[438]

[439]

Sav. Bank, 92 U. S. 631 (23: 631); Marcy v. | trial deriving its whole efficacy from the con-
Oswego, 92 U. S. 637 (23: 748); Douglas Co. v. sent of the parties, the bill of exceptions al-
Bolles, 94 U. S. 104 (24: 46); Weyauwega v. Ay-lowed at that trial was irregular and unavailing,
ling, 99 U. S. 112 (25:470); Calhoun Co. v. and the facts stated in that bill of exceptions
Galbraith, 99 U. S. 214 (25: 410); Brooklyn v. cannot be regarded, nor the rulings stated there-
Etna L. Ins. Co. 99 U. S. 362 (25:416); Wilson in reviewed, by this court. As the questions
v. Salamanca, 99 U. S. 499 (25: 330); Orleans argued by the plaintiff in error do not appear
v. Platt, 99 U. S. 676 (25:404); Lyons v. Mun- of record independently of the bill of excep-
son, 99 U. S. 684 (25:451); Douglass v. Pike tions, this court has no authority to pass upon
Co. 101 U. S. 677 (25:968); Marshall Co. v. them, and no error is shown in the judgment
Schenck, 72 U. S. 5 Wall. 772 (18:556); Marsh afterwards rendered by the circuit court.
v. Fulton Co. 77 U. S. 10 Wall. 676 (19:1040). Campbell v. Boyreau, above cited; Lyons v.
Purchasers of negotiable securities are not Lyons Bank, 19 Blatchf. 279.
chargeable with constructive notice of the pen- Judgment affirmed.
dency of a suit affecting the title or validity of
the securities.

Warren Co. v. Marcy, 97 U. S. 96 (24:977);

Carroll Co. v. Smith, 111 U. S. 556 (28: 517); J. FRIEDLANDER ET AL., Plffs. in Err., [416]
Scotland Co. v. Hill, 112 U. S. 183 (28: 692).

Mr. Justice Gray delivered the opinion of the court:

V.

THE TEXAS AND PACIFIC RAILWAY
COMPANY.

(See S. C. Reporter's ed. 416-426.)

Railroad company not bound by bill of lading
issued by its agent for goods not shipped-com-
mon carrier, when not liable-company not
estopped to deny agent's act-not company's
agent-rights of innocent assignee.

The authority of this court to review the
judgments of the circuit court by bill of ex-
ceptions and writ of error is regulated exclu-
sively by the Acts of Congress and the practice
of the courts of the United States without re-
gard to the statutes of the State or the practice
of its courts. Chateaugay Co. Petitioner, 128
U. S. 544 [ante, 508]. The right of review is
limited to questions of law appearing on the stations cannot bind the company by the execution
1. The agent of a railroad company at one of its
face of the record, and does not extend to mat- of a bill of lading for goods not actually placed in
ters of fact or of discretion; questions of law his possession, and by its delivery to a person fraud-
arising upon the trial of an issue of fact cannotulently pretending, in collusion with such agent,
that he had shipped such goods, in favor of a party
be made part of the record by bill of excep- without notice, with whom, in furtherance of the
tions, unless the trial is by jury, or by the court fraud, the pretended shipper negotiates a draft,
after due waiver in writing of a jury trial; and with the false bill of lading attached.
when the trial is by rule of court and consent
of parties before a referee or arbitrator, no ques-
tion of law can be reviewed on error, except
whether the facts found by him support the
judgment below. Campbell v. Boyreau, 62
U. S. 21 How. 223 [16: 96]; Bond v. Dustin,
112 U. S. 604, 606 [28: 835]; Paine v. Central
Vermont R. Co. 118 U. S. 152 [30:193].

2. No recovery can be had against a common carrier for goods never actually in its possession for transportation because one of its agents, having authority to sign bills of lading, by collusion with another person, issues the document in the absence of any goods.

3. The company, under such circumstances, is not
estopped from denying that it had clothed such
the scope of his employment and of its own busi-
agent with apparent authority to do an act outside
ness; the agent was not the company's agent in the
transaction.

vice of a false bill of lading, may work injury to
4. Although fraud, perpetrated through the de-
an innocent party, this cannot be redressed by a
change of victim.
[No. 236.]

Argued April 4, 5, 1889. Decided April 15, 1889.

IN ERROR to the Circuit Court of the United

States for the Eastern District of Texas, to review a judgment for defendant in an action to recover for the nondelivery of goods named in an alleged bill of lading of which the plaintiffs were assignees for value. Affirmed.

In the present case, there was no demurrer,
or case stated, or special verdict, or finding of
facts by the court or by a referee, presenting a
pure question of law. But the pleadings pre-
sented issues of fact which, in the legal and
regular course of proceeding, could be tried by
a jury only, and at a stated term of the court,
unless the parties either in writing waived a
jury and submitted the case to the court's deci-
sion, or else agreed that the case should be tried
and determined by a referee. There was no wai-
ver of a jury trial and submission of the de-
termination of all issues of fact to the court.
But the case was tried by consent of the par-
ties before the judge at chambers under an or-
der providing that it should be so tried, and
that "If it shall appear to the judge upon such
trial that there are questions of fact arising up-trict Court of Texas, in and for the County of
on the issues therein, of such a character that
the judge would submit them to the jury if one
were present," they should be submitted to a
jury at the next term of the court; and the
only finding of the judge was a general find
ing for the plaintiff.

The trial thus ordered, consented to and bad, was neither a trial by jury, nor a trial by the court, in accordance with the Acts of Congress, but was a trial by the judge as a referee. The

Statement by Mr. Chief Justice Fuller:
Friedlander & Co. brought suit in the Dis-

Galveston, against the Texas and Pacific Rail-
way Company, to recover for the nondelivery
of certain cotton named in an alleged bill of
lading hereinafter described, of which they
claimed to be assignees for value, their peti-
tion, after counting upon said bill of lading,
thus continuing:

"That the said defendant, fraudulently con-
triving to avoid its liability to these plaintiffs,
pretends and alleges that the said cotton was

not so delivered as in and by said bill of lading | received for the purpose of transportation by
is recited and acknowledged, but that the said defendant.

[417] bill of lading was executed without the receipt

[418]

"That on the said 6th day of November,
by its said agent of any of said cotton, all of 1883, the said Easton, combining and confed-
which said pretenses on the part of the defend-erating with one Joseph Lahnstein, did fraud-
ant, plaintiffs allege are untrue; but they say ulently and collusively sign a certain bill of
that even if it be true that no cotton was deliv- lading purporting to be his act as agent of de-
ered to said defendant as in and by said bill of fendant, whereby he falsely represented that
lading is recited and acknowledged, yet is the defendant had received from the said Joseph
defendant estopped from setting up that fact Lahnstein two hundred bales of cotton in ap-
in defense of plaintiff's cause of action upon parent good order, to be transported from Sher-
said bill of lading, because these plaintiffs say man to New Orleans, La., and did deliver the
that the said bill of lading was executed in said false bill of lading to the said Joseph
form negotiable and transferable by indorse- Lahnstein; and defendant says that in point of
ment under the usage and customs of merchants fact the said bill of lading was executed by the
and that these plaintiffs, relying upon the va- said Easton fraudulently and collusively with
lidity of said bill of lading in all respects and the said Lahnstein without receiving any cot-
upon the facts therein stated, that said cotton ton for transportation, such as was represented
had been delivered to said defendant as afore- in said bill of lading, and without the expectation
said, and that defendant had contracted to carry on the part of the said Easton of receiving any
and deliver said cotton as aforesaid, advanced such cotton; that the said pretended bill of
to the said Joseph Lahnstein and paid out up- lading was the one that is set out in the peti-
on his order and at his request and in consid- tion of the plaintiffs and was false, fraudulent,
eration of his said transfer of said bill of lad- and fictitious, and was not executed by de-
ing to these plaintiffs the sum of eight thou-fendant nor by its authority, and that the said
sand dollars on, to wit, the 10th day of No-
vember, 1883, and that said payment was made
and advanced upon the faith of the recitals and
effect of said bill of lading as a contract to de-
liver the cotton therein mentioned as aforesaid,

Easton only had authority as agent aforesaid to
execute and deliver bills of lading for freights
actually received by him for transportation."

The cause was submitted to the court for

trial, a jury being waived, upon the following
agreed statement of facts:

"1st. On November 16th, 1883, at Sherman
Station, in Grayson County, Texas, on the
Eastern Division of the Texas and Pacific Rail-
way Company, E. D. Easton, agent for the de-
fendant at said station, executed as such agent
a bill of lading, of which a copy is hereinafter
given, and delivered the same to Joseph Lahn-
stein, the person named in said bill of lading.

and that if the said cotton was never received
by defendant, yet ought it to be held to the
terms of the said bill of lading for the indem-
nification of these plaintiffs for said payment,
with interest thereon from the date thereof, be-
cause of the fraud practiced by the said agent
upon these plaintiffs in the issuance of said bill
of lading in the ordinary form and manner
wherein he was authorized by the defendant to
act, and defendants are estopped to deny that
said cotton was received as against the claims "2d. That said Easton was at the time and
of these plaintiffs for damages on account of place aforesaid the regularly authorized agent
defendant's failure to comply with said bill of of the defendant for the purpose of receiving
lading to the extent of eight thousand dollars, for shipment cotton and other freight for trans-
with interest thereon, at the rate of 8 per cent portation by defendant over and along its line
per annum, from the date of payment thereof from Sherman Station aforesaid, and that said
as aforesaid; and if it be true, as alleged, that bill of lading was in the usual form and made
defendant received said cotton in said bill of out upon the usual printed blanks in use by
lading mentioned, then plaintiffs claim of de- said defendant at said station, and that said
fendant the full value thereof, to wit, the sum Easton was authorized by said defendant to ex-
of fifteen thousand dollars, with interest there-ecute bills of lading for cotton and other freight
on from and after the 6th day of December,
1883, when and before which time defendant
should have delivered said cotton under said
bill of lading, according to the true intent and
meaning thereof."

Defendant demurred, and also answered, denying "all and singular the allegations in the petition contained. The case was subseqently removed to the Circuit Court of the United States for the Eastern District of Texas, whereupon by leave the defendant amended its answer by adding these further averments:

"That one E. D. Easton, on the 6th of November, 1883, was the station agent of defendant at Sherman Station, in Grayson County, Texas, on the Eastern Division of defendant's line in Texas, and that as such agent he was authorized to receive cotton and other freight for transportation and to execute bills of lading for such cotton and other freight by him

by him received for the purpose of transporta-
tion by the defendant.

3d. That the said Joseph Lahnstein in-
dorsed said bill of lading by writing his name
across the back thereof and drew a draft on the
plaintiffs in this cause on or about November
6th, 1883(of which draft a copy is hereinafter
given), for the sum of eight thousand dollars,
payable at sight to the order of Oliver & Griggs,
and attached said draft to said bill of lading so
indorsed, and on or about Nov. 6th, 1883, for.
warded the same through said Oliver & Griggs
for presentation to and payment by the plain-
tiffs in this cause; that in due course of busi-
ness Oliver & Griggs forwarded said draft,
with bill of lading attached, to New Orleans,
where the same was presented to and paid by
plaintiffs on or about November 10th, 1883.

"4th. That in paying said draft said plaintiffs acted in good faith and in the usual course of their business as commission merchants making advances upon shipments of cotton to

[419]

[420]

[421]

[423]

authority to issue bills of lading for cotton not | tended shipper negotiates a draft with the false
actually received by him for transportation, bill of lading attached. Bills of exchange and
and bills so issued cannot impose any liability promissory notes are representatives of money,
upon the railway company to deliver the goods circulating in the commercial world as such,
therein described; but it may be shown, even and it is essential, to enable them to perform
as against an innocent indorsee for value, that their peculiar functions, that he who purchases
no goods were ever received for carriage. them should not be bound to look beyond the
Lickbarrow v. Mason, 2 T. R. 77; Grant v. instrument, and that his right to enforce them
Norway, 2 Eng. L. & Eq. 337; Hubbersty v. should not be defeated by anything short of [424]
Ward, 18 Eng. L. & Eq. 551; Brown v. Powell bad faith on his part. But bills of lading an-
D. S. Coal Co. L. R. 10 C. P. 562; The Free-swer a different purpose and perform different
man v. Buckingham, 59 U. S. 18 How. 182 functions. They are regarded as so much cot-
(15: 341); The Loon, 7 Blatchf. 244; Robinson ton, grain, iron or other articles of merchan-
v. Memphis &C. R. Co. 9 Fed. Rep. 129; S. C. dise, in that they are symbols of ownership of
16 Fed. Rep. 57; Pollard v. Vinton, 105 U. S. the goods they cover. And as no sale of goods
7 (26: 998); Sears v. Wingate, 3 Allen, 103; lost or stolen, though to a bona fide purchaser
Baltimore & O. R. Co. v. Wilkens, 44 Md. 11; for value, can devest the ownership of the per-
Hunt v. Miss. Cent. R. Co. 29 La. Ann. 446; son who lost them or from whom they were
La. Nat. Bank v. Laveille, 52 Mo. 380; Wil- stolen, so the sale of the symbol or mere repre-
liams v. R. Co. 93 N. C. 42; Chandler v. sentative of the goods can have no such effect,
Sprague, 5 Met. 306, 38 Am. Dec. 407, note; although it sometimes happens that the true
Cox v. Bruce, L. R. 18 Q. B. Div. 147; St. owner, by negligence, has so put it into the
Louis, 1. M. & S. R. Co. v. Knight, 122 U. S. power of another to occupy his position osten-
79 (30: 1077).
sibly as to estop him from asserting his right as
against a purchaser, who has been misled to his
hurt by reason of such negligence. Shaw v.
Railroad Co. [Merchants Nat. Bank], 101 U.
S. 557, 563 [25: 892, 893]; Pollard v. Vinton,
105 U. S. 7, 8 [26: 998, 999]; Gurney v. Behr-
end, 3 El. & Bl. 633, 634. It is true that while
not negotiable, as commercial paper is, bills of
lading are commonly used as security for loans
and advances, but it is only as evidence of
ownership, special or general, of the property
mentioned in them, and of the right to receive
such property at the place of delivery.

The question of active fraud or collusion upon the part of the agent in issuing the bill of lading is not material, and in no wise interferes with the application of the general rule to this

case.

Balt. &0. R. Co. v. Wilkens, 44 Md. 11; Robinson v. Memphis & C. R. Co. 9 Fed. Rep. 129; Coleman v. Riches, 29 Eng. L. & Eq. 323; The Freeman v. Buckingham, 59 U. S. 18 How. 182 (15: 341); Pollard v. Vinton, 105 U. S. 7 (26: 998).

Mr. Chief Justice Fuller delivered the opinion of the court:

ment in the absence of any goods at all?

Such being the character of a bill of lading,
can a recovery be had against a common car-
The agreed statement of facts sets forth" that rier for goods never actually in its possession
in point of fact said bill of lading of Novem- for transportation, because one of its agents,
ber 6, 1883, was executed by said E. D. Easton having authority to sign bills of lading, by col-
fraudulently and by collusion with said Lahn-lusion with another person, issues the docu-
stein, and without receiving any cotton for
transportation such as is represented in said It has been frequently held by this court
bill of lading, and without the expectation on that the master of a vessel has no authority to
the part of the said Easton of receiving any sign a bill of lading for goods not actually put
such cotton;" and it is further said that Easton on board the vessel, and, if he does so, his act
and Lahnstein had fraudulently combined in does not bind the owner of the ship, even in
another case, whereby Easton signed and de- favor of an innocent purchaser. The Free-
livered to Lahnstein a similar bill of lading for man v. Buckingham, 59 U. S. 18 How. 182,
cotton "which had not been received, and 191 [15: 341, 345]: The Lady Franklin, 75 U.
which the said Easton had no expectation of S. 8 Wall. 325 [19: 455]; Pollard v. Vinton,
receiving;" and also "that, except that the 105 U. S. 7 [26: 998.] And this agrees with the
cotton was not received nor expected to be rule laid down by the English courts. Lick-
received by said agent when said bill of lading barrow v. Mason, 2 T. R. 77; Grant v. Nor
was by him executed as aforesaid, the trans-way, 10 C. B. 665; Cox v. Bruce, L. R. 18 Q.
action was from first to last customary.' In B. Div. 147. "The receipt of the goods," said
view of this language, the words "for trans- Mr. Justice Miller, in Pollard v. Vinton, supra,
portation, such as is represented in said bill of 'lies at the foundation of the contract to carry
lading," cannot be held to operate as a limita- and deliver. If no goods are actually received,
tion. The inference to be drawn from the there can be no valid contract to carry or
statement is that no cotton whatever was de- to deliver." "And the doctrine is applicable to
livered for transportation to the agent at Sher- transportation contracts made in that form by
man Station. The question arises, then, wheth- railway companies and other carriers by land,
er the agent of a railroad company at one of its as well as carriers by sea," as was said by Mr.
stations can bind the company by the execu- Justice Matthews in Iron Mountain Railway v.
tion of a bill of lading for goods not actu- Knight, 122 U. S. 79, 87 [30: 1077, 1080], he
ally placed in his possession, and its delivery to adding also: "If Potter (the agent) had never
a person fraudulently pretending, in collusion delivered to the plaintiff in error any cotton at
with such agent, that he had shipped such all to make good the 525 bales called for by
goods in favor of a party without notice, with the bills of lading, it is clear that the plaintiff
whom, in furtherance of the fraud, the pre- in error would not be liable for the deficiency.

[425]

This is well established. by the cases of The
Froman v. Buckingham, 59 U. S. 18 How. 182
[15: 341], and Pollard v. Vinton, 105 U. S. 7
[26: 998.1"

[412]

WILLIAM H. ROBERTSON, Collector,
Piff. in Err.,

V.

LOUIS A. SALOMON ET AL.

(See S. C. Reporter's ed. 412-416.)

mon designation.

1. Beans, as the term is used in the Customs Duties Act, are not garden seeds, but may be included under the term "vegetables."

It is a familiar principle of law that where
one of two innocent parties must suffer by the
fraud of another, the loss should fall upon him
who enabled such third person to commit the Duty on beans-commercial designation-com-
fraud; but nothing that the railroad company
did or omitted to do can be properly said to
have enabled Lahnstein to impose upon Fried-
lander & Co. The company not only did not
2. The commercial designation is the first and
authorize Easton to sign fictitious bills of lad-most important designation to be ascertained in
ing, but it did not assume authority itself to settling the meaning and application of the tariff
issue such documents except upon the delivery | laws.
of the merchandise. Easton was not the com-
pany's agent in the transaction, for there was
nothing upon which the agency could act.
Railroad companies are not dealers in bills
of exchange, nor in bills of lading; they are
carriers only, and held to rigid responsibility
as such. Easton, disregarding the object for

་་

3. But if the commercial designation fails to give
an article its proper place in the classifications of
the law, then resort must necessarily be had to the
common designation; and evidence may be given to
prove it.
Argued Jan. 16, 1889. Decided April 15, 1889.
[No. 446.]

IN ERROR to the Circuit Court of the United
States for the Southern District of New
York, to review a judgment in favor of plaint-
iffs for duties illegally exacted. Reversed.
The facts are stated in the opinion.

Mr. G. A. Jenks, Solicitor-Gen., for plaint-
iff in error:

The protest is insufficient.

Elmes, Law of Customs, § 714; Frazee v.
Moffitt, 20 Blatchf. 269; Thomson v. Maxwell,
Blatchf. 387-8; Arthur v. Morgan, 112 U. S.
501 (28:827).

Messrs. Joseph H. Choate, Henry Edwin
Tremain and Mason W. Tyler, for defend-
ants in error:

which he was employed, and not intending by bis act to execute it, but wholly for a purpose of his own and of Lahnstein, became particeps criminis with the latter in the commission of the fraud upon Friedlander & Co.; and it would be going too far to hold the company, under such circumstances, estopped from denying that it bad clothed this agent with apparent authority to do an act so utterly outside the scope of his employment and of its own busi-2 ness. The defendant cannot be held on contract as a common carrier in the absence of goods, shipment and shipper; nor is the action maintainable on the ground of tort. The general rule," said Willes, J., in Barwick v. English Joint Stock Bank, L. R. 2 Exch. 259, is that the master is answerable for every such wrong of the servant or agent as is com- Swan v. Arthur, 103 U. S. 597 (26:525); [426] mitted in the course of the service and for the Greenleaf v. Goodrich, 101 U. S. 284 (25:847); master's benefit, though no express command Maillard v. Lawrence, 57 U. S. 16 How. 251 or privity of the master be proved." See also (14:925); Schmieder v. Barney, 113 U. S. 645 Limpus v. London General Omnibus Co. 1 (28:1130); Arthur v. Morrison, 96 U. S. 108 Hurl. & C. 526. The fraud was in respect to a (24:764); Marvel v. Merritt, 116 U. S. 11 (29: matter within the scope of Easton's employ-550); Lawrence v. Merritt, 127 U.S. 113 (ante,91). ment or outside of it. It was not within it, for Duties are not to be assessed on doubtful inbills of lading could only be issued for mer- terpretations. chandise delivered; and being without it, the company, which derived and could derive no benefit from the unauthorized and fraudulent act, cannot be made responsible. British Mut. Banking Co. v. Charnwood Forest R. Co. L. R. 18 Q. B. Div. 714.

The law can punish roguery, but cannot always protect a purchaser from loss, and so fraud perpetrated through the device of a false bill of lading may work injury to an innocent party, which cannot be redressed by a change of victim.

Under the Texas statutes the trip or voyage
commences from the time of the signing of the
bill of lading issued upon the delivery of the
goods; and thereunder the carrier cannot avoid
his liability as such, even though the goods are
not actually on their passage at the time of a
loss; but these provisions do not affect the
result here.

We cannot distinguish the case in hand from
those heretofore decided by this court, and in
consonance with the conclusions therein an-
nounced this judgment must be affirmed.
180 U. S. U. S., Book 32.

Language will be presumed to have the same meaning in commerce that it has in ordinary use, unless the contrary is shown.

Hartranft v. Wiegmann, 121 U. S. 609 (30:
1012).

The articles were enumerated, and the provis-
ions as to nonenumerated articles do not apply.
Hartranft v. Langfeld, 125 U. S. 128 (31:672).
No technicalities in protests.

Frazee v. Moffitt, 20 Blatchf. 267; Herrman
v. Miller, 127 Ü. S. 363 (ante, 186); Arthur v.
Dole, 101 U. S. 34 (25:948); Arthur v. Morgan,
112 U. S. 499 (28:827); Steegman v. Maxwell, 3
Blatchf. 365; Vaccari v. Maxwell, 3 Blatchf.
373; Chung Yune v. Kelly, 14 Fed. Rep. 639;
Maillard v. Lawrence, 3 Blatchf. 381.

Mr. Justice Bradley delivered the opinion [13] of the court:

This is an action brought by the defendants in error against the Collector of New York, to recover an alleged excess of duties on goods imported. The goods referred to were white beans, upon which the collector levied a duty of twenty per cent ad valorem, as garden seeds. This charge was paid under protest, the plaintiffs insisting that the article was exempt from 64

995