text:
    Edward Cotter v. James E. Bettner.
    The defendant, owning a stone quarry, agreed, on the'9th of October, 1854, with one Edward Hollis, as follows: Hollis agreed with Bettner to blast stone in this quarry, and fit them for market, with men and materials to be furnished and paid for by himself Bettner was to procure them to be drawn to his dock on the Hudson River, preparatory to selling them there, or forwarding them to New York to be sold. Hollis’s men were to assist Bettner’s teamster in loading the stone at the quarry, and in loading them on a boat if sent to New York for sale. Hollis was to pay half the expense of the powder, purchased necessarily for the business. Bettner was to retain possession of the stone and sell them. And it was further agreed that “the net proceeds shall be equally divided, share and share alike, one half to said Hollis, and the other to belong to said Bettner.”
    In November, 1854, while the business was prosecuted under this agreement, the plaintiff, while at work on adjoining premises, was injured by the careless and negligent manner in which stone were blasted .out of this quarry, by men employed by Hollis, and under his exclusive direction and control, and sustained damage to the amount of §1300.

      JELeld, 1. That the defendant was liable for such injury.
    2. That Bettner and Hollis were partners in quarrying the stone, and in the results of the business, in the sense and to the extent that the defendants in the case of Bostwick v. Champion et al. (11 Wend. 571, and 18 id. 175) were partners.
    3. One partner is liable to third persons for the negligent acts of his copartner in the prosecution of the partnership business. And each is liable, in tort, for the negligence of the servant employed and paid by one of them exclusively, by which a third person is injured, while such servant is engaged in the due course of his employment, in transacting the business of said partnership.
    (Before Bosworth & Woodruff, J.J.)
    Argued, June 17;
    decided, July 11, 1857.
    This action, comes before the Court, at General Term, upon a verdict for the plaintiff, subject to the opinion of the Court; the only questions arising at the trial, being questions of law, they were there ordered to be heard, in the first instance, at the General Term. The facts are as follows:
    On the 14th of November, 1854, the plaintiff was injured by the careless and negligent manner, in which stone were blasted out of a quarry, near Yonkers, in Westchester county, N. Y., and sustained damages to the amount of $1300.
    The quarry was the property of the defendant, and at the time of the injury Edward Hollis was working it and blasting stone out of it, under, and pursuant to a written agreement between him and the plaintiff, which reads as follows, viz:
    “ Memorandum of agreement and lease, entered into this ninth day of October, 1854, between Edward Hollis and James E. Bett-. ner—namely, said Hollis covenants and agrees with said Bettner to commence, prior to the first day of November next, to quarry out stone on the property and premises of said Bettner (lying and being in the town of Yonkers) for one equal share, namely, said Hollis is to do and furnish the labor and perform the part of procuring and working out said stone, for one equal half of the proceeds of the sale thereof, when realized by the said Bettner, who is to have the possession of the same, and to have them drawn to the dock on his premises, preparatory to the sale of the same on said dock, or otherwise forwarding them to New York for sale.
    Said Hollis farther covenants and agrees with said Bettner to work the quarry on the premises of said Bettner, known as the old quarry, in such manner and form as he has pointed out and described to said Bettner, viz., sloping down and grading the east side thereof in a suitable and satisfactory manner to said Bettner.
    Said Hollis also agrees to bear one equal half of the expense which shall be incurred in the purchase of the powder necessary for the work above named; said Hollis also covenants and agrees with said Bettner to assist and aid the teamster who shall do the drawing of said stone from the quarry to the dock; in loading the truck, also in loading any boat which shall be engaged to take said stone on freight to Hew York, if required so to do by said Bettner; and that he shall and will put and keep the dock and the road between said quarry and the dock in good order and repair, during the term of this agreement, viz., two years, and said Bettner promises and agrees with said Hollis to have the stone which shall be quarried out by said Hollis, as aforesaid, drawn to the dock preparatory to their sale or shipment to Hew York for sale, and that when sold and the money realized therefor (by him, the said Bettner,) the net proceeds shall be equally divided, share and share alike, one half to said Hollis, and the other to belong to said Bettner; and said Bettner covenants with said Hollis, that he may continue to work said quarry or quarries in manner and form agreed upon for two years ensuing from the date hereof, provided he shall faithfully conform to and fulfil the covenants and agreements set forth in his part of this agreement, otherwise it shall be lawful for the said Bettner to annul and dissolve this agreement at his pleasure, on giving ten days’ notice to said Hollis to that effect.
    In witness of all which said Hollis and the said Bettner have hereto affixed their respective signatures.”
    Under that agreement, Edward Hollis employed three men to assist him in performing his part of the agreement. At the time of the casualty, they, and Edward Hollis, were employed in ■quarrying stone, and one of these men fired the fuse that communicated with the powder, by which the blast was made that did the injury.
    The defendant had a team of his own, and a man hired by himself, employed in drawing to the dock, the stone which Hollis quarried; the dock being on the Hudson River, about 1800 feet from the place of the blast. By the blast, a large piece of rock was thrown a great distance, hit the plaintiff who was at work for a third person, on adjoining premises, fractured plaintiff’s arm, in consequence of which he was confined in the hospital some months, and his arm permanently affected.
    The action was tried before Mr Justice Slosson and a jury, on the 14th of December, 1855. The judge submitted the questions of negligence and damage to the jury with proper instructions, who found a verdict for the plaintiff, with $1300 damages, which verdict was rendered, and taken subject to the opinion of the Court, at General Term, upon the question of the defendant’s liability under the aforesaid agreement, between him and Hollis, with liberty to the Court at General Term to dismiss the complaint, if of the opinion that the defendant is not hable, and judgment to be applied for at the General Term, in the first instance.

      Jas. W. Gerard and Beck and McAdam, for plaintiff.

      John M. Mason, for defendant.
   By the Court. Bosworth, J.

If Bettner & Hollis were partners in quarrying the stone and in the results of that business, in the sense that the defendants were, in the case of Bosiwick v. Champion and others, it will be difficult to discriminate between that case and the present.'—Bostwick v. Champion et al, 11 Wend. 571, and 18 Wend. 175.

In the case. cited the defendants, Champion, Bissell, Ewers, & Dodge, run a line of stage-coaches from Utica to Bochester. The route was divided into sections: the section from Utica to Vernon was occupied and run by Dodge; another section, extending west, by Ewers and others; and the remainder of the route by Champion & Bissell. The business was conducted as follows:

The occupants of each section provided their own carriages and horses, employed their own drivers, and paid the expenses of their separate section of the route, except the tolls at the turnpike gates. The moneys received as the fare of passengers, after deducting such tolls, were divided among the occupants of the several sections, in proportion to the number of the miles of the route run by each.

Bostwick’s wife was injured while riding in a wagon, in consequence of a stage running against it, by the carelessness of the driver of the stage.

The injury happened on the section occupied by Dodge. The stage-coach which run against the wagon was owned by him, and the driver of it was employed and paid by him.

All the defendants were held to be partners, as to third persons, to such an extent as to be liable, as such, for such an injury to the party injured; although, as between themselves, the loss ought to be borne by Dodge alone.

By the agreement between Bettner & Hollis, the net proceeds of all the stone -quarried under it, were to be equally divided between them.. What other items of expense, if any, were to be deducted from the gross price for which the stone should be sold, to ascertain and determine the balance deemed to be net proceeds, may not be so clear as to be free from controversy.

While it is certain that no expenses of Hollis, for the wages of men he might hire to perform his part of the agreement, were to be deducted, nor any expenses on the part of Bettner, in drawing the stone from the quarry to the dock, it is quite clear that the cost of the powder used for blasting was to be deducted. By the terms of the contract each was to pay half of that expense, and, of course, its cost must be deducted to ascertain net proceeds.

If any part of the expense of transportation from the dock to Hew York, or of wharfage, slippage, or storage in that city, or of disposing of the stone in that market, were also to be deducted, then there would be some matters, other than the powder, as to which the expense was borne equally, as between themselves.

In Bostwick v. Champion there was but one item of expenditure to be deducted from the gross receipts for passengers’ fares, viz., the tolls at the turnpike gates. The difference between the two amounts was to be divided in definite proportions.

In the case before us one item of expenditure (and perhaps others) was to be deducted from the aggregate of the gross receipts for the stone. In that respect, the two cases are alike.

The stages could not be run and fares earned without paying tolls at the turnpike gates.

The stone could not be blasted and produced from the quarry, so as to be the subjects of sale, according to the terms and purposes of the agreement between Bettner & Hollis, without powder, and making the disbursements necessary to procure it.

In each case the expenditure which is made a charge upon the common fund, or which is to be deducted from it, before any division of profits can be made, is one which is necessary to enable the agreement between the contracting parties to be executed by either.

In each case it is made in order to earn profits by the prosecution of an enterprise or business, in which profits, as such, each is to participate, in stipulated proportions.

Of the agreement between Bettner & Hollis it may be said, that each contributed to the business of quarrying stone and vending them in the market as much as the other. The partners themselves, by their agreement, treat their contributions as equal. Bettner furnished the stone in his quarry, and men and teams, at his own expense, to draw the stone from the quarry to the dock.

Hollis contributed,' at his own expense, the labor necessary to blast and quarry the stone, and to assist Bettner’s teamster in loading the truck at the quarry which was to carry the stone to the dock, and also in loading any boat at the dock which should be engaged to take the stone on freight to Hew York.

Bach was to pay half of the expense of the powder. They both treat what either agrees to do and furnish at his own expense, as equivalent to that to be done and furnished by the other at his expense.

One item of expense, it is expressly stipulated, shall be a common charge. It is unnecessary to determine whether it is not clearly contemplated that there may be other items of expense, which, if incurred, shall be deemed a common charge, and deducted from the gross receipts, in order to ascertain the sum to be equally divided between them.

Bettner & Hollis were, clearly, partners, in respect to the profits of the business.

In this case, as in Bostwick v. Champion, a third person sues to recover compensation for injuries, occasioned by the negligent manner in which the business was conducted.

In the latter case, all the defendants were charged as partners, although the injury was inflicted on a section of the route, occupied and run by only one of their number, under an agreement which required Mm to run it by conveyances, and drivers to be furmshed by himself, and at Ms own expense; and although he was so occupying and running it at the time, and a driver hired, and paid by himself, was guilty of the negligence for wMch the action was brought.

If Bettner & Hollis had been united as defendants in this action, the analogy of the two cases would seem to be perfect throughout.

There is a marked distinction between the facts of this case, and of the cases of Blake v. Ferris (1 Seld. 48), and Peck v. The Mayor of N. Y. (4 Seld. 222), and the prmciples applicable to each.

In the present case, by reason of the partnersMp relation between Bettner & Hollis, the servants and laborers of either, while acting under and executing the agreement on the part of their immediate employers, are, as to third persons, the servants and laborers of the other, in so far, as the results of their negligence, while thus employed,'may affect third persons.

Although hired and paid by one only, and acting at the time under Ms immediate direction, they are acting m a busmess wMch is that of both parties; in the results of wMch one is as much interested as the other, and in the fruits of which each has as much property and right of property as either.

- In the other cases, there was no commumty of mterest between the defendant and the particular contractor, by the negligence of whose employee, the injury was inflicted.

And the law is deemed to be well settled that one partner is liable, in tort, for the acts of his co-partner, in the prosecution of the co-partnersMp business, as well as upon contracts made by one for the benefit of the jomt concern.

And each is liable, in tort, for the negligence of the servant employed, and paid by one of them exclusively, by which a tMrd person is injured, while such servant is engaged in the busmess, from wMch both were to derive, as partners, a profit. (18 Wend. 185, 286).

The plaintiff is entitled to a judgment on the verdict, Judgment was entered accordingly.


source: Caselaw Access Project

author: By the Court. Duer, Ch. J.

license: Public Domain

text:
    Charles Cook v. George W. Beal and Seth Adams.
    When an agent has a general authority to sell goods, entrusted to him by the owner, or is held out to the world by his principal as possessing that authority, a sale made by him to an innocent purchaser, although in violation of his duty, and of his secret instructions, cannot be impeached. But the mere possession of goods, by a factor or commission merchant, is not evidence to the world that he has an unlimited authority to sell them, so as to preclude the owner from impeaching a sale made by him, by showing that the goods were entrusted to him " for a wholly different purpose.
    It is true, there are some dicta that support this proposition, and that have led to its adoption by some of the text writers; but there is no express adjudication, and the cases relied on as justifying it, when carefully examined, are found to lead to an opposite conclusion.
    A sale made by a factor or agent not entrusted with the documentary evidence of title, or with the goods themselves for the purpose of sale, is not rendered valid by the provisions of the Factors’ Act. On the contrary, the 6th section of the act, by a necessary implication, declares such a sale to be void.
    (Before Dues, Slosson & Woodruff, J.J.)
    Heard, April 13;
    decided, July 11, 1857.
    This action comes before the Court, at General Term, upon a case made by the plaintiff, upon exceptions taken on the trial, and there directed to be heard in the first instance at General Term.
    This action was brought to obtain the delivery of a large quantity of wool, and was tried before Ch. Justice Oaklet, and a jury, on the 22d December, 1856. He directed the complaint to be dismissed, on the ground that the action could not be sustained upon the facts proved. *
    The following are the material facts as established by the evidence on the trial.
    The plaintiff, in 1855, possessed a large quantity of wool at his place of business in the county of Chemung, and made an arrangement with the firm of Davis and Peabody, for its storage in their warehouse in Duane street, Hew York, for the purpose of exhibiting it to the Horthampton Manufacturing Company, who were large purchasers. The wool came to the warehouse about the first of May, 1855, and the Northampton Co. examined it but did not purchase it, and it remained in the warehouse. One Baker was the agent of the plaintiff in the purchase of the wool, and also for its sale subject to the approbation of the plaintiff, and while the plaintiff was absent at Charleston, S. C., he had power to fix the price for about a month. Davis & Peabody were provision merchants, selling provisions, beans, cheese, apples, &c., but not wool. Their agency was to communicate offers for the wool to Baker. They were not to sell, nor by any arrangement to have commissions. They were to l)e paid storage. They told the plaintiff Cook if he would store the wool in their vacant-lofts, it might be sold, and he would not have to pay 5 or 10 per cent, commissions "which wool dealers charged. Davis and Peabody failed before the sale, made by one Tuthill, who was a member of that firm when it failed, and succeeded them in December, 1855, and took the wool into his possession upon the same terms that it had been held by Davis & Peabody. He was a commission merchant, principally for the sale of provisions. Numerous offers for the purchase of the wool were made by various parties to Davis & Peabody, and they referred them to Baker. Tuthill also referred applicants to purchase, to Baker. Baker by direction submitted all offers to Cook, who declined them. Evidence was given tending to show that Tuthill had an express authority to sell, but it was deemed by the Court at General Term, wholly insuffi-'ent.
    About the latter part of February, 185by- Cook directed his agent, Baker, to take the wool out of market. It was to be shipped to Boston.
    On the 13th February, 1856, Tuthill rendered his bill for' charges upon the wool to Cook, which had been requested a few days before, and which, after adjustment with Baker as the agent of Cook, was paid the next day by Raplie & Co., through Baker in full, and on the 15th day of February, Cook gave an order to Tuthill to deliver the wool to Raphe & Co., which was duly accepted, and Tuthill said it was all right, and it would be delivered. The arrangement with' Tuthill about the room or loft, at the time of payment of the bill, was, that he was to store the wool until the first of March. The understanding was then had, that as on account of the condition of the streets, &c., the wool could not yet be removed to Boston, he was to store it until the first of March.
    Immediately after the acceptance of this order, and on the next day, 16th February, Tuthill wrote to Cook that he had sold the wool, which act Cook repudiated and disapproved, in his reply of the 18ih, saying that Raphe & Co. were the only parties authorized to sell the wool, This was before it was taken out of market.
    Between the 12th and 15th of March, the witness Baker discovered that the wool was being removed, and he asked Tuthill what he was doing with Cook’s wool, and he said he had sold it to the defendants, and that he was authorized by Cook to sell. The witness replied that it could not be, and that Cook would not sanction anything of the kind, and forbade the delivery. Cook being advised by telegraph, came immediately to town, and called the next morning on the defendants, and notified them that it was his wool, and that Tuthill had no authority to sell it, and demanded the wool, about one half of which had then been received in their store; and Adams said the rest would be received that day, and that they had nothing to do with Cook, that they had bought it, and that he must go to Tuthill. The wool was 23,7551 pounds net. Wool rose after the 15th January, 1856. This wool was worth 48 cents in September, 1855; 53 cents in March, 1856, and 57|- cents at the time of trial,
    The question ""rising upon these facts was, whether the defendants had acquired a valid title to the wool as bond fide purchasers.
    When the plaintiff rested, the counsel for the defendants moved that the complaint be dismissed upon the grounds, that the wool was in Tuthill’s possession, and that he had an express or implied authority to sell, and that at any rate the defendants were entitled to protection as bond fide purchasers.
    The Chief Justice granted the motion, and the counsel for the plaintiff excepted.

      A. Mann, Junr., for the plaintiff, moved for a new trial.

      Jas. C. Carter, for defendants contra.

   By the Court. Duer, Ch. J.

It was clearly proved upon the trial, and is not denied, that the plaintiff was the sole owner of the wool in controversy, when it was sold by Tuthill to the defendants, and consequently, unless the sale was made by his authority, he must be entitled to recover. The undoubted rule of the common law, that no person can give a better title to another than he himself possesses—nemo plus juris in alium iransferre potest quarn ipse Tidbet—is applicable, with certain exceptions, to every sale of goods, whatever may be their character; and hence, unless it was established upon the trial that, by force of some known exception from the rule, the defendants are entitled to protection as bond fide purchasers, the complaint ought not to have been dismissed, and a new trial must be granted. . As it is certain that Tuthill was not the owner of the wool, there must be a new trial, unless the evidence given was conclusive to show, either that he had an express authority to sell, or that the defendants were justified in believing that he possessed this authority, and that the plaintiff was estopped from denying it.

The whole argument for the defendants, therefore, rests upon the proposition, that we are bound to say, upon the evidence before us, that Tuthill possessed either an express or an implied authority to sell, and to give to the defendants a valid and unimpeachable title.

The allegation that he had an express authority, will not require many observations. So far from being sustained by the evidence, it is very clearly disproved, not only by the oral testimony of Baker, which is uncontradicted, but by the letters which the defendants themselves produced and read upon the trial. It was proved by Baker, that, as the agent of the plaintiff, he placed the wool in the possession of Davis & Peabody, as mere bailees for storage and safe keeping; that he gave to them no power whatever, of disposition, or to contract, but imposed on them the duty of communicating to him or the plaintiff all such offers of purchase as might be made to them, and if it be said that this conveyed to them an authority to receive such offers, it is not possible to contend that this was equivalent to an authority to sell. It was further proved, that the agreement and understanding with Tuthill, when he succeeded Davis & Peabody, was exactly the same; and if it may be inferred from the evidence and correspondence that for a time he was entrusted with a power to sell, the proof is decisive that this authority was revoked several weeks "before he made the sale to the defendants. It was effectually revoked when he accepted the order of the plaintiff, requiring him to deliver the wool to S. S. Raplie & Co., to whom, as the plaintiff informed him in his letter of the 18th February, the power of making a sale was from that time exclusively given. The sale fraudulently made by him to the defendants, contrary, as he well knew, to the wishes of the plaintiff, and in the exercise of a power that had been expressly denied to him, was on the 12th or 13th of March. Holding it, therefore, to be certain that Tuthill, in making the sale which is set up as a defence, acted without authority from the plaintiff, and in plain violation of his trust, the question that remains is, whether the trust has clothed him, by implication, with an authority to sell, which rendered the transaction valid and binding on the plaintiff. The contention on behalf of the defendants is, that where the owner of goods places them in the possession of a person whose known occupation is that of a commission merchant or factor, he by that act holds him out to the world as having a general and unlimited authority to sell, and consequently, when a sale is made to a purchaser in good faith, is not allowed to question its validity.

How it is undoubtedly true, that when an agent has a general authority to sell, or is held out to the world by his principal as possessing that authority, a sale made by him to an innocent purchaser, although in violation of his duty and of his secret instructions, cannot be impeached; and we entirely agree with - Mr. Justice Story, that a contrary doctrine would lead to great abuses, and open a wide door to injustice and fraud, (Story on Agency, §§ 127-133,) but it by no means follows that the mere possession of merchantable goods by a factor is evidence to the world that he has an unlimited authority to sell them, and precludes the owner from showing that they were entrusted to him, not for sale, but for a wholly different purpose, such as transportation to another place, or temporary custody. It is not denied that there are many dicta to this effect, that have been adopted by text writers, but we fully believe that there has been no express adjudication. After a careful research, we were unable to discover any, and we were certainly not referred to any by the counsel for the defendants.

The only authorities to which we were referred by the learned counsel, are Pickering v. Busk, (15 East 38); Whitehead v. Tuckett, (id. 400), and the observations of Senator Verplanck, in Saltus v. Everett, (20 Wend. 281.)

Whitehead v. Tuckett, may be at once dismissed as irrelevant, for the general authority of the agent, in this case, was not implied, but distinctly proved—and the case is only one of a numerous class that have settled the doctrine, that the law will not permit the title of an innocent purchaser, to be defeated by his ignorance of the private instructions of an agent acting within the scope of his general authority.

Nor does Pickering v. Busk, as an actual decision, tend to establish the doctrine it was cited to prove; As a decision, it has no more relevancy to the question under consideration, than Whitehead v. Tuckett. The principal in this case had clothed the agent with a legal title to the property in dispute, and had thus enabled him as the apparent owner to sell it in his own name. We understand Mr. J. Story to admit that this was the true ground of the decision, (Story on Agency, § 164), and it was certainly upon these facts that Lord Ellenborough laid the stress of his opinion. That he who has the legal title may give a full title to a prior purchaser, has never been doubted; that there would be manifest injustice in permitting the owner to divest the title which he had thus enabled the faithless agent to convey, is confessed by all.

But although Pickering v. Busk, as an adjudication, is very far from sustaining the broad position upon which the defendant’s counsel relied, that the mere possession of property by a factor is an implied authority to sell, it cannot be denied, that the position seems to be justified to some extent, by some of the observations that were made by Lord Ellenborough and his brethren, in the delivery of their opinions, but whether these extra-judicial dicta, for such they were, are a sufficient foundation for the doctrine, may deserve consideration. They form, apparently, a very slight basis of authority for the introduction of a new and wide exception from the sound rules of the common law, that possession is only presumptive existence of ownership or authority, and that he who has in truth no right to sell, can give no title to another.

As to Saltus v. Everett, the judgment of the Court was in strict conformity to the rules of the common law, and the observations of Mr. Senator Verplanck, in his able opinion, were built entirely upon the dicta in Pickering v. Busk. They show his interpretation of those dicta, but make no addition to their authority.

For myself, I entertain very serious doubts whether the observations of the judges in Pickering v. Busk, detached from the context as they have been, have been rightly understood. I strongly incline to believe that a construction has been given to them that they were never designed to bear, and that such is the fact, in relation to those of one of the most eminent of these Judges, appears to be certain. The language of Mr. Justice Bayley, the Judge to whom I refer, was—“ If a man puts goods into another’s custody, whose common business it is to sell, without any limitation of his authority, he confers an implied authority to sell.” Mr. Senator Yerplanck, in citing this passage, omits the qualifying and significant words, “ without any limitation of his authority,” and this omission led him to attribute a meaning to the learned Judge, widely different from that which the language of the Judge, when the omission is supplied, plainly conveys.

Mr. J. Bayley evidently meant, that an authority to sell will be implied only when a different object or purpose is not declared, but that when the exercise of the authority is limited, and a fortiori when the authority itself is expressly withheld, a sale made by the agent or bailee in violation of his duty, will no longer be binding on the owner. And such, I am persuaded, was not only his meaning, but that of the Court. A repeated perusal of all the opinions that were given, has convinced me that the ground of the decision was, that the facts "of the case, in the absence of contrary proof, warranted the belief that the hemp—the subject in controversy—was, in reality,, placed in the hands of the broker for the purpose of sale, and that we have, therefore, no right to say or suppose, that had it been proved, that such was not the purpose and intention of the plaintiff, it would not have been held that he was entitled to recover. It was held that he was bound by the sale, because the proof was deemed to be sufficient, that he intended a sale should be made. Hence, Pickering V. Busk, rightly interpreted, so far from being an authority for the defence now relied on, tends to prove its insufficiency. It was insisted by the counsel for the defendants, that the defence is frilly sustained by the provision of the act “ relative to principals, and factors or agents,” (1 R. Stat. p. 774); but an attentive consideration of the statutory provisions has led us to an opposite conclusion. As we understand these provisions, so far from countenancing the defence, they prohibit and exclude it. They are directly inconsistent with the position that the possession of goods by a factor with the consent -of the owner, is alone conclusive evidence of his authority to sell them, and precludes the owner from showing that they were put into his custody, not for the purpose of sale, but for storage only.

We do not doubt that the 3d section of this important statute was meant to be declaratory of the common law as it was understood by the framers of the act, and is now understood by ourselves. It accordingly renders valid every contract made by a factor or agent, for the sale or disposition of any merchandize in his possession, in two classes of cases: first, where the factor has the documentary evidence of title; and second, where he has been entrusted with the possession of the merchandize for the purpose of sale. It seems to us impossible to doubt that these last words, “for the purpose of sale,” by their natural and just interpretation, confine the protection that in the second class of cases was meant to be given to purchasers, to the cases where the owner has entrusted the merchandize to the factor or agent, with the intention of enabling him to sell it, and with an authority to sell it; and, consequently, that the words are not applicable at all, when it is proved that no such intention existed, and that no such authority was meant to be given. If this construction be rejected, and that of the defendant’s counsel be adopted, it will be found that the words, “for the purpose of sale,” are superfluous or unmeaning. They are useless, if the factor may sell, no matter for what purpose the merchandize has been entrusted to him, and the possession is alone conclusive evidence of his right to sell. They are unmeaning, if they do not forbid him to sell when the merchandize has been entrusted to him for any other purpose than that of sale. There is a manifest solecism in saying that goods are entrusted to a factor for sale, which it is proved that he received for storage only; and, if we adopt the defendant’s construction, to get rid of the solecism, the words “for the purpose of sale” must be struck out from the law. This, assuredly, we have no right to do, but, on the contrary, are bound to give effect to those words, if a reasonable and consistent interpretation can be given to them. We are bound to say that their natural and obvious is their true meaning, unless it can be shown that it is irreconeileable with the other provisions of the statute. It is a sound and controlling rule of interpretation, that “ verba aliquid operari debent.”

If we could admit that the third section of the statute is fairly susceptible of an interpretation different from that which has been stated, and consistent with the defence that is relied on, we must still hold that every reasonable doubt, as to our duty in the disposition of the case before us, is removed by the positive language of the 6th section of the statute, which is in the words following:

“ § 6. Nothing contained in this act shall authorize a common carrier, warehouse-keeper, or other person, to whom merchandise or other property may be committed for transportation or storage only, to sell or hypothecate the same.” 1 R. S., p. 774.)

It cannot be.said that there is any ambiguity here. The evident meaning of the Legislature is, that no sale made by a common carrier, warehouse-keeper, or other person, to whom property is committed for transportation or storage only, shall operate to divest the title of the true owners; in other words, that every such sale, as against the owner, shall be wholly void. We are unable to see that there are any grounds whatever for limiting the application of the words, “ or other person,” &c., to any particular class of persons; to those, for example, whose ordinary business is the transportation or storage of goods entrusted to their charge. Indeed, upon this construction, these added words were unnecessary; those that precede them were alone sufficient. It seems to us plain, that it is the special purpose for which merchandize or other property is committed, and not the special character or business of the person to whom it is committed, that takes from him the authority to sell that he might otherwise be held to possess. We are therefore convinced that no court of justice has the right to say that the words, “or other person,” &c., are not just as applicable to commission merchants and factors, to whom goods are entrusted for transportation or storage only, as to any other class or description of persons whatever; and if this be so, there is an end of this controversy. The proof is conclusive that the plaintiff’s wool was placed in the custody of Davis & Peabody, and was left in the custody of Tuthill ‘1 for storage only.” Hence the sale made by Tuthill, as against the plaintiff, was wholly void. It was an unauthorized and fraudulent act, and however innocent the defendants may be, it passed no title which, as against the plaintiff, they can be permitted to allege. Such is the necessary effect of that which we deem to be the necessary construction of the statute.

It follows, that in our opinion, the plaintiff’s complaint ought not to have been dismissed upon the trial, but that, upon the contrary, the Jury ought to have been instructed that upon the evidence before them, he was entitled to their verdict.

We must, therefore, order a new trial, with costs to abide the event.

There are a few words which, although not necessary to our decision, I deem it expedient to add. _ x

If, notwithstanding the provisions of the Act “ Relative to Principals, and Factors or Agents,” which, from some unexplained cause, seem hitherto to have been passed over, the doctrine laid down by Senator Verplanck, in Saltus v. Everett, and to which both Chancellor Kent, in his Commentaries (2 Kent’s Com., p. 621), and Mr. Justice Story in his Treatise upon Agency (§§ 73, 94, 229), seem to have given their sanction, is to be followed as law, it may be seriously doubted, whether the doctrine as understood and explained by these eminent jurists, is applicable to the present case, so as to cover and warrant the defence that has been so confidently relied on. The doctrine thus explained, we understand to be this: That when the owner of goods puts them into the possession of a person whose ordinary and known business it is to sell goods, of the same description, he by this voluntary act holds out such person to the world as clothed with a general authority to sell, and, consequently, if a sale is made by him to an innocent purchaser, is concluded from denying its validity. If, under the doctrine applicable, therefore, it is evident that it must appear that the business of the agent was known to his principal,' the owner of the goods, when he entrusted them to such agent’s charge, and was known to him to embrace the sale of goods of the same description. Now, as I understand the evidence in the present case, the ordinary business of Davis & Peabody, when the plaintiff placed his wool in their custody, did not embrace the sale of wool. The testimony of Baker is express, that at that time they were sellers of provisions and other produce and not of wool, and if their business or that of their successor -Tuthill was afterwards so enlarged as to embrace the sale of wool, there is no evidence that this change in the business was known to the plaintiff. There is no evidence, therefore, that by any voluntary act he held out Tuthill to the world as clothed with an authority to sell.

The plaintiff’s counsel excepted upon the trial to the ruling of the Judge, in admitting evidence to show that Tuthill, previous to the sale to the defendants, had publicly become a dealer in wool, and if proof of this fact were alone sufficient to establish the defence, we think that the evidence given was properly admitted; but if we are right in the grounds upon which we now place our decision, this evidence upon a future trial will be immaterial and irrelevant, and ought, therefore, to be excluded. It will be irrelevant if the fact that the wool was left with Tuthill for storage only shall be conclusively proved.

Nonsuit set aside, and new trial granted; costs to abide event.


author: By the Court. Woodruff, J.

text:
    Charles Irving v. The Excelsior Fire Insurance Company.
    Under the conditions in a policy of insurance against fire, it is the duty of the assured to deliver to the Company, as a part of the preliminary proofs, a just and true account of his loss; and the delivery of this account is a condition precedent to his maintenance of an action for the recovery of the loss.
    The assured is bound by the statement thus delivered, and cannot, upon the trial, impeach its truth, and recover upon testimony showing a different state of facts from that which it contains.
    A witness, alleged to he a partner of the plaintiff, was examined on the trial to show the nature of the plaintiff’s interest in the property insured, and it was insisted on the part of the defendants that his testimony was inconsistent with the statement delivered by the plaintiff to the Company, and, therefore, ought not to have been received.
    But the Court held that there was a substantial agreement between the statements and the testimony, and that the latter was rather explanatory than contradictory, and that the necessary result of both was that, the plaintiff, if not the legal, was the equitable owner of all the property insured.

      Held, therefore, that the property, on which the loss was claimed, and which was a stock of goods, in a certain store, was properly described in the policy as “ his (i. e. the plaintiff’s) stock,” there being no other goods in the store fer which the description could be applied.

      Held, that it could not be doubted that the plaintiff meant to cover by an insurance, and the defendants meant to insure the very property destroyed, and this intention the Court was bound to carry into effect, if this could be done without violating the rules of law.
    The general rule is that the assured is not bound to disclose the nature of his interest, whether legal or equitable, a several or an undivided share, unless the disclosure is material to the risk; and in the case before the Court, whether the property insured was “ his ” (the plaintiff's) at law or in equity, was plainly immaterial. The nature of bis ownership could not possibly alter or affect the character of the risk.

      Held, that this view of the plaintiff’s rights was not forbidden or varied by a condition in the policy, that “ if the interest in the property be a leasehold interest or other interest not absolute, it must be so represented to the Company, and expressed in the policy in writing, otherwise the insurance shall be void.”
    The plaintiff’s interest in the property was not qualified or contingent, but in the fullest sense of the term was absolute. The property belonged to him in his own right, and not as a trustee for another; and if his interest was merely equitable, it was in its nature as absolute as a legal ownership, and hence the condition in the policy did not require it to be disclosed.

      Held, that even if the interest of the plaintiff, in the property insured, was that of a partner, still his interest was properly described in the policy, and was insured to its actual extent.
    That an insurance made by a partner on partnership property, although made in his own name, and expressed to be on his sole account, protects his undivided share, so as to entitle him in the event of a loss to recover to the extent of that interest, may be regarded as settled and undoubted law.
    The conclusion, that the decisions fully justify, is that the plaintiff would be entitled to recover, to the extent of his own interest, even had it been proved that the witness Clark was interested as his partner in the stock of goods, which the policy describes as “ his (the plaintiff’s) stock,” for although the description would be literally untrue, yet in order to carry into effect the certain intention of the parties it would be construed as applying not to the whole stock, but to the plaintiffs undivided share.
    lastly, in the opinion of the Court, the testimony tended to show that the co-partnership arrangement between the plaintiff & Clark, gave to the latter no interest in the capital stock as owner, but only secured to him a share of the net profits when realized.
    If such was the arrangement Clark could assert no title in the property insured, and, consequently, the property was rightly described by the plaintiff in the policy as “ his stock." Hence in every possible aspect of the case the plaintiff was entitled to judgment.
    Verdict sustained, and reference ordered to ascertain the amount of the loss.
    (Before Boswobth & Woodeüff, J.J.)
    Heard, June 19;
    decided, July 11, 1857.
    The questions, discussed and decided in this action, arise on a verdict taken, subject to the. opinion of the Court at General Term.
    The action was brought to recover a loss under a policy of insurance against fire, and the following are the material facts, as proved upon the trial, before Oakley, Ch. Justice, and a iurv, in March, 1857.
    The defendants by their policy dated September 5th, 1855, insured “ Charles Irving, (the plaintiff) against loss or damage by fire to the amount of $1,750 on his stock as a cabinet manufacturer, finished and unfinished, and materials for making the same contained in the five-story brick building, with metal roof, situated in the rear of Eos. 110, 112 and 114, East 27th street, in the city of Eew York.”
    Among the conditions of the insurance annexed to the policy and by express reference incorporated in it, was the following: “ If the interest in property to be insured be a leasehold interest or other interest not absolute, it must be so represented to the Company and expressed in the policy, in writing, otherwise the insurance shall be void.”
    Another condition required the assured in case of loss to deliver to the Company, as soon as possible, as particular an account of his loss and damage as the nature of the case will admit, which account must be sworn to be true and just.
    On the 19th of December, 1855, a fire occurred, which partially destroyed the three buildings, and the stock of cabinet furniture, and materials contained therein, and it is averred that the loss and damage sustained by the plaintiff, by the injury to such stock and materials, amounted to the sum of $8,500.
    There were other insurances to the amount of $6,750, making the whole amount of insurance $8,500, whereupon the plaintiff claims for a total loss, the amount insured $1,750.
    By the plaintiff’s statement of loss, sworn to by him, submitted to the defendants, and read as evidence in chief on the trial, it is stated that the stock contained in the buildings at the time of the fire, “ belonged to him, as herein-after stated.” That is to say, “ his ownership of the said property was as follows: He was then, and is now, the principal member of the firm of Irving and Clark, by which firm the said property was manufactured and possessed; that he furnished all the capital of the said firm, and was then, and is now almost its sole creditor, and his interest therein covers and would absorb as he believes not only all the said property, but all the assets of the said firm.” The defence interposed by the Company rests upon the ground that the subject of the insurance is described as the plaintiff’s sole property, and that property held under such ownership as is above described in the plaintiff’s statement of loss is not covered by the policy, and therefore the plaintiff has sustained no loss or damage by fire “ on the subject insured by said policy.”
    On the trial, OlarTc, the person whose name is used in the firm name of “ Irving & Clark,” gave testimony tending to show that in December, 1854, he entered into a negotiation with the plaintiff in respect to forming a partnership. That he went with him upon the understanding that they were to become partners, and were to share equally in the profits—that he continued with the plaintiff upon that understanding until six weeks before he (Clark) left for California, which was November 20th, 1855, i. e. until early in October, 1855, when he says, that understanding was abandoned, and the plaintiff was to give him a proper remuneration for his services. As the witness expresses it, “ Our co-partnership here was not consummated, and in September or October, 1855, we agreed to abandon all thoughts of it, and plaintiff agreed to pay me for my services.” The witness farther says, “the capital in the business here all belonged to the plaintiff—-the property was all his, and the profits all his.” “ I suppose that he and I, are to the world, partners, but between ourselves, we are not, and have never been so.” And again— “At the time of the insurance, and at the time of the fire, there was no partnership existing between the plaintiff and myself. There was no sign np—There were bills headed ‘Irving and Clark,’ they were so from the beginning, and have continued up to the present time, and the business was, and is done in our names. I am now there in the same way; when I returned, he continued in the same manner; we are not co-partners now. I don’t participate at all in the profits. I had no interest in the property destroyed—nor have I any interest in the property now on the premises; all the property burned belonged to the plaintiff alone.
    “I have no fixed compensation. I take so much money a week as I need to support myself with, at no given-rate.”
    To the evidence of this witness, the defendants objected, but it was received and the defendants excepted. The ground of objection does not appear in the case—but on the argument it was insisted that the plaintiff was not at liberty to contradict his sworn statement contained in his proof of loss, and that this testimony of Clark was such contradiction. «
    By consent, a verdict was entered for the nominal sum of $2,000, “ subject to the opinion of the Court at General Term, on a case to be made, and subject to a reference to determine the amount of the loss, with liberty to reduce the amount or turn the same into a dismissal of the complaint.”

      D. D. Field., for the plaintiff,
    insisted that the property insured belonged to the plaintiff at the time of the insurance and of the loss. The arrangement between him and Clark, and their subsequent conduct, may have made them liable to third "persons as partners, but they were never partners as between themselves, and Clark had never any interest in the property. The question, therefore, does not arise how far a person who insures in his own name can recover for his interest as a partner.
    If, however, the question had arisen, it would have presented no difficulty. A partner may insure the partnership property in his own name, and recover his entire interest, whatever it may be. Each partner is vested with the whole property. It is not a misdescription to describe the property as his. (3 Kent’s Com. 258; 2 Duer’s Ins. 19-20; Turner v. Burrows, 5 Wend. 541; Ib., 8 Wend. 144; Burgher v. The Columbian Ins. Co., 17 Barb. 274.)

      J. M. Van dotty for the defendants,
    argued as follows: We contend that the defendants’ liability is limited by the contract. By the terms of the policy, the plaintiff is insured “on his stock” against such loss “ as shall happen by fire to the property above specified.” These words describe and limit the subject of the insurance, and the policy covers no property of which the plaintiff was not the “ absolute” and exclusive owner.
    The risk is estimated upon the knowledge of the person assured, in whose integrity, care and interest to preserve the property, a confidence is reposed; and it is varied by a variance of the interest, and by a participation in interest and custody by persons who may be less careful and honest. A company may be willing to insure A, but not to insure B, or A and B. (2 Peters, 47, Columbia Ins. Co. v. Lawrence.)

    The policy industriously excludes every risk, except for property owned by the plaintiff, reposing confidence only in him, and obtaining guarantees only against his acts and omissions.
    By the third condition, all interests not “ absolute,” are excluded, unless expressed in the policy.
    By the fourth condition, a change of interest, by assignment, avoids the policy, unless the Company consents by endorsement to continue the risk as altered.
    By the fifth condition, prior or subsequent insurance, not communicated or endorsed, avoids the policy. If parties having a joint interest, can each obtain a separate insurance, and in the policy describe the property as “ his,” this condition is no shield against fraud.
    By the sixth condition, the assured is required to use his best endeavors to save the property. The criminal neglect of a'partner (the insurance being single) could not be availed of by the insurer.
    By the ninth condition, fraud and false swearing work a forfeiture of the policy; but if the'assured have not the knowledge, that is an element of the fraud and perjury, the policy is not forfeited by the knowledge of the party in joint interest, who is not named in the policy.
    These cautiously stipulated conditions are decisive of the construction of thé policy, and defeat this action.
    Eire and marine policies vary materially in their terms,

      Tn a marine policy, the thing insured is determinate—as a ship named and registered—and the insurance is upon that subject, for account of the owners, or of whom it may concern, or, in terms, of the undefined and changing interest of part owner, mortgagee, or other party.
    The plaintiff is estopped by his sworn proof of loss to allege that Clark was not a partner and jointly interested in the property. If he meant to, and could, revoke that statement, he was bound to do it explicitly, and to deliver a new proof of loss.
    The variance is material. The right changes with the fact. A loss as sole owner, and a loss as joint owner with Clark, are fundamentally different things, involving substantially variant rights and liabilities; and the plaintiff was not at liberty to play fast and loose, and go upon one or the other ground, as opinions and circumstances might change.
    But the evidence makes Clark a partner. The business was done, and is now done, in the firm name. Clark draws for his expenses like a partner, and plaintiff swears to the partnership. These decisive circumstances cannot be moulded to suit the legal opinion of Clark, or the legal necessities of the plaintiff.
    By the ninth condition of the policy, the assured is required promptly to deliver to the Company, under oath, “ a particular account of his loss,” and also to show “ how the building was occupied at the time of the loss.” The policy is forfeited by nomcompliance with this condition; and the loss is in no case payable until sixty days after such proof of loss.
    If Clark is not a partner and jointly interested in the property, or if the building was not occupied by Irving & Clark at the time of the fire, the proof of loss was both false and defective, and the action was at least prematurely brought.
    If the plaintiff can recover at all in this action, it can be only his undivided interest in the property of Irving & Clark. He cannot recover in the character of a creditor of the firm, with an equitable lien upon the partnership assets.
    The defendants are therefore entitled to judgment.
   By the Court. Woodruff, J.

It was the duly of the plaintiff to deliver to the Company a just and true account of his loss, which should be as particular as the nature of the case would admit, and should be verified by his oath. This he attempted to do. This was a part of his preliminary proofs. Such delivery was a condition precedent to his right to recover. By express condition, the amount of loss is not payable until sixty days after such account (with other proofs) .is delivered. The defendants made no objection to the sufficiency of the account furnished, and by their answer have acquiesced in its truth. They rested upon the claim that if the facts so stated and sworn to are true, they are not liable. The plaintiff could not therefore, on the trial, change his ground, by impeaching the truth of his own statement. The defendants had a right to take the facts as he stated them. They have been furnished with no other. Had any other been delivered, they would have been entitled to sixty days for examination, and then might, in their defence, have relied upon showing that the plaintiff’s loss was not truly stated. We are therefore of opinion that in regard to the material facts stated by the plaintiff, in his affidavit of loss, &c., he is, certainly for the purposes of the trial of this action and its decision,- concluded by that affidavit.

Under that view of the plaintiff’s position before the Court, the testimony of the witness, Clark, is to be rejected unless it harmonizes with the plaintiff’s statement; but so far as such harmony exists it may properly be taken into view; and to that extent, at least, it was properly received in evidence. It is no valid objection to his testimony, that it more fully explains the relations existing between himself and the plaintiff, in that firm of “ Irving & Clark,” who are stated, by the plaintiff, to be the firm by which the property was manufactured and possessed, or that it tends to show in whgt sense the property insured by the plaintiff was his property, although manufactured and possessed by Irving & Clark.

Read together, the affidavit of the plaintiff and the testimony of Clark show that Irving, having capital and stock in trade, as a cabinet manufacturer, received Clark into connection with him, upon an understanding that he should have one half the profits, the whole capital being furnished by the plaintiff, and the whole property belonging to him, subject only to Clark’s claim to such half of the profits of the business; and under this arrangement, the business was done in their joint names as “ Irving & Clark.”

Such were their relations when the insurance now in question was effected. They were ostensibly partners. The property had been manufactured under their firm name of Irving & Clark, and was in their joint possession. But the plaintiff owned the whole capital, and on a settlement with him for such capital and advances, the whole property and assets of the firm must necessarily be applied to his benefit, so that in a practical sense Clark had no interest in the property itself, though he. might be entitled to share the profits of its employment, and his testimony shows that he so understood it. His testimony, therefore, confirms the affidavit of the plaintiff. The only difference between the testimony of the witness, Clark, and the affidavit of the plaintiff, seems to be that, according to Clark’s understanding of the subject, although they entered into a verbal agreement to form a partnership, and actually carried on business under the name of Irving & Clark, and so became, as “ to the world,” co-partners, yet that in truth such agreement was never consummated by the actual formation of a copartnership, but “ all thoughts of it were abandoned before the witness went to California;” and therefore, inasmuch as the property was all put into the business by the plaintiff, and was due to him in reimbursement, the witness had no interest in it.—While the plaintiff, in his affidavit, regards the firm as an actually subsisting firm, the property of which was all due to him for his advances or contributions thereto, without, on his part, attempting to define the terms of his agreement with Clark, so as to say whether Clark was interested in the property, or in the profits only, If they differ, it is rather in their views of the legal effect of their arrangement, than in the facts themselves:

The plaintiff was then in fact the substantial owner of the property insured. He was in possession and had a legal title, and his equitable interest covered the whole property. This seems to us sufficient to answer the description, “ his stock,” &c., in the policy.

There was no other property on the premises; there was, therefore, nothing else which could be described by the terms, “ his stock.” It was not denied on the argument, that had the language of the policy been “the stock, &c.,” the plaintiff’s interest in the stock would have been protected by the policy. We think it would be too rigid a construction to say, when there is no other stock to which the policy can apply, that “ his stock ” may not mean the stock in which he is interested to the whole amount and value thereof, because another may be or is entitled to see that it is rightly appropriated to satisfy the plaintiff’s interest.

The stock lost was the stock of goods in the store, or ware-room, described in the policy. It is to be assumed that the Company knew what goods they were insuring. There can be no possible doubt that the plaintiff intended to effect insurance, and the defendants intended to insure the very property which was destroyed. We deem it most conducive to justice to give effect to that intention, if we can do so without violating the rules of law.

If there was no misrepresentation and no concealment which should vitiate the policy, no rule of law forbids our construing the words, “his stock,” according to the substantial interest of the plaintiff in the property.

The general rule on this subject is, that the assured is not bound to disclose the nature of his interest—whether legal or, equitable, whether a distinct or an undivided share—unless such disclosure is material to the risk.—2 Duer on Ins., p. 448; L. 13, § 44; Lawrence v. Van Horn, 1 Caines, 284. How, whether the property was “ his,” (the plaintiff’s) at law, or in equity, was quite immaterial. The plaintiff had the same motive to its preservation. Ho effectual double, or over-insurance could be had to their prejudice.

This subject is discussed in Niblo v. The North Am. Fire Ins. Co., 1 Sandford S. 0. Rep. 551, and it is there held, that a tenant who insures “ his buildings,” may recover to the extent of his interest therein, though he have but a term for one year, subject to the payment of.rent—that the description in the policy “his buildings,” is not equivalent to a warranty on the part of the assured that he is the owner, nor does it constitute a material misrepresentation—that where no inquiry is made, he will in such case recover according to his real interest, whether it is absolute or qualified.

That case and others cited in the opinion have a very important if not conclusive bearing upon the case before us; they show that the word “Ms,” is not necessarily to be construed as importing absolute legal title, and may not be satisfied in any other manner.

It must, we think, be conceded that when there is an insurance of a person upon “ his stock of goods,” in a specified store, and it appears not only that he is carrying on business there as a sole trader, but that other business is carried on in the same store by himself, and another as co-partners, the insurance must be confined to the goods pertaimng to Ms sole and separate business; but that concession, we tMnk, does not conflict with the conclusion, that where the only property answering the description in the policy, i. e. the only goods upon the premises, are his in the sense disclosed by the proof in this cause, the policy shall be held to relate to them. The Court should give effect to the contract, rather than that it should fail. The Court can do tMs, as we think, and effectuate the actual design of the parties without contradicting the terms of the policy, or doing violence to its language.

It was suggested that this view of the plaintiff’s right is forbidden by the condition in the policy, that “ if the interest in the property be a leasehold interest, or other interest, not absolute, it must be so represented to the Company, and expressed in the policy in writing, or otherwise the insurance shall be void.” We tMnk not. The plaintiff’s interest, whether legal or equitable, is an absolute interest; it is not contingent. He had a clear right to have the whole property, applied to his use at the time the insurance was effected. It was his, in Ms own right—not in trust for any other. The condition is not, that if his interest is equitable, it must be disclosed; an equitable interest may be in its nature as absolute as a legal title.

Upon tMs view of the construction of the policy, and the rights of the plaintiff under the facts proved, we think the plaintiffs interest was protected by the policy, and that he should have a reference to determine the amount of loss pursuant to the stipulation at the trial.

In what has been said, we are not tobe understood as deciding that even if the property destroyed belonged in a more enlarged sense to the firm of “Irving & Clark,” and the interest of the plaintiff therein was not explained any further than is stated in the plaintiff’s affidavit, he could not recover to the extent of his interest.

That one of two parties may insure his interest in the joint stock was not, and cannot he denied. And if one partner insures in his own name only, it will protect his undivided interest in the partnership, and that only. (Graves v. Bost. Mu. In. Co., 2 Cranch, 419 ; Dumas v. Jones, 4 Mass. 647.) Where there are general words which will admit of application to an alleged intent to insure the joint interest, though the policy he in the name of one only, extrinsic proof may be given to show whether the insurance was intended by the assured party to cover his interest solely, or that of his partners also. (Lawrence and Whitney v. Van Horne et al, 1 Caines, 284; Lawrence v. Sebor, 2 Caines, 203.)

The case of The Pacific Ins. Co. v. Catlett, 4 Wend. 75, (S. C.1 Wend. 561,) appears to us to apply with great significance to this case. There was an insurance in terms “on account of the owners” on vessel and on cargo; and the plaintiffs were held entitled to recover the full sum insured, although it appeared that the plaintiffs (by whose orders the insurance was effected) owned only five-sixths, (see S. C., 1 Paine, U. S. Dist. Ct. R.)

The subject is elaborately discussed in 2 Duer on Ins. p. 24, &c., Lee. 9, § 20, § 31, and notes HI. and IV"., p. 74 and 83, and cases reviewed. It is shown that it is not necessary that the nature of the interest of the assured be set forth in the policy, and that an undivided interest in joint property, may be insured without a specific description of it in the policy as joint or undivided. To the latter effect, is the case cited from 1st and 4th Wendell supra.

Chancellor Kent refers to Valin and Boulay Paty as authority on the Continent of Europe, that where a partner insures partnership property as his goods, the insurance covers the whole interest of the firm, while in this country it is deemed that where the insurance is expressed to be on his sole account, it protects his individual share only. (See 3 Kent, 258, 2 Duer on Ins. 22-4, § 19, &c.;) and see Turner v. Burrows, 5 Wend. 541, 8 id. 144; Burgher et al. v. The Columbian Ins. Co., 17 Barb. 274.) The case last cited, was considered in the Court of Appeals, and the views expressed in the Supreme Court, so far as they bear on the present case, are reiterated in the opinion pronounced in that Court. So far as applicable they tend to sustain the right of the plaintiff herein to recover upon the policy as a protection to his interest in the subject insured. (See opinion of Mr. Justice Hand, MSS.)

The principles thus stated, and especially the cases of Niblo v. The North Am. Ins. Co. and Pacific Ins. Co. v. Catlett, we think, warrant the conclusion, that where the insurance is effected in good faith, without fraud or misrepresentation, with intent to protect the assured, upon goods described as his goods in a particular store, there being no other goods on the premises, the interest of the assured will be protected thereby, notwithstanding another person has also an interest in the same goods as co-partner. And this view ought more clearly to prevail, when, as in the present case, the interest of such co-partner is only nominal, the assured being in truth, the substantial and beneficial owner.

We add, in conclusion, that there is one other aspect of the interest of Clark in the business of the firm of Irving & Clark, which relieves the plaintiff’s title from embarrassment or doubt. His testimony tends in some degree to the conclusion, that the terms of the co-partnership arrangement did not contemplate the acquisition by him of any interest in the capital stock as owner, but only secured to him a share of the net profits when realized. Such an arrangement is not inconsistent with the affidavit of the plaintiff. Although such an arrangement would entitle Clark to require the appropriation of the property to the joint use, so far as to realize the profits he was to share, still, we think, that under such an arrangement, Clark could not assert title in the property itself, and if not, then of course, the property was rightly described by the plaintiff in the policy as “ his stock.”

The verdict must be sustained, anda reference must be ordered to determine the amount of the loss in accordance with the consent given at the trial.-


author: By the Court. Slosson, J.

text:
    James Harper & Others v. The City Insurance Co.
    •The insurance, in this case, by a policy against fire, was upon “ the printing, and book materials, stock, paper, stereotype plates, fixtures, printed books, and steam-engine, and machinery, contained in the buildings, described in the policy, and privileged for a printing office, bindery, and book store, and steam boiler in the yard.” The Jury found that when the policy was effected, the use of camphene for fine work in the printing of books, was a general and established usage among printers, and that its use for this purpose was not only more advantageous than that of any other article, but was necessary. The 8th condition, annexed to the policy, provided among other things, that the Company should not be liable for a loss by fire, “ occasioned by camphene or other inflammable liquid.” The loss claimed, in the opinion of the Court, was not “ occasioned by camphene,” in the true meaning of the exception.

      Beld, that under the finding of the Jury, the defendants, when the policy was effected, were chargeable with a knowledge of the fact, that camphene was one of the materials used by the plaintiffs in the printing of books, and, consequently, that its use for this purpose was as effectually protected, by the general words of the policy, as if it had been authorized in terms.

      Beld, that evidence of the general and established usage of printers was properly admitted.

      Beld, that as camphene was an article covered by the policy, the defendants took upon themselves the risk of any and every loss incident to, or resulting from its use.

      Beld, that by this construction, the exception in the 8th condition of the policy was not wholly superseded, since it might still operate to exempt the defendants from a loss occasioned by the use of camphene for any other purpose than as a material for the printing of books.
    Judgment for plaintiffs upon the verdict, with costs.
    (Before Doer, Slosson & Woodruff, J.J.)
    Heard, April 17; decided, July 11, 1857.
    The questions, decided in this action, arise on a verdict for the plaintiff, taken, subject to the opinion of the Court at General Term, on the exceptions taken on the trial.
    The action was brought to recover a total loss, under a policy of insurance against fire issued by the defendants, and dated the 3d of March, 1853. By the terms of the policy, the defendants insured the plaintiffs against loss or damage by fire, to the amount of $10,000, on their printing, and book materials, stock, paper, stereotype plates, fixtures, printed books, and steam • engine, contained in certain brick buildings, particularly described in the policy, with the privilege “for a printing office, bindery, book store, and steam boiler in the yard.”
    The defence was, that the fire was occasioned by camphene, in violation of the conditions of the policy, and of the rights of the defendants. The 8th condition of the policy, to which the defence refers, declares among other things, that the Company shall not be liable for loss or damage by fire “ occasioned by camphene or other inflammable liquid.”
    The cause was tried before Mr. Justice Dube, and a Jury, in January, 1855. The defendants’ counsel admitted the execution and delivery of the policy, and of the preliminary proofs, the fire, the plaintiffs’ ownership of the goods insured, their destruction by the fire, and that the loss exceeded the amount insured.
    It was proved that the fire was caused by the accidental ignition of a quantity of camphene, kept in the plaintiffs’ printing office, in a large and open sheet iron pan, in which the rollers, used for fine printing, were cleaned.
    A number of witnesses were examined, on the part of the plaintiffs, to prove that this use, of camphene, was general, among printers, and was not merely advantageous, but, for fine work, absolutely necessary. «
    When the plaintiffs rested, the defendants’ counsel moved for a nonsuit, substantially on the grounds, stated in his points on the argument, at General Term. The motion was denied, and the counsel excepted.
    Several witnesses were examined for the defendants, to repel the testimony on the part of the plaintiffs.
    When the testimony was closed, and the counsel had summed up, the Judge submitted to the Jury the following questions:
    1st. Was there a general and established usage among printers in the use of camphene for fine work in the printing of books, at the time this policy was effected?
    2d. Was the use of camphene necessary for fine work in the printing of books ?
    3d. If not necessary, was its use more advantageous than that of any other article for the purposes for which it is proved to have been used?

      And he then charged the Jury, that if they answered either of the questions in the affirmative, they should find a verdict for the plaintiffs for the amount of the policy.
    The counsel for the defendants excepted to the charge.
    The Jury answered all the above questions in the affirmative, and rendered a verdict for plaintiffs for $11,278 76.

      Wm. M. Evarts, in moving for judgment for the plaintiffs
    upon the verdict, made and argued the following points:
    I. Under the finding of the jury as to the necessary use of camphene in the printing of books, and the general established usage of the trade so to employ that article, it is impossible to contend that its use by the plaintiffs, as proved, was not within the special description of the subject insured, and the special privilege accorded by the policy.
    II. It is equally clear that the disclosure of the subject and object of the insurance as recited in the policy, repels any suggestion of concealment of the element of risk supposed to arise from this use of camphene in printing.
    This notice of the subject of insurance, and of the purposes for which the premises in which it was situated were privileged, either gave the company actual information of all the elements of risk involved, or put them upon inquiry.
    HI. If then the general conditions of the policy be construed as a warranty by the assured against the use of camphene, the particular use within the description and the privilege of the subject insured, is allowed by the special terms of the contract. (Wall v. Howard Ins. Co., 14 Barb. 383; Bryant v. Poughkeepsie Ins. Co., 21; Id. 154; Harper v. the same, G. T. S. C. Nov. 1856.)
    IV. The only remaining question is, whether, though the use of camphene in printing be allowed by thfe policy, the manner of the loss exempts the defendants from liability, as not being a risk insured against.
    V. The property insured was destroyed by fire; fire was the proximate cause and the exclusive agent of its destruction; destruction by fire was the risk insured against.
    "VT. The originating and responsible cause to which the destruction by fire is traceable, is the careless yet purely casual communication of an ignited material to camphene, as in use within the privilege of the policy, such camphene being a part of the subject insured against fire.
    The ignition was independent of the camphene in its origin; that its spread on the subjects insured was through the inflammability of camphene, which formed an incorporate part of the subjects insured, does not make the camphene the occasion of the loss.
    Camphene can, within the meaning of the policy, be regarded as occasioning a loss by fire, only when it occasions the original ignition by its inflammable nature, or, at the furthest, when its use becomes the means whereby the proper and ordinary use of light or fire in the premises is inflamed into a destructive combustion, occasioning the loss.
    Camphene cannot be regarded as occasioning a loss by fire, merely because the ignition reaching it becomes less controllable than before; this would be equivalent to a repudiation of loss where camphene was used, although its use was licensed and it was itself insured.
    YU. The true construction of the clause, in regard to loss occasioned by camphene, in connection- with the special subject insured, which includes camphene, and the special privilege accorded, which involves the use of camphene, is, that a loss occasioned by camphene in a relation or use outside of the description and privilege, is excluded from the risks assumed.

      A. K. Hadley, for the defendants,
    made and argued the following points:
    I. The fire and consequent loss were occasioned by camphene, and therefore within the express exception contained in the 8th condition annexed to and forming part of the policy. (12 Wendell, 456 ; 2 Denio, 78; 2 Comstock, 220; 5 Hill, 18.)
    It is lawful and proper in itself, and binding and conclusive upon the plaintiffs; and this notwithstanding the defendants may have known and assented to the use of camphene. (St. John v. The American Mutual Fire and Marine Ins. Co., 1 Duer, 371; 1 Keman, 516.)
    It was cleSrly competent for the defendants to authorize the use of camphene, and yet screen themselves from any liability on account of loss occasioned by it.

      They also expressly authorized the use of a “ steam hoiler in the yard,” and yet provided that “ this company will not be liable for any loss, either by fire or otherwise, occasioned by the explosion of a steam boiler;” and this last condition the Court of Appeals, as well as this Court, has already held to be valid and conclusive upon the plaintiffs, in the case of Sí. John and others against The American Mutual Fire and Marine Insurance Co., above cited.
    H. All testimony tending to show the usage of printers, and the necessity or utility of camphene, was incompetent, and improperly received.
    1st. The contract being free from ambiguity, no such usage, necessity, or utility could have any effect to change its purport or effect. (Cowen & Hill’s Notes, 1896-7,1416, 1463; 16 Wend. 285.)
    2d. The usage of the trade in this particular was not brought home to the knowledge of the defendants; neither was it so general, so well settled, so uniformly acted on, or of so long continuance, as to raise any presumption of such knowledge, or that the contract was made with reference to it. (Cowen & Hill, 1412, 1417.)
   By the Court. Slosson, J.

It is difficult to distinguish this case from that of St. John v. The American Mutual Fire Insurance Company, (1 Duer Rep. 371, affirmed 1 Hernán Rep. 516,) and unless the privilege contained in the policy, taken in connection with the general nature of the subject insured, to wit, a printing and book establishment, creates a distinction between the two, that case must be decisive of this.

The defence mainly relied upon is, that the fire was “ occasioned by camphene,” a risk from which, by the eighth printed condition of the policy, the Company is expressly exempted.

The conditions of the policy are, by express reference to them in the body of the instrument, made part of the contract, and it is provided in terms, that they “are to be used and resorted to, in order to explain the rights and «Obligations of the parties thereto in all cases not therein otherwise ‘ specially provided for.’”

The eamphene was kept in open sheet-iron jars or pans, in two rooms, one on the second, and one on the third floors, expressly fitted up and arranged, and supposed to be sufficiently so, to prevent any dangerous communication between.them and other parts of the building in case of accident in the use of the article.

These jars or pans were stationary. They were nearly four Set long, and the fluid was put into them to the depth of from two to two and a half feet; they were used for dipping the rollers, used in printing, for the purpose of cleaning them.

The fire was communicated to the eamphene by one of the workmen, accidentally or carelessly, dropping or throwing a lighted paper or match into one of the open jars.

The fire spread with immediate and fatal rapidity, and the whole building, with almost its entire contents, was destroyed, producing an immense loss.

The insurance was for $10,000, on the plaintiffs’ “printing and book materials, stock, paper, stereotype plates, fixtures, printed books, and steam engine, and machinery, contained in [the premises in Cliff and Pearl streets.”] The privilege was thus expressed, “Privilege for a printing office, bindery, and book store, and steam boiler in the yard.”

The Judge, at the trial, admitted, under objection, evidence of a usage among .printers to use eamphene for fine work, in the printing of books, and of the necessity and advantage of its use.

It appears from the evidence, that the article was used by printers in cleaning rollers, wood cuts, metal plates, and type metal, where there are engravings. Most of the witnesses speak of it as a necessary article in what is called fine work.

Some of the witnesses speak of its having been in use five years; some, six or seven; some, eight or ten; and one, that it has been in use fourteen years.

One witness says, its use has been general, in all printing offices, for nine or ten years; another says, he knows of no printers, who do fine work, who do not use eamphene; another, however, says, that he cannot say that a majority of printers use it, and thinks not; another, that it is generally used by those who do fine work. The plaintiffs themselves had used it for fourteen years.

The importance of establishing a usage, in the use of camphene, arises both from the absence of any evidence to show that when the plaintiffs applied for the insurance, they made known to the defendants that the article was used on the premises, as they were bound to have done, it being an article materially affecting the risk; and the omission of all reference to it by name in the privilege which it is contended includes its use.

The Judge submitted three distinct questions to the jury.

First—Was there a general and established usage among printers in the use of camphene for fine work in the printing of books, at the time the policy was effected?

Second—Was camphene necessary for fine work in the printing of books?

Third—If not necessary, was its use more advantageous than that of any other article for the purposes for which it is proved to have been used ?

And the jury were instructed that if they found either in the affirmative, they should find a verdict for the plaintiffs for the amount of the policy.

The jury answered each question in the affirmative, and a verdict was taken for the plaintiffs subject to the opinion of the Court at General Term.

The question of how long the usage, if the jury should find it to exist, had prevailed, was not submitted to them. They have found that the usage prevailed, and that" the use of the article was both necessary and more advantageous than that of any other for the purpose for which it was used in printing.

As the jury found all the questions in the affirmative, no question can arise as to which of the three formed the basis of the verdict.

It rests upon all, and if the charge of the Judge contained a correct exposition of the law of the contract between the parties, the verdict must stand, unless the omission to find how long the custom to use camphene had prevailed shall be considered fatal, or unless evidence of usage was inadmissible at all.

I am of opinion, considering the generality of the language employed in the clause containing the privilege, that the evidence was properly admitted, and I think the finding that there was a general and established usage among printers to use earn. phene, especially under the evidence, which shows it to have existed several years, at the least,, quite enough, without a special •finding as to the length of time it has prevailed, to charge the defendants with knowledge of its existence.

The Judge charged, “that under the description of the subjects insured, and the privilege granted therewith, the plaintiffs are entitled to recover, although the accidental fire may have been communicated to or propagated through the camphene used and employed by the plaintiffs in their business within the description and privilege of the policy, if the jury should be of opinion that camphene is an article of usual, necessary, or advantageous use in such, the business of the plaintiffs, within the description and privilege of the policy.”

It is important here to determine what is meant by the words “occasioned by camphene,” as used in the eighth condition, for if they are to be construed in the sense of originating or causing of itself a fire, the condition becomes practically a dead letter.

The liquid itself can never physically originate fire—it is not self-combustible—it can only occasion a fire by being the immediate medium of its communication to other subjects. It is in this sense, therefore, that the words are to be understood, and thus read the plain meaning of the condition, is, that the company will not be responsible for a loss by fire which shall have been occasioned by means of camphene, as a medium of its communication, and which would not have happened but for the presence of that article on the premises.

The language of the charge, in which the fire is spoken of as “ communicated to or propagated through the camphene,” therefore correctly defines the meaning of the words in the condition “ occasioned by.”

The question then is, whether under the privilege contained in the policy; “privilegefor a printing office, bindery, and book store,” taken in connection with the subjects insured, .“printing and book materials, stock, paper, stereotype plates, fixtures, printed books, and steam engine, and machinery contained in, &c.,” the defendants, with knowledge, at the time of effecting the insurance, that camphene was used in the process of printing, agreed to assume the risk of a fire “ occasioned by camphene,” against which they'have expressly stipulated in the eighth condition of the policy, in other words, whether the privilege does not supersede the condition ?

There are two aspects in which this question is to be considered and in which it was argued, both depending upon the proper construction of the terms of the policy.

The first is that contended for by the plaintiffs, to wit, that by permitting the business of a “ printing office" to be carried on upon the premises for the purposes of which the use of camphene was necessary and advantageous, and 'known to the defendants to be usual and customary, they thereby, and by force of such privilege or permission, assumed, and must be held in law to have assumed the risk of a loss by fire through the medium of that article, notwithstanding they are by the eighth condition of the policy, in terms, exempted from that risk.

The other is that contended for by the defendants, to wit, that in giving the privilege, they have assented to the use of camphene to this extent, and in this sense only, to wit, that its use on the premises in the business of printing, though in itself, an article of extra-hazardous character, shall not, under other provisions of the policy, avoid the contract, but that they do not thereby intend, nor upon a proper construction of the contract, can be held to have intended to waive the benefit of the condition which exempts them from a loss occasioned through its medium. In other words, that while they permit its use, and agree to waive any" forfeiture by reason of such use, they, nevertheless, will not be responsible for a loss occasioned by such use.

The question is one by no means of easy solution, nor is it perhaps going too far to say, that its decision either way will still leave some embarrassment and doubt on the mind. There are considerations which make the views entertained by the defendants extremely cogent and difficult to answer; while, on the other hand, the construction given to the contract by the plaintiffs is, to say the least, of equal plausibility and force.

It must be borne in mind that the privilege is contained in a special written clause, while the exemption is in one of the usual printed conditions.

That every stipulation in a contract should be so construed as to give it some practical operation, is a conceded rule, and it is equally true that all the stipulations in the contract must be so construed as to harmonize, if possible.

The office of a privilege in a policy is to authorise the use of an article or an occupation on the premises, which, but for such licence, would avoid the contract. As in the present case; the business of book printing is one of the trades included in the memorandum of special rates, and to carry it on upon the premises without a special authority, would have avoided the policy.

In the license or privilege of carrying on a particular business or trade on the premises, as in this instance, that of a printing office, must properly be included all that is necessary, essential and customary in the conduct of such business. If this be so, then the use of camphene in printing is by necessary implication allowed in the privilege to print, but conceding this, the question remains—shall the company be bound for a loss by fire, occasioned by that article ?

The defendants contend that by holding them exempt from liability for loss, while the privilege to use is conceded, both provisions or stipulations are fully answered, and each party obtains what he stipulated for, the plaintiffs a right to use an article which without the privilege would have avoided their contract altogether, while the defendants thus waiving the use as a ground of forfeiture, nevertheless are relieved from liability in respect to that particular article, thus sustaining in full force the terms and stipulations of the eighth condition.

On the other hand the plaintiffs say, that this construction is to make the privilege in a measure nugatory, and that by giving the privilege, the company upon every principle of sound sense and fair interpretation assume the whole risk incident to the customary and proper use of the article, and it is contended that this construction does not altogether dispense with the eighth condition, whose requirements it is said are met by confining the exemption contained therein to “ a loss occasioned by camphene, in a relation or use outside of the privilege."

This latter view of the question, it seems to us, after a careful consideration of the whole subject, is the true one.

If the privilege is to be construed by the usage at all, and the usage be a reasonable use, it is to the extent of such usage, a limitation of, or exception from the stipulations of the condition.

So also if the privilege is to be construed in reference to what are the necessary means of securing its enjoyment, as it unquestionably must be, then it embraces all the means necessary to the business of printing, and to the full extent of such necessity is a limitation of, or exception from the terms of the condition. The condition is not, however, left a dead letter in the contract, for the moment the point of usage or necessity is passed, it becomes as operative as ever. It therefore stands for every purpose not specially excepted by the privilege.

This construction seems to us both reasonable and just, and the only one by which effectual justice will be secured.

It is contended by the defendants, that however the use of camphene in small quantities may be fairly held to be within the privilege, its use to the extent shown in the present case, cannot reasonably be held to have been within the contemplation of the parties at the time of underwriting this policy, and that therefore the exemption covenanted in the condition remains in full force.

This was made a point on the motion for a nonsuit, and it was contended that such a use of the article was “ not in accordance with any known custom or usage, with notice of which the defendants were presumed to be cognizant or chargeable, and was a fact and feature in the risk which increased its hazard.”

This mode of using camphene, is not, according to the evidence, confined to the plaintiffs. Williams, a printer in the Methodist Book Concern, says, they use it in that establishment as the plaintiffs do, to wit, “ immerge the plates and rollers in tubs containing the article; and Brown, the superintendent of the printing department, in the American Tract Society, says that rollers are used in all printing offices.”

It is a fair inference from this evidence, that this mode of using camphene is a part of the general usage or custom, and if so, it was equally within the knowledge of the defendants, as the fact of its use at all. It, therefore, was unnecessary to have made a special explanation in respect to it, on applying for the insurance, and if the use of the article at all was within the privilege by reason of the usage, as we have shown it was, its use in this particular mode was equally so,

Nor does it follow that the privilege, if extended thus far, is necessarily unlimited: any abuse of it would clearly defeat a recovery.

Like all other stipulations in a contract, it must not only be reasonably construed, but acted upon in good faith.

The evidence does not show that more of the article was used in the present instance, than was absolutely necessary for the purpose" of the printing authorized by the privilege, and it would be hard to say, if not difficult to comprehend, that though the use of it in a smaller quantity might have been embraced within the privilege, its use in quantities adequate to the necessities of so large an establishment as the plaintiffs was not so embraced. The answer would be obvious, that the magnitude of the risks assumed, was in proportion to the magnitude of the subject, the defendants had undertaken to insure.

There must be judgment for the plaintiffs, for the amount of the verdict and interest.

       In Harper v. The Albany Mutual Ins. Co. (17 N. Y. Reports, 194), on a policy against loss or damage by fire, and containing similar provisions, the Court of Appeals has construed the policy, as this Court did in tfre case of Harper v. The H. T. City Ins. Go.