had accepted the bill; so that Gibbons might fairly expect that the bill would be accepted. But on the second ground the nonsuit is right, for these bills, as appears from the order of the Vice Chancellor, must be taken to have come to the possession of the defendants as assignees at the time of the bankruptcy. Then, if so, they fall within the operation of the statute of James, being goods and chattels in the order and disposition of the bankrupt at the time of his bankruptcy, with the consent of the real owner. In either way, therefore, the nonsuit is right. Marryat and Lawes, contrà. There must be considered to be an implied contract in this case, that the bill given by Gibbons and Co. should be an accepted bill; for otherwise it would not be an exchange of valuable securities. If so, the bill being refused acceptance is altogether a nullity, and the transaction a nullity also, and the party may recover back in trover the bills he has given. Bishop v. Shillito (a), and Puck (a) Bishop v. Shillito, Hil. term 59 G. 5. Trover for iron. The iron was to be delivered under a contract that certain bills outstanding against the plaintiff should be taken out of circulation. After a part of the iron had been delivered, and no bills had been taken out of circulation, the plaintiff stopped the farther delivery, and brought trover for what had been delivered. Scarlett, for defendant, contended that trover would not lie, and that the only remedy for the plaintiff was to bring an action for the breach of the contract by the defendant. But the Court held that this was only a conditional delivery, and the condition being broken, the plaintiff might bring trover. Abbott C. J. said he had left it to the jury to say, whether the delivery of the iron and the re-delivery of the bills, were to be contemporary, and that the jury found that fact in the affirmative; and Bayley J. added, that if a tradesman sold goods to be paid for on delivery, and his servant by mistake delivers them without receiving the money, he may, after demand and refusal to deliver or pay, bring trover for his goods against the purchaser. ford 1819. HORNBLOWER against PROUD. 1819. HORNBLOWER against PROUD. ford v. Maxwell (a) is applicable in principle to this case. But secondly, this transaction is void on the ground of fraud, for Gibbons and Co. do not advise their bankers in London of the bill having been drawn. They say they did not do it because they had had heavy advices to make; in other words, because they knew it would not be accepted. Then their taking these bills from the plaintiffs, and giving them another which they knew at the time was of no value, was fraudulent. And the dates corroborate this view of the case; for the bill was presented in London on 4th March, and the bankruptcy took place on the 16th; so that they must have been in a failing condition at the time. Gladstone v. Hadwen. (b) As to the statute of James, it has never yet been held, that a bill of exchange falls within the description of goods and chattels mentioned in that act. And in several cases before the Lord Chancellor it has been held, that short bills in a banker's possession at the time of his bankruptcy are not within the operation of the statute, Exparte Pease and Others. (c) Here Gibbons and Co. were bankers, and those cases are therefore in point. 1 ABBOTT C. J. I am of opinion that in this case the nonsuit was right. The case, on the facts admitted, appears to be, that Gibbons and Co., on the 2d of March, exchanged a bill drawn on Esdaile and Co. for the three bills in question, and I think that the property in the latter actually passed to them by this exchange of securities. For they were indorsed over to Gibbons and Co., who had the power of disposing of them (a) 6 Term Rep. 52. (b) 1 Maule & Selw. 517. (c) 1 Rose, 232. for for a valuable consideration, and in like manner the plaintiffs had a similar power over the bill which was given to them in exchange. It is, however, contended that the property did not pass immediately by the act of exchange, but that it was in abeyance till the exchanged bill had been accepted by Esdaile and Co. But if that were so, I do not see why it should not equally remain so until the bill was not merely accepted but also paid. That, however, would be quite inconsistent with the nature of the transaction. It has been urged that there was fraud in obtaining possession of the bills which will therefore vitiate the whole transaction. But I do not think that there was sufficient evidence from which to draw this conclusion. It does not follow that because Gibbons and Co. found that it was inconvenient to them to send advice to Esdaile and Co., of their having drawn the bill for 9037., that they therefore knew, at the very instant when the exchange was made, that it was out of their power to advise of that fact with any probability that the bill would be honoured. It is possible that subsequently to the exchange being made they might discover their situation, and if so, there is no sufficient fraud to vitiate the transaction: if, however, that ground was to be relied upon, it ought to have been presented to the jury by a distinct issue upon that fact. But, supposing that the exchange in this case was not an absolute transfer of the property, still these bills, being negotiable securities of which the bankrupts might dispose, and having remained in their possession (for so we must take the fact to be in this case) till the time. of the bankruptcy, and so come to their assignees, are in my opinion within the operation of the statute of James. It has been held, that debts are within that statute; if 1819. HORNBLOWER against PROUD. So, 1819. HORNBLOWER against PROUD. so, à fortiori bills of exchange must be so. BAYLEY J. I am of opinion that in this case the property in the three bills was never in the plaintiff after the 2d of March; that bills of exchange are within the statute of James, subject only to this exception where they are in the hands of known trustees; and that these bills were in the hands of Gibbons and Co., not as trustees, and that they had the order and dispo sition of them at the time of their bankruptcy. It appears that the exchange of bills took place on the 2d of March without any pre-existing debt between the parties. Now, if instead of an exchange of securities the plaintiffs had given goods for the bill upon Esdaile, there is no doubt that the property in the goods would have passed by the exchange, and that if the defendants had had sold the goods to a third person, the plaintiffs, in case the bill had not been accepted, could not have maintained trover against the vendee on the ground of the supposed fraud. But if no property passed by the transaction, no doubt the plaintiffs would have been entitled to maintain that action, unless the sale had been in market overt. Then, as there is no substantial difference between that case and the present, it seems to follow that trover will not lie for the bills in question. There is another reason to shew that the property in this case passed absolutely by the exchange. If there had been an implied condition that the bill given in exchange should be an accepted bill, it was the duty of the plaintiffs to have presented it for acceptance, and upon refusal to have immediately rescinded the contract. But that was not done: they made no demand to have their three bills restored to them, nor took any step in the matter. I think, therefore, that the property passed by the exchange. The next question arises on the statute of James, which does not apply unless the property be in the order and disposition of the bankrupt at the time of his bankruptcy. In this case, the bills in question were in the possession of Esdaile and Co. at that period, who held them because they had a lien upon them. It turned out, however, ultimately, that on the accounts between them being adjusted, the balance, independently of these bills, was in favour of the bankrupts. We must, therefore, consider, in this case, Esdaile and Co. as having been ab origine trustees of these bills for the bankrupts, and that their possession was the possession of the bankrupts. Then the bankrupts had, in point of law, the order and disposition of them at the time of their bankruptcy, and they not only might, but actually 1819. HORNBLOWER against PROUD. |