Cochran v. Sherman — 12 N.Y. Super. Ct. 13

Majority

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Cochean, Appellant, v. Sherman and others, Respondents.

Headnote

The defendants owned a vessel, which formed part of a line of E. D. Hurlhut & Co., running between New York and Mobile, and consigned by E. D. H. & Co. to W. & S. of Mobile. W. & S. collected the freight, paid the disbursements, and, by direction of the captain, procured freight for the vessel to Barcelona. They having advanced §264.36 over and above the freight collected, and he wishing more money, they advanced him the further sum of $235.64. The captain drew a bill to his own order on two of the defendants for $500, and endorsed it. The plaintiff discounted it, at the instance of W. & S., who did not endorse it. They received the money, and credited it in their account. The drawers refused to accept or pay the bill. Some months subsequently, W. & S. assigned to the plaintiff their account against the owners, and all claims by reasons of the advances they had made to the captain of the vessel.

Held, that the mere drawing and negotiation of the bill, which the drawees refused to accept, gave to the plaintiff no right of action against either defendant.

The claim of W. & S. not having been assigned to the plaintiff on his discounting the bill, but, on the contrary, having been paid with the proceeds of it, the subsequent assignment of it to the plaintiff was a nullity, and gave him no additional claim upon the defendants.

(Before Duek, Boswouth and Hoffman, J.J.)

Heard, May term;

decided, June term, 1855.

This action came before the court, on an appeal from a judgment entered on the report of John L. Mason, referee. The facts, as found by the referee, are as follows, viz.;

The defendants were, in the months of July and August, one thousand eight hundred and forty-nine, and for some time previous and subsequent thereto, the owners of a bark or vessel called the Ophir, whereof one H. W. Ramsdell was the master. By some arrangement, (the particulars whereof did not appear,) made between the defendants and the firm of E. D. Hurlhut & Go. the said bark was placed in the line of packets owned by the latter firm, running between Hew York and Mobile, and arrived at Mobile in the month of June, one thousand eight hundred and forty-nine, with an assorted cargo of dry goods, consigned by the said E. D. Hurlbut & Co. to Whittaker & Sampson, the agents in Mobile of the said line.

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Whittaker & Sampson collected the freight and paid all the disbursements of the vessel, and by the directions of the' captain, procured a freight for her to Barcelona, and paid all the expenses of loading, manning and victualling her for her foreign voyage. They also paid the captain, from time to time, such moneys as he needed for his personal expenses.

When Whittaker & Sampson’s account was made up, just before the vessel sailed on her voyage to Barcelona, it was found that the expenditures of Whittaker & Sampson, over and above the freight received by them, amounted to two hundred and sixty-four dollars and thirty-six cents, and thereupon they advanced to the said captain the further sum of two hundred and thirty-five dollars and sixty-four cents, making the balance claimed by them to be five hundred dollars; for this last mentioned sum, the captain drew an order on Messrs. Gr. & J. Sherman, two of the defendants, bearing date the thirtieth day of August, one thousand eight hundred and forty-nine, payable to his own order, and by him endorsed in blank.

This order was negotiated to the plaintiff, who advanced the whole amount thereon, which was paid to Whittaker & Sampson. They did not endorse it. Afterwards, and in the month of September, one thousand eight hundred and forty-nine, it was presented for acceptance and also for payment to the drawees, and acceptance and payment refused. In the account of Whittaker & Sampson, they give credit for the five hundred dollars, as follows: “By Capt. Bamsdell’s draft at three d-s, on Gr. & J. Sherman, Hew York, taken at par, for balance of ac. $500,” but Mr. Whittaker, in his testimony, says, that the draft was negotiated by him for Capt. Bamsdell, without fee, at par, after Capt, Bamsdell had been unsuccessful in obtaining the amount, by valuing on his freight to Barcelona.

Afterwards, and on the fifth day of July, one thousand eight hundred and fifty, Whittaker & Sampson assigned their account against the bark and owners, for the disbursements aforesaid, to the plaintiff, and it is upon this account, and for the balance of five hundred dollars, for which the captain gave the order, that the present suit is brought.

The disbursements were sufficiently proved, except the last payment of two hundred and thirty-five dollars and sixty-four

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cents to the captain, as to the necessity of which further evidence would, in my judgment, be necessary to entitle the plaintiff to recover, if he can recover at all in this action.

Upon these facts I am of opinion, that when Whittaker & Sampson received the proceeds of the draft, their claim upon the account was extinguished. It made no difference whether the draft was negotiated by them for Captain Ramsdell, or whether they took it from him in payment, and then negotiated it to the plaintiff as they did not endorse it or become responsible to the plaintiff in case the drawees should refuse acceptance. and payment. Their demand was paid in full, and could not be assigned ten months afterwards to the plaintiff.

The complaint must be dismissed with costs.

All which is respectfully submitted.

Dated, New York, May 17, 1853.

A. J. Willard, for appellant.

Wm. Bliss, for respondent.

The draft or bill, drawn by the master to his own order, on Gr. &. J. Sherman, two of the defendants, and which they refused to accept, by its own mere force never gave to any holder of it a right of action against either defendant.

When it was negotiated to the plaintiff, the account of Whittaker & Sampson was not transferred with it. The plaintiff cashed the draft for Ramsdell, and the money received was paid to Whit-taker & Sampson in satisfaction of the balance of their account. They did not endorse it, and were not parties to it. Payment to them extinguished all claims which they had either against Rams-dell, or the owners of the vessel. Any subsequent assignment by them of the account would transfer no right to the assignee.

The drawing of the bill by the master, and the negotiation of it by him, if it had been negotiated without the assistance of Whittaker & Sampson, could not transfer or affect their claim, if they had any, upon the owners of the vessel.

The claim, which the complaint alleges was subsequently assigned to the plaintiff, and which, the assignment shows, was

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made on the 5th of July, 1850, was a claim of Whittaker & Sampson against the bark Ophir and owners. This claim had been fully paid and satisfied to them as early as the 31st of August, 1849.

Even if they had a valid claim against the owners to the amount of the bill, and they had drawn a mere bill of exchange to the plaintiffs’ order on the defendants, for a sum equal to the balance of the account, and the plaintiff had bought the bill of them, the mere negotiation of the bill would not have operated as an assignment of the account. (Cowperthwaite v. Sheffield, 2 Coms. 243; Luff v. Pope, 5 Hill, 413 ; 7 id. 577.) But the bill in question was not drawn by them, but by Ramsdell.

Its proceeds satisfied their claim in full. Their subsequent assignment of it was a nullity. The plaintiffs’ only remedy, on the facts as they appear in the case before us, is against the drawer of the bill. The referee decided correctly, and the judgment entered upon Ms report must be affirmed.