II.

DECISIONS OF THE SUPREME COURT OF THE UNITED STATES, AND OF THE SUPREME COURTS OF CERTAIN STATES, GIVING CONSTRUCTION TO THE LAWS RELATING TO PUBLIC WAREHOUSES AND ELEVATORS.

SUPREME COURT OF THE UNITED STATES.

Elevator charges may be regulated by State legislation.-An act of the legislature of New York (Laws of 1888, chap. 581) provided that the maximum charge for elevating, receiving, weighing, and discharging grain should not exceed five-eighths of 1 cent a bushel, and that in the process of handling grain by means of floating and stationary elevators the lake vessels or propellers, the ocean vessels or steamships, and canal boats should only be required to pay the actual cost of trimming or shoveling to the leg of the elevator when unloading and trimming cargo when loading: Held, that the act was a legitimate exercise of the police power of the State over a business affected with a public interest and did not violate the Constitution of the United States, and was valid.

Munn v. Illinois (94 U. S., 113) reviewed and adhered to and its application in cases decided in the State courts considered. [The case of Munn v. Illinois is fully digested in Volume II of the reports of the Industrial Commission, pp. 57, 58.] Chicago, Milwaukee and St. Paul Railway Company v. Minnesota (134 U. S., 418) explained.

Although the act of New York did not apply to places having less than 130,000 population, it did not deprive persons owning elevators in places of 130,000 population or more of the equal protection of the laws. (February 29, 1892. Budd v. New York, 143 U. S., 517.)

Public and private warehouses distinguished under the laws of North Dakota.Brass, the plaintiff in error, owned and operated a grain elevator in Grand Harbor, N. Dak. Stoeser, the defendant in error, owned a farm adjoining the village, on which in the year 1891 he raised about 4,000 bushels of wheat. On September 30, 1891, Stoeser applied to store a part of his wheat crop for the compensation fixed by section 11 of chapter 26 of the laws of North Dakota for the year 1891, which Brass refused to do unless paid therefor at a rate in excess of that fixed by statute. On this refusal, Stoeser filed in the district court of Ramsey County, N. Dak., a_petition for an alternative writ of mandamus. The court granted the writ. Brass made return by answer, and to this Stoeser interposed a general demurrer, which was sustained, and Brass electing in open court to stand on his return, a peremptory writ of mandamus was allowed. From this judgment an appeal was taken to the Supreme Court of Dakota, which affirmed the order and judgment of the district court. Brass sued out a writ of error to the Supreme Court of the United States.

Held, the act of March 7, 1891, of North Dakota, "regulating grain warehouses and weighing and handling of grain," declaring elevators, etc., to be public warehouses and their owners to be public warehousemen and requiring them to give bond conditioned for the faithful performance of their duty as such, fixing rates of storage, and requiring them to keep insured for the benefit of the owners all grain stored with them, does not apply to elevators built by a person only for the purpose of storing his own grain, and not to receive and store the grain of others, and being so construed it does not deny the equal protection of the laws to the owner of an elevator made a public warehouse by it, does not deprive him of his property without due process of law, does not amount to a regulation of commerce between the States, and is not in conflict with the Constitution of the United States. Munn v. Illinois, 94 U. S., 113, and Budd v. New York, 143 U. S., 517, reviewed and adhered to. (May 14, 1894. Brass v. North Dakota, ex rel. Stoeser, 153 U.S., 391.)

Identity of stored merchandise preserved under certain conditions.-Although warehouse receipts, when issued, may fail to state on their face the brands or distinguishing marks, yet if, before any valid liens attach to the property stored, the party storing the same specifically sets apart and allots the merchandise in the warehouse to such receipts, then in the hands of assignees for value, the uncertainty as to goods called for by the receipts will, as against the storer and those seeking to assert his rights, be removed, and the lien of the receipts enforced as to the property thus identified and set apart; and this, though the substitution and setting apart of the property may be done without the knowledge of the holders of the receipts. The rights of such holders rest upon estoppel, and not upon contract. (June 23, 1892. Hoffman v. Schoyer, 143 U.S., 598.)

STATE SUPREME COURTS.

ILLINOIS.

Where a warehouseman receives grain, he will be liable to the party storing the same if he delivers it to any other person without authority from the owner, unless the latter has done some act or acts to estop him from denying permission to make such delivery.

Order required for delivery of grain-Sampler's ticket not a warehouse receipt.— It is the usual custom on the board of trade in Peoria, when grain has been consigned to a dealer and the railroad cars in which it was shipped remain upon the track, to cause the grain to be sampled by a person appointed by the board of trade for that purpose, the sampler giving to the consignee a ticket stating the kind and grade of the grain inspected, and the consignee named, with a sample of the grain. It appeared also to have been the custom when a sale was made on the board for the seller to mark on the sampler's ticket the name of the purchaser and the price and give the same to the purchaser, with an order, either verbal or written, to deliver the grain sold at such place as the buyer may designate. It was held that a warehouseman to whom a shipment of grain had been delivered on the order of one who had purchased under the conditions mentioned was not authorized to deliver the grain to such purchaser merely upon the presentation of the sampler's ticket with the name of the purchaser and the price marked thereon, without any order from the seller. The sampler's ticket was not a warehouse receipt, in the sense of the term used in the statute. (June 13, 1885. Peoria v. Pekin Rwy. Co., 114 Ill., 337.)

Warehouse receipts-Effect of possession.-To affect subsequent purchasers without notice and creditors there must be an actual delivery of personal property to consummate a sale; but the rule has its exceptions, as in the case of warehouse receipts. Usage has made the possession of such documents equivalent to the possession of the property itself.

Purchase of grain by warehouseman. -The law makes no distinction in respect to grain purchased or acquired by the holder of such receipts from others, and those acquired from the warehouseman himself. The law does not prohibit him from selling his property, and if he does so in good faith he may become its future custodian, and the fact that he keeps a public warehouse is sufficient to put parties on inquiry as to the ownership of grain stored.

Warehouseman as agent.-Where a warehouseman purchased grain stored by him, for another person, and with such other person's money, and took up his outstanding receipt held by the vendor, it was held that the grain was not liable thereafter to be taken in execution against the warehouseman. (January term, 1875, Broadwell v. Howard, 77 Ill., 305.)

Usage of the market.-A person who deals in a particular market must be taken to deal according to the known, general, and uniform custom or usage of that market, and he who employs another to act for him at a particular place or market must be taken as intending that the business to be done will be done according to the custom and usage of that place or market, whether the principal in fact knew of the usage or custom or not.

Warehouse receipts not property of consignor, but evidences of debt.—Under the custom of trade in Chicago a commission merchant to whom grain is consigned, may dispose of the warehouse receipt given him for the same, although directed by the consignor not to sell, but to hold the grain for further orders, if he keeps on hand, ready for delivery when called on, other receipts for a like quantity and grade of grain. The receipts are not the consignor's property, and do not represent his property, but are merely evidences of a debt to the consignee. Special bins.-The shipper of grain may, by consent of the warehouseman, have his grain kept in a separate bin by itself, which consent must appear upon the

face of the receipt, as well as the number of the bin, or he may instruct the commission man, and require him to keep the identical receipts received upon his shipment, and not part with them except when he sells on his account.

Consignee a debtor.-Where a consignee of grain stores the same in a warehouse, and it is intermixed with other grain of like grade, and a receipt is taken for the amount, the grain being no longer capable of identification, the owner parts with his property in the same, and the consignee to whom the receipt is given, instead of being a bailee, becomes a debtor to the owner.

Accountability of commission merchant.-If a commission man places the grain of his consignor in a warehouse, taking a receipt therefor, and disposes of the receipt, and afterwards fails to keep warehouse receipts for the same amount and grade of grain, it will not amount to a conversion of the grain. The only effect will be a bar to his charges for storage and insurance.

Commission merchant-Compensation for advances.-A commission merchant may rightfully sell grain consigned to him to reimburse himself for advances made, after a reasonable time, when such is the usage of trade.

Commission merchants-Storage and insurance charges.-Accounts of sales rendered monthly by a commission merchant to the consignor for several years, containing items of charges for storage and insurance, unobjected to until after suit brought by the former for a balance due him, is prima facie evidence of the correctness of the account, and the right to make such charges. (September term, 1877. Bailey v. Bensely, 87 Ill., 556.)

Inspection of grain-Inspectors appointed by board of trade.-By the act of 1867, incorporating the East St. Louis Board of Trade, there were conferred upon that board all the powers and privileges, and it was subjected to all the restrictions, of the Chicago Board of Trade, as then existing under its charter of 1859. Section 10 of the charter of the Board of Trade of Chicago merely authorizes an inspection of grain by inspectors appointed by the board of trade among its members, or to any other person who may agree thereto, and such inspectors so appointed have no authority to act in any other case or under other or different circumstances.

Board of trade inspectors not affected by Illinois act of 1871.-The act of 1871, for the regulation of public warehouses, was not intended as an amendment of the charters of boards of trade. That act was intended as a complete system of itself, in no manner connected with or depending upon any other law on the subject. Under it no provision is made for the appointment of inspectors of grain for public warehouses in Class B.

Under the act of 1871, in relation to public warehouses, it making no provision for the appointment of inspectors of grain in Class B, the owners or proprietors of that class of warehouses could conduct their business without inspection, as before the passage of the law. This seeming defect in the act can not be construed to invest boards of trade with the power of appointing such inspectors. Section 19 of the act of 1871 prohibits warehousemen of Class B from receiving and mixing the grain of different owners until the same shall have been inspected in all places where there are legally appointed inspectors of grain. Such inspectors are not such as are appointed by a board of trade, but such as might be appointed under power subsequently conferred by law.

So inspectors appointed by the Board of Trade of East St. Louis are not legally appointed under this section. (January term, 1883. East St. Louis Board of Trade v. People ex rel. McCormick, 105 Ill., 382.)

Warehouse receipts.-A warehouse receipt stands in the place of the grain it represents, and the possession of the receipt is regarded as the possession in law of the grain itself; and as the warehouseman is not required to surrender the grain until the return of the receipt and the payment of charges, one who obtains it under such circumstances as would charge him with notice of a want of title in his assignor, the real owner, may recover of him, in trover, the value of the grain on his refusal to surrender the receipt to him. (November term, 1882. Canadian Bank v. McRae, 106 Ill., 281.)

The weight of the American authorities is that when the sale or exchange is part of a mass of the same kind, quality, and grade-as of part of the corn or wheat in an elevator-separation from the mass or other specification of the particular part sold is unnecessary to its appropriation, independent of the statute vesting the ownership in the holder of a warehouse receipt. (May 11, 1891. Cloke v. Shafroth, 137 Ill., 393.)

Where the grain of different owners has all been intermingled in one common mass, according to the usage of warehousemen and without objection by the owners, it becomes common property, owned by the several parties in the proportion in which each has contributed to the common stock.

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The grain being thus owned in common, the several owners are subject to sustain any loss pro rata which might occur by diminution, decay, or otherwise. (April term, 1864. Dale v. Olmstead, 36 Ill., 150; S. C., 41 Ill., 344.)

Where grain is stored in an elevator, the length of time it shall remain is optional with the owner, so long as he sees fit to pay storage.

Where a person puts grain in a warehouse for the purpose of storage and the warehouseman converts the grain to his own use by manufacturing the same into flour and selling the same, receiving the money therefor, the owner of the grain may waive the tort and recover from the warehouseman in assumpsit for money had and received for the value of the grain. (September term, 1869. Ives v. Hartley, 51 Ill., 521.)

Warehouses established under act of 1871 (Rev. Stat., 1874, p. 820) are public agencies, and the proprietors thereof, as licensees, pursue a public employment which public policy forbids shall be so conducted as to expose them to temptation of serving their personal interests at the expense of their duty to the public.

A public warehouseman has no right under the act of 1871 to buy and store his own grain, issuing his own warehouse receipts to himself as an individual, and buying and selling through his own warehouse, as such a course is inconsistent with the full and impartial performance of his duty to the public.

The failure of warehouse commissioners to question the legality of private grain deals by warehousemen through their own houses is not a construction of the act of 1871 in favor of such practice.

A stockholder in a public warehouse can not use the property to carry on his individual business as a grain dealer.

An injunction against one in his relation as a stockholder in a public warehouse is not binding upon him after the relation of stockholder ceases. (June 18, 1898; rehearing October 6, 1898. Central Elevator Co. v. People ex rel. Moloney, Attorney-General, 174 Ill., 103.)

MINNESOTA.

A deposit of grain for storage is a bailment, the title remaining in the depositor, so that he is deemed to be the owner of the grain in the warehouse to the amount of his deposit, although the identical grain he deposited has been removed and other grain of like kind and quality substituted in its stead.

The holders of receipts for grain so deposited, of the same kind and quality, are tenants in common in the mass of grain of that kind and quality in the warehouse, the interest of each being limited to the amount called for by his receipt. The warehouseman may also be tenant in common with them in such mass, as where he puts his own grain in the warehouse or purchases from a depositor. His interest in the mass is limited to the excess above what is necessary to meet his outstanding receipts.

He may remove and dispose of such excess as his own. If he sell as his own any grain beyond such excess without express consent of the depositors his sale passes no title, and the owners may follow the grain into the hands of the purchaser and recover from him for a conversion. (February 18, 1890. · Hale v. Pillsbury, 43 Minn., 33.)

By laws 1887 (ch. 10, sec. 2, subdivision P) a railway company is obliged to give equal or substantially similar facilities for the transportation of grain to all persons who in good faith erect or desire to erect warehouses at any of its stations; and if a demand therefor is unreasonably refused the State railway and warehouse commission may, after due consideration, enforce the performance of such duty. The railway company may impose reasonable terms and conditions upon persons who demand such facilities, but they must be the same for all. (September 8, 1893. Farwell Farmers' Warehouse Association v. M., St. P. and S. Ste Marie Rwy. Co., 55 Minn., 8.)

Laws 1876, chapter 86. section 6, not repealed by Penal Code, section 415. A receipt for grain placed in store, which in all other respects constituted a contract of bailment, contained the following: The conditions on which this wheat is received at this elevator are that Rieger [the warehouseman] has this optioneither to deliver the grade of wheat that this ticket calls for or to pay the bearer the market price for the same, less elevator charges, on surrender of this ticket." Held, that this did not render the contract one of sale; it merely gave the warehouseman an option to buy when the receipt was presented. This option he could only exercise when the receipt was presented and by paying the money. Judgment below affirmed. (November 16, 1894. Minnesota v. Rieger, 59 Minn., 151.)

Defendants were indicted under laws of 1895, chapter 149, for refusing to turn over unclaimed freight to a licensed public warehouseman after twenty days from the receipt thereof.

Held, this act is unconstitutional and void, not being a lawful exercise of the police power of the State.

Causes were remanded with directions to the court below to dismiss indictments. (May 27, 1897. Minnesota v. C., M. and St. P. Rwy. Co. et al., 68 Minn., 381.) Statement of facts.-Swart was a general warehouseman; one Foster delivered to him certain wheat at the warehouse of defendant, at Minneiska. All of said wheat was kept in a bin, and kept by itself. Receipts were issued which ultimately passed to Robson, the plaintiff. The receipts described the wheat as "No. 2 wheat."

Held, the receipts or memoranda did not estop the warehouseman from showing that the wheat was inferior to No. 2, and the offer to deliver to such purchaser of the memoranda the identical wheat delivered was a sufficient offer to perform his contract by the warehouseman. (Robson v. Swart, 14 Minn., 287.)

NORTH DAKOTA.

Rates of storage, etc., may be fixed by law.-Chapter 126 of the session laws of 1891 considered, and sections 4 and 11 thereof held to be constitutional, in so far as they define public warehouses, and in so far as they prescribe maximum rates of charges for elevating and storing grain in the public warehouses, as they are defined in section 4 of the act. (State ex rel. Stoeser v. Brass, 2 N. Dak., 482; S.C. 153 U. S., 391.)

(See decision of Supreme Court of the United States in this case, vol. 153, p. 391.)

Identity of grain lost in storage.—The owner of mortgaged wheat delivered the same to an elevator and turned over to defendant in payment of a claim the tickets issued by the elevator company. They were general storage, and not special bin tickets. Held, that defendant had no control over the identical wheat covered by the mortgage, or over the mass with which it was mingled, but could only claim from the elevator company the delivery to him of the number of bushels named in the ticket of the grade therein specified, without reference to the source from which the company should obtain the grain for delivery, and therefore held that the mortgagee could not maintain replevin against the defendant for the mortgaged wheat, he being neither in the actual nor in the constructive possession thereof. (June 2, 1898. Best v. Muir, 8 N. Dak., 44.)

Loss or destruction of property in storage.-The burden rests upon the bailee to show the loss or destruction of the property bailed, if such be the fact. No other rule could be admitted. It would generally be impossible for the bailor to show that the property had not been lost or destroyed. It was otherwise with the bailee in possession of the property. [Defendants had not introduced any testimony in the cause.] (April 24, 1899. Marshall v. Andrews, 8 N. Dak., 364.)

OREGON.

A warehouseman receiving grain on storage and mixing it with other grain of the same nature and quality also stored in his warehouse in the usual course of business is not chargeable with a conversion by reason of such act alone.

The identity of grain so stored is not lost, nor is it thereby placed beyond a lien thereon. (March term, 1883. Sears v. Abrams, 10 Or., 499.)

In the absence of statutory enactment a warehouseman's receipt is not a negotiable instrument, and an assignment thereof operates merely as a transfer of the property deposited and passes no better title to the purchaser than the vender had. (March term, 1884. Solomon v. Bushnell, 11 Or., 277.)

An attaching creditor is to be deemed a purchaser in good faith and for a valuable consideration from the date of the attachment.

When by a warehouse receipt it is agreed to deliver the property to any one to whom the receipt may be indorsed, as to one or to his order, a symbolical delivery of the property may be effected by transfer of the receipt, and the warehouseman in such case becomes bailee to such transferee. (November 23, 1885. Gill v. Frank, 12 O1., 507.)

Where several depositors have wheat stored in a warehouse in a common mass and a deficiency occurs, from whatever cause, not occasioned by the fault of any such depositors, the loss must be borne by each of them in the proportion which the amount of his wheat bears to the whole amount deposited. But it seems a