APPEAL from the Circuit Court for the Southern District of New York; the case being this:
In January, 1868, Alfred Bennett, James Van Pelt, and Gilbert Van Pelt, were merchants doing a commission business in New York under the name of Bennett, Van Pelt & Co. The partner, Gilbert, resided in Savannah, where he was in the habit of purchasing cotton and consigning it to his firm in New York. In the course of this dealing he bought, on the 28th of January, 1868, one hundred and eleven bales of Brady & Moses, commission merchants in Savannah, for this firm in New York, and on the same day shipped the cotton to New York by the steamship Thames, one of the vessels of a line known as the Black Star Line. Three bills of lading, of the same tenor and date, were issued, each stating that the cotton was shipped by Gilbert Van Pelt, and that it was to be delivered 'unto order or to his or their assigns.' 'And it is expressly understood,' the bill of lading went on to say, 'that the articles named in this bill of lading shall be at the risk of the owner, shipper, or consignee thereof, as soon as delivered from the tackles of the steamer, at her port of destination, and they shall be received by the consignee thereof, package by package, as so delivered; and if not taken away the same day by him, they may (at the option of the steamer's agents) be sent to store, or permitted to lay where landed, at the expense and risk of the aforesaid owner, shipper, or consignee.' Two of the bills were delivered to said Gilbert Van Pelt; the other being retained as the ship's bill of lading. On the same day, in order to procure money wherewith to pay for the cotton, and in compliance with the terms and conditions of the purchase, he drew his draft on his firm in New York for $8300, payable fifteen days after sight, to the order of 'Billopp Seaman, cashier,' and delivered the draft and the two bills of lading which he had to the said Brady & Moses, who held moneys of the Atlanta National Bank of Atlanta, Georgia, for the purpose of investment in bills drawn on New York, and the draft was discounted for the account of that bank, and the proceeds were applied toward the payment of the cotton. The bill or invoice for the cotton was receipted as if it had been paid for in cash, and the Atlanta Bank was charged with the advances. The two bills of lading were indorsed,
'Deliver B. Seaman, Cashier, or order.
'G. S. VAN PELT.'The point of contest in the case was for what exact purpose the two bills of lading had been delivered to Brady & Moses, that is to say, whether to stand as security until the draft of Gilbert Van Pelt should be accepted, or whether to stand until it should be paid. Gilbert Van Pelt himself swore it was given but for the former purpose, and that this was perfectly understood on both sides. Brady & Moses, on the other hand, each swore that it was given no stand as security until the draft should be paid; and in this they were confirmed by the clerk of their house, one Bruen. The draft and the bills of lading were forwarded to Billopp Seaman, under general instructions from the Atlanta National Bank, to hold and collect for the credit of the account of the said Atlanta National Bank.
The Thames arrived in New York late on Sunday afternoon, February 2d, 1868. Before arrival, the purser had made out bills for freight, and made out those for freight on this cotton, to Bennett, Van Pelt & Co. There was a memorandum, in writing, at the foot of the ship's bill of lading, 'for Bennett, Van Pelt & Co.;' by whom put there was not at all explained, further than that it was not in the handwriting of any of the ship's agents at Savannah who signed the bill of lading and made the contract for carriage. The ships of the Black Star Line, of which, as already mentioned, the Thames was one, had brought cotton regularly for Bennett, Van Pelt & Co. On Monday morning, February 3d, the steamer commenced delivering cargo. The one hundred and eleven bales were delivered on the pier. Bennett, Van Pelt & Co. sent their carts and took the cotton, paid freight for it, receipted for it on the ship's bill of lading, and sold the bulk of it for cash on delivery the day that they got it.
As appeared on the one hand, nothing was done by the Fourth National Bank in reference to the cotton, or its delivery, from the time of the acceptance of the draft, February 1st, 1868, until after its maturity, February 19th, 1868. On that day, and on that draft, Bennett, Van Pelt & Co. failed, and the draft was protested for non-payment. On the other hand it did not appear, except by the testimony of James Van Pelt, which was contradicted by Billopp Seaman, that he, Seaman, knew of the arrival of the vessel before the cotton was delivered and sold. On the 19th, after the draft was dishonored, Seaman, by direction of the President of the Fourth National Bank, sent a clerk to the office of the agents of the ship, where he saw the ship's bill of lading, and heard that the cotton had been delivered some days before to Bennett, Van Pelt & Co. He made no demand. Afterwards, on March 16th, 1868, the bank made a formal demand for it.
Until the inquiries made on February 19th, 1868, the agents of the Thames had no notice, beyond that which the bill of lading itself gave, of any claim to or interest in the cotton in question by any other parties than Bennett, Van Pelt & Co.
It was undisputed that Seaman had no real interest in the cotton, and that it belonged to the Atlanta National Bank, whose sole agent in New York was the Fourth National Bank.
In this state of things Seaman filed his libel in the District Court of New York against the Thames, March 19th, 1868, claiming damages in the sum of $8300 for non-delivery to him, at New York, of the cotton, the bill of lading for which had, as he set forth, and as was not denied, been assigned to him for a valuable consideration. The owners of the Thames answered the libel and put in issue its material allegations, averring that the cotton was shipped by the Thames for and to be delivered to Bennett, Van Pelt & Co., of New York , and was so delivered in due course and without notice of the claim of the libellant, and that no claim for it was ever made by the libellant until long after such delivery; that the alleged assignment of the bill of lading to the libellant was by way of security for personal obligations of Bennett, Van Pelt & Co., who were solvent merchants, and to whom the libellant looked for payment of such obligations; and that he gave no notice and did no act as assignee of the bill of lading on the arrival of the vessel or upon the delivery of the cotton, nor until after Bennett, Van Pelt & Co. had become insolvent, and that by his delay and laches he waived and lost all claim against the vessel and her owners.
The District Court, considering that Seaman had a sufficient interest to sue, and holding, upon the evidence, that the delivery of the bills of lading for the cotton was intended to, and did, transfer it to the libellant as a security for the payment of the draft for $8300, decreed in favor of the libellant, and the Circuit Court affirming that decree, the owners of the vessel brought the case here.
Messrs. Barney, Butler, and Parsons, for the appellant:
The witnesses do not, indeed, agree as to the purpose for which the bills of lading were transferred, but the facts show that it was as security for the acceptance, and not for the payment of the draft. Thus—
1. The draft was a time draft, having fifteen days to run, and was taken at the rate of such paper. Van Pelt would have had no motive to buy cotton on credit if his house was not to have the benefit of the purchase till the credit expired.
2. No instructions were given to the Fourth National Bank to deal with the cotton in the interval of fifteen days during which the draft would be running to maturity. The bank actually did nothing to show any interest in the property.
Even if the transfer of the bills of lading was intended to secure the payment of the draft, Seaman was not entitled to hold the vessel and owners for the non-delivery of the goods, inasmuch as by his own laches he suffered the cotton to go into the possession of Bennett, Van Pelt & Co., and to remain in their possession until after their insolvency. The cotton was shipped in the regular course of business on a vessel which formed one of a line of steam packets between New York and Savannah, and which had been engaged in carrying cotton for account of the same shipper and consignees. The vessel knew no other party in interest. Before arriving at New York, the purser made out the freight bill to Bennett, Van Pelt & Co., assuming in good faith that the cotton was for them. A memorandum at the foot of the bill of lading, 'For Bennett, Van Pelt & Co.,' confirmed him in this assumption. The bill of lading, by its terms, required the consignee to take away goods on the day of the arrival of the vessel at her port of destination, or in default of his so doing the goods were, at the option of the steamer's agents, to be sent to store or left on the steamer's wharf. The vessel arrived on Sunday, and on Monday morning early, notice was given to Bennett, Van Pelt & Co., the only consignees of whom the ship had knowledge, and who came in the usual course of business and took it from the pier, receipting for it. The firm being solvent, and being regular consignees, and giving their receipt, the non-production of the outstanding bill of lading was not a circumstance to excite suspicion. Notwithstanding that the bill of lading showed a shipment on a steamer of a regular line at Savannah, January 28th, 1868, which in due course would have brought the goods to the pier in New York about 3d February following, the Fourth National Bank did absolutely nothing until February 19th, and even then made no demand, and took no further action till March 16th. Bennett, Van Pelt & Co. did not fail until February 19th, 1868.
On this state of facts Seaman took the risk of the continued solvency of Bennett, Van Pelt & Co., and of the possession of the cotton by them. Although he may have been legally entitled, in the first instance, to the possession, yet it was competent for him by his acts to waive actual possession, and permit the goods to go into the hands of Bennett, Van Pelt & Co., consignees and owners, subject to Seaman's rights. Had he intended to avail himself of the rights of a consignee of the cotton under the bill of lading, he should have looked after the property and asserted such right. A consignee, by refusing or failing to accept the consignment, and look after the property, disclaims and loses the position of consignee. By failing to assert his rights as consignee until after the insolvency of Bennett, Van Pelt & Co. had intervened, Seaman lost all recourse, except as against them. They were liable to him in trover for the value of the goods if they took them from the ship without right. The ship's agent having acted in good faith, and Seaman having clearly been guilty of laches, the ship should not be visited with the consequences of his neglect.
3. Seaman was not entitled to maintain this action. He was not the real party in interest, nor had he such title to or interest in the case as to entitle him to sue in admiralty. The Fourth National Bank, the real agent and representative of the Atlanta National Bank, and not the cashier, was the only party entitled to bring the suit. 
The indorsement of commercial paper to and by a bank cashier is the act of his bank and not his individual act, and the libellant having no individual property or interest did not stand in any such relation to the transaction as to enable him to proceed. 
Mr. B. F. Lee, contra.
Mr. Justice STRONG delivered the opinion of the court.
^1 Houseman v. Schooner North Carolina, 15 Peters, 40; McKinley v. Morrish, 21 Howard, 355.
^2 Bank of Genesee v. Patchin Bank, 19 New York, 312; Folger v. Chase, 18 Pickering, 63; Watervliet Bank v. White, 1 Denio, 608.