been duly executed and attested to pass real estate.
    The provisions in the'will, upon the construction of which the case wholly turned, are the following :
    “ I do hereby give and bequeath unto my beloved wife, Mary Ann Jennings, all my real and personal estates, whatever and wheresoever, in trust for the several uses and purposes hereinafter expressed, whom I hereby constitute and appoint my sole executrix (during her widowhood only), to this my last will.”
    “ I give and bequeath unto my daughters Elizabeth Linard and Ann Jennings, my children by a former wife, to each, one dollar (only). I will, that all the incomé of my estates, real and personal, be applied, after the payment of my just debts, to the maintenance and clothing of my said wife, and the maintenance, clothing, and education of my children by her, now born, or such as may be born in due time after my decease. And the surplus of such income to be laid up by her for these my children by her, on interest invested in the purchase of United States stock, in her name, as trustee to these my children.”
    “And as soon as the eldest surviving child by my present wife, becomes óf the age of twenty-one years, the whole of the property to be fairly appraised and valued, and his or her equal share of the property apportioned, and if required, paid to him or her.”
    “ And in like manner, the same couajs© to be pursued in respect to the rest of my surviving children by her, after the last of these my children, arriving at the age of twenty-one years, my said wife has to take the sole possession of my premises, with my furniture and live and dead stocks, on which I reside at Swedesborough, for her own use and benefit during her-natural life and widowhood, and after her decease or interest cease, to become the joint property of my then surviving child or children by her, share and share alike.”
    The plaintiff demurred to that part of the answer, which set up as a bar, the devise to the defendant, upon the ground, that by the laws of this state, the devise was illegal and void, and that the defendant had acquired, thereby, no title to the premises in question.
    Judgment upon this demurrer, was rendered, at special term, in favor of the plaintiff, and the case was now heard upon the appeal of the defendant from this judgment.
    J. Cook, for defendant.

      T. H. Rodman, for plaintiff.

         Affirmed in the Court of Appeals, December, 1851.

   By the Court.

Sandford, J.

It appears from the will, that the testator, at its date, owned buildings in this city, two parcels of real estate in New Jersey, and some personal property.

He gave all his “ real and personal estates,” to his wife, (the defendant,) in trust for the purposes of. his will. These were, first, to apply all the income of his estate, to the maintenance and clothing of his wife, and the maintenance, clothing, and education of his children, by her—the surplus, if any, was to be invested in United States stock, for those children. This trust was to continue, subject to the portioning off, presently mentioned, until the last of those children should arrive at full age—then, and net before, the defendant, if still a widow, was to take the sole possession of his Swedesborough premises in New Jersey, with his “ furniture, and live and dead stock,” for her own use during her life and widowhood, and when her interest ceased, that property was to be divided between the survivors of those children.

The will further provided, that whenever the eldest surviving child became twenty-one, the whole of the testator’s property, except the Swedesborough premises, furniture, and stock, should be fairly appraised and valued, and such child’s equal share, apportioned, and if required, paid to him or her. The same course was to be pursued in like manner, “ in respect to the rest of the surviving children” of the testator, by the defendant.

The will shows, that at its date, there were four children of that class, living ; and by the pleadings, it appears that they all survived the testator. The question involved, is the validity of the will, in respect of the testator’s real estate in this city, and it is to be determined according to the law of this state.

It is contended, on the part of the plaintiff, that the trust' attempted to be created by the will, if carried into effect, will suspend the- power of alienation beyond two lives, in being at the testator’s death, and, at any rate, may thus suspend it, and-that the trust is' therefore void. After maturely considering the subject, we are satisfied that this view of the effect of the will, is correct.

The life of the widow may be omitted in the argument, On the assumption, that as far as her interest in the income is concerned, it may be regarded as a legal estate, which she could alienate at any time, and which therefore of itself would not prevent a complete alienation of .the land devised. Then how does the case stand ? The property is to be kept entire, for the mutual and common benefit of the four children, until the eldest surviving child, becomes of age. Not for the equal benefit of each child, share and share alike, but for the support of all, as their varying ages and circumstances should require. The eldest might be a young lady, at a boarding school, requiring twice as much of the income as the youngest, a child of five years of age, and much more than one fourth of the entire income; This fact, as well as the manner of apportioning, forbids the idea that the éstate, at the death of the testator,-was, by the will, divided into four equal shares, one of which rested in each Of the children. The case, therefore, does not fall within the decisions in the Clendining will case, (26 Wend. 21, and 8 Paige, 295,) and Mason v. Mason’s Executors, (2 Sand. Ch. R. 432, affirmed iff May, 1849, in the' court of appeals.)

There can be no severance, or division of this property, iff fact, or iff theory, until the' eldest surviving child, attains his "dr her majority. It must remain entire until that event, as well by the express terms of the will, as1 by the necessary, effect of the provision for the' maintenance, clothing; and education of all the four children, who were beneficiaries Of the trust. Now suppose the two eldest, Josephine- and Frances, were to* die before they became twenty-one years of age, the trust- would continue for the benefit of the two younger children, who would thereupon be presumptively entitled to the whole estate, on their respectively becoming of age. . But until one of them attained that age, there could be no severance or apportionment of the property. Thus two lives would have already elapsed, during which, the power of alienation was suspended, and it must remain suspended, till at least one more life lapses, or the existing minority of one of the survivors, terminates. So if the three eldest should die under age, the trust, it would seem, must still continue, during the minority of the youngest child.

In our opinion, the case, for these reasons, falls directly within the principle established by Hawley v. James, (16 Wend. 61, 129, 167,) and which has been applied in many subsequent cases, under various circumstances. The trust estate created by the will, is determinable on the ceasing of a succession of minorities. It is thus dependent upon lives, and as two at least, of those lives, may expire before the trust can terminate, it contravenes the provision of the statute against perpetuities, (1 R. S. 723, § 15,) and it is therefore void.

Independent of the effect attributed to the bequest of the income in keeping .the estate entire and in mass, during the minority of the children, the same consequences may be deduced from the clause relative to the apportionment. When the eldest survivor became of age, the whole property, except that at Swedesborough, was to be appraised, and such survivor’s equal share apportioned to him. It would still remain in the trust, if she did not require its transfer, but it would, nevertheless, be alienable. But the residue must remain in the trust, inalienable, to provide for the future apportionments. Now, there is this insuperable obstacle to treating the estate as divided into equal fourth parts at the testator’s death, or the residue into equal third parts, after the eldest, if she survived, had received her share ; the appraisement was, in each instance, to be made, at the period, when the respective children became of age, and the apportionment was to be made upon the value then ascertained, and not upon the value, at the testator’s death ; or in respect of the three youngest, on the value, when the eldest became of age.

•To illustrate this, we will suppose that the testator’s personal property consisted of four bonds and mortgages, of six thousand dollars each. In that case, if each child were entitled, at his death, to an equal fourth, and there were no other clause in the will preventing a severance into equal shares, it would be the duty of the trustee at once to set apart one bond and mortgage to each, subject to a contribution from each to the support of the widow. Then, suppose that the bond and mortgage allotted by the trustee to the eldest had turned out to be worthless. No one will pretend that, when she became twenty-one, she would be compelled to receive the worthless security, as, and for, her share of the testator’s estate, which, by the terms of the will,, was to be then finally appraised and valued, and “ apportioned” to her.

Again, after the eldest child, on becoming of age, shall have received his share on the appraisal then made, both the real estate and the personal property may greatly depreciate, and when the next child becomes twenty-one, a new appraisal must be made of what is left, and her third of thatz residue may not be more than half as much as the eldest received. Such valuation is also subject to the further contingency of losses and dilapidations of the remaining estate. Without pursuing these5 illustrations, we think enough has been said to show that this estate cannot be deemed to have been given in equal fourths to. the four children at the testator’s death, and that there was nen gift of separate and distinct shares to each, or distinct trusts' in respect of each ; but that the estate was to be kept entire and as a whole, in the hands of the trustee, until the respective periods arrived, which were designated for the successive valuations and apportionments. Indeed, the will gives no part of the capital of the estate to. any of the children,, except upon' such apportionment; and it seems that neither of them took a. vested interest, at the testator’s death, either absolute or defeasible.

• On both of the grounds stated, we think the trust is void and the will cannot be upheld.. The authorities applicable to this, case, besides Hawley v. James, are Thompson v. Carmichael’s Executors, 1 Sand. Chy. R. 387; McSorley v. McSorley’s Executors 4 ibid. 414; McSorley v. Wilson, 4 ibid. 515: Field v. Field’s Executors, 4 ibid. 528; Boynton v. Hoyt, 1 Denio 53; and Vail v. Vail, 7 Barb. S. C. R. 226. The two former are very similar' to this case in the terms and effect of the devises in question, and each was dependent on four minorities.

The devise in trust being void, the defendant has no legal title to the premises claimed in this suit, by virtue of the will of her husband. If the gift of a portion of the income of his estate, for her maintenance, can be supported, aside from the trust, it would not aid her in this suit, and therefore we are not called upon to express any opinion on that subject.

The judgment at the special term must be affirmed, on the ground taken in the demurrer to the answer.


text:
    Charles Stoddard and Joseph S. Lovering v. The Long Island Rail Road Co.
    Commercial law is not local or sectional, but national in its character, and it is desirable that its uniformity, as such, should be preserved.
    Hence, upon questions of this nature, a paramount authority ought to be attributed to the deoisions of the highest national tribunal.
    The owners of goods, delivered for transportation to the proprietors of an express and forwarding line, are bound by.any contract between such forwarders, and the common carriers, or other subordinate agents, whom they employ.
    Hence, such owners can only maintain an action against such carriers, or other agents, in those cases in which the action could have been maintained by the forwarders.
    A special agreement restricting the liability of common carriers is valid in law.
    Such an agreement, however, although general in its terms, is not to be interpreted, as exempting the carriers from losses, resulting from fraud or negligence.
    It has been an invariable rule in this court not to grant a new trial upon an objection which is raised for the first time, upon the argument of the motion.
    An error of law, in the charge of a judge, is to be disregarded as immaterial, when it appears that the question of fact, upon which alone the cause depended, was properly submitted by him to the jury.
    Hence, the verdict of the jury upon the question submitted in this, as in other eases, is not to be set aside unless plainly contrary to the evidence. '
    Motion, on behalf of the plaintiffs for new-trial denied with costs,
    (Before Dber and ^ami-bell, J.J.)
    (June 10, 28, 1851.)
    This was a motion on the part of the plaintiffs for a new trial upon a case settled, with liberty to either party to turn the same into a special verdict or bill of exceptions.
    The action, which was commenced before the code, was trespass upon the case against the defendants, as owners of the steamboat New Haven, to recover damages for the loss of four cases of silk goods, belonging to the plaintiffs; which in the month of January, 1846, were delivered on board the New Haven to be transported to Allyn’s Point, Norwich, and thence by railroad to Boston. It was tried before Mr. Justice Sand-ford and a jury, on the 15th April, 1849.
    The following are the material facts proved upon the trial.
    The plaintiffs are merchants, importers of French goods, residing in Boston, trading under the firm of Stoddard & Love-ring ; and on the 25th January, 1846, the goods in question, consisting of four cases of valuable silks, were delivered, as their property, at the office of Adams & Co., in New York, for the purpose of being transported by the latter to Boston and there delivered to the plaintiffs. Adams & Co., are common carriers, very extensively engaged in the express and forwarding business. They receive goods for transportation from and to the principal cities of the Union, and have an office in each of them for that purpose. Their contract is with the shippers or consignees of the goods for the whole route of transportation, and it is to them that the shippers or consignees pay the entire freight. On this occasion the goods in question were taken from the office of Adams & Co., in one of their own wagons, and placed on board the New Haven, for the purpose of being transported thence to Norwich, and thence by the Norwich and Worcester rail road to Boston. They were not, however, delivered to the captain or any other officer of the boat, but to a special agent or messenger of Adams & Co., whose duty it was to accompany and take charge of the goods, which they undertook to convey, and to pack them in crates provided for such conveyances. The four cases of silks were accordingly packed by him in such a crate, and this crate, after the arrival of the boat at Allyn’s point, by the gross negligence of the hands of the boat, who attempted to land it, fell overboard. It. was, however, got out from the water and transported to Boston ; but when the cases were opened, the silks were found to be wet and greatly damaged. They were, therefore, sold as damaged, on account of whom it might concern, at public auction. The sum for which they were sold, deducting charges and commissions, was $1257.20 less than their market value, if sound, and it was this sum, with interest, that the plaintiffs claimed to recover.
    On the part of the defendants, it was admitted that they were the owners of the New Haven, which was one of a line of boats belonging to them, employed in the transportation of freight and passengers, from New York and Norwich; and it was proved that they had purchased this, and the other boats of the line, from the original owner, Cornelius Vanderbilt—that between Vanderbilt and Adams & Co., there was a special agreement, in writing, relating to the transportation of the goods which Adams & Co. might undertake to convey ; that when the defendants became the owners of the line, the agreement with Vanderbilt was, by mutual consent, renewed and adopted throughout, as binding upon themselves and Adams & Co., and that it was under this agreement, that the goods in question, were received on board the New Haven, and transported.
    The agreement with Vanderbilt, which was read, in evidence, upon the trial, was in these words :—
    “ Memorandum of an agreement entered into this — day of February, 1844, by and between Cornelius Vanderbilt, proprietor of the Norwich Line of Steamboats, and Adams & Co., proprietors of a Package Express between New York and Boston.
    “ For, and in consideration of the sum of four thousand three hundred dollars, to be paid by the said Adams & Co. monthly, the said C. Vanderbilt agrees to transport, in his said steamers, on each and every passage between New York and Norwich, or such point in its vicinity at which said steamers may land, to the extent of one conductor or messenger, (without extra charge for berths or meals while on the passage,) and two merchandise crates measuring, together, one hundred and eighty-four cubic feet, or their equivalent.
    “ It is understood and. agreed, that the business of the said Adams & Co. on this route shall be confined exclusively to the transportation of merchandise and express matter from Boston through to New York, and from New York through to Boston; and that they, the said Adams & Co. and,their agents, will not in any way interfere with its local business ; said Adams & Co. further agree not to transport nor assist in transporting U. S; mails on this route.
    “ During the continuance of this agreement, it is understood and agreed that the said Adams & Co. shall possess the exclusive privilege, so far as it is in the power of said C. Vanderbilt, to grant such rights, of prosecuting the business,of a package express between New York and Boston, over his, said C. Vanderbilt’s, steamboats, via Norwich; and further, said C. Vanderbilt agrees to render all reasonable and proper facilities in the transportation of said express, as aforesaid; hut such exclusive privilege shall not be construed so as to preclude the proprietors of the line from transporting freight over this route in any way they may see fit.

      “ The said Adams & Co. agree to be alone responsible for any and all losses or damage to goods, wares, merchandise, or other property transported for them by the said C. Vanderbilt under this agreement; and they, the said Adams & Co., will advertise and give proper notice accordingly.

      “ This agreement to take effect from 1st ultimo, and continue one year therefrom, to wit—to the 1st January, A. D. 1845, unless sooner terminated, at the election of said C. Vanderbilt, in case said Adams & Co. should fail to comply with either of the provisions of this agreement; or in case he, said Vanderbilt, should withdraw his steamers from the route ; and in case said C. Vanderbilt should fail to perform either of thé requirements herein stipulated to be performed by him ; then, and in that event, said Adams <fc Co. shall have the power to annul the contract immediately.”
    The principal question of fact upon the trial, was, whether the hands of the boat, by whose negligence the loss was occasioned, were acting of their own accord, or under the direction of an officer of the boat, or at the request, and under the direction of Gould, the messenger of Adams & Co., in opposition to the wishes, and even orders, of the captain. Upon this question there was a direct conflict of testimony, Gould swearing positively to one state of facts, and a mate, and others of the hands, as positively, to another, and directly opposite.

      Upon the whole case, the judge charged the jury, as follows:—
    If the defendants were common carriers of the goods in question, they are liable for the loss sustained, although it happened on an extra trip; and this depends upon the question, whether the goods were in their care or keeping, at the time of the loss. If the plaintiffs contracted with Adams & Co. as the agents of, or acting for the defendants, the jury will be warranted in finding that the goods were in the defendants’ care, or keeping, and that they were liable as common carriers.
    It is proved that Adams & Co. were not, in fact, the defendants’ agents; but the defendants’ liability is the same as if they were agents, provided the defendants so acted towards the public with Adams & Co., and their express establishment, as to warrant persons delivering goods to Adams & Co., in believing that the latter were the defendants’ agents, or were acting in the defendants’ behalf, in carrying on their express.
    The jury will decide this point on the testimony before them, relative to the plaintiffs’ course of dealing with Adams & Co., and relative to the nature and character of their express business. There has been no satisfactory evidence given to show that the plaintiffs had any knowledge of the use by Adams & Co., of the forms of bill-heads and receipts which have been produced on the trial, and the jury will lay those forms entirely out of view. And as to the advertisement read in evidence, the testimony is very slight to connect the plaintiffs with any knowledge or notice of the same; and the jury will regard it accordingly.
    If the plaintiffs contracted with Adams & Co., as the agents of the defendants, or under circumstances which warranted them in believing that Adams & Co. were such agents, the defendants are liable, as common carriers, for the injury to the plaintiffs’ goods.
    On the other hand, if the plaintiffs contracted with Adams & Co., as principals, the defendants are not liable as common carriers. In that aspect of the case, Adams & Co. were the common carriers in respect of the plaintiffs, and were liable as such for the loss.
    Independent of the liability as carriers, there is another ground upon which it is claimed the defendants are responsible.

      The cause of the injury is obvious, and it clearly exhibits a want of care so great as to constitute a wrong, and to render liable those who were guilty of the neglect; and if this negligence was that of the defendants, or of those acting in their employment, they are liable for the injury.
    To determine this, the jury will inquire, were the hands of the boat, in attempting to get the crate ashore, acting under the orders and directions of Gould, the messenger of Adams & Co.; or were they acting of their own accord, or in supposed accordance with their ordinary duty, to run the crates ashore, on the boat being made fast to the wharf?
    If the steamboat hands were acting by the direction of Gould, or in aid of his expressed wish to get out the crate, after he was notified by the captain’s orders to the contrary, the defendants are not liable on this ground of negligence. If Gould assume 1 to direct in the matter, and the proper officer of the boat was not acting in it, Gould is responsible for all the defects in the placing of the planlts, and the want of care which resulted in the loss.
    If, on the other hand, the crew of the steamboat were acting of their own accord, without reference to Gould’s wishes, or were acting in the supposed discharge of their duty to get out the crates on the arrival of the boat, the defendants are liable for the injury which occurred. In this view of the case, the orders of the captain and first mate, not to take out the crate, do not relieve the defendants from liability.
    If the jury find the defendants liable, either as common carriers, or on the ground of negligence, they will give their verdict for the amount of the damages as proved, with interest from the date of the loss.
    The plaintiffs excepted to all that part of the charge, which, in any aspect of the case, exonerated the defendants from liability as common carriers.
    The jury found a verdict for the defendants.

      F. B. Cutting, for the plaintiffs, relied upon the following points and authorities, which he argued in extenso.

    I. The defendants were common carriers of the goods in question, and, as such, were responsible to the plaintiffs for the damage sustained by them in this case. (Merchants’ Bank v. The N. J. Transportation Co., 6 Howard’s U. S. S. C. Rep. 344; Roberts v. Turner, 12 J. R. 232.)
    II. The fact that Adams & Oo. by their contract with defendants agreed to assume all the liability for losses or damage to goods transported under their contract, does not by the settled law of this state alter the liability of the defendants as common carriers. (Goold v. Hill, 2 Hill 623.)
    III. The fact that Mr. Gould, the messenger or agent of the parties, was present to look after the property, does not alter the defendants’ liability. (Hollister v. Nowlan, 19 Wend. 234.)
    IV. That part of the judge's charge, in which he instructed the jury, that, “ If the plaintiffs contracted for the transportation of the goods with Adams & Oo. as the agents of, or acting for the defendants, the jury will be warranted in finding that the goods were in the defendants’ care and keeping, and that they were thus liable as common carriers”—is erroneous, and was calculated to mislead the jury, because that question has never arisen in the case, nor has either party ever contended or suggested, nor was any evidence offered that Adams & Co. were the agents of the defendants.
    V. The whole tenor of the charge, as to who was liable as common carriers, was erroneous, and calculated to mislead the jury as to the principles of law applicable to the case. Instead of charging that the liability of the defendants, as common carriers, depended upon the facts as to whether Adams & Oo. were the defendants’ agents, or whether defendants had so acted as to induce other people to believe so, the judge should have charged, as matter of law, from the facts proven, that Adams & Co. were the plaintiffs’ agents in employing defendants to transport the goods in question ; and that the defendants were liable as common carriers to the plaintiffs in the same manner, and to the same extent, as if the plaintiffs had made the contract with the defendants in person. (Merchants’ Bank v. The N. J. Transportation Co., 6 Howard’s Sup. Court Rep. 344.)
    YI. That part of the charge is erroneous, in which the judge instructed the jury that—
    “If the steamboat hands were acting by the direction of Gould, or in aid of his expressed wish, to get out the crate after he was notified of the captain’s orders to the contrary, the defendants are not liable, on this ground, of negligence.” (1.) If the officers and men who were in charge of the boat at the time of the accident, and who were the agents or servants of the defendants, instead of obeying the orders of the captain, as they should have done, violated such orders, and endeavored to put the crate ashore at the request or by direction of Mr. Gould, a stranger, that, of itself, was a gross neglect of duty, and sufficient to make the defendants liable for all the consequences. (2.) If Mr. Gould did direct or request that the crate should be put ashore, and the mate and hands of- the boat, contrary to the orders of their captain, consented to put it ashore, it was then their duty to put down the proper planks, and to úse all proper care in getting it ashore; and the loss having happened by the want of such care, the defendants are liable.

      H. F. Clark, for defendants, insisted that,
    I. The defendants were not the common carriers of the goods in question, and never had them in their custody or control. The plaintiffs contracted with Adams & Co., as principals, and not with the defendants. The action cannot therefore be maintained against the defendants. "The remedy of the plaintiffs is against Adams & Co., who were the carriers of these goods for the plaintiffs.
    II. The defendants had the power to contract for exemption from liability in respect of merchandise transported by Adams & Co. and are by such contract exonerated.
    III. The damage to the goods in question having been occasioned by the act of Gould, to whose custody they were intrusted by Adams & Co., and not by any negligence of the defendants, the defendants are not liable for such damage.
    IV. There is no error in the charge of the judge, and the motion for a new trial should be denied with costs.
   By the Court.

Duer, J.

All the questions of law that properly arise in this case, were involved in that of the Merchants’ Bank of Boston v. The New Jersey Steam Navigation Company, (6 Howard, 344,) and were then determined by the supreme court of the United States. This determination, including the reasons by which it is sustained, commands our entire assent, and had it been otherwise, we should still have yielded to its authority. The decisions of our highest national tribunal, upon questions of general commercial law, we cannot but think, ought to be regarded throughout the Union, as authoritative and controlling. Commercial law is not local or sectional, but national in its character, and its uniformity therefore a national concern, and it is only by attributing a paramount authority to the decisions of the highest court of national jurisdiction, that this desirable uniformity can be attained or preserved.

The contract in this case, between Adams & Co. and the defendants, is substantially the same, and must receive the same interpretation, as that between Harnden and the New Jersey Steam Navigation Company, in the case, by which we are governed, and conforming our decision to that of the supreme ■court of the United States, we must therefore hold: 1st. That the liability of the defendants, as common carriers, was restricted by the terms of the special agreement between them and Adams & Co., and that this restriction was valid in law.

2d. That by the just interpretation of this agreement, the defendants were not to be exonerated from all losses, but remained liable for such as might result from the wrongful acts, or the want of due care and diligence of themselves, or their agents and servants ; and, lastly,

That the plain tiffs, not having delivered their goods immediately to the defendants, but claiming through Adams & Co., are bound by the special agreement, and consequently, are not entitled to recover, unless this action could have been maintained by Adams & Co., in their own names.

These points being decided, it is obvious that the only question which remains in the case, is the question of fact, namely, whether the negligence, by which, it is admitted, that the loss was occasioned, can be justly imputed to the defendants, and if this question was properly submitted to the jury, and the verdict rendered, is sustained by the evidence, the motion for a new trial, must of necessity be denied.

It is therefore needless to consider, n hether all the positions of law, that were laid down by the judge upon the trial, and to which, exceptions were taken, were strictly correct, since, if in the result, the proper question was submitted to the jury, no previous mistake of the judge, could by possibility, have had any influence upon their verdict. If he arrived at the true conclusion, that the plaintiffs were entitled to recover, if the loss was occasioned by the negligence of the defendants, and so instructed the jury ; no error in the process of reasoning, by which he reached that conclusion, can be material. And if the jury have acquitted the defendants of the negligence imputed to them, and upon the existence of which, their liability solely depended, the verdict, if not against evidence,, must be conclusive. We are not to be understood as intimating, that there was in truth any error in the charge of the learned judge, but, as there was certainly none that could have misled the jury upon the single question which it was important for them to consider, we decline to enter upon a useless discussion. It is evident that upon the trial, the counsel of neither party had just views of the law, as settled by the decision of the supreme court, in the Merchants’ Bank v. The New Jersey Steam, Navigation Company, and hence the attention of the judge was directed to questions, in relation to which, no expression of his opinion was necessary to be made, or ought to have been required ; and it is equally clear, that neither party could have been prejudiced by the opinion which he did express. The plaintiffs excepted to all that part of the judge’s charge, “ which in any aspect of the case, exonerated the defendants from liability, as common carriers,” but, if the defendants, although common carriers, were exonerated from the loss, that was sought to be recovered by force of the special agreement between- them and Adams & Co.; the error of the judge, if such he committed, in holding them not to be liable as common carriers at all, was purely verbal, and wholly unimportant, since it is not pretended that he exonerated them from any loss, for which, under the agreement, they were meant to be responsible. On the contrary, he distinctly told the jury, that, if the defendants had been guilty of the negligence which occasioned the loss, (and, which alone under the agreement, could render them liable,) the plaintiffs were entitled to recover. The exception to the charge is therefore overruled, as irrelevant.

The judge told the jury, in substance, that if the hands of the boat, to whose neglect, the injury to the goods was plainly owing, were acting under the orders and direction of Gould, the messenger and agent of Adams & Co., the defendants were not responsible for the loss ; but, that they were responsible, if the hands were acting of their own accord, without reference to the wishes of Gould, and in the supposed discharge of their own duty. To this mode of stating and submitting the question of negligence, no exceptions were taken upon the trial, and it is, therefore, evident that the acts of Gould, the agent, were then considered by the plaintiffs’ counsel, as well as by the court, as those of his principals, Adams & Co. Upon the question thus submitted, it is impossible to say, that the verdict of the jury was against the evidence. There was a direct conflict between the testimony of Gould, the agent, and that of the hands of the boat, and looking merely to the number of witnesses, the weight of evidence was clearly in favor of the defendants. We have no right to say, that the witnesses for the defendants were unworthy of belief. Of their credibility, the jury were the proper and sole judges, and a verdict, which it is not denied, expressed their deliberate judgment, cannot be disturbed. To set aside a verdict, when the testimony was conflicting, and the question doubtful, would be, not an exercise of discretion, but an usurpation of power.' It has, however, been insisted, that the question of negligence was not submitted to the jury in the proper form, and that for this reason, the verdict may be justly disregarded. The judge, it is said, should have instructed the jury that, it was immaterial, whether the boatmen were acting under the direction of Gould, or in the supposed discharge of their own duty, since, upon either supposition, if the loss was occasioned by their carelessness, the' defendants were responsible for its satisfaction. The defendants were bound, it was argued, by the contract, with Adams & Co., not merely to transport the goods, but to deliver them at the place of destination. The landing of the goods, with due care, was therefore an essential part of the contract, from the obligation of which, Gould had no power to discharge them. As the agent of Adams & Co., he was to receive the goods upon their delivery, at Norwich, but during the passage, he was a stranger, having no right to interfere, and consequently, the servants of the defendants, in following his directions, were guilty of a breach of duty, for the consequences of which the defendants must be liable.

It is not to be denied, that this reasoning is specious, but it is a conclusive reply, that the question which it raises, was not raised upon the trial, nor the alleged error in the charge of the judge, then made a ground of exception. In this court, it has been an invariable rule never to grant a new trial upon an exception which is taken for the first time upon the argument of the motion. (Cook v. Hill, 3 Sand. Sup. C. R., p. 351.)

We are aware that there are cases, in which the supreme court has granted a new trial, upon the sole ground, that the decision involved an error of law, which had been wholly overlooked upon the trial, and we are not prepared to say, .that cases may not arise, in which we shall deem it expedient to follow a similar course ; but we shall certainly not depart from the rule that we have hitherto followed, in any case, in which the objection that is relied upon, had it been raised on the trial, might, perhaps, have been removed by additional proof, which the party against whom the objection is urged, may have been prevented from offering by the silence of his adversary. Here, had the question been raised on the trial, it might have appeared, upon the further examination of Gould himself, that he was clothed with all the authority of his principals, and had the same control over the goods that Adams & Co., if present, would have possessed ; and it cannot be pretended, that if Adams & Co. had personally directed the landing of the goods, the defendants would have been bound to make good any portion of the loss that followed.

As the case stands, we think, we are bound to say, that the silence of the plaintiffs, upon the trial, was equivalent to an admission, that Gould possessed, in its fullest extent, the authority which is now denied to him, and that the admission thus made, cannot now be withdrawn.

Our decision, that the plaintiffs are concluded by the verdict, must not be understood as implying that they are without remedy as against Adams & Co., or have lost their remedy by electing to sue the defendants. These are questions, upon which, it would be improper for us, now, to express, or intimate an opinion.

The motion for a new trial, is denied, with costs.