Scottish Court of Session Decisions

Subject_1 SALE.
Subject_2 DIVISION II.

Sale of Moveables.
Subject_3 SECT. III.

Stoppages in transitu.

Collins
v.
Marquis's Creditors

Date: 23 November 1804
Case No. No 48.

The delivery of a part of a cargo does not end the transitus of the rest.

Unloading a cargo, and laying it down on the shore, is not a complete delivery.

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John Marquis, shipmaster in Dysart, commissioned from William and Thomas Collins, in Kent, a cargo of timber. It was stripped (26th March 1801) on board a vessel freighted by Messrs Collins*.

* This was disputed, but the Court was satisfied of the fact

The vessel arriven at Dysart on the 10th April 1801, before which time, (20th March), letters of caption had been issued against Marquis upon a horning, which he had suspended.

On the 11th the vessel began to unload, and the greatest part of the timber was laid down on the sands of Dysart, or conveyed in carts into Marquis's wood-yard.

The shipmaster having made a demand for his freight, which was not paid, he refused to deliver any more of the cargo; and (20th April) obtained from the Judge of the Court of Admiralty, a warrant to sell as much of it as would cover the freight.

On the day following, Marquis, upon application to the Sheriff, was interdicted from disposing of this cargo; and the creditors purchased the shipmaster's right of hypothec, by paying his freight and charges, taking an assignation from him. He also delivered to them the bill of lading. The rest of the cargo was then unloaded, and put into Marquis's wood-ward.

The execution on the caption bears date the 14th May, and next day Marquis's estate was sequestrated.

Messrs Collins having first presented a bill of suspension against selling the timber, brought an action against the Trustee, concluding for repetition of the whole timber, as having been fraudulently taken possession of by Marquis. The Lord Ordinary (12th May 1802) pronounced the following interlocutor: “Finds, That the said John Marquis having commissioned a cargo of timber, to be sent to him at Dysart, by the said Messrs Collins, they did accordingly ship for him, upon the 26th March 1801, the timber on board the brig Jean, Captain Sheddan, master, they having agreed with him as to the amount of the freight, to be paid on delivery, as is instructed by the bill of lading produced in process; finds, That the said vessel and cargo arrived at Dysart early in the month of April 1801; but, by that time, the said John Marquis having become utterly bankrupt, and unable to pay the freight; in consequence of which, the shipmaster refused to deliver the cargo, or to give him the invoice; finds, That, in these circumstances, the shipmaster could not warrantably deliver or transfer the cargo in question, either to the said John Marquis, or to his creditors, but was bound to have retained the same for behoof of Messrs Collins, the owners of the timber; and that, although the Creditors of Marquis obtained and took possession of the timber, upon their paying the freight to Captain Sheddan, the master, yet this transaction was illegal, and could not transfer the property to the prejudice of Messrs Collins; and in respect the cargo was afterwards sold, and the price consigned, to be made forthcoming to those who should be found to have best right thereto, finds the said Messrs Collins and their attornies preferable to the proceeds of the said cargo; and therefore, in the suspension, suspends the letters simpliciter; and in the ordinary action, at the instance of Messrs Collins and their attornies, decerns in terms of the conclusions of the libel.”

The Creditors reclaimed, and

Pleaded, The shipmaster is merely the mandatary of the shipper, to deliver the cargo on receiving his freight; and this he could not refuse to do on being paid. He was not intruested with the conditional delivery of the cargo, so as only to put Marquis in possession of it, if the price was then paid; nor had the purchaser at that time been rendered bankrupt, but, on the contrary, his warehouse continued open, and he traded as usual. The property of the timber, then, by the delivery, was completely transferred. No proof of actual fraud has been attempted; and insolvency, of itself, is not sufficient to afford a legal presumption of fraud, even though the delivery should take place within three days of actual bankruptcy; Allan and Steuart against Stein's Creditors, 4th December 1788, No 45. p. 14208.; reversed in the House of Lords. The right of stopping in transitu, in this case, was not used; the shipmaster only detained what covered his freight; but the sellers never appeared to exercise their right, till the whole was delivered either to the bankrupt or his creditors; and a partial delivery puts an end to the transitus; Slubey and Smith contra Hayward and Company, 2. H. Blackstone, 504.

Answered; The bankrupt circumstances of the purchaser, when the vessel arrived, prevented any effectual delivery being made to him. He was even unable to pay the freight; and therefore the shipmaster, who is appointed to watch over the interest of the person who employs him, could not warrantably transfer the cargo to the bankrupt or his creditors, without receiving or securing the price. The cargo, therefore, or at least a great part of it, never was legally in the possession of the bankrupt or of his creditors, for they cannot avail themselves of the breach of trust which they induced the shipmaster to commit. The creditors obtained, indeed, the bill of lading, which was the warrant for delivery of the cargo, upon paying the freight due to him; but this was after the bankruptcy, which first gave them a right to act. While the shipmaster retained the bill of lading, he preserved a real right over the whole cargo, part of which was still in the ship, part on the sands, and only a part in the wood-yard. But the cargo cannot be separated into parts, nor subjected to different rules. The right to the whole must be determined by the bill of lading.

The Court (24th November 1803) pronounced the following interlocutor:

“The Lords having advised this petition, with the answers thereto, find the respondents, Messrs Collins, preferable to the price of that part of the cargo which remained on ship board, as also to that part of the cargo which remained upon the pier or shore upon the 21st of April 1801, the date of the Sheriff's interlocutor, in the application made to him by the petitioners, for inventorying and selling the wood in question: Find the petitioners preferable upon the price of that part of the cargo which was at that time within the wood-yard, or other premises belonging to John Marquis; and find the parties liable proportionally in the freight paid to the shipmaster; and in so far alter the interlocutor of the Lord Ordinary complained of; and remit to his Lordship to proceed accordingly.”

Both parties reclaimed. Both petitions were appointed to be answered; but, on advising them (23d Novemher 1804) the Court adhered.

The Court were, upon the whole, of opinion, that the circumstance of subsequent insolvency was not sufficient to prevent Marquis from receiving delivery of the goods he had commissioned some time before; that fraud did not give rise to the transaction, as he continued carrying on business as usual, although under diligence, which afterwards rendered him bankrupt. But they resorted to a distinction between what had actually come into his possession and what was still in transitu at the time of his bankruptcy, not listening to the plea, that the delivery of a part of the cargo barred the right of stopping as to that which was still undelivered.

Lord Ordinary, Cullen. Act. Gillies. Agent, Jo. Peat. Alt. Campbell, J. Clerk, Forsyth. Agent, Wm. Callender. Clerk, Home. Fac. Col. No 185. p. 413.