IMPORTANT TO MERCHANTS.

Otago Witness, Issue 902, 13 March 1869, Page 17

IMPORTANT TO MERCHANTS.

(The Argun, Feb. 25th.)

In the District Court yesterday, a case of some importance to the mercantile community came before Mr Call, the stipendiary magistrate. Mr Gilbett Gen. G. Smythers, wine and spirit merchant, Elizabeth street, sued Messrs Twentjmin and Co., prop ietors of Nicholson's bonded stores, Flinders street, for the illegal detention of three quarter-casks of sherry, pu'chas-d by him in 1567, at auction, a-.d for which he ht-ld the bonded certificates. Mr M'K"an appeared for complainant, and Mr Liddle for defendant.

Mr M'lvean, iv opening the case for complainant, said that in October, 1867. Mr Smythers bought; at auction, held by Mpssrs Greig and Murray, a parcel of eight quarter casks 01 Amontillado sheny, for which he paid by bill, that bill being duly honoured He received the bonded certificates from the auctioneers, and since then had, an different times, taken from boad five out of the eight quarter-casks. The bonded certificates -were duly endorsed by Messrs D cksoa, Williams, and Co., who were the original vendors, but who had sold the goods to Messrs Joake Brothers, at whose instance they were sold at auction. After Mr Smvthers had taken out the fifth quarter-cask, and before he required the sixth, Joske Brothers stopped payment, and mide an assignment for the ben/ fit of their creditors. Not dreaming that this fact would at all affect him, Mr Smythevs went to bring away his sixth moiety cf the sherry, w^.en he was informed that delivery had been stopped by Messrs Dickson, Williams, and Co. (ia whose name it still stood on the books of the store), as unsatisfied creditors of Joske Brothers. There remained, therefore, no other course open to his client than to sue the warehousemen for illegal detention. Referring to the question really raised by this cause — viz., the right to stop goods in transitu — he pointed out that the right was founded wholly on equitable principles, which have been adopted in courts of law. In illustration of the principles so adopted, he quoted Lickbarrow v. Mason (Smith's Leading Cases, vol. 1, d 690), where , it ia laid down as a broad general principle " that wherever one of two innocent persons must suffer by the action of a third, he who has enabled such, third person to occasion the loss must sustain it." He further quoted from Hammond v Anderson (i N. E.. 69). where it is said:— '"lt has been decided that where part of the goods sold by one entire contract is taken possession of by the vendee, without any intention on the vendor's part of retaining the rest, his right to stop in transitu is gone." Having thus, as he thought, stated fairly both the facts and the law of the case, he called his witnesses :—: —

Gilbert George Goold Smythers said he was a wine and spirit merchant, carrying on business in Elizaheth. street. Tn October, 1867, he bought at an auction held by Messrs G-reig and Murray, at their rooms, a parcel of eight quarter-casVs of sherry. He paid for these by a bill, and received the bonded certificates duly endorsed by Messrs Dickson, Williams, and Co., by whom the wine had been warehoused in defendants' store. Five of those casks he had received on presenting aa many cer.ificatea, at various times, and paying the amounts chargeable upon them in respect of s orage, &c. But when he presented the sixth certificate he was informed that the delivery tad been stopped by Messrs Dickson, Williams, and Co., aa unsatisfied

creditors of Joake Brothers, who bad failed * He took down a dny, proffere-1 to defendants the entire amount of charges due u^on the sherry, and offered to take it away, but delivery was refused. In c'-oss-exam nation, witness suid the sale at widen he purchased the wine was authorised by Joake Brothers.

Paul Joske, of the firm named, deposed to having exported theae goods from London, consigned to Messrs Dickson, Williauus. and Co ., whose London agents had made advances upon them. The goods were sold y Greig and Murray at his instance, lie having repurchased them from Dickson Williams, and Co., and paid for them by bills. Both before and after this consignment he had done s mil.ir business with tha him, obtaniu;', advances in the same way, and consigning the goods in their name, in consequence of this \ they had a general ledger account, upon which he paid bills when he wanted goods, butwhen he desired to clear of? any single transaction he paid by cheque. The certificates for the wine in question were obtained by him as part of a large parcel— several thousands of pounds worth — for which he paid by bills. The goods were sold by hia order, and he received Mr Smythers'3 acceptance in payment, discounting it in the usual way. Owing to the fact of the account between himself and Dickson, Williams, and Co. being a ledger running accouut, he could not say whether there was a payment made on account of this particular parcel or not. On the Ist of October, 1868, he believed his firm stopped payment, and on the Sfch.of that month he executed a deed of assignment for the benefit of his creditors. In reference to any transaction for the withdrawal of goods from bond, he should give a bill within a month, from the time of purchase. On the 11th of October, IS 1 }?, when this -wine was sold, he was indebted to Diekson, Williams, and Co , to the extent of L 3689 16s 7d, and he had since given bills for that amount ; but he was always largely ia arrear with the firm, and when he stopp d payment owed them L125-i. None 01 his bills, however, had ever been dishonoured prior to his stoppage. In cross-examination, witnesa admitted that; the account was a general one, and that no paymerjt, except to close transactions right off, was ever made upon any particular portion of the goods he purchased. This was the case for tbe comp^inant, and Mr Liddle submitted that there was nothing to answer. The magistrate, however, said he should be glad to hear from the learned gentleman something of his defence. Mr Liddle : Upon complainant's own showing, our debt has nev^r been covered, and therefore, as unsatisfied creditors, wa were quite rL'ht in staying delivery.

Mr ''all : But I have before me a case with reference to running accounts, in which the decision is, that " when there is an account current between th» paitiea, tbe law, in the absence of any other specific arrangement between them, presumes that xhey intend to apply the first item on the credit side to the first item on the debit side, and so on." How do you get over that?

Mr Liddle said an erroneous idea prevailed in this country, as it did formerly in.

England, that these certificates passed the property in the goods dealt; with from one ;ierson to another by virtue of the endorsement. But that was purely an assumption, which, the law did not warrant. The requirement of the law was that the certificate itself should le endorsed, and that its transfer should be entered upon the books of the storekeeper. That was a point which had been already decided in the well-known cases Lorim.tr v. Cleve and Moss v. Grice, heard in the Supreme Court. The transfer had not been eflected in this ease, the g;oods remained in the name of Dickson, Williams, and Co. , and they could, consequently, stay delivery if their Hen upon the goods was not satisfied.

Mr Call : But I should like to hear you upon tbe point as to whether this sherry was not constructively paid for, because, your law being correct, the question now resolves itself into one of payment or non-payment, Mr Liddle : By complainant' 3 own showing we have not been paid ; there has been no appropriation of special payments to special goods, and as lone; as any money remained due we had a lien upon any goods standing in our name. We claim the right of appropriating the moneys we have received as we think fit, and we say these goods have never been paid for. Some further conversation took place upon the question raised by the magistrate, and eventually it was agreed that the sums paid by Joske Brothers before stoppage vvera sufficient to cover his indebtedness up to 1867, when this transaction took place. Mr Call then, said he should prefer to hear Mr Liddle upon, the point raised aB to constructive payments, after he had consulted the authorities, and looked through, the cases bearing thereupon. In order to give time for this, he would, by consent of the parties, adjourn the case for a week, and thin hear what was to be Baid about it. The case was, therefore, adjourned till Wednesday next, at twelve o'clock.

Mr Farrell, one of the members for Castlemaine. will probably be appointed Secretary to Mr Verdon, the London agent of the colony.

A correspondent of a Scotch paper say 3 that the discovery of gold in the protogene rocks of Sutherland is not new In the sixteenth century it was found in valuable quantities afc Durneas, on. the north c >aat, and, together -with the wishing of the Elvan, in Lanarkshire, supplied the bullion for the Scotch money, and probably also for the present Scottish crown, or part of it.