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Commentaries on the law of sales and collateral subjects (Volume 1) online

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ants ; and it was an altogether immaterial factor in the case that
they usually did business as agents and brokers ; and that, on
their selling the cotton, they re-sold it to parties for whom they
were accustomed to purchase cotton, and sold it to them simply
at the price they had themselves paid for it, with an additional
sum which they called " commission." The law in such a case is
entirely too clear for doubt. But the difficulty in the case which
led to what seems to us a series of incorrect judgments, which we
do not think the ablest conducted courts of this country would
follow, thus occurred. When the facts whicli we have pretty fully
summarized were proved on the trial, the judge left two questions
to the jury, namely : first, whether the cotton in question had been
bought by the defendants as agents in the course of their business
as brokers ; and secondly, whether they dealt with the goods as
agents for their principals^ The jury answered both of these
in the affirmative ; and, according to the whole consensus of opin-
ion of the judges, so far as those answers mean (as we think it is
too clear for question that they do mean) that the defendants
purchased the cotton only as agents, and not as principals ; and
that they dealt with the cotton as agents only for their principals ;
and that, therefore, by their purchase of the cotton no property
vested in themselves, the jury ansicered the questions wrongly. In
accordance with the answers of the jury, obviously understood,
as, without scholastic refinement and judicial perversion, any one
would understand tliem, Willes, J., " directed the verdict to be
entered for the defendants, reserving leave to the plaintiffs to
move to enter the verdict for them." A rule was afterwards ob-
tained for that purpose in the Queen's Bench, which was made
absolute. On appeal to the Exchequer Chamber, the judges were
equally divided in opinion. The case was then appealed to the
House of Lords, and the judges were called in for consultation.
As we have shown, and as was all around with scarcely an excep-
tion conceded, independent of the questions submitted to the jury


and their answers, on the facts of the case, the verdict and
judgment should have been for the plaintiffs. An application was
made to the Court of Queen's Bench for a rule as for misdirec-
tion, or as for a verdict against evidence. Had this been granted,
as it clearly should have been, the whole difficulty in the case would
have been avoided, and we would not have had the bad law which,
as applied to the actual, express finding of the jury in the case,
we cannot but think the case contains. But the Court of Queen's
Bench, improperly, we think, instead of granting the plaintiffs'
application for a new trial, disregarding, or rather, distorting the
finding of the jury, by which, adopting and affirming their an-
swers, they were bound ; entered the verdict for the plaintiffs.
By this course the courts of appeal were concluded by the find-
ings of the jury in their answers to the questions proposed to them ;
and while even the House of Lords were excluded from disregard-
ing the findings of the jury, but were bound by them, we think
that their decision rests on a complete distortion of the findings
of the jury ; and that, while independent of those findings, the
defendants clearly were liable for conversion, we do not, notwith-
standing the ultimate holding in the case in the House of Lords,
think it good law, that where parties buy goods only " as agents
in the course of their business as brokers,''^ and " deal ivith the goods
only ^ as agents for their prineijjals,^^ that they are liable in trover
for conversion ; and, notwithstanding the express holding of the
House of Lords in the case that theg are, we quite confidently
submit, that the whole ratio decidendi of the case itself is, that
theg are not. And we submit further that their so expressly hold-
ing was the result only of a complete and utterly unjustifiable
perversion of the distinct, express finding of the jury in the case.
We think the differing opinion of the judges who advised against
such holding, the better one ; and that the holding of the House of
Lords, affirming the judgment of the Queen's Bench "that the de-
fendants in effect bought as principals, and would have been liable
to B, as vendees, and having dealt with the cotton as if the prop-
erty was in them, by assigning it to M. <fe Co., they were liable to
the plaintiffs for a conversion on its turning out that no property
had passed from the plaintiffs to B," while perfectly good law on
the facts of the case, independent of the finding of the jury, is ut-
terly inconsistent with the express finding of the jury, that the
defendants did not buy the cotton " as principals," but bought it
" as agents," and " dealt with the goods only as agents for their
principals." But for the deliberate holding of the House of Lords
(to question which is often, with sycophants, no matter how trans-

1 See the questions, as stated by Lord pears as we have here quoted it. L. R. 7
Chelmsford, where the word "only" ap- H. L. 793.


parently bad the holding may be, deemed presumption^), it would
seem almost a waste of labor and space to insist upon anything
so palpable. And although Lord O'Hagan assented to the hold-
ing of his colleagues in the House, he did so (while admitting
that they were bound by the findings of the jury) on the ground
that the jury did not mean that the defendants in their agency
were not acting " only as such," against the express language as
we have quoted it from Lord Chelmsford. And we think that
the better opinion of Lord O'Hagan was represented by his hesi-
tancy in agreeing with his colleagues, rather than in his agreeing
with them. On that point he says : " The real difficulty which
embarrasses decision has arisen on the findings of the jury, and
the form of the reservation by which, properly understood, ice
are hound to abide. And unquestionably, although that view does
not appear to have been pressed in the Court of Queen's Bench, I
have felt the force of the objection founded on the findings ; and
I have doubted whether some of the judges in the Exchequer Cham-
ber were not right in holding themselves coerced by the verdict to
differ from the learned judges of the Queen^s Bench, with whose
conclusion they would otherwise have concurred." ^

And it must be borne in mind that the House of Lords, in
holding that the defendants, who, according to the finding of
the jury, " bought the cotton in question as agents in the course
of their business as brokers," and " dealt with the goods only
AS AGENTS to their principals," ^ held that this language did not
mean " only as such " * agents, but was open to the construc-
tion that they did not buy as agents, but bought as principals ;
and it is only on the absurdity that parties who " bought only
as agents," did not buy " only as such " agents, that the case can
be sustained. Notwithstanding such holding, wc state the law
advisedly, from the case itself, that, as in the facts of the case it-
self, the defendants bought and dealt with the goods as principals,
and were thus liable for a conversion on those facts ; but, with
reference only to the finding of the jury, notwithstanding the
manner in which that was distorted, one who buys the goods and
deals with them only as an agent, as the jury found the defendants
did, is not a principal and is not guilty of a conversion, nor liable
in trover, and the case so far as it holds contrary to this is, un-
questionably, wrongly decided, according to the decision of the
House of Lords in the case itself.^

1 A very emphatic intimation was made ^ Hollinsr. Fowler, L. R. 7 H. L. p. 800.

in the Privy Council the other day, in the 3 JUd.^ at p. 793.

Bishop of Lincoln's Case, as to the right * At p. 800.

of reversing wrong decisions, whether of ° See Fowler v. HoUins, L. R. 7 Q.

the Privy Council or of the House of B. 616, at p. 620, where the terms of the

Lords. leave reserved assumed, in accordance with




Robinson v. Mollett ^ is another interesting case, in which a
similar conflict took place in the opinions of the judges as charac-
terized Hollins V. Fowler.2 While, however, we are very strongly
of the opinion, as we have shown, that the latter case was finally
decided by a complete perversion of plain English, and is, as it
was decided, of extremely doubtful authority, Robinson v. Mollett,
we think, was decided with unquestionable correctness. The case
was tried before Bovill, C. J., when a verdict was taken for the
plaintiff, subject to leave reserved to enter a nonsuit. In the Com-
mon Pieas,^ the judges having equally divided, the verdict was
sustained. On appeal, the judges in the Exchequer Chamber^
being also equally divided, the judgment of the Common Pleas
was affirmed. On appeal to the House of Lords, the judges were

the finding of the jury, that the defend-
ants had "acted throughout honestly, in
the ordinary course of business, having
bougJit and paid for the cotton only as
AGENTS for M., and having dealt with the
goods ONLY AS AGENTS to forward them ; "
and the question was, under such an as-
sumed state of facts, whetlier the defend-
ants were answerable for the value of the
cotton as having converted it to their
own use ; ' ' the defendants to be at lib-
erty to argue, if necessary, that the sale
by Bayley, under the circumstances, gave
a good title to a bond fide purchaser for
value without notice." Tlie rule was
moved in the Queen's Bench on three
grounds : 1. That the verdict was against
the evidence ; 2. Misdirection ; 3. On
the point reserved. The court refused the
rule on the first and second grounds. As,
on principle and authority, the case is not
arguable on the ground that B., to whom
no property had passed, could, under the
circumstances, give a good title to another,
the case went to the Exchequer Chamber,
and to the House of Lords, hampered with
the assumption — the very basis of the
leave reserved — that the defendants had
" bought and paid for the cotton onhj as
agents," and had "dealt with the goods
only as agents to forward them." And in-
asmuch as the case, therefore, does on the
facts, as governed by the terms of the
leave reserved, decide, that one who has
bought and paid for goods only as an
agent for another, and who has dealt with
the gooils only as agent to forward them,
is liable in trover for conversion ; accept-
ing the clear and express reasoning in the
case itself on the point, in the House of
Lords, we think it is palpable that it is
not, as an abstract principle, law, notwith-
standing the holding to the contrary in
both the Exchequer Chamber and in the
House of Lords, — that one who buys and
pays for goods only as an agent for another,

and vs^o has dealt with them only as an
agent to forward them, is liable in trover ;
and we submit that, while the House of
Lords nominally decide that he is so lia-
ble, they have only reached such a conclu-
sion by such a complete perversion of
language as to make the case itself in ef-
fect decide, that a person who has dealt
with goods as named in the leave reserved,
is not liable in trover for conversion. We
make these additional remarks because the
volume of the Law Reports containing the
report of the case in the Exchequer Cham-
ber was not at hand when we examined the
report of the case as decided by the House
of Lords. And we are in the fullest ac
cord with the judgments of Kelly, C. B.
and Brett, J. (with whom agreed Byles, J. )
and we think their reasoning in the case
is unanswerable. We think, on the ques
tion which they had to decide, their con
elusions, that the defendants were not
guilty of a conversion, inasmuch as they
acted only as brokeis, and exercised no
dominion over the cotton in their own
right and for their own benefit ; and that a
pjossessiou or detention, which is a mere
custody or mere asportation made with-
out reference to the question of the prop-
erty in chattels, is not a conversion ; and
that the defendants, acting only as brokers
by negotiating a bargain of purchase and
sale, and by passing a delivery order, were
not guilty of a conversion, — is not only
law, but that it is sustained as law by the
whole reasoning in the House of Lords,
which nominally decided the reverse. See
Eoss V. Johnson, 5 Burr. 2825 ; Green-
way V. Fisher, ] C. & P. 190 ; Fouldes
V. Willoughby, 8 AL & W. 540 ; Lanca-
shire Waggon Co. v. Fitzhugh, 6 H. & N.

L. 802.

1 L. R. 7 H.

2 Ibid. 757.
8 L. R. 5 C.
< L. R. 7 C.

P. 646.
P. 84.


called in, who were divided in opinion, four against three. The
House of Lords unanimously reversed the decision of the courts
below. Notwithstanding this wonderful conflict of opinion among
the very able judges acting in the case, the correctness of the de-
cision of the House of Lords is, we think, entirely beyond doubt.
The facts were that the defendant and appellant, Robinson, a mer-
chant at Liverpool, gave an order to the plaintiffs, tallow-brokers
in London, on April 2, for the purchase of fifty tons of tallow at
46s. Gd. On April 29, the defendant gave the plaintiffs another
order to purchase 200 tons of tallow, 100 for him, and 100 for a
friend ; the whole to be booked to him, and the purchase to be
made, not at a specified price, but on " the best terms ; " the
orders being for the June delivery. The plaintiffs had before
bought, and afterwards also bought from various persons, consid-
erable quantities of tallow, none specifically for defendant ; but
proposed to supply the whole 250 tons at the June delivery, out of
their various purchases. In their notes, sent immediately after
each of the orders had been received, the plaintiffs said : " We
have this day bought for your account," and signed them, with the
addition of the words, " sworn brokers." The price of tallow fell
in the market between the date of the orders and the time for
June delivery. When that time arrived, the plaintiffs tendered
250 tons of tallow, but the defendant refused to accept the tallow
so tendered. The plaintiffs sold the tallow, and then (suing in
their own names, in effect, as though they were principals) brought
assumpsit to recover the difference ; insisting that they were en-
titled to do so in virtue of the established usage of the London
tallow market. The usage relied on did not exist in Liverpool,
and was unknown to the defendant. The question in the case
was, whether the appellant was bound by the custom merely by
the employment of the respondents as his brokers to buy for him,
and from their having purchased in the London market the quan-
tity of tallow ordered. The House of Lords held that he was not.
Lord Chelmsford, in his judgment in the House of Lords, which
was concurred in by his able colleagues, deals conclusively with
the case. The following brief passages in his judgment go to the
very gist of the matter : " The effect of this custom is to change the
character of a broker who is an agent to buy for his employer,
into that of a principal to sell for him. No doubt a person em-
ploying a broker may engage his services upon any terms he
pleases ; and if a person employs a broker to transact for him
upon a market with the usages of which the principal is unac-
quainted, he gives authority to the broker to make contracts upon
the footing of such usages, j»rovided they are such as regulate the


mode of performing the contracts, and do not change their in-
trinsic character. ... I have already intimated the doubt which
I entertain whether the usage of the London tallow trade applies
at all to the case of an ordinary transaction between broker and
principal. Assuming, however, that it does, I hesitate to say that
it would not apply in the case of persons knowing of its existence,
and employing a broker to act for them in the market where it
prevails. But the usage is of such a peculiar character, and is so
completely at variance between the parties, converting a broker em-
ployed to buy, into a principal selling for himself, and thereby
giving him an interest wholly opposed to his duty, that I think no
person who is ignorant of such an usage can be held to have
agreed to submit to its conditions, merely by employing the ser-
vices of a broker, to whom the usage is unknown, to perforin the
ordinary and accustomed duties belonging to such employment." ^
The principle on which the case was decided by the House of
Lords was virtually conceded by all the judges, so many of whom,
in this most extreme case, failed to make a proper application to it.
Thus : " It is an elementary proposition that a custom of trade
may control the mode of performance of a contract, but cannot
change its intrinsic character." ^ And, per Blackburn, J. : " If the
terms are such as to be inconsistent with the nature of the employ-
ment, so that if they prevailed they would change its nature alto-
gether, I think they should be rejected." ^ It was on the clearest
application of these principles that the House of Lords reversed
the decision of the courts below.*

1 L. R. 7 H. L. at p. 836 et scq. tnith, is partly express and in writing ;

2 Per Willes, J., Ibid., at p. 818. partly implied or understood, and unwrit-
' Ibid., at p. 819. ten. But, in these cases, a restriction is
* The principle governing this case is established on the soundest principle, that

well laid down by Coleridge, J., in Brown the evidence received nucst not be of a
V. Byrne, 3 El. & B. 703, 715, thus : particular which is repugnant to, or incon-
" Mercantile contracts are very com- sistent with, the written contract. Merely
monly framed in a language peculiar to that it varies the apparent contract is not
merchants ; the intention of the parties, enough to exclude the evidence ; for it is
though perfectly well known to them- impossible to add an}' material incident to
selves, would often be defeated if this Ian- the written terms of a contract without
guage were strictly construed according to altering its effect, more or less. Neither,
its ordinary import in the world at large ; in the construction of a contract among
evidence, therefore, of mercantile custom merchants, tradesmen, or others, will the
and usage is admitted in order to expound evidence be excluded because the words
it and arrive at its true meaning. Again, are in their ordinary meaning unambigu-
in all contracts, as to the subject-matter ous ; for the principle of admission is,
of which known usages prevail, parties that words perfectly unambiguous in their
are found to proceed with the tacit as- ordinary meaning are used by tlic con-
sumption of these usages ; they commonly tractors in a different sense from that,
reduce into writing the special particulars What words more plain than ' a thou-
of their agreement, but omit to specify sand,' 'a week,' 'a day'? Yet the cases are
these known usages, which are included familiar in which ' a thousand ' has been
however, as of course, by mutual under- held to mean twelve hundred ; ' a week,'
standing ; evidence therefore of such in- a week only during the theatrical season ;
cidents is receivable. The contract, in 'a day,' a working da}'. I n such cases the



[book II.

Armstrong v. Stokes,^ in the Queen's Bench, decides that a
vendor, who has given credit to an agent, believing him to be the
principal, cannot recover against the undisclosed principal, if the
principal has bond fide paid the agent at a time when the vendor
still gave credit to the agent, and knew of no one else as principal.

In this case, R. & Co. were commission merchants, acting some-
times for themselves and sometimes as agents. The plaintiff, a
merchant, had had dealings with them, and had never inquired

evidence neither adds to, nor qualifies nor
contradicts the written contract ; it only
ascertains it, by expounding the language."
See Webb v. Plummer, 2 B. & Aid. 746 ;
Hutton V. Warren, 1 M. & W. 466 ; Smith
V. Wilson, 3 B. & Ad. 728 ; Grants. Mad-
dox, 15 M. & W. 737; Cochran v. Retberg,
5 Esp. 121 ; Trueman v. Loder, 11 A. &
E. 598 ; Anderson v. Pitcher, 2 B. & P.
164, 168; Si)artati v. Benecke, 10 C. B.
212; Syers v. Jonas, 2 Ex. 116 ; Wiggles-
worth V. Dallison, 1 Dong. 201 ; Ford v.
Yates, 2 M. & G. 549 ; Blackett v. Royal
Ex. Ass. Co., 2 C. & J. 244, 249. In
Trueman v. Loder, 11 A. & E. 589, Lord
Denman says: "Evidence of the prevail-
ing custom is supposed to show that both
parties had in their contemplation more
than appears in the writing ; but suppos-
ing them both to have not only contem-
plated, but distinctly expressed, in the
plainest words, that they considered their
contract to include a provision not to be
found in the paper, still the evidence can-
not be introduced into the cause. Custom
of trade has been sup[)Osed to form a vir-
tual exception to this well-known rule ;
but the cases go no farther than to permit
the explanation of words used in a sense
different from tlieir ordinary meaning, or
the .addition of known terms not incon-
sistent ivith the written contract." The law
is laid down to the same effect bv Parke,
B., in Hutton v. Warren, 1 M. &.'\\\ 466,
475: "It has long been settled that,
in commercial transactions, extrinsic evi-
dence of custom and usage is admissible
to annex incidents to written contracts,
in matters with respect to which they are
silent. The same rule has also been ap-
plied to contracts in other transactions of
life, in which known usages have been
established and prevailed ; and tliis has
been done upon the principle of presump-
tion that, in such transactions, the parties
did not mean to express the whole of the
co7itract by which thej' intended to be
bound, but a contract with reference to
those known usages. . . . Accordingh% in
Wigglesworth v. Dallison, 1 Doug. 201,
afterwards affirmed in a writ of error, the
tenant was allowed an away-going crop,
though there was a formal lease under

seal. There the lease was entirely silent
on the subject of such a right, and Lord
Mansfield said, that the custom did not
alter or contradict the lease, but only
superadded something to it. This ques-
tion subsequently came under the consid-
eration of the Court of King's Bench, in
the case of Senior v. Armitage, Holt, 197.
In that case, which was an action by a
tenant against his landlord for a compen-
sation for seed and labor under the de-
nomination of tenant-right, Mr. Justice
Bayle}-, on its appearing that there was
a written agreement between the parties,
nonsuited the ])laintiff. The courl after-
wards set Eiside the nonsuit, and held, as
appears by a manuscript note of that
learned judge, tliat, though there was a
written contract between landlord and
tenant, the custom of the country would
be still binding, if not inconsistent with
the terms of such written contract ; and that
not only all common-law obligations, but
those imposed by custom, were in full force
where the contract did not vary them."
See further, Sweeting u. Pearcc, 7 C. B. x. s.
449 ; Lamj)leigh v. Braithwait, Hob. 105 ;
Sutton V. Tatham, 10 A. & E. 27 ; Taylor
V. Strav, 2 C. B. x. s. 175, 197 ; Rose-
warne v. Billing, 15 C. B. N. s. 316 ; Bay-
liffe V. Butterworth, 1 Ex. 425 ; Greaves
V. Legg, 11 Ex. 642; 2 H. & N. 210 ;
Humphrey v. Dale, 7 E. & B. 266 ; E. B.
& E. 1004 ; Wall v. Cockerell, 10 H. L. C.
229 ; Fawkes v. Lamb, 31 L. J. Q. B. 98 ;
Hall V. Janson, 4 E. & B. 500 ; Salo-
mons V. Pender, 3 H. & C. 639 ; Bos-
tock V. Jardine, Jb. 700 ; Sliarman v.
Brandt, L. R. 6 Q. B. 720 ; Stultey v.
Dickey, 5 Binn. 287 ; Barber v. Bruce, 3
Conn. 9 ; Bank of Columbia v. Fitzhugh,

1 Harr. & G. 239 ; Haven v. Wentworth,

2 N. H. 93 ; United States v. Arredondo,
6 Pet. 715 ; Simpson i'. Gazzam, 6 Port.
123 ; The Reeside, 2 Sumn. 569 ; Cooper
V. Kane, 19 Wend. 386 : Sliaw v. Mitchell,
2 Mete. 65; Eaton v. Smith, 20 Pick. 250;
Wayne v. Steamboat General Pike, 16
Ohio, 421 ; Inglebright v. Hammond, 19
Ohio, 337 ; Foye v. Leighton, 2 Post.
71. See further, in a later volume of this
work, on Custom and Usage.

1 L. R. 7 Q. B. 598.


whether they had principals or not, and had always settled with
them. On June 15, plaintiff contracted to sell to R. & Co., 200
pieces of shirtings at a certain price, payment to be made in

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