that breach is committed by one of the part owners of the ship only (the master), and for which the other part owners would not be responsible. THIS was a cause of breach of contract for short delivery of cargo, instituted under the 6th section of the Admiralty Court Act 1861, by James Hall, Robert Hartley Bower, James Robinson Pease, and George Augustus Duncombe, bankers, of Beverley, Yorkshire (Hall, Bower and Co.), against the above-named vessel, and Emilien Aubin and others, her owners intervening.

The plaintiff's petition, so far as material, was as follows:

1. On or about the 27th Aug, 1874, forty tons of palm kernels were shipped on board the Emilien Marie at Lagos, on the coast of Africa, to be carried to Liverpool.

2. The master of the Emilien Marie signed a bill of lading for the said palm kernels, whereby he undertook to deliver the same at Liverpool to the order of D. Chinery. 3. The plaintiffs, at the time of the short delivery hereinafter mentioned, and thenceforward to the commencement of this suit, were the owners of the said palm kernels, and the holders for value of the said bill of lading.

4. The Emilien Marie having arrived at Liverpool, the plaintiffs caused the said bill of lading to be presented to the master. but the only cargo delivered out to the plaintiffs was about three tons of palm kernels and sweepings; and, except as aforesaid, the plaintiffs have been unable to obtain delivery of the palm kernels to which they are entitled under the said bill of lading.

5. The said deficiency was caused by the negligence, and misconduct, and breach of contract, and breach of duty on the part of the owners or of their servants or agents.

6. The value of the portion of the said cargo which is deficient is 600l., or thereabouts.

7. No owner or part owner of the said vessel is domiciled in England or Wales.

The defendants' answer, so far as is material, was as follows:

1. In or about the month of Aug. 1874, a quantity of palm kernels, in bulk, was shipped on board the abovenamed vessel, Emilien Maria, at Lagos, by or on behalf of the African Barter Company (Limited.) Three bills of lading respectively in quadruplicate, copies whereof are hereto annexed, marked respectively A, B, and C, were presented by the said shippers to the master of the said vessel, in respect of such shipment for his signature, the copy marked C. being a copy of the bill of lading mentioned in the petition. The said master, not knowing the weight of the said shipment, wrote on each of the said bills of lading, before signing the same, the words "weight unknown," and signed and delivered the same at the dates respectively appearing thereon. The quantity of palm kernels so shipped was much less than 140 tons, the aggregate quantity represented by the said bills of lading to have been shipped on board the said vessel.

2. The master of the said vessels signed the said bill of lading, mentioned in the petition, without there being any palm kernels on board the said vessel, save a very small quantity, namely, about three tons to meet the same, and the said master had not any authority to sign or deliver the said bill of lading.

3. Save as herein appears, the defendants deny the truth of the allegations contained in articles 1 and 2 of the said petition.

4. The said vessel subsequently left Lagos with the said palm kernels, and with other palm kernels and other goods on board her, and arrived therewith at Liverpool, and entered and used for the discharge of her cargo the George's Dock, being a usual and proper place of discharge, and being a dock belonging to or under the management of "The Board," as defined by sect. 3 of The Mersey Docks Acts Consolidation Act 1858, and being an open dock, as defined by the said section.

5. The said vessel having on board her goods belonging to more than one owner or consignee, all the goods on board her had, under and by virtue of the provisions of the said Act, and of the Mersey Docks and Harbour Board Act 1860, and The Mersey Docks (Corporation Purchase) Act 1861, and the bye-laws made under the said

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Acts to be received, weighed, and loaded off by one set of porters only, in the employment and under the directions and orders of a duly qualified master porter, appointed to that office by "The Board," defined as aforesaid; and all the said goods, including all the said kernels shipped by or on behalf of the African Barter Company, were accordingly, under and in compliance with the provisions of the said Acts and bye-laws, discharged and delivered from the said vessel by the said master to, and received by, a master porter, duly qualified and appointed, and entitled to act in receiving, weighing and loading off the said goods, including as aforesaid, and whose duty it was, under and by virtue of the said Acts and bye-laws, to receive, discharge, and weigh off the said goods, and to deliver the same to the respective consignees and owners thereof; and the masters and owners of the said vessel duly did all things which they were bound to do, in order to enable the plaintiffs to have delivered to them, by the said master porter, all the palm kernels which they were entitled to receive under and by virtue of the said bills of lading, mentioned in the said petition, and by reason of the premises the defendants are not liable in respect of the non-delivery and deficiency complained of by the plaintiffs.

6. The defendants admit that only about three tons of palm kernels were delivered to the plaintiffs.

7. Save as herein appears, the defendants deny the truth of articles 3 and 4 of the said petition.

8. At the time of the said shipment by the African Barter Company, and before the signing of the said bills of lading, it was, for valuable consideration, agreed by and between the said company and Messrs. Charles Leigh Clare and Company and Samuel Rigby Stainforth respectively, who are the consignees respectively named in the said bills of lading-copies whereof are annexed, marked respectively A and B-that the said Messrs. Charles Leigh Clare and Company and Samuel Rigby Stainforth were respectively to have delivered to them, out of the said shipment, made by or on behalf of the said company, the full quantity of kernels, mentioned in their said bills of lading, before any portion of the said kernels should be delivered to the said D. Chinery, managing director of the said company, or to his assigns, on the said bills of lading mentioned in the petition.

9. The quantity of palm kernels shipped by or on behalf of the said company as aforesaid, was sufficient only to meet the quantities respectively mentioned in the said bills of lading, of which the copies are annexed, marked A and B respectively, and to leave about three tons of kernels and sweepings. The said master porter accordingly delivered, to the holders of the lastly-mentioned bills of lading, the full quantities of kernels therein respectively mentioned, and the said three tons of kernels and sweepings, being those mentioned in article 4 of the said petition, were by the said master porter, delivered to the plaintiffs.

10. The plaintiffs had notice of the agreement, mentioned in article 8 of this answer, before any assignment was made to them of the said bill of lading referred to in the said petition. No consideration was paid by the plaintiffs for the assignment of the said bill of lading.

11. The defendants further say that at the time of the shipment of the said palm kernels, comprised in the said bills of lading the said vessel had been chartered by her master to Messrs. John Longton and Company by a charter-party, bearing date the 10th Oct. 1873, and had, by the said John Longton and Company, been subchartered to Samuel Rigby Stainforth, of Lagos, merchant. The shippers of the said palm kernels, comprised in the said bills of lading, had, before and at the time of the said shipment, notice of the said charter-party and sub-charter-party. The master of the said vessel, on signing the said bills of lading, was acting as agent for the said charterers or sub-charterer, and not as agent for the owners of the said vessel. The defendants crave leave to refer to the said charter-party and sub-charterparty.

12. The defendants deny the truth of the allegations contained in the fifth and sixth articles of the said petition.

(A).

Shipped, in good order and well conditioned, by African Barter Company, Ltd., in and upon the good ship called the Emilien Maria, whereof E. Aubin is master for this present voyage, and now riding at anchor off the port of

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60 tons

Palm kernels

Lagos, and bound for Liverpool, sixty tons palm kernels, in bulk, being marked and numbered as in the margin, and are to be delivered in the like good order and well-conditioned, at Weight unknown. the aforesaid port of Liverpool (the act of God, the Queen's enemies, fire, and all and every other dangers and accidents of the seas, rivers, and navigation of whatever nature and kind scever excepted), unto Messrs. Charles Leigh Clare and Co., or to their assigns. Freight for the said goods to be paid in Liverpool, 408. per ton net weight, primage, and average accustomed.

In witness whereof, the master or purser of the said ship hath affirmed to four bills of lading, all of this tenor and date, the one of which bills being accomplished, the others to stand void.

Dated in Lagos, 19th Aug. 1874.

(B).

E. AUBIN.

Shipped, in good order and well conditioned, by African Barter Company, Ltd., in and upon the good ship called the Emilien Marie, whereof E. Aubin is master for this present voyage, and now riding at anchor in the port of Lagos, and bound for Liverpool, forty tons palm kernels, in bulk, being marked and numbered as in the margin, 40 tons and are to be delivered in the like Palm kernels. good order and well-conditioned, at Weight unknown the aforesaid port of Liverpool (the act of God, the Queen's enemies, fire, and all and every dangers and accidents of the seas( rivers, and navigation of whatever nature and kind soever excepted), unto Sam R. Stainforth, or order. Freight for the said goods to be paid in L'pool, at 408 per ton net weight, primage, and average accustomed.

In witness whereof the master or purser of the said ship hath affirmed to four bills of lading, all of this tencr and date, the one of which bills being accomplished the others to stand void.

Dated in Lagos, 19th Aug. 1874.

(C).

EMILIEN AUBIN.

Shipped, in good order and well conditioned, by John Finlay, in and upon the good ship or vessel called the Emilien Marie, whereof E. Aubin is master for this present voyage, and now lying in the port of Lagos, and bound for Liverpool, forty tons palm kernels, in bulk, being marked and numbered as per margin, and are to be

40 tons

Palm kernels, in bulk.

delivered in the like good order and condition, at the aforesaid port of Liverpool (all and every the dangers Weight unknown. and accidents of the seas, and navigation of whatever nature and kind excepted), unto D. Chinery, managing director African Barter Company (Limited), or to his assigns, he or they paying frieght for the said goods, at the rate of 40s. per ton net weight, with per cent. primage and average accustomed.

In witness whereof, the master of the said ship or vessel hath affirmed to four bills of lading, all of this tenor and date, one of which being accomplished, the rest to stand void.

Dated in Lagos, this 27th Aug. 1874.

EMILIEN AUBIN.

The plaintiffs replied, denying the allegations of the answer, and concluded.

Jan. 22, 28, 30, and Feb. 4-The cause came on for hearing before the judge.

On behalf of the plaintiffs, the orignal bills of lading were put in; the bills of lading set out in the pleadings were exact copies of the original bills, except that there were indorsed upon the bill of lading C the words, "Deliver the within to Parry, Lovell, and Co., or order, D. Chinery," and also an indorsement by Parry, Lovell, and Co. to the plaintiffs. These bills of lading, with the

admissions in the defendants' answer formed the plaintiff's case.

Butt, Q.C., on the part of the defendants, submitted that as the bill of lading contained the words, "weight unknown," the plaintiffs made out no case without proof of the actual amount shipped. There was nothing to show that forty tons were shipped at Lagos to the consignee named in bill of lading C, without positive proof

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that that amount was put on board. The bill of lading in itself is not sufficient evidence of the quantity shipped, where it contains a qualification, as in the present case: (Jessel v. Bath, L. Bep. 2 Ex. 275.)

Milward, QC., for the plaintiffs. The bill of lading is prima facie proof of the quantity shipped as against the shipowners.

McLean v. Fleming, 25 L. T. Rep. N. S. 317; L. Rep. 2 Sc. App. 128; 1 Asp. Mar. Law Cas. 160. Sir R. PHILLIMORE.—I cannot stop the case at the present stage. There is evidence to show that the master accepted what purported to be forty tons, and it lies upon the defendants to show that such an amount was not received by the master. If any question arises upon this point, I will reserve it till after the defendants' case has been heard.

Witnesses were thereupon called for the defendants; who established the following facts: The master of the Emilien Marie, whose name was Emilien Aubin, was also a part owner. The master had at Liverpool, on the 10th Oct. 1873, entered into a charter-party with Messrs. J. Longton and Co., merchants, by which the ship was to take a cargo on board at Liverpool, then proceed to a port between Cameroon and Lagos, both places included, and there take on board from the charterers' agents a full and complete cargo of palm kernels or other produce of the country, and being so loaded, to proceed therewith to a port in the United Kingdom, and there deliver the cargo agreeably to bills of lading (the usual perils excepted), on being paid freight at the lump sum of 34,000 francs; the master to be at liberty to sign bills of lading as tendered, without prejudice to the charter-party, and having a lien on the cargo for all freight, dead weight, and demurrage, due under the charter-party.

The ship duly took on board a cargo at Liverpool, and carried the same to Brais River, and there delivered it, and then proceeded to Lagos to obtain cargo. Previous to the arrival of the ship at Lagos, one John Finlay had been agent for the African Barter Company, named in bill of lading C, but when the ship got out there Finlay had left for England, and one Lewis was then agent for the company. The African Barter Company was at this time indebted to a Mr. Stainforth and to Messrs. Leigh Clare and Co., merchants at Lagos in separate sums of money, and these creditors held bills of the company, and were pressing Lewis for payment, and in fact had obtained judgments in the court at Lagos against the African Barter Company for the amounts of the bills. In order to satisfy these judgments it was arranged between Lewis and Stainforth and the agent of Leigh Clare and Co., that produce should be shipped to England by Lewis, and that Stainforth and Leigh Clare and Co. should each receive a bill of lading representing a sufficient quantity of the produce shipped to satisfy their respective claims, by sale thereof in England. Thereupon Stainforth obtained from the charterers' agent at Lagos a sub-charter of the Emilien Marie, which was made at Lagos at the end of July 1874, and by which John Longton and Co., as chartered owners of the ship, agreed with Stainforth that the ship should load from Stainforth's factors a full and complete cargo of palm oil or other produce, and being

loaded should proceed to Liverpool and deliver the same, on being paid freight at the rate of 308. per ton of 20 cwt. delivered for palm kernels, and 358. for like quantity of palm oil (the usual perils excepted), the freight to be paid on the correct delivery of the cargo in cash, on unloading, and true delivery of the cargo at Liverpool; the captain to sign bills of lading at any rate of freight, without prejudice to this charter. The master was no party to this sub-charter, and, although he had heard of its existence, had never seen it. The master had no experience of palm kernels as cargo.

In pursuance of this agreement, Lewis began to load the after hold of the ship with palm kernels, in bulk, about the beginning of August.

On the 19th Aug. 1874, Lewis presented to the master for signature the two bills of lading, A and B, for sixty tons and forty tons respectively. The master objected, that he did not know the quantity that had been shipped, and the words "weight unknown." were thereupon written across the bills of lading by Lewis, and the bills of lading were then signed by the master. Lewis at the same time, in the presence of Stainforth and Leigh Clare and Co.'s agent, informed the master that the sixty and forty tons would have to be delivered first, free from depreciation, before the rest of the cargo to be put in the after hold, and that, only if any was left, was delivery to be made to other consignees. At this time there was only about sixty or seventy tons of palm kernels in the after hold, but Lewis continued to load palm kernels until the after hold was full. As it had been estimated that the after hold would contain about 140 tons, Lewis, on the 27th Aug., when the hold was full, presented (in addition to the bills of lading already signed) a bill of lading (C) for forty tons more, to the master for signature. By this bill of lading J. Finlay was the consignor, and "D. Chinery, Managing Director African Barter Company (Limited)," was the consignee, and there was also an indorsement, Weight unknown." The ship sailed from Lagos, duly arrived in Liverpool, and discharged her cargo; the quantity discharged from the after hold was 103 tons and no more, and of this sixty tons was delivered to Messrs. Leigh Clare and Co., under bill of lading A, and forty tons to Stainforth, under bill of lading B. The remaining three tons consisted of sweepings, and these were delivered to the plaintiffs. It was distinctly shown that the master delivered at Liverpool all that he had shipped at Lagos in the after hold.

46

On the ship's arrival in Liverpool, Mr. Maddril, a master porter duly appointed under the Mersey Dock Acts Consolidation Act, received the cargo on the quay, and his servants weighed it and loaded it off, and delivered it to the consignees or indorsees named in the bills of lading. It was stated that Mr. Maddril was instructed by the ship's brokers to deliver the sixty and forty tons, under bills of lading A and B, to Stainforth and Leigh Clare and Co., in priority to other persons claiming cargo out of the afterhold under other bills of lading. No such order was given to the master, nor was there any notice of any right to priority on any of the ship's papers, but these two bills being presented first the master porter delivered accordingly. The afterhold was full on arrival at Liverpool, and no more could have been put into it.

Under the Mersey Docks Acts Consolidation Act

|

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1848, the Mersey Docks and Harbour Board have power (sect. 32) to appoint masters, porters, and Sect. 35:

The cargo of every vessel from any foreign or colonial port, entering and using any open dock, shall be received, weighed, and loaded off by one set of porters only who shall be in the employ and under the directions and orders of one of the master porters appointed by the board.

Sect. 36:

Every master porter, immediately after his appointment and before he shall be capable of acting as such, shall execute to the board a bond, with two sufficient sureties, to be approved of by the board, in the penal sum of 2001., to be conditioned for paying or satisfying the owners of goods received, weighed, or loaded off by such master porter, or by the porters in his employ or under his direction, the amount of any loss, damage, or injury which such goods may sustain during such receiving, weighing, or loading off; and the owner of any goods sustaining any such loss, damage, or injury as aforesaid, may sue in his own name such master porter and his sureties, or any or either of them, upon such bond, and shall recover in such action damages in the same manner as he might have done in case the said bond had been executed to him and not to the board.

By the bye-laws made under the above Act (Bye-laws 120, 121), further provision is made as to the responsibility of the master porters in receiving, weighing, and loading off the discharged

cargoes.

Parry, Lovell, and Co. had for some time before this transaction been connected with the African Barter Company in business. About the time of the arrival of the Emilien Marie at Liverpool, the African Barter Company went into liquidation. Parry, Lovell, and Co. were then indebted to the plaintiffs in a sum of money considerably exceeding the value of the goods purporting to be covered by the bill of lading. The plaintiffs' bank was in the habit of making advances to Parry, Lovell, and Co., upon security, and it was in respect of these advances that Parry, Lovell, and Co. were indebted to the plaintiffs. No specific advances had been made against the cargo of the Emilien Marie. Parry, Lovell, and Co. wrote to the plaintiffs as follows:

122, Cannon-street, London, E.C., 31st Oct. 1874.

Messrs. Bower, Hall and Company,
East Riding Bank, Beverley.

Re African Barter Company. Having in view the appointment of a liquidator next week, which might possibly interfere with the proceeds of the shipment by the Emilien Marie as far as we are concerned, we thought best, to prevent the possibility of a hitch, to send you the inclosed bills of lading for you to deal with, you having advanced us money on account thereof. There can be no possibility of a question being raised as to your right to receive proceeds; please, therefore, send the inclosed bills of lading to the brokers in Liverpool by Monday's post, and we send you herewith a copy of our usual note of instruction for your guidance in writing them. The value of this parcel will be about 500l., after paying freight and charges.

The bills of lading of the other portion of the cargo are in the bands of the brokers who are discharging the vessel, there having been some advances made thereon, and we are now negotiating, with a view of paying off these advances, in order to secure the balance of proceeds.

We saw Mr. Silvester yesterday, to whom we gave some telegrams which will explain the delay in our promised remittance.

We are, dear sirs, yours faithfully,

PARRY, LOVELL, AND CO. Milward, Q.C. (W. C. Gully with him), for the plaintiffs. The plaintiffs derive their title as indorsees from Parry, Lovell, and Co., who are in

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dorsees of Chinery, described in the bill of lading as Managing Director of the African Barter Company Limited)." The plaintiffs are indorsees for value, without notice of any special arrangement which could defeat their claim, and are primâ facie entitled to recover, if the defendants show no good defence. One defence is, that the plaintiffs had notice of the arrangement, that they gave no consideration for the bill of lading. This lies upon the defendants to show, and they have not shown it; moreover, they are bound to show that Parry, Lovell, and Co. had notice of the arrangement, and gave no consideration, otherwise the plaintiffs take from innocent holders and have a good title. A second defence is, that the plaintiffs must look to the master porter, and that he is liable for any deficiency under the Mersey Docks Acts Consolidation Act. A third defence is, that the shippers from whom the plaintiffs derive their title had notice of the charter-party and subcharter-party, and that as the sub-charter was not entered into by the shipowners or the master, but by the charterers by the shipowners' backs, any liability arising under the sub-charter-party falls upon the charterers and not upon the shipowners,and that the master signed the bills of lading as agent of the charterers, and not of the shipowners. But by both charter-parties the master is to sign bills of lading without prejudice to the charter-party, and therefore as agent for the shipowner.

66

First, as to the notice of any arrangement for priority: There is nothing on the face of any of the documents to show that any such arrangement had been made, and there is no proof that knowledge of it had come either to the plaintiffs or Parry, Lovell, and Co. The bill of lading is in the ordinary form, and even if any ordinary words, such as or to his assigns," had been omitted, there would have been not even constructive notice: (Henderson and another v. The Comptoir d'Escompte de Paris, ante, p. 98; 29 L. T. Rep. N. S. 192); and I submit that nothing short of actual notice of such an arrangement could affect the plaintiffs in such a case as the present. There was ample consideration for this bill of lading in the fact that Purry, Lovell, and Co. were indebted to the plaintiffs and gave them the bill of lading as security for their overdrawn account. Such a deposit gives the plaintiffs a lien upon the bill of lading: (Brandrao v. Barnett, 1 M. & G. 908; 12 Cl. & Fin. 787) and, consequently, a right

to sue.

Secondly, as to the master's power to bind the owners by signing bills of lading. The master was part owner, and, consequently, so far as his own share in the ship is concerned, he bound the ship, and the plaintiffs are entitled to recover to that extent; but I submit that they are entitled against all the owners. Under the charter-party of the 10th Oct. 1873, the master was to sign bills of lading as tendered, without prejudice to the charter-party. Hence the master had not only the general authority of a master to sign bills of lading, but also a special authority under the charter-party. He was empowered to sign and to bind the ship. Even if the master was made acquainted with the fact that Lewis had promised that bills of lading A and B should have priority, he was no party to the bargain, and he cannot set up that bargain in derogation of his own contract in writing in bill of lading C, by which he undertakes to deliver forty tons of palm kernels to the plaintiffs. Much

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less can he set up the bargain against the plaintiffs, who had no knowledge of it and cannot therefore be effected by it.

Then as to the defence set up in paragraph 5 of the answer. The plaintiffs seek to throw off their obligation by recourse to the Act, although they never delivered more than 103 tons out of the after hold to the master porter. There was no notice upon the ship's manifest that there was to be priority of delivery. [Sir R. PHILLIMORE.—If goods are to be delivered to several consignees, they are delivered under the provisions of the Mersey Docks Act; but I do not see how that makes any difference in the obligation upon the shipowner to perform his contract. The master porter is only part of the machinery for delivery. This part of the question had better be argued by the defendants, as I do not at present see how it affects the plaintiffs.]

The

Butt, Q.C. and E. C. Clarkson, for the defendants. -The African Barter Company were the actual shippers of the whole 103 tons. In bills of lading A and B they are named as the shippers; in bill of lading C, John Finlay is named, but it has been shown that Finlay was agent of the African Barter Company, and was succeeded by Lewis. Finlay had gone to England before the shipment, and Lewis made the arrangement with the creditors of the African Barter Company. In effect the African Barter Company, Lewis, Finlay, and Chinery, are all one for the purpose of this case, and the consignment by Finlay to Chinery in bill of lading C was a consignment from the African Barter Company to the African Barter Company. The plaintiffs derive their title through Chinery,who indorses the bill of lading as managing director of the African Barter Company, to Parry, Lovell, and Co. The African Barter Company could not set up anything against the arrangement with Stainforth and Leigh Clare and Co. plaintiffs can only sue as assignees, and therefore the question arises whether they are bona fide assignees for value. There is no evidence that Parry, Lovell, and Co. gave anything for the bill of lading, and the onus of proof is on this point upon the plaintiffs. Parry, Lovell, and Co., having been connected in business with the African Barter Company, the presumption is that they were fully acquainted with the whole transaction, and if so, all parties concerned were affected with knowledge of the arrangement up to the time the bill of lading C got into the hands of the plaintiffs. Then as showing whether the plaintiffs are bonâ fide holders for value, it becomes important to inquire whether they had notice, actual or constructive, of the agreement between the shippers and Stainforth and Leigh Clare and Co. As to actual notice, there is no evidence; but we submit that they had constructive notice, that is to say, such facts came to their knowledge as ought to have put them on inquiry. The letter of the 31st Oct. 1874, from Parry, Lovell, and Co. to the plaintiffs, shows that the bill of lading was sent to the plaintiffs in order to get it into the hands of persons who would appear bona fide holders; because Parry, Lovell, and Co. feared that they themselves could not enforce the bill of lading against the African Barter Company or the shipowners. Parry, Lovell, and Co. were rather interested in the African Barter Company themselves, or they were afraid they could not get the goods from the liquidators. If Parry, Lovell, and Co. were indorsees for value,

and without notice of the arrangement, why should they not have claimed? The word "hitch" in the letter shows something wrong, so far as Parry, Lovell, and Co. are concerned. Moreover, although it has been proved that nothing was advanced against the Emilien Marie consignment, the letter expressly says that the bill of lading is sent to cover such an advance already made. That letter ought to have shown to the plaintiffs that Parry, Lovell, and Co.. were not bona fide holders, and that it was desired to make the plaintiffs appear so; such conduct should have put the plaintiffs upon inquiry. A bonâ fide holder must come into court with his hands clean. He must not only have no actual notice, but no constructive notice, that is to say, nothing which puts him on inquiry. The duty as to inquiry is clearly laid down in the equity cases relating to the purchase of real property, but it is equally applicable here. In White and Tudor's Leading Cases in Equity, 2nd edit., vol. 2, p. 38, it is said, "No equitable doctrine is better established than that so clearly and forcibly laid down by Lord Hardwicke in the principal case (Le Neve v. Le Neve), viz., that the person who purchases an estate (although for valuable consideration) after notice of a prior equitable right, makes himself a malâ fide purchaser, and will not be enabled, by getting in the legal estate, to defeat such prior equitable interest, but will be held a trustee for the benefit of the person whose right he sought to defeat: " Again, at p. 38, "Constructive notice is defined to be in its nature no more than evidence of notice, the presumption of which is so violent that the court will not allow of its being controverted." The authors proceed to quote a passage from a judgment of Wigram, V.Č., in Jones v. Smith (1 Hare, 55), in which it is said that there are two classes of constructive notice-the one where the party has had actual notice that the property he purchases is in some way incumbered or affected, the other cases in which the court has been satisfied that the party charged had designedly abstained from inquiry for the purpose of avoiding notice. Here the plaintiffs both had actual notice that the property was affected, and they abstained from injuiry after their suspicions were, or ought to have been, aroused. When bankers have the offer of a security such as this, they ought to make some inquiry. The defendants had no means of knowing of this letter, and could not, therefore, set up fraud specifically in their answer; but still, if the plaintiffs had notice of the real state of things, their acts amount to legal fraud, and this is sufficiently raised by paragraph 10 of the answer.

Even if the plaintiffs hold this bill of lading as security for advances, they have only a lien upon it, and that does not give them a right of action against the shipowners. They derive their right, if any, from the indorsement of the bill of lading by Parry, Lovell, and Co. The consideration for this indorsement is alleged to be the lien upon the bill of lading for advances made; but at the time the advances were made the bill of lading was not in their possession, or indorsed to them, and consequently the consideration was a thing they had no right to and did not possess, and was valueless.

This action is brought under the Admiralty Court Act 1861, s. 6, by which this court has "jurisdiction over any claim by the owner or consignee, or assignee, of any bill of lading of any goods, &c., or his right to sue at all in any breach of duty or breach of contract," &c.

An

[ADM.

assignee of a bill of lading has no right to sue for breach of contract, except such right as he derives from the Bills of Lading Act (18 & 19 Vict. c. 111). Such right as he acquires by that Act is a bare right to sue, and he can acquire no greater rights than those possessed by the original shipper or owner of the goods. This is clearly shown by the preamble of the Act, which says: "Whereas, by the custom of merchants, a bill of lading of goods, being transferable by indorsement, the property in the goods may thereby pass to the indorsee; but nevertheless all rights in respect of the contract contained in the bill of lading continue in the original shipper or owner, and it is expedient that such rights should pass with the property: And whereas it frequently happens that the goods in respect of which bills of lading purport to be signed have not been laden on board, and it is proper that such bills of lading in the hands of a bona fide holder for value should not be questioned by the master or other person signing the same, on the ground of the goods not having been laden as aforesaid: Be it therefore enacted," &c. The wording of that preamble shows that it was not intended to pass to an indorsee any greater right than those possessed by the original shipper or In Smith's Leading cases, 4th edit., vol. 1, p. 651 (Notes to Lickbarrow v. Mason), it is said, speaking of the bills of Lading Act: "That statute, however, has altered the law in this respect (the right to sue). By the first section, rights of action and liabilities upon the bill of lading are to vest in and bind the consignee or indorse to whom the property in the goods shall pass. By the second section it is provided that the Act is not to affect the right of stoppage in transitu or claims for freight against the shipper or owner of the goods, or the consignee or indorsee as owner, or by reason of his receipt of the goods. It should seem that the statute has not altered the rule that the indorsement of a bill of lading gives no better right to the indorsee than the indorser himself had, and that in this respect a bill of lading still differs from a bill of exchange in the same way as it did before the statute: (see Gurney v. Behrend, 3 E. & B. 622.)" Independently of the statute, the plaintiff, even if owner of the goods, could only have brought trover, and could then only have recovered what the shippers transferred to them, viz., three tons. The statute gives no greater right than that of the shipper, who was himself a party to the arrangement which gave priority to the other consignees.

Owner.

Henderson v. The Comptoir d'Escompte de Paris (ubi sup.) does not affect this case, as it only decided that the omission of the words "order or assigns" from a bill of lading was not enough to put the transferee upon inquiry. In Rodger v. The Comptoir d'Escompte de Paris (L. Rep. 2 P.C. 393, 405), a bona fide holder is described as a person who can show that he got the bill of lading without notice of anything unfair or dishonest in the transaction.