1843. March 24, 25. July 8.

1844.

Dec. 5, 6, 14.

1845. Jan. 20, 21,

22. 1846. July 6.

Rolls Court.

Lord LANGDALE, M.R.

SPALDING v. RUDING (1).

(6 Beav. 376-381; S. C. 12 L. J. Ch. 503; affd. on appeal, 15 L. J. Ch. 374.) In equity, a transfer of goods for valuable consideration by a consignee for a limited purpose, does not destroy the consignor's right of stoppage in transitu, ultra the particular lien of the transferee.

A. consigned goods of the value of 1,8007. to B., who transferred the bill of lading to C. to secure 1,0007. B. having become bankrupt, C., as B.'s factor, claimed, as against A.'s title to stop in transitu, a right to retain the whole in satisfaction of a general balance due to him from B.: Held, first, that he was not entitled beyond the 1,000l.; and, secondly, that A.'s remedy against C. for the surplus, was in equity.

THE plaintiffs were merchants residing at Stralsund; on the 17th of May, 1841, their agent Mr. Schleicher, on their behalf, sold to James Williams Thomas a quantity of wheat, at 35s. per COTTENHAM, quarter free on board, the shipment to be made forthwith to

On Appeal.
Lord

L.C.

[376] [ *377 ]

London, at the current rate of freight, and the amount to be *drawn for on Thomas at three months' date, payable in London, on handing invoice and bill of lading.

The plaintiffs accordingly, on the 1st of June, 1841, shipped at Stralsund, by the ship Ceres 714 quarters of wheat; a bill of lading was signed by Zillmer the master of the ship in the usual form, and the plaintiffs, having made out and signed an invoice of the wheat, sent the same with the bill of lading to Thomas, and, at the same time, drew upon him three bills for the amount in the whole of 1,2641. 2s.; and by letter requested Thomas to protect those bills.

Thomas received the bill of lading and invoice on the 8th of June, 1841, and he thereupon requested Ruding to accept for him a bill of exchange for 1,000l., payable at three months after date, which Ruding agreed to do, on receiving from Thomas a memorandum or letter signed by Thomas to this effect:

66

"LONDON, 9th June, 1841. "Messrs. J. C. RUDING & SON.

GENTLEMEN,-In consideration of your having this day accepted my draft on you at three months' date for 1,000l. on a cargo of wheat (viz., 3,825 scheffels), from Stralsund per the Ceres, J. H. Zillmer, of which I have handed you the policy of insurance for 1,6001. and a bill of lading, I authorise you to dispose of the same on my

(1) Sewell v. Burdick (1884) 10 App. Ca. 74, 85, 54 L. J. Q. B. 126, 54 L. T. 445; Kemp v. Falk (1882) 7 App. Ca.

573, 52 L. J. Ch. 167, 47 L. T. 454; Ex parte Golding, Davis & Co. (1880) 13 Ch. D. 628.

account, subject to your usual commission and charges, before such bill becomes due; or, I undertake to provide you with cash to the amount of your advance, should I wish you to hold it beyond that time.

"JAMES W. THOMAS."

On the 1st of July, 1841, the ship Ceres, with the wheat on board, arrived in the port of London. About this time, Mr. Thomas stopped payment. On the 2nd of July, Schleicher, the agent of the plaintiffs, gave a verbal notice, and on the 3rd of July, a written notice to Zillmer the master of the Ceres, not to part with the wheat, without the orders of the plaintiffs. On the 5th of July, a fiat of bankruptcy was issued against Thomas, and on the same day Schleicher again gave notice to the master not to part with the wheat, but being then informed that the bill of lading had been indorsed and delivered to Ruding as a security for monies lent, he permitted the wheat to be delivered to Ruding, but on the same day gave him notice, that the plaintiffs claimed to be entitled to the wheat and the proceeds thereof, and did not, by removing the stop placed upon the delivery to Ruding, abandon their claim, and that in case Ruding should be entitled by law to any part of such proceeds, the plaintiffs claimed the balance which should remain, after satisfying such claim, if any, as Ruding might by law have.

Ruding claimed to be entitled to apply the proceeds of the wheat, not only in payment of the 1,000l. bill which he had accepted, and the freight and other charges of the shipment, but also in satisfaction of the balance of a general account which he alleged to be subsisting between himself and Thomas. Under these circumstances, the plaintiffs offered to pay him 1,200l. in satisfaction of his acceptance and the charges on the wheat, and requested to have the wheat thereupon delivered to them. This was on the 23rd of July. Mr. Ruding refused to accept the money offered to him, or to deliver up the wheat, and he afterwards, on the 21st of August, 1841, sold it for 1,8221., which he retained to his own use. Having subsequently, in December, 1841, declined to acknowledge that the plaintiffs had any claim whatever, this bill was filed on the 31st of December, 1841.

The bill prayed, that an account might be taken of the monies which had come to the hands of the defendant Ruding, in respect of the wheat, and also of the monies due to the same defendant on the security of the bill of lading. That the defendant might be

SPALDING

v. RUDING.

[ *378 ]

[ 379 ]

SPALDING v

RUDING.

July 8.

[380]

[ *381 ]

allowed such last mentioned monies, and might pay to the plaintiffs the balance of the monies arising from the wheat.

Mr. Pemberton Leigh and Mr. Wood, for the plaintiffs.

Mr. G. Turner and Mr. Fisher, for the defendant Ruding.

Mr. Bichner, for the assignees of Thomas.

[In re Westzinthus (1) and other cases were cited.]

THE MASTER OF THE ROLLS:

I apprehend it to be clear, that the indorsement and delivery of the bill of lading by Thomas the consignee to Ruding, for valuable consideration, gave to Ruding the legal right to the delivery and possession of the goods. That right is not disputed by this bill, but the plaintiffs insist, that under the contract subsisting between Thomas and Ruding, the right to the possession of the goods was vested in Ruding, only as a security for the repayment to him of his advance and charges, and that subject to that security, the plaintiffs, in the consideration of a court of equity, retained their right to a stoppage in transitu against the assignee or indorsee of the bill of lading; it appears that in the case of Westzinthus (1) the Court of Queen's Bench held, that in such a case, a court of equity would hold such a transfer to be a pledge or mortgage only, and that the attempt to stop in transitu gave a right to the goods, in equity, subject only to the lien for the advance.

The propriety of that opinion was questioned, but, as it appears to me, without sufficient reason. As against Thomas, I think that the plaintiffs had a right to stop the goods in transitu; and, although the legal right to the goods was transferred with the bill of lading, yet I think, that in equity, the transfer took effect only to the extent of the consideration paid by the transferee, leaving in the plaintiffs an equitable interest in the surplus value.

In the argument for the defendants it was urged, that they, in the character of factors for Thomas, had an interest of their own to retain the surplus value in *satisfaction of a balance due to them from Thomas; and, secondly, that any interest of the plaintiffs, though of an equitable nature, might be made available in an action to be brought by them against the defendants in this cause; but the goods came to the hands of Ruding under a special contract, interfering with any general right which he might have as

(1) 39 R. R. 665 (5 B. & Ad. 817).

factor; and, even if the defendants were entitled to be considered

as factors of Thomas, having a balance due to them, it does not appear to me, that, as against the plaintiffs the owners and shippers of the goods entitled to stop in transitu, they could, by virtue of the bill of lading, have a right to retain more than the consideration they paid for the advantage which the bill of lading gave them; and as to the action, the legal right to the goods being clearly in the defendants, it does not appear to me that the plaintiff's could have obtained, at law, that relief which I think them entitled to here.

I am therefore of opinion that the plaintiffs are entitled to the decree which is asked by the bill, and that an account must be taken of the monies received by the defendants in respect of the wheat in question, and of the monies due to the defendants on the security of the bill of lading, and that the balance may be ascertained and paid to the plaintiffs by the defendants.

[This decision was affirmed by the LORD CHANCELLOR, July 6, 1846; see 15 L. J. Ch. 374.]

SPALDING

v.

RUDING.

THE ATTORNEY-GENERAL v. THE DRAPERS'

COMPANY.

(HOWELL'S CHARITY.)

(6 Beav. 382-390; S. C. 12 L. J. Ch. 421; 8 Jur. 1060.)

A bequest was made to a corporation, in terms which devoted the whole improved income to a charity. In 1559, the corporation by their answer in a suit, offered to apply the whole income to the charity. The decree directed the distribution of the whole existing income, and provided that in case of an increase, the objects should receive an increase limited to 167., but it made no disposition of any surplus: Held, that under this decree the corporation was not, by implication, entitled to such surplus.

Generally, a charitable gift must be accepted according to the declared intention of the giver; but a corporation not being bound to accept an accession to its foundation, may consent to receive it with qualifications, which may be collected either from documents, or constant usage adopted at the time and persevered in downwards.

In charity informations, the account is sometimes carried back to the date of the report of the Charity Commissioners, sometimes it is directed from the filing the information, and sometimes from the decree, according

to the circumstances of each case.

THIS was an information filed by the Attorney-General, on the certificate of the Charity Commission, under the following

circumstances:

The testator Thomas Howell being resident at Seville, made his

1843. May 5.

Rolls Court.

Lord LANGDALE,

M.R.

[382]

A.-G.

v.

THE DRAPERS' COMPANY.

[ *383 ]

will in 1540, whereby he bequeathed in the words following: Item, I comaund myne executours, that I leve in Syvell that incontynent after my deathe, doo send to the citie of London, 12,000 duckats of golde by billes of Cambio, for to delyver to the house called the Drapers' Hall, to delyver theyme to the wardeynes thereof, and the saide wardeynes as sone as they have received the same 12,000 duckats, to bye therewith 400 duckats of rent yerely for ever more, in possession for ever more. And it is my will that the saide 400 duckats be disposed vnto foure maidens, being orphans, next of my kynne and of bludde, to theire marriage, if they can be founde, every one of theyme to have 100 duckats; and if they cannot be founde of my lynnage, then to be geven to other foure maydens, though that they be not of my lynnage, so that they be orphanes honnest and of good fame, and every of theyme 100 duckats, and so every yere, for to marry foure maydens *for ever. And if the saide 12,000 duckats will bye more lande, then the saide 12,000 duckats to be spent to the marriage of maydens, being orphanes, increasing the foure maydens aforesaide, as shall seme by the discretion aforesaide of the master and wardeynes of the saide house of Drapers' Hall, and that this memoria to remayne in writing, in the booke of memoryes in the saide howse, in suche manner as it shall at no tyme be undon for ever."

The sum of 8,720 ducats only was transmitted to the Drapers' Company.

In 1543, the Drapers' Company purchased from Henry VIII. some property in the city of London, which had been forfeited by the attainder of Cromwell, Earl of Essex, which was conveyed to them; and the Company covenanted with the King to distribute the clear rents "to and for the marriage of poor maidens, being orphans."

About 1559, a suit was instituted in this Court (1) by certain female orphans, alleged kinswomen of the testator, stating that the defendants had purchased lands of the yearly rent of 1057., but had disposed of the residue of the said bequest to their own benefit, and claiming the benefit of the said charity. The Drapers' Company, by their answer in that suit, admitted that the rent of the premises purchased with the charity funds amounted to 105l. a year, but said that 301. a year was expended in the reparations; and they stated that they always intended, and still did intend, God willing, as near as they could, to perform the said will and testament of the (1) Crysly v. Chester.