Nottebohm v. Maas — 26 N.Y. Super. Ct. 249

Majority

p. 249

Augustus Nottebohm, plaintiff and respondent, vs. Frederick M. Maas et al. defendants and appellants.

Headnote

Where a pledgee of goods employs the owner to sell them, and the latter sells them to a purchaser with notice of the pledgee’s lien thereon, for advances, rendering bills stating the price to be payable to the pledgee, and the purchaser agrees to pay the price to the pledgee, the purchaser cannot set off a claim against the owner, in an action by the pledgee for the price of the goods.

(Before Robertson, Ch. J. and Garvin and McCunn, JJ.)

Heard February 9, 1865;

decided May 27, 1865.

This was an appeal from a judgment rendered on a report of a referee. The complaint was for goods sold and delivered; the answer was a general denial of the allegations of the complaint. The referee found that in September, 1863, the plaintiff sold and delivered to the defendants, through one Victor Fleury, the goods in question, and the defendants promised to pay a certain sum ($8391.63) therefor on demand. That in the same month the defendants paid the plaintiff a certain sum, ($5391.63,) leaving a residue ($3000) due on the price of such goods, for which, with interest, he gave judgment.

Fleury being examined as a witness, testified that the plaintiff was to have the bill of lading of the goods imported, and pay any thing outside ; and he was to pay the plaintiff the cash on receiving the bill of lading. When he did not pay the plaintiff and take the bill of lading, the latter made the

p. 250

entries at the custom house and paid .the duties. He sold the goods to one of the defendants, (Maas,) who was to pay the amount to the plaintiff, who had made advances on such goods. The plaintiff sent the goods by his own cartman to the defendants, whose porter received them and gave receipts according to his custom therefor, in which he stated he received them from the plaintiff. The same witness further testified, that he required the defendants to pay the amount to the ■ plaintiff, on account of his having made advances on the goods ; that he himself had power to sell the goods; they belonged to him, after he had paid the plaintiff; the latter had nothing to do with the profit and loss on the goods. On the 1st of September he delivered a written order, signed by him, to the defendants to pay, absolutely, the price of the goods sold, to the plaintiff, to which was annexed a bill of parcels specifying the amount due ; they delivered to him in-return, a written promise to do so. The bills rendered were for the goods as bought by Eleury, but the price mentioned therein was stated to be payable to the plaintiff.

The plaintiff testified that he had imported a good deal of the same kind of goods for Eleury, for which the latter at first paid him, but latterly could not do so, so that he kept possession of the goods. He then gave Eleury liberty to sell them, with the understanding that the price should be paid to him. On a previous occasion he sold some of the same goods to the defendant Maas, and received a similar order for the price. He was informed on that occasion, when he inquired, that it was all right. He further testified that the difference between his advances on those goods and interest, and what he claimed from the defendants, would be very small, not over one or two hundred dollars; there might be a loss. Eleury then owed for other advances by him which were not paid. There might be a loss as well as a profit on that transaction, because he had not closed it.»

One of the defendants (Maas) testified that he did not know the plaintiff, in making the purchase, until the bargain was concluded; that he advanced Eleury a certain sum ($1500)

p. 251

on account of such goods, after he had given the latter the written promise before mentioned, to pay the price to the plaintiff; the latter then owing them another sum, ($1430.02.) He subsequently promised, to pay them the whole, but again borrowed a third sum, ($500,) which he promised to pay before they paid the plaintiff. Maas, on behalf of both defendants, on the 12th of September, sent the plaintiff a check, in a letter, for a certain sum, ($5391.63,) excusing themselves for not having sent the check before, in consequence of having paid Fleury part. To this the plaintiff replied, claiming the balance, ($3000,) to be paid as agreed on, and asking a check therefor. On a personal application by the plaintiff, on the 12th of September, the defendant Maas told him he had no transaction with him ; that as Fleury asked him to pay an amount to the plaintiff, he thought he had the right to countermand it.

The referee reported in favor of the plaintiff for $3227.50, together with costs; and the defendants appealed from the judgment entered on the report.

M. V. B. Wilcoxson, for the appellants.

G. Dean, for the respondent.

The defendants, in their answer and by their proofs, have endeavored to show that they did not purchase the goods from the plaintiff, but from one ’ Victor Fleury, who owed the defendant a large amount of ■ money which they seek to offset. The plaintiff, on the contrary, alleges that Fleury was only his agent, and that consequently, the set-off claimed by the defendants cannot be allowed.

There is but a single question in the case, and that is, to whom was the credit in the transaction given—to Victor Fleury or to the defendants ? I am satisfied, from a careful examination of the facts, that the credit was given to the defendants. Fleury, the agent, testifies that the leather belonged to the plaintiff, and that he (Fleury) simply sold the skins to

p. 252

the defendants as the plaintiff’s goods, and in this he is fully corroborated by the plaintiff, Nottebohm, who testifies that he sold the goods to the defendants, and not to Fleury ; and he is further corroborated in this respect by the letter of the defendants, written before the goods were delivered, agreeing to pay for the same to the plaintiff, and not to Fleury.

Indeed it is seen from a careful examination of the defendant Maas’ testimony, that he knew the goods were the plaintiff’s, and admits he owed the money to Nottebohm, and not to Fleury.

Some stress is laid by the defendants upon the fact that the bill for the goods was made out in the name of Fleury. The making out of the bill was not done by the plaintiff; it was done by Fleury, at the defendants’ request, and was done, no doubt, to fix the credit on Fleury. The making out of the bills, however, in the name of Fleury, is of no consequence, so long as the credit was given to the defendants ; moreover, the bills, themselves show that the proceeds of the sale were to be paid to the plaintiff.

It is quite clear, therefore, from the evidence, that Fleury was acting as agent of the plaintiff at the time of the sale, and that he disclosed his principal, and that the defendants knew they were dealing with Fleury as agent of Nottebohm, and were consequently bound to respond to Nottebohm, unless there was some special agreement between the plaintiff and defendant to the contrary, and of this there is no evidence.

The referee, in passing upon the facts of the case, took all these questions into consideration. His findings are in favor of the preponderance of proof; the judgment already entered cannot, consequently, be disturbed.

The evidence in this case is sufficient to sustain either a finding that the plaintiff sold the goods in question to the defendants, or one that he transferred to them his interest therein, or lien thereon, to the extent of the whole purchase money. Fleury sold them as his agent, to reimburse him to the extent of his advances, which he test

p. 253

ified probably exceeded such purchase money, in which statement he was not contradicted by any other testimony. It is immaterial, so far as the pleadings are concerned, whether such sale operated merely as a transfer by the plaintiff, of his lien for advances to the defendants, and a simultaneous transfer of the valueless equity of redemption, or nominal ownership of Fleury, at the same time, or as a sale of goods owned by the plaintiff; since no objection was taken on the trial, on the motion to dismiss the complaint, of a variance between the complaint and proof, but only of an entire absence of proof of any cause of action. The goods were in the possession of the plaintiff, and could not have been obtained except by his delivery of them. The pledgee of .goods is not to be deprived of his rights because he employs the owner to sell them. The defendants, before paying any of the price, should have ascertained in whose possession they were, and what was the nature of the holder’s interest. Fleury acted as a mere broker, and had no right to receive the price. The written acceptance of the order to pay the price, which was very nearly, if not quite, the acceptance of a bill of exchange on demand for the amount, inasmuch as such amount was fixed, the payment made absolute, and the goods were delivered on the faith of such acceptance. (2 R. S. 768, §§ 7, 8,) with the possession of the goods by the plaintiff, and the rendering of bills as payable to him went far to notify the defendants of the plaintiff’s interest, and render their promise to Fleury to pay the amount irrevocable. At all events, no payments to the latter could take away from the plaintiff his right to recover that for which he had sold his lien on the goods.

Judgment affirmed, with costs.