US SUPREME COURT DECISIONS

1. Actual delivery by the bailee on the demand of the true owner, who has the right to the immediate possession of the goods bailed, is a sufficient defense of the bailee against the claim of the bailor, and there is no difference in this regard between a common carrier and other bailees.

2. While a contract of bailment undoubtedly raises a strong presumption that the bailor is entitled to the thing bailed, it is not true that the bailee thereby conclusively admits the right of the principal. His contract is to do with the property committed to him what his principal has directed -- to restore it or to account for it. He does so account for it when he has yielded it to the claim of one who has a right paramount to that of his bailor.

3. If there be any estoppel on the part of the bailee, it ceases when the bailment on which it is founded is determined by what is equivalent to an eviction by title paramount -- that is, by the reclamation of possession by the true owner.

4. Nor can it be maintained that a carrier can excuse himself for failure to deliver to the order of the shipper, only when the goods have been taken from his possession by legal proceedings, or where the shipper has obtained the goods by fraud from the true owner.

5. Whether the shipper has obtained, by fraud practiced upon the true owner, the possession he gives to the carrier, or whether he mistakenly supposes he has rights to the property, his relation to his bailee remains the same. He cannot confer rights which he does not possess, and if he cannot withhold the possession from the true owner, one claiming under him cannot.

6. While a bailee cannot avail himself of the title of a third person (though that person be the true owner) for the purpose of keeping the property for himself, nor in any case where he has not yielded to the paramount title, he is not answerable if he has delivered the property to its true owner at his demand.

7. without asserting that a title to personal property may not be created between the issue of a bill of lading therefor and its delivery to the ship, which will prevail over the master's bill, the Court holds that in the absence of any such intervening right, a bill of lading does cover goods subsequently delivered and received to fill it, and that it will represent the ownership of the goods. Their subsequent removal from the vessel by a person other than the true owner, either with or without the consent of her officers, cannot divest that ownership. chanrobles.com-red

Page 93 U. S. 576

8. The taking possession of property by one not its owner or authorized by him, shipping it, obtaining bills of lading from the carriers, endorsing them away, or even selling the property and obtaining a full price for it, can have no effect upon the rights of the owner even in the case of a bona fide purchaser.

9. The statutes of Louisiana prohibit the issue of bills of lading before the receipt of the goods, but they do not forbid caring an illegal bill by supplying goods the receipt of which have been previously acknowledged.

10. If the owner of goods willfully and wrongfully mixes them with those of another of a different quality and value so as to render them undistinguishable, he will not be entitled to any part of the intermixture.

The libellants claim damages against the Idaho for the nondelivery of one hundred and sixty-five bales of cotton, part of a shipment of two hundred bales for Liverpool, made by Thomas W. Mann, and consigned to the order of James Finlay & Co. After the shipment, the libellants purchased the cotton from Mann, who endorsed to them the ship's bill of lading therefor. On the arrival of the vessel at Liverpool, thirty-five bales were delivered to Finlay & Co., but the remaining one hundred and sixty-five were delivered to Baring Brothers & Co., in pursuance of an order from William J. Porter & Co. of New York. Such a delivery was not in accordance with the stipulations of the bill of lading, but it is attempted to be justified by the alleged fact that Porter & Co. were the true owners of the cotton, and as such had a right, superior to that of the shippers, to control its delivery.

In April, 1869, at New Orleans, W. J. Porter & Co., in due course of business and in good faith, advanced to one Forbes a large sum of money upon a bill of lading, which set forth a shipment of one hundred and forty bales of cotton at New Orleans, in the brig C. C. Colson. The bill of lading was in the ordinary form, executed by the lawful master of the Colson, but in fact the cotton had not been shipped at the time of its execution. Some few days after the date of the bill of lading, and after the acceptance of the drafts by Porter & Co., Forbes did ship by the Colson one hundred and forty bales of cotton, as and for that described in the bill of lading sent to Porter & Co. This cotton was duly delivered to the Colson, was receipted for by the officers of the brig, and, chanrobles.com-red

Page 93 U. S. 577

although not then placed on board, was delivered to the vessel on the wharf alongside.

Subsequently to this shipment and before the cotton was taken into the hold of the brig, Forbes removed it from the custody of the brig and shipped it on the steamship Lodona, lying near and bound for New York. The previous shipment of the cotton on the Colson was unknown to the officers of the Lodona, and they issued bills of lading in the ordinary form for the cotton they received.

Forbes shipped in the Lodona twenty-five other bales, and took one bill of lading for the whole one hundred and sixty-five, on which second bill of lading he obtained a large advance from Schaefer & Co., of New York, to whom he made a second assignment of the cotton.

The bill of lading for one hundred and sixty-five bales, which was sent to Schaefer & Co., included the one hundred and forty bales which had been taken from the Colson and delivered to the Lodona. The Lodona arrived in New York on the 29th or 30th of April. The one hundred and sixty-five bales were taken directly to a warehouse by Schaefer & Co., who, on the 1st of May, engaged freight in the Idaho for two hundred bales. On the same day, Schaefer & Co. sent for one Corcoran, who went to Schaefer's house on the next day (Sunday), and was then directed to remove all the marks and numbers from the one hundred and sixty-five bales, and re-mark them with marks similar to thirty-five other bales, which Schaefer & Co. had stored in West Street. Corcoran did this as well as the short time permitted, and on Monday the two hundred bales -- one hundred and twenty of them marked S.A.L. and eight marked V.O.X. -- were shipped in the Idaho. This shipment was not made in Schaefer's name, but while Corcoran was at work on the cotton, it was nominally sold to Mann, Schaefer's clerk, and was shipped in the name of Conklin & Davis, grocers, who permitted their names to be thus used, and who endorsed the ship's receipts over to Mann. On the 4th of May, Mann applied for and received the bill of lading of the Idaho for the two hundred bales on which this action is brought. On the same day, Mann made a nominal sale of the cotton to Hentz & Co., free on board. chanrobles.com-red

Page 93 U. S. 578

Hentz & Co. were told to ask no questions, and on the 5th or 6th gave their note for the cotton to Mann, who paid it to Schaefer, who held it till maturity, and when Hentz & Co. paid the amount of it to Mann they obtained Schaefer's guaranty against loss. Mann then paid the money over to Schaefer, who gave him a check for $897.36, as for a difference in price between the sale to Mann and his sale to Hentz & Co. Hentz & Co. acted under the direction of Schaefer & Co., the real parties in interest here in bringing this suit.

The court below dismissed the libel, and the libellants appealed here.