provisions of the Factors' Act, (a) by the consignee's transferring a shipping note or a delivery order to a third person for value; (b) or by his sale of goods not in his possession to a third party, unaccompanied by a transfer of the bill of lading or of a document of title. In such a case the title of the third party is subject to the right of stoppage in transitu, for he cannot be allowed to stand in a better situation than the consignee. (c) And in America it is laid down in many cases that this right of the consignor cannot be defeated by any bargain between the consignee and his assignee, or by any claim, or lien, or attachment of any other person.(d) § 396. The transfer of the bill of lading, by indorsement or otherwise, to the consignee does not defeat the consignor's right to stop.(e) Still less does the mere signature by the master of a bill of lading making the goods deliverable to the consignee's order.(f) By transfer of the bill of lading. When transfer of bill of But the right is put an end to if the consignee, being the bond fide and authorised holder (g) of a bill of lading of, or docu- lading puts an ment of title to, (h) the goods, during the transit and before the end to right. right of stoppage has been exercised, transfer (i) such bill of lading to a third (k) person for valuable consideration; provided the latter takes the document in good faith (1) and without notice of fraud or insolvency on the part of the consignee,(m) or of any circumstance which would render the bill of lading not fairly and honestly assignable.(n) The good sense of this rule is manifest, when it is remembered that the right to stop in transitu was originally introduced in Equity(0) in favour of the unpaid consignor, and that it would be most inequitable if, after the consignor has placed the bill of lading in the consignee's hands and so enabled him to transfer or 42; Nicholls v. Le Feuvre, 2 B. N. C. 81. (a) 52 & 53 Vict. c. 45, s. 10. (b) Akerman v. Humphery, 1 C. & P. 53; affd.,see Tucker v. Humphrey, 4 Bing. at p. 523; Jenkyns v. Usborne, 7 M. & Gr. 678; McEwan v. Smith, 2 H. L. Cas. 309. (c) Jenkyns v. Usborne, 7 M. & Gr. 678; Craven v. Ryder, 6 Taunt, 433; Nix v. Olive, Abbott Sh., 13th ed., 707; Kemp v. Falk, 7 Ap. Ca. 573; 1 S. L. C. 9th ed. 807. (d) 1 Parsons on Shipping, 520. (e) Tucker v. Humphrey, 4 Bing. at p. 522; The Tigress, B. & L. at p. 44; Nix v. Olive, Abbott, 13th ed. 707. (f) Thompson v. Trail, 6 B. & C. 36; and see Feise v. Wray, 3 East, 93. (g) Gurney v. Behrend, 3 E. & B. 622; Benjamin on Sale, 4th ed. 891. (h) 52 & 53 Vict. c. 45, s. 10. (i) The transfer may be by way of pledge only. See The Marie Joseph, L. R. 1 P. Č. 219; Coventry v. Gladstone, L. R. 4 Eq. 493; 6 Eq. 44; in which case the right is defeated to the extent of the pledgee's interest, see Re Westzinthus, 5 B. & Ad. 817, and § 399 inf. (k) The Tigress, B. & L. at p. 44. (1) Lickbarrow v. Mason, 1 S. L. C. (m) The Argentina, L. R. 1 Adm. 370; (0) 1 S. L. C. 9th ed. 794. Or of document of title under the Factor's Act, 1889. When transfer of bill of lading does not put an end to the right. pledge it and deceive the transferee, the consignor were allowed to set aside what he has himself enabled the consignee to do, and so deprive the bond fide transferee of the goods, which the consignor has by his own act induced the transferee to purchase.(p) And although such bond fide transferee for value of the bill of lading knew, at the time when the bill of lading was so transferred to him, that the consignor had not received money payment for the goods, but had taken consignee's acceptances payable at a future day not then arrived, the right to stop is put an end to, if the transferee at the time of the transfer had no reason to know or apprehend that the consignee was insolvent, or that the bills given by him for the goods were not likely to be paid.(g) Accordingly, the right to stop in such a case is also put an end to, even if bills of exchange have been given to the consignor for the goods, which are certain to be dishonoured, or even if the consignor has been induced by the consignee's fraud to transfer the bill of lading to the consignee, provided the indorsee has acted bona fide and without notice.(r) § 397. By s. 10 of the Factors Act, 1889:(s) Where a document of title to goods has been lawfully transferred to a person as a buyer or owner of the goods, and that person transfers the document to a person who takes the document in good faith and for valuable consideration, the last-mentioned transfer shall have the same effect for defeating any vendor's lien or right of stoppage in transitu, as the transfer of a bill of lading has for defeating the right of stoppage in transitu. § 398. But, inasmuch as a bill of lading is not negotiable in the same sense as a bill of exchange,(t) in order that its transfer by the consignee may put an end to the consignor's right to stop, it is essential that the bill of lading should have come into the hands of the consignee, with the authority of the consignor.(u) If, for example, the bill of lading has been stolen from the consignor, or transferred without his authority, a subsequent bonâ fide transferee for value cannot make title under it, as against the shipper of the goods. And even although the shipper may have indorsed in blank a bill of lading deliverable to his assigns, his right is not affected by an appropriation of it without his authority.(x) A transfer by a consignee will not defeat the right of stoppage if it is subject to a condition with which the indorsee has failed (p) See Rodger v. Comptoir, &c., L. R. 2 P. C. at p. 406. (q) Cuming v. Brown, 9 East, 506; Jones v. Jones, 8 M. & W. 431. (r) The Marie Joseph, L. R. 1 P. C. 219. (8) 52 & 53 Vict. c. 45. (t) Supra § 343. (u) See per Tindal, C.J., Jenkyns v. ·Usborne, 7 M. & G. 697; Rodger v. Comptoir, &c., L. R. 2 P. C. at p. 405. (x) Gurney v. Behrend, 6 El. & Bl. 622; explained in The Marie Joseph, L. R. 2 P. C. 219, 228. to comply; (y) or if the transferee has given no value or consideration for the transfer of the bill of lading to him; (2) or if he act mala fide:(a) as, for instance, if he has notice at the time of the transfer that the original indorsement by the consignor was only made on a condition which had not not been fulfilled, (b) or has assisted in contravening the actual terms upon which the goods were sold by the consignor, or his reasonable expectations arising out of them, or his rights connected therewith; (c) or if he had notice at the time of the transfer of the insolvency of the consignee; (d) or if the transferee, after the transfer, becomes jointly interested with the consignee in the adventure, and undertakes to pay for the goods.(e) A transfer of the bill of lading by the consignee to his factor, to whom the goods are consigned for the purpose of being sold by him on account of his principal, will not defeat the right of stoppage, although the factor is under acceptance to the consignee on a general account; though it would be otherwise if there were a specific pledge of the cargo, as if bills had been accepted on the credit of the particular consignment.(ƒ) for limited bill of lading purpose, defeats right of stoppage § 399. And although the right of the consignor to stop goods Transfer of in transitu is defeated in law by the indorsement of a bill of lading for a limited purpose, as for instance to secure a sum of money, it will still remain in equity, subject to a lien for the indorsee's demand, and its exercise will vest in the consignor a right to the surplus after discharging that lien.(g) The Judicature Act, 1873, enables all the courts to give effect to this doctrine.(h) (y) Newsom v. Thornton, 6 East, 17. (z) Newsom v. Thornton, 6 East, at 40; Rodger v. The Comptoir, L. R. 2 P. C. 393; Waring v. Cox, 1 Camp. 369. (a) Cuming v. Brown, 9 East, 506, 514; 1 S. L. C. 9th ed. 811. (b) See Barrow v. Coles, 3 Camp. 92. (c) Per Lord Ellenborough, 9 East, at p. 514. (d) Vertue v. Jewell, 4 Camp. at p. 33. (g) Spalding v. Ruding, 6 Beav. 376; extent only. Generally. CHAPTER VIII. WHEN THE MASTER MAY BIND THE SHIPOWNER BY By Contracts relating to the usual Course of the Ship's Employment. § 400. THE master, as confidential agent of the owners, has an implied authority to bind them, by any legal contract, which he may make relating to the usual employment of a general ship.(a) His authority in this respect is very large and extends to all acts, which are usual and necessary for the use and employment of the ship. Constant usage shows that the master has this general authority; and his authority "to perform all things usual in the line of business, in which he is employed, cannot be limited by any merely private order or direction not known to the party dealing with him."(b) The course of the usual employment of the ship is evidence of authority given by the owners to the master to make for them and on their behalf a contract relating to such employment; and consequently a contract so made by him is esteemed in law to have been made by them.(c) And they will be bound by it, although made without their knowledge or approbation, and even against their orders, if the party, with whom the master contracted, had no knowledge that the master was acting without authority.(d) (a) Abbott on Shipping, 13th ed. 119; Kent's Com. iii. 161; Story on Agency, 116. (b) Per Jervis, C.J., Grant v. Norway, 10 C. B. 687; per Blackburn, J., Reynolds v. Jex, 34 L. J. Q. B. p. 255, quoting Smith's Merc. Law, 10th ed. 139. (c) Abbott, 13th ed. 119, 120. (d) Story on Agency, 443; Grant v. Norway, ubi sup.; Ellis v. Turner, 8 T. R. 531; Abbott, ubi sup. The master may bind the owners by letting the ship on a charter- Contracts party and taking shipments on freight, if such is the usual em- relating to ship's employ. ployment of the ship, but not otherwise; (e) or by any particular ment. engagement or warranty relating to the usual employment of the ship.(f) And in such case the owners will be liable on the contract of carriage in case of the loss of the goods from any cause other than an excepted peril.(g) His authority to bind his owners by signing bills of lading has been sufficiently discussed above. (h) His power to bind them by the sale of the ship, or the hypothecation of ship and freight, will be considered below. (¿) He has authority in a foreign port, to settle accounts for freight, demurrage and delay, and all such matters; (k) or to commence an action in rem for injury by collision to the ship and cargo of which he is in charge. (1) present, master has less power, § 401. "Ordinarily," says Mr. Justice Story, (m) "these inci- If shipowner dental powers belong to the master only in the absence of the owner or employer of the ship; as, for example, when the ship is in a foreign port and not in the home port. (n) For, when the owner or employer is present, he is known to possess and is presumed to exercise his own right of general superintendence over the conduct of the ship and its concerns, unless some presumption of a delegation of authority to the master can be implied, either from the usage of trade, or from the particular employment of the ship, or from the conduct and proceedings of the parties. Even in the home port, however, there are many acts, which are so invariably confided to the master, as to amount to a positive delegation of authority.(0) Thus, the master is ordinarily entrusted with the authority of shipping the officers and crew, (p) of superintending the ordinary outfits, equipments, repairs, and other preparations of the ship for the voyage, (q) of lading and unlading the cargo; and in cases of a general ship, of receiving goods on freight and of signing bills of lading for (e) Story on Agency, 116; Reynolds v. Jex, 7B. & S. 86; Grant v. Norway, 10 C. B. 687. (f) Rinquist v. Ditchell, Abbott, 13th ed. 125. But it is doubtful whether he can bind the owners by a stipulation in the charter-party for advances to himself against freight. Gibbs v. Charleton, 26 L. J. Ex. 321. (g) Boson v. Sandford, Carth. 58; Boucher v. Lawson, Rep. temp. Hardwicke, 85, 194; Abbott, 13th ed. 123; Ellis v. Turner, 8 T. R. 531. (h) §§ 330-333; 355, 356. (i) §§ 412-417; 429-444. (k) Alexander v. Dowie, 1 H. & N. 152. (1) The Reinbeck, 60 L. T. 209; supra § 85. the same. (r) These are such (m) Story on Agency, § 119. (n) This limit applies to his power of chartering the ship; per Brett, L.J., The Fanny; The Matilda, 48 L. T. 771. (0) Per Lord Campbell, Frost v. Oliver, 2 E. & B. at p. 305; Abbott, 13th ed. 132. (p) Including, it would seem, the employment of a pilot. See The Nelson, 6 C. Rob. 227. As to contracts for extra remuneration for special services, see Yates v. Hall, 1T R.73; The Christiana, 5 (Irish) Jur. N. S. 63; § 506 inf. (q) But not to pledge the owner's credit for them, if he or a solvent agent ie at the port; Gunn v. Roberts, L. R. 9 C. P. 331; inf. § 407. (r) See Grant v. Norway, 10 C. B. 665. but may even then transact matters usually entrusted to him. |