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- border:1px solid silver; margin:2em 10% 0 10%; font-family: Georgia, serif; - } - .covernote { visibility: hidden; display: none; } - div.tnotes p { text-align:left; } - @media handheld { .covernote { visibility: visible; display: block;} } - .ol_1 li {font-size: .9em; } - @media handheld {.ol_1 li {padding-left: 1em; text-indent: 0em; } } - body {font-family: Georgia, serif; text-align: justify; } - table {font-size: .9em; } - .figcenter {font-size: .9em; } - div.titlepage {text-align: center; page-break-before: always; - page-break-after: always; } - div.titlepage p {text-align: center; text-indent: 0em; font-weight: bold; - line-height: 1.5; margin-top: 3em; } - </style> - </head> - <body> - - -<pre> - -The Project Gutenberg EBook of Lumber Legal Opinions, by Anonymous - -This eBook is for the use of anyone anywhere in the United States and most -other parts of the world at no cost and with almost no restrictions -whatsoever. You may copy it, give it away or re-use it under the terms of -the Project Gutenberg License included with this eBook or online at -www.gutenberg.org. If you are not located in the United States, you'll have -to check the laws of the country where you are located before using this ebook. - -Title: Lumber Legal Opinions - -Author: Anonymous - -Release Date: August 18, 2019 [EBook #60134] - -Language: English - -Character set encoding: UTF-8 - -*** START OF THIS PROJECT GUTENBERG EBOOK LUMBER LEGAL OPINIONS *** - - - - -Produced by Richard Tonsing and the Online Distributed -Proofreading Team at http://www.pgdp.net (This file was -produced from images generously made available by The -Internet Archive) - - - - - - -</pre> - - -<div class='tnotes covernote'> - -<p class='c000'><b>Transcriber’s Note:</b></p> - -<p class='c000'>The cover image was created by the transcriber and is placed in the public domain.</p> - -</div> - -<div class='titlepage'> - -<div> - <h1 class='c001'>LUMBER<br /> <span class='xlarge'>LEGAL OPINIONS</span></h1> -</div> - -<div class='figcenter id001'> -<img src='images/ititle.jpg' alt='' class='ig001' /> -</div> - -<div class='nf-center-c0'> -<div class='nf-center c002'> - <div>1910</div> - <div class='c002'><span class='small'>PUBLISHED BY</span></div> - <div class='c003'><span class='large'>NATIONAL WHOLESALE LUMBER DEALERS ASSOCIATION</span></div> - <div class='c003'>66 BROADWAY, - NEW YORK</div> - </div> -</div> - -</div> - -<div class='chapter'> - <h2 class='c004'>OFFICERS 1910–1911</h2> -</div> - -<table class='table0' summary=''> - <tr> - <td class='c005'>President</td> - <td class='c006'>ROBERT W. HIGBIE</td> - </tr> - <tr> - <td class='c005'>First Vice-President</td> - <td class='c006'>FRED R. BABCOCZ</td> - </tr> - <tr> - <td class='c005'>Second Vice-President</td> - <td class='c006'>FRANKLIN E. PARKER</td> - </tr> - <tr> - <td class='c005'>Treasurer</td> - <td class='c006'>FRED’K W. COLE</td> - </tr> - <tr> - <td class='c005'>Secretary</td> - <td class='c006'>E. F. PERRY</td> - </tr> - <tr><td> </td></tr> - <tr><td> </td></tr> - <tr><th class='c007' colspan='2'>BOARD OF TRUSTEES</th></tr> - <tr><td> </td></tr> - <tr><th class='c007' colspan='2'>Terms expire in 1911</th></tr> - <tr><td> </td></tr> - <tr> - <td class='c005'>LEWIS DILL</td> - <td class='c006'>Baltimore, Md.</td> - </tr> - <tr> - <td class='c005'>C. H. PRESCOTT, Jr.</td> - <td class='c006'>Cleveland, O.</td> - </tr> - <tr> - <td class='c005'>G. F. CRAIG</td> - <td class='c006'>Philadelphia, Pa.</td> - </tr> - <tr> - <td class='c005'>A. L. STONE</td> - <td class='c006'>Cleveland, O.</td> - </tr> - <tr> - <td class='c005'>W. W. KNIGHT</td> - <td class='c006'>Indianapolis, Ind.</td> - </tr> - <tr> - <td class='c005'>W. E. LITCHFIELD</td> - <td class='c006'>Boston, Mass.</td> - </tr> - <tr> - <td class='c005'>W. W. REILLEY</td> - <td class='c006'>Buffalo, N. Y.</td> - </tr> - <tr><td> </td></tr> - <tr><td> </td></tr> - <tr><th class='c007' colspan='2'>Terms expire in 1912</th></tr> - <tr><td> </td></tr> - <tr> - <td class='c005'>R. D. BAKER</td> - <td class='c006'>Pittsburg, Pa.</td> - </tr> - <tr> - <td class='c005'>G. C. EDWARDS</td> - <td class='c006'>Ottawa, Ont.</td> - </tr> - <tr> - <td class='c005'>F. W. COLE</td> - <td class='c006'>New York City</td> - </tr> - <tr> - <td class='c005'>R. H. DOWNMAN</td> - <td class='c006'>New Orleans, La.</td> - </tr> - <tr> - <td class='c005'>F. E. PARKER</td> - <td class='c006'>Saginaw, Mich.</td> - </tr> - <tr> - <td class='c005'>R. W. HIGBIE</td> - <td class='c006'>New York City</td> - </tr> - <tr> - <td class='c005'>HORTON CORWIN, Jr.</td> - <td class='c006'>Edenton, N. C.</td> - </tr> - <tr><td> </td></tr> - <tr><td> </td></tr> - <tr><th class='c007' colspan='2'>Terms expire in 1913</th></tr> - <tr><td> </td></tr> - <tr> - <td class='c005'>F. R. BABCOCK</td> - <td class='c006'>Pittsburg, Pa.</td> - </tr> - <tr> - <td class='c005'>N. H. WALCOTT</td> - <td class='c006'>Providence, R. I.</td> - </tr> - <tr> - <td class='c005'>T. J. MOFFETT</td> - <td class='c006'>Cincinnati, O.</td> - </tr> - <tr> - <td class='c005'>F. S. UNDERHILL</td> - <td class='c006'>Philadelphia, Pa.</td> - </tr> - <tr> - <td class='c005'>L. L. BARTH</td> - <td class='c006'>Chicago, Ill.</td> - </tr> - <tr> - <td class='c005'>J. V. STIMSON</td> - <td class='c006'>Huntingburg, Ind.</td> - </tr> - <tr> - <td class='c005'>W. A. GILCHRIST</td> - <td class='c006'>Memphis, Tenn.</td> - </tr> -</table> - -<div class='chapter'> - <h2 class='c004'>PREFACE</h2> -</div> - -<p class='c008'>In presenting “Lumber Legal Opinions” to our members and to -some of our friends whom we particularly desire to become members -of our Association, not only for the good their co-operation will -do us, but for their own benefit as well, we desire to say that this -compilation is based upon the practical working out of specific cases -for our members during the past few years. An examination will, -we think, prove the work to be practical and dependable, and generally -to express good common sense, and consequently good law. -You will, we hope, find it worth your careful study and guidance. -In some instances the opinions may be affected by court decisions -of the respective States; some of these decisions are specifically -referred to, but, as a rule, it has been our aim to secure opinions -covering a general situation.</p> - -<p class='c009'>This gives us an opportunity to remind you of the special -work which this Association is constantly undertaking for its members -and especially that it is worthy of your earnest co-operation -and special effort to bring in new members, so that the influence -of the organization may be enlarged and made in every way -worthy of its name.</p> - -<hr class='c010' /> - -<div class='sidenote'>Purpose of the Association</div> - -<p class='c009'>The Charter defines the Purpose of the Association to be “to -protect the members against unbusinesslike methods in the wholesale -and retail trade; to foster such trade and commerce; -to reform abuses in such trade or business; -to secure freedom from unjust or unlawful -exactions; to diffuse accurate information among -its members as to the standing of merchants and -others by and with whom said trade or business is conducted, and -as to other matters to produce uniformity and certainty in the customs -and usages of said trade and of those engaged therein; to -settle differences between its members, and to promote a more -large and friendly intercourse between them.”</p> - -<div class='sidenote'>Bureau of Information or Credit Department</div> - -<p class='c009'>The Charter and By-Laws of the Association defines the duty of -this Bureau to be as follows: “To diffuse accurate information -as to the standing of merchants.” There are in the -records of this Bureau at the present time 28,000 -reports showing the financial condition of an equal -number of buyers of lumber. In addition to these -financial statements all of these buyers of lumber -are rated by the Bureau as to their credit standing as well. It is -the unanimous opinion of our members who use this Bureau that -the reports are superior to those of any other mercantile agency -or other source of information. The Bureau makes a specialty of -securing reports only on lumber buyers or users, and it therefore -furnishes more complete and reliable reports as to moral and financial -standing and business methods than any other agency. A system -is also a part of the Bureau whereby important information is -sent to each subscriber without the subscriber making special request -therefor; in other words, it is the aim of the Bureau to keep its subscribers -fully and promptly advised of all important business -changes.</p> - -<div class='c002'></div> -<div class='sidenote'>Legal and Collection Department</div> - -<p class='c009'>In connection with and as a part of the Bureau of Information -there has been established a legal and collection department. This -department handles commercial claims, past due -accounts, etc., sent to it with promptness and at a -minimum cost when compared with the usual -methods employed by attorneys and the courts; also -has on file much information, including legal opinions -and court decisions which are furnished upon request without -charge.</p> - -<div class='c002'></div> -<div class='sidenote'>Railroad and Transportation Bureau</div> - -<p class='c009'>The Railroad and Transportation Committee through its Bureau -is in a position to be of the greatest service to our members, because -of the intimate knowledge which our Traffic Manager -has of all matters that have to do with our -relations with the railroads.</p> - -<p class='c009'>Information and assistance covering a wide range -of transportation subjects is being constantly rendered. -There are also on file complete lumber tariffs which are -kept up to date, and this enables our members to obtain correct -information as to rates, routing, etc. Upon request, shipments are -traced and prompt deliveries effected. The above services are -furnished to our members entirely free of charge.</p> - -<p class='c008'>This Bureau also investigates and collects claims for loss or -damage in transit, overcharges in rates, weight, mis-routing, etc. -For these services a nominal charge is made based on the actual -amount collected. The manager of this Bureau has had years of -experience and possesses intimate knowledge of the methods pursued -by the various claim departments of the railroads and he is -therefore in a position promptly to collect any just claims and frequently -has been able to collect claims which our members have been -unable to collect themselves. In this connection it may be well to -state that all shippers of lumber are entitled to free allowances in -weight of five hundred pounds for car stakes used on flat and gondola -cars, and this Bureau has secured many refunds on past shipments -for members who have not been allowed this free weight. -The Bureau is also in a position to compel the railroads not now -making the allowances, to do so.</p> - -<div class='c002'></div> -<div class='sidenote'>Arbitration</div> - -<p class='c009'>The By-Laws define the duties of the Arbitration Committee -to be “to settle differences between our members.” The services -of this committee are at the disposal of our members -at the actual cost of the expenses of three selected -men from among the members of this committee -who thoroughly understand the customs of the lumber -trade. Any member who avails himself of the services of this -committee consequently obtains at an actual cost the services of a -jury of experts, with the result that differences are settled fairly, -equitably and promptly and without any annoyances and undue -expenses.</p> - -<div class='c002'></div> -<div class='sidenote'>Legislation Committee</div> - -<p class='c009'>“To reform abuses” and “to secure freedom from unjust or -unlawful exactions” is jointly the work of several Committees. -For freedom from unjust and burdensome laws and -for laws granting us security and reasonable opportunity -in the conduct of our business, we look to -the Legislation Committee, whose duty it is to -scrutinize acts affecting the trade, to oppose those -which oppress, and to favor and forward those which assist.</p> - -<div class='c002'></div> -<div class='sidenote'>Forestry and Conservation</div> - -<p class='c009'>“To foster such trade and commerce” by perpetuating the raw -material which forms the basis of all lumber business, we have -our Forestry Committee. The people of this country, -with its tremendous sources of timber supply, -must be educated to grasp the possibility of a future -famine, and needful legislation must be enacted to -reduce the problem of reforestation to a practical -business proposition before the scarcity of timber shall enhance the -values of stumpage to the point of placing trees as a crop in the -same class with grain and cotton. The Advisory Forestry Committee -links our Association with the country at large in this movement.</p> - -<div class='c002'></div> -<div class='sidenote'>Fire and Marine Insurance</div> - -<p class='c009'>The services performed by the members of these committees -in past years have most fully justified their existence in the reduction -which has been obtained not only for our -members, but for all lumbermen both in fire insuring -companies as well as in marine insuring companies. -These savings amount annually to a sum which is -estimated at more than one million dollars in premiums.</p> - -<div class='c002'></div> -<div class='sidenote'>Hardwood Inspection</div> - -<p class='c009'>Our Association stands for not only a national but an international -set of rules to govern the grading and inspection of hardwood -lumber. In all lines of business nothing is -more desirable and necessary than uniformity. It -is the aim of the Hardwood Inspection Committee -to secure the adoption of a reasonable and universal -set of rules for the inspection of hardwood lumber.</p> - -<div class='c002'></div> -<div class='sidenote'>Management</div> - -<p class='c009'>The Active Management of the Association is in the hands of -a board of twenty-one trustees, operating with the -Officers and the Executive Committee, through the -Secretary and his assistants.</p> - -<div class='c002'></div> -<div class='sidenote'>Headquarters</div> - -<p class='c009'>The offices of the Association are at 66 Broadway, New York, -centrally located in the business section of the city. -Members have the unrestricted privilege of using -these offices as the headquarters for receiving mail -and telegrams, and for business conferences.</p> - -<div class='c002'></div> -<div class='sidenote'>Membership</div> - -<p class='c009'>The four hundred Lumbermen who are members are ready -and willing to testify to the advantages to be derived from connection -with this Association. Coming from 28 States -and Canada, they are qualified by numbers and -ability to cope with all questions affecting the manufacture -and wholesale distribution of lumber.</p> - -<p class='c008'>Membership in our Association is restricted to legitimate manufacturers -of lumber and wholesale dealers in lumber who are in -good standing in the trade.</p> - -<p class='c008'>There is no initiation fee. The annual dues are $50.00, with -a charge of $50.00 additional to those who desire the benefits of the -Bureau of Information. The Collection Department and Transportation -Bureau are open to all members without charge other -than the very moderate fees scheduled for actual work performed.</p> - -<div class='figcenter id002'> -<img src='images/i006.jpg' alt='' class='ig001' /> -</div> - -<p class='c011'>These opinions and abstracts were compiled, and arranged under the -supervision of the LEGAL DEPARTMENT, BUREAU OF INFORMATION, -W. W. Schupner, Department Manager.</p> - -<div class='chapter'> - <h2 class='c004'>INDEX</h2> -</div> - -<p class='c008'>The cross index is arranged so as to bring out the several points -in each opinion or extract. The number at the left, following each -opinion or extract, indicates the number of such opinion or extract -referred to in the index. The first number after the subject gives -the number of the opinion and the second the page number, for -example: after “acceptance of checks sent in full settlement” appear -18–21, denoting that the information can be obtained from opinion -18 on page <a href='#Page_21'>21</a>. The other figures after the same subject indicate the -other opinions and pages where similar information is given.</p> - -<hr class='c010' /> - -<div class='nf-center-c0'> - <div class='nf-center'> - <div><b>First number gives number of opinion; second number gives page number.</b></div> - </div> -</div> - -<ul class='index'> - <li class='c012'><i>Agent.</i> - <ul> - <li>Authority of salesman to bind principal, 35–<a href='#Page_36'>36</a></li> - <li>Carrier as agent—see common carriers</li> - <li>License in New York City, 3–<a href='#Page_17'>17</a></li> - <li>May receive notice for principal, 88–<a href='#Page_74'>74</a></li> - <li>See also certificate to do business.</li> - </ul> - </li> - <li class='c012'><i>Acceptance of</i> - <ul> - <li>checks sent in full settlement, 18–<a href='#Page_21'>21</a>, 20–<a href='#Page_28'>28</a>, 51–<a href='#Page_49'>49</a>, 66–<a href='#Page_60'>60</a>, 80–<a href='#Page_68'>68</a>, 95–<a href='#Page_77'>77</a></li> - <li>delayed shipments avoids claim for delay, 87–<a href='#Page_73'>73</a></li> - <li>draft does not avoid claim for inferior lumber, 92–<a href='#Page_76'>76</a></li> - <li>less than invoice price, 109–<a href='#Page_89'>89</a></li> - <li>offer constitutes valid contract, 72–<a href='#Page_65'>65</a>, 96–<a href='#Page_79'>79</a></li> - <li>order through salesman, when it is complete, 96–<a href='#Page_78'>78</a></li> - <li>shipment affected by statute (New Jersey), 81–<a href='#Page_69'>69</a></li> - <li>shipment affected by warranty, 62–<a href='#Page_57'>57</a>, 102–<a href='#Page_83'>83</a>, 108–<a href='#Page_89'>89</a></li> - <li>shipment unless promptly rejected, 62–<a href='#Page_57'>57</a></li> - <li>shipment validates verbal contract, 65–<a href='#Page_59'>59</a>, 86–<a href='#Page_72'>72</a></li> - <li>shipment when it is all or partially used, 34–<a href='#Page_36'>36</a>, 90–<a href='#Page_75'>75</a>, 102–<a href='#Page_83'>83</a></li> - <li>shipment when it is retained, 6–<a href='#Page_17'>17</a>, 31–<a href='#Page_48'>48</a></li> - <li>shipment when it is used may depend on a private custom, 90–<a href='#Page_75'>75</a></li> - </ul> - </li> - <li class='c012'>Acceptance necessary to make valid contract, 72–<a href='#Page_65'>65</a>, 96–<a href='#Page_79'>79</a></li> - <li class='c012'>Accord and satisfaction, 18–<a href='#Page_21'>21</a>, 20–<a href='#Page_28'>28</a>, 51–<a href='#Page_49'>49</a>, 66–<a href='#Page_60'>60</a>, 80–<a href='#Page_68'>68</a>, 95–<a href='#Page_78'>78</a></li> - <li class='c012'>Accounting by executor, 23–<a href='#Page_26'>26</a></li> - <li class='c012'>Accounts stated—what does it consist of and what advantage, 101–<a href='#Page_82'>82</a></li> - <li class='c012'>Assignment for creditors voided by bankruptcy, 14–<a href='#Page_22'>22</a></li> - <li class='c012'>Assignment of account by foreign corporation (New York), 63–<a href='#Page_58'>58</a></li> - <li class='c002'><i>Banking.</i> - <ul> - <li>Certification of check releases maker, 45–<a href='#Page_43'>43</a>, 104–<a href='#Page_85'>85</a></li> - <li>Liability of bank for failure to give notice of protest to endorser of note, 99–<a href='#Page_81'>81</a></li> - <li>Protest not always necessary, 52–<a href='#Page_50'>50</a></li> - </ul> - </li> - <li class='c012'><i>Bankruptcy.</i> - <ul> - <li>Avoids assignment of creditors, 14–<a href='#Page_22'>22</a></li> - <li>Discharge not prevented by giving bad check, 41–<a href='#Page_39'>39</a></li> - <li>Discharge, what will prevent it, 97–<a href='#Page_79'>79</a></li> - </ul> - </li> - <li class='c012'><i>Bill of Lading.</i> - <ul> - <li>in name of buyer may not release seller, 53–<a href='#Page_51'>51</a></li> - <li>may be required for surrender of shipment, 29–<a href='#Page_34'>34</a></li> - <li>stipulation as to delivery, 11–<a href='#Page_20'>20</a></li> - <li>stipulation as to notice of arrival, 25–<a href='#Page_31'>31</a></li> - <li>to order retains title, 70–<a href='#Page_62'>62</a></li> - </ul> - </li> - <li class='c012'>Breach of contract—see contracts.</li> - <li class='c012'>Buyer’s position when lumber offered is not as per contract, 37–<a href='#Page_33'>33</a></li> - <li class='c002'>Cancelling contract when one party guilty of breach, 5–<a href='#Page_14'>14</a>, 47–<a href='#Page_44'>44</a>, 67–<a href='#Page_61'>61</a>, 71–<a href='#Page_64'>64</a></li> - <li class='c012'>Cancelling order by purchaser before accepted by seller’s home office, 96–<a href='#Page_79'>79</a></li> - <li class='c012'>Cancelling order for non-delivery or delay, 43–<a href='#Page_41'>41</a>, 84–<a href='#Page_71'>71</a></li> - <li class='c012'>Carload of lumber must all be in accordance with order to fulfill contract, 76–<a href='#Page_66'>66</a></li> - <li class='c012'>Certification of check binds bank and releases maker, 45–<a href='#Page_43'>43</a>, 104–<a href='#Page_85'>85</a></li> - <li class='c012'>Certificate for individual to do business in New Jersey or New York, 10–<a href='#Page_22'>22</a></li> - <li class='c012'><i>Certificate to do Business.</i> - <ul> - <li>Indiana, 106–<a href='#Page_86'>86</a></li> - <li>Kentucky, 106–<a href='#Page_87'>87</a></li> - <li>Maryland, 55–<a href='#Page_52'>52</a></li> - <li>Michigan, 106–<a href='#Page_88'>88</a></li> - <li>Mississippi, 106–<a href='#Page_87'>87</a></li> - <li>New Jersey, 17–<a href='#Page_18'>18</a>, 64–<a href='#Page_58'>58</a></li> - <li>New York, 17–<a href='#Page_19'>19</a>, 26–<a href='#Page_32'>32</a>, 63–<a href='#Page_57'>57</a>, 106–<a href='#Page_88'>88</a></li> - <li>Ohio, 106–<a href='#Page_87'>87</a></li> - <li>Pennsylvania, 19–<a href='#Page_24'>24</a></li> - <li>Tennessee, 106–<a href='#Page_87'>87</a></li> - <li>West Virginia, 106–<a href='#Page_86'>86</a></li> - </ul> - </li> - <li class='c012'>Change in original order no excuse for refusing shipment, 1–<a href='#Page_13'>13</a></li> - <li class='c012'>Checks sent in full settlement, etc., 18–<a href='#Page_21'>21</a>, 20–<a href='#Page_28'>28</a>, 51–<a href='#Page_49'>49</a>, 66–<a href='#Page_60'>60</a>, 80–<a href='#Page_68'>68</a>, 95–<a href='#Page_77'>77</a></li> - <li class='c012'><i>Common Carriers.</i> - <ul> - <li>Agent for buyer, 33–<a href='#Page_77'>77</a>, 53–<a href='#Page_51'>51</a>, 70–<a href='#Page_62'>62</a>, 88–<a href='#Page_74'>74</a></li> - <li>Agent for seller, 22–<a href='#Page_28'>28</a>, 37–<a href='#Page_33'>33</a>, 70–<a href='#Page_62'>62</a>, 88–<a href='#Page_74'>74</a></li> - <li>Can insist upon acceptance of delayed delivery, 13–<a href='#Page_47'>47</a>, 56–<a href='#Page_53'>53</a></li> - <li>Claim for loss or damage, 13–<a href='#Page_47'>47</a>, 46–<a href='#Page_42'>42</a>, 56–<a href='#Page_53'>53</a>, 59–<a href='#Page_54'>54</a>, 73–<a href='#Page_65'>65</a></li> - <li>Liability as warehouseman, 8–<a href='#Page_16'>16</a>, 48–<a href='#Page_44'>44</a></li> - <li>Liability for delay, 13–<a href='#Page_47'>47</a></li> - <li>Liability for delivery without surrender of Bill of Lading, 29–<a href='#Page_34'>34</a>, 58–<a href='#Page_54'>54</a></li> - <li>May return rejected shipment to consignor, 58–<a href='#Page_54'>54</a></li> - <li>Must deliver shipment as directed, 11–<a href='#Page_20'>20</a>, 61–<a href='#Page_56'>56</a></li> - <li>Not always compelled to notify consignor that shipment is rejected by consignee, 61–<a href='#Page_56'>56</a></li> - <li>Not bound to act as intermediary, 58–<a href='#Page_54'>54</a>, 61–<a href='#Page_56'>56</a></li> - <li>Notice to, when loading complete, 8–<a href='#Page_15'>15</a></li> - <li>Obligation to send notice of arrival, 8–<a href='#Page_16'>16</a>, 25–<a href='#Page_31'>31</a>, 28–<a href='#Page_33'>33</a>, 48–<a href='#Page_44'>44</a></li> - <li>Should pay value at destination for lumber lost, 59–<a href='#Page_55'>55</a>, 73–<a href='#Page_65'>65</a></li> - <li>Stopping shipments in transit, 27–<a href='#Page_29'>29</a>, 79–<a href='#Page_68'>68</a>, 105–<a href='#Page_85'>85</a></li> - <li>When can charge demurrage, 25–<a href='#Page_31'>31</a></li> - <li>When liability begins and ends, 8–<a href='#Page_16'>16</a>, 48–<a href='#Page_44'>44</a></li> - </ul> - </li> - <li class='c012'>Conditional clauses on letter-heads, orders, etc., 24–<a href='#Page_27'>27</a>, 110–<a href='#Page_48'>48</a>, 50–<a href='#Page_46'>46</a>, 82–<a href='#Page_70'>70</a></li> - <li class='c012'>Confirmation of order by home office, 65–<a href='#Page_59'>59</a>, 96–<a href='#Page_78'>78</a></li> - <li class='c012'>Confirmation as to time of shipment, 36–<a href='#Page_35'>35</a></li> - <li class='c012'><i>Contract.</i> - <ul> - <li>Acceptance of offer constitutes valid contract, 72–<a href='#Page_65'>65</a>, 96–<a href='#Page_79'>79</a></li> - <li>Against liability for delay in shipping, 24–<a href='#Page_26'>26</a></li> - <li>Breach for failure to make good delivery, 6–<a href='#Page_18'>18</a>, 37–<a href='#Page_33'>33</a></li> - <li>Breach for non-delivery, 22–<a href='#Page_28'>28</a>, 30–<a href='#Page_30'>30</a>, 39–<a href='#Page_38'>38</a>, 43–<a href='#Page_41'>41</a>, 84–<a href='#Page_71'>71</a></li> - <li>Conditions must all be part of contract, 24–<a href='#Page_27'>27</a>, 50–<a href='#Page_46'>46</a>, 110–<a href='#Page_48'>48</a>, 82–<a href='#Page_70'>70</a></li> - <li>Incomplete when only part of car as per order, 76–<a href='#Page_66'>66</a></li> - <li>May be cancelled when one party guilty of breach, 5–<a href='#Page_14'>14</a>, 47–<a href='#Page_44'>44</a>, 67–<a href='#Page_61'>61</a>, 71–<a href='#Page_64'>64</a></li> - <li>May be void if a mistake in it is obvious, 72–<a href='#Page_65'>65</a></li> - <li>Should be in writing and signed, 65–<a href='#Page_59'>59</a></li> - <li>Valid by acceptance of offer, 72–<a href='#Page_65'>65</a>, 96–<a href='#Page_79'>79</a></li> - </ul> - </li> - <li class='c012'>Conveyance in F. O. B. shipment, 42–<a href='#Page_40'>40</a></li> - <li class='c012'>Corporations (foreign) see certificate to do business.</li> - <li class='c012'>Credit cannot be demanded when business transferred, 40–<a href='#Page_39'>39</a></li> - <li class='c012'>Credit must be kept good, 30–<a href='#Page_30'>30</a>, 39–<a href='#Page_38'>38</a>, 47–<a href='#Page_44'>44</a>, 67–<a href='#Page_60'>60</a>, 71–<a href='#Page_64'>64</a>, 79–<a href='#Page_68'>68</a>, 91–<a href='#Page_75'>75</a></li> - <li class='c012'>Custom—private and general—as to using a shipment, 90–<a href='#Page_74'>74</a></li> - <li class='c002'>Damage claim against carrier, amount of claim, 13–<a href='#Page_47'>47</a>, 46–<a href='#Page_42'>42</a>, 56–<a href='#Page_53'>53</a>, 59–<a href='#Page_54'>54</a>, 73–<a href='#Page_65'>65</a></li> - <li class='c012'>Damage in transit, who responsible, 8–<a href='#Page_15'>15</a>, 54–<a href='#Page_51'>51</a></li> - <li class='c012'>Delay beyond shipper’s control, 50–<a href='#Page_46'>46</a>, 84–<a href='#Page_71'>71</a></li> - <li class='c012'>Delay by carrier, liability for, 13–<a href='#Page_47'>47</a></li> - <li class='c012'>Delay in shipment, liability for, 24–<a href='#Page_27'>27</a>, 50–<a href='#Page_46'>46</a>, 84–<a href='#Page_71'>71</a></li> - <li class='c012'>Delayed delivery, acceptance of, avoids claims for damages, 87–<a href='#Page_73'>73</a></li> - <li class='c012'>Delayed delivery by carrier should be accepted, 13–<a href='#Page_47'>47</a>, 56–<a href='#Page_53'>53</a></li> - <li class='c012'>Delayed delivery need not be accepted as fulfilling contract, 84–<a href='#Page_71'>71</a>, 87–<a href='#Page_73'>73</a></li> - <li class='c012'><i>Delivery.</i> - <ul> - <li>Delayed, liability for, 24–<a href='#Page_27'>27</a>, 50–<a href='#Page_46'>46</a>, 84–<a href='#Page_71'>71</a></li> - <li>In installments, 5–<a href='#Page_14'>14</a>, 43–<a href='#Page_41'>41</a>, 44–<a href='#Page_41'>41</a>, 47–<a href='#Page_44'>44</a>, 86–<a href='#Page_72'>72</a>, 102–<a href='#Page_83'>83</a></li> - <li>Liability for non-delivery, 22–<a href='#Page_28'>28</a>, 30–<a href='#Page_30'>30</a>, 39–<a href='#Page_38'>38</a>, 43–<a href='#Page_41'>41</a>, 49–<a href='#Page_45'>45</a>, 91–<a href='#Page_75'>75</a></li> - <li>May be stopped when buyer becomes insolvent, 27–<a href='#Page_29'>29</a>, 71–<a href='#Page_64'>64</a>, 79–<a href='#Page_68'>68</a></li> - <li>May not affect original purchaser, 38–<a href='#Page_35'>35</a></li> - <li>Delivery must be complete, 31–<a href='#Page_48'>48</a>, 76–<a href='#Page_66'>66</a></li> - <li>Delivery must be made by carriers as directed, 11–<a href='#Page_20'>20</a>, 61–<a href='#Page_56'>56</a></li> - <li>Not in accordance with contract, 37–<a href='#Page_33'>33</a></li> - <li>On consignee’s side-track, 48–<a href='#Page_45'>45</a></li> - <li>What constitutes, on F. O. B. sales, 8–<a href='#Page_15'>15</a>, 37–<a href='#Page_33'>33</a>, 42–<a href='#Page_40'>40</a>, 53–<a href='#Page_50'>50</a>, 70–<a href='#Page_62'>62</a></li> - </ul> - </li> - <li class='c012'>Demand that shipment be returned cannot be enforced, 6–<a href='#Page_18'>18</a></li> - <li class='c012'>Demurrage—see common carriers.</li> - <li class='c012'>Discount must be in accordance with terms, 18–<a href='#Page_21'>21</a>, 57–<a href='#Page_53'>53</a>, 69–<a href='#Page_61'>61</a></li> - <li class='c012'>Draft (accepted) with Bill of Lading does not avoid claim for inferior lumber, 92–<a href='#Page_76'>76</a></li> - <li class='c012'>Draft with Bill of Lading to order, 70–<a href='#Page_62'>62</a></li> - <li class='c012'>Due notice, what does it mean, etc., 83–<a href='#Page_71'>71</a></li> - <li class='c002'>Endorser on note entitled to notice of protest, 99–<a href='#Page_81'>81</a></li> - <li class='c012'>Executor, time for accounting, 23–<a href='#Page_26'>26</a></li> - <li class='c002'>False statement may prevent discharge in bankruptcy, 97–<a href='#Page_79'>79</a></li> - <li class='c012'>Fire delaying shipment, seller’s liability, 50–<a href='#Page_46'>46</a></li> - <li class='c012'>F. O. B.—what constitutes delivery, 8–<a href='#Page_15'>15</a>, 37–<a href='#Page_33'>33</a>, 42–<a href='#Page_40'>40</a>, 31–<a href='#Page_48'>48</a>, 53–<a href='#Page_50'>50</a>, 70–<a href='#Page_62'>62</a></li> - <li class='c012'>Foreign corporations—see certificates to do business.</li> - <li class='c012'>Freight as a consideration for passing title, 9–<a href='#Page_23'>23</a>, 53–<a href='#Page_50'>50</a>, 54–<a href='#Page_51'>51</a></li> - <li class='c012'>Freight rate advance, 110–<a href='#Page_48'>48</a></li> - <li class='c012'>Fraud, statute of, 65–<a href='#Page_59'>59</a></li> - <li class='c002'>Indefinite quantity, order for, 98–<a href='#Page_80'>80</a>, 103–<a href='#Page_84'>84</a></li> - <li class='c012'>Indiana—necessity of foreign corporations filing certificates, 106–<a href='#Page_86'>86</a></li> - <li class='c012'>Insolvents, shipments to, can be stopped, 27–<a href='#Page_29'>29</a>, 71–<a href='#Page_64'>64</a>, 79–<a href='#Page_68'>68</a></li> - <li class='c012'>Insolvency, cause for declining further shipments, 67–<a href='#Page_61'>61</a>, 71–<a href='#Page_63'>63</a>, 91–<a href='#Page_75'>75</a></li> - <li class='c012'>Inspection on arrival—privilege of, 62–<a href='#Page_57'>57</a>, 92–<a href='#Page_76'>76</a>, 102–<a href='#Page_83'>83</a></li> - <li class='c012'><i>Installment Shipments.</i> - <ul> - <li>Acceptance of one installment validates verbal contract, 86–<a href='#Page_72'>72</a></li> - <li>Contract for delivery, not separable, 5–<a href='#Page_14'>14</a>, 93–<a href='#Page_77'>77</a>, 102–<a href='#Page_83'>83</a>, - <ul> - <li>(see Minnesota case), 107–<a href='#Page_88'>88</a></li> - </ul> - </li> - <li>Cancelling for non-payment, 47–<a href='#Page_44'>44</a>, 71–<a href='#Page_64'>64</a></li> - <li>Cancelling order for non-delivery, 43–<a href='#Page_41'>41</a></li> - <li>Delay in shipment, 44–<a href='#Page_41'>41</a></li> - <li>Using one installment may constitute waiver of objection to subsequent installments, 102–<a href='#Page_83'>83</a></li> - </ul> - </li> - <li class='c012'>Invoice terms not effective unless part of contract, 82–<a href='#Page_70'>70</a></li> - <li class='c002'>Judgment in one state ground for suit in another, 60–<a href='#Page_55'>55</a></li> - <li class='c002'>Kentucky, necessity of foreign corporations filing certificate, 106–87</li> - <li class='c002'>Loss for non-delivery of lumber, 49–<a href='#Page_45'>45</a></li> - <li class='c012'>Loss for reselling shipment refused on arrival—method of recovery, 1–<a href='#Page_13'>13</a>, 5–<a href='#Page_14'>14</a>, 78–<a href='#Page_67'>67</a>, 94–<a href='#Page_77'>77</a></li> - <li class='c012'>Lost shipment, amount of claim against carrier, 59–<a href='#Page_55'>55</a>, 73–<a href='#Page_65'>65</a></li> - <li class='c002'>Maryland, necessity of foreign corporations filing certificate, 55–<a href='#Page_52'>52</a></li> - <li class='c012'>Maximum and minimum amounts in contract of sale, 98–<a href='#Page_80'>80</a>, 103–<a href='#Page_84'>84</a></li> - <li class='c012'>Measure of claim against carrier, 13–<a href='#Page_47'>47</a>, 46–<a href='#Page_42'>42</a>, 56–<a href='#Page_53'>53</a>, 59–<a href='#Page_54'>54</a>, 73–<a href='#Page_65'>65</a></li> - <li class='c012'>Michigan, necessity of foreign corporations filing certificate, 106–<a href='#Page_88'>88</a></li> - <li class='c012'>Mississippi, necessity of foreign corporations filing certificate, 106–<a href='#Page_87'>87</a></li> - <li class='c012'>Mistake must be obvious to avoid contract, 72–<a href='#Page_65'>65</a></li> - <li class='c002'>New Jersey—certificate for individual dealing under assumed name, 10–<a href='#Page_22'>22</a></li> - <li class='c012'>New Jersey lien law, 21–<a href='#Page_32'>32</a></li> - <li class='c012'>New Jersey—necessity of foreign corporations filing certificate, 17–<a href='#Page_18'>18</a>, 64–<a href='#Page_58'>58</a></li> - <li class='c012'>New Jersey statute affects acceptance, 81–<a href='#Page_69'>69</a></li> - <li class='c012'>New York City license for agent, 3–<a href='#Page_17'>17</a></li> - <li class='c012'>New York State certificate for individual dealing under assumed name, 10–<a href='#Page_22'>22</a></li> - <li class='c012'>New York—necessity of foreign corporations filing certificate, 17–<a href='#Page_19'>19</a>, 26–<a href='#Page_32'>32</a>, 63–<a href='#Page_57'>57</a>, 106–<a href='#Page_88'>88</a></li> - <li class='c012'>Non-suit for foreign corporations—see certificates to do business.</li> - <li class='c012'><i>Notice.</i> - <ul> - <li>As to non-delivery, 49–<a href='#Page_45'>45</a></li> - <li>Of arrival by carrier, 8–<a href='#Page_16'>16</a>, 25–<a href='#Page_31'>31</a>, 28–<a href='#Page_33'>33</a>, 48–<a href='#Page_44'>44</a></li> - <li>To agent is notice to principal, 88–<a href='#Page_74'>74</a></li> - <li>To carrier when loading complete, 8–<a href='#Page_15'>15</a></li> - <li>To carrier as to measure of damages, 46–<a href='#Page_43'>43</a></li> - <li>What constitutes reasonable notice, 83–<a href='#Page_71'>71</a></li> - </ul> - </li> - <li class='c002'>Offer accepted constitutes valid contract, 72–<a href='#Page_65'>65</a>, 96–<a href='#Page_79'>79</a></li> - <li class='c012'>Offer may be withdrawn until accepted, 96–<a href='#Page_79'>79</a></li> - <li class='c012'>Ohio—necessity of foreign corporations filing certificate, 106–<a href='#Page_87'>87</a></li> - <li class='c012'>Order, confirmation by home office, 65–<a href='#Page_59'>59</a>, 96–<a href='#Page_78'>78</a></li> - <li class='c002'>Partial payment validates verbal contract, 65–<a href='#Page_59'>59</a>, 86–<a href='#Page_72'>72</a></li> - <li class='c012'>Partial shipments—see installment shipments.</li> - <li class='c012'>Pennsylvania—necessity of foreign corporations filing certificate, 19–<a href='#Page_24'>24</a></li> - <li class='c012'>Postscripts on letters or contracts should be signed, 82–<a href='#Page_70'>70</a></li> - <li class='c012'>Principal bound by notice to agent, 88–<a href='#Page_74'>74</a></li> - <li class='c012'>Principal not always bound by salesman’s act, 35–<a href='#Page_36'>36</a></li> - <li class='c012'>Prompt rejection of shipment necessary to avoid acceptance, 62–<a href='#Page_57'>57</a></li> - <li class='c012'>Protest not always necessary, 52–<a href='#Page_50'>50</a></li> - <li class='c002'>Quantity, order for indefinite quantity, 98–<a href='#Page_80'>80</a>, 103–<a href='#Page_84'>84</a></li> - <li class='c002'>Railroads—see common carriers.</li> - <li class='c012'>Reasonable time for shipment, unless otherwise agreed, 36–<a href='#Page_35'>35</a></li> - <li class='c012'>Reasonable time, what does it mean, 13–<a href='#Page_47'>47</a>, 62–<a href='#Page_57'>57</a>, 83–<a href='#Page_71'>71</a></li> - <li class='c012'>Refusal of seller to make deliveries, 49–<a href='#Page_45'>45</a></li> - <li class='c012'>Refusing shipment on arrival, 1–<a href='#Page_13'>13</a>, 5–<a href='#Page_14'>14</a>, 56–<a href='#Page_52'>52</a>, 78–<a href='#Page_67'>67</a>, 94–<a href='#Page_77'>77</a></li> - <li class='c012'>Refusing to send shipping instructions for lumber ordered, 12–<a href='#Page_20'>20</a></li> - <li class='c012'>Rejection of shipment by notice to railroad, 88–<a href='#Page_74'>74</a></li> - <li class='c012'>Rejected shipment may be returned to consignor by carrier, 58–<a href='#Page_54'>54</a></li> - <li class='c012'>Rejection of shipment, carrier not always compelled to notify consignor, 61–<a href='#Page_56'>56</a></li> - <li class='c012'>Rejection of shipment must be prompt, 62–<a href='#Page_57'>57</a></li> - <li class='c012'>Reselling lumber refused on arrival, 1–<a href='#Page_13'>13</a>, 5–<a href='#Page_14'>14</a>, 78–<a href='#Page_67'>67</a>, 94–<a href='#Page_77'>77</a></li> - <li class='c012'>Retaining lumber shipped constitutes acceptance, 6–<a href='#Page_17'>17</a>, 34–<a href='#Page_36'>36</a></li> - <li class='c002'>Sales in installments—see installment shipments.</li> - <li class='c012'>Sales on credit, 30–<a href='#Page_30'>30</a>, 39–<a href='#Page_38'>38</a>, 40–<a href='#Page_39'>39</a>, 47–<a href='#Page_44'>44</a>, 67–<a href='#Page_60'>60</a>, 71–<a href='#Page_64'>64</a>, 79–<a href='#Page_68'>68</a>, 91–<a href='#Page_75'>75</a></li> - <li class='c012'>Sales of indefinite quantity, 98–<a href='#Page_80'>80</a>, 103–<a href='#Page_84'>84</a></li> - <li class='c012'>Salesman’s order, when accepted, 96–<a href='#Page_79'>79</a></li> - <li class='c012'>Salesman’s power to bind principal, 35–<a href='#Page_36'>36</a></li> - <li class='c012'>Selling lumber refused on arrival, 1–<a href='#Page_13'>13</a>, 5–<a href='#Page_14'>14</a>, 78–<a href='#Page_67'>67</a>, 94–<a href='#Page_77'>77</a></li> - <li class='c012'>Shipping instructions for lumber ordered, refusal to send, 12–<a href='#Page_20'>20</a></li> - <li class='c012'>Stated accounts, advantage of, 101–<a href='#Page_82'>82</a></li> - <li class='c012'>Statement of assets, etc., if false, may prevent discharge in bankruptcy, 97–<a href='#Page_79'>79</a></li> - <li class='c012'>Statute of fraud, 65–<a href='#Page_59'>59</a></li> - <li class='c012'>Stopping shipment in transit, 27–<a href='#Page_29'>29</a>, 71–<a href='#Page_64'>64</a>, 79–<a href='#Page_68'>68</a>, 105–<a href='#Page_85'>85</a></li> - <li class='c012'>Storing lumber refused on arrival, 1–<a href='#Page_13'>13</a>, 5–<a href='#Page_14'>14</a>, 78–<a href='#Page_67'>67</a></li> - <li class='c012'>Strike delaying shipment, seller’s liability, 50–<a href='#Page_46'>46</a></li> - <li class='c012'>Suit can be instituted in one state on judgment obtained in another state, 60–<a href='#Page_55'>55</a></li> - <li class='c012'>Suit by foreign corporation may not be maintained because of failure to file certificate—see certificate to do business.</li> - <li class='c002'>Taxes of foreign corporations, 89–<a href='#Page_74'>74</a>. - <ul> - <li>See also certificate to do business.</li> - </ul> - </li> - <li class='c012'>Tender in fulfillment of contract should be accepted or rejected as a whole, 31–<a href='#Page_48'>48</a></li> - <li class='c012'>Tennessee—necessity of foreign corporations filing certificate, 106–<a href='#Page_87'>87</a></li> - <li class='c012'>Terms of sale must be part of contract, 82–<a href='#Page_70'>70</a>. - <ul> - <li>See also conditional clauses on letter-heads, etc.</li> - </ul> - </li> - <li class='c012'>Terms of sale should stipulate discount, 18–<a href='#Page_21'>21</a>, 57–<a href='#Page_53'>53</a>, 69–<a href='#Page_61'>61</a></li> - <li class='c012'>Time of shipment, confirmation of, 36–<a href='#Page_35'>35</a></li> - <li class='c012'>Time of shipment, reasonable unless otherwise agreed upon, 36–<a href='#Page_35'>35</a></li> - <li class='c012'>Title, during transit (carrier’s assumption), 61–<a href='#Page_56'>56</a></li> - <li class='c012'>Title, not affected by freight payment, 9–<a href='#Page_23'>23</a>, 53–<a href='#Page_50'>50</a>, 54–<a href='#Page_51'>51</a></li> - <li class='c012'>Title, when it passes, 8–<a href='#Page_16'>16</a>, 22–<a href='#Page_28'>28</a>, 31–<a href='#Page_48'>48</a>, 48–<a href='#Page_45'>45</a>, 53–<a href='#Page_50'>50</a>, 54–<a href='#Page_51'>51</a>, 70–<a href='#Page_62'>62</a></li> - <li class='c012'>Title, transfer after purchase holds original buyer, 38–<a href='#Page_35'>35</a></li> - <li class='c002'>Using lumber shipped constitutes acceptance, 34–<a href='#Page_36'>36</a>, 90–<a href='#Page_75'>75</a>, 102–<a href='#Page_83'>83</a></li> - <li class='c002'>Verbal contract, when valid, 65–<a href='#Page_59'>59</a>, 86–<a href='#Page_72'>72</a></li> - <li class='c002'>Warehouseman, carriers’ liability as, 8–<a href='#Page_16'>16</a>, 48–<a href='#Page_44'>44</a></li> - <li class='c012'>Warranty may survive acceptance, 62–<a href='#Page_57'>57</a>, 102–<a href='#Page_83'>83</a>, 108–<a href='#Page_89'>89</a></li> - <li class='c012'>West Virginia—necessity of foreign corporations filing certificate, 106–<a href='#Page_86'>86</a></li> -</ul> - -<div class='chapter'> - <span class='pageno' id='Page_13'>13</span> - <h2 class='c004'>CHOICE OF REMEDIES WHEN LUMBER IS REFUSED ON ARRIVAL.</h2> -</div> - -<p class='c008'>Recently a member took an order from a dealer in Pennsylvania -for a car of lumber, and after order had been forwarded to the -mill, the buyer requested that a change be made in a certain size -included in the order, which our member advised would be made -if shipment had not already gone forward from the mill. It developed, -however, that shipment had been made and that it was too -late to alter any part of the original order. Upon arrival the -buyer refused to accept the lumber on the ground that it was not -as ordered.</p> - -<p class='c009'>In connection with this case we have the following opinion -from an experienced attorney:</p> - -<p class='c013'>Seller has the choice of one of three things, viz.: First, -he may store or retain the property for the vendee and sue -him for the entire price. Second, he may sell the property, -acting as the agent for this purpose of the vendee, and recover -the difference between the contract price and the -price of resale. Third, he may keep the property as his own -and recover the difference between the market price at the -time and place of delivery and the contract price. Usually, -the best course to pursue would be to elect the second remedy, -to wit: that of acting as agent for buyer and dispose -of the carload of lumber and recover the difference between -the contract price and the price of resale. By proceeding -in this manner, they may have the use of the price realized -from the sale, and they have done all that good faith required -to the end that any loss sustained be reduced to a -minimum. Of course, the seller on the resale must dispose -of the goods in good faith and the best mode calculated to -produce their value, whether it be public auction or by -broker, or any other mode that can or could be easily adopted.</p> - -<p class='c014'><b>Opinion No. 1.</b></p> - -<p class='c008'>A metropolitan dealer writes:</p> - -<p class='c009'>We took an order in writing from a party for 25,000 feet of -lumber, 5,000 feet to be delivered the latter part of May, June, -<span class='pageno' id='Page_14'>14</span>July, August, and until all should be taken. Buyer accepted the -delivery of the shipments until June, when he refused the shipment, -writing us a letter, as trade was dull, to please not ship any -more goods on account of order until he notified us. We immediately -wrote him that we should insist on his living up to the terms -of the contract. We had our truckman make note of the fact -that he tendered the goods at their factory and that they refused to -receive them. Now, can we sue and collect for these goods, and -in the future if they refuse to receive them after tendering them -can we sue? If we should instruct our truckman to leave these -goods on the sidewalk in front of their place of business, could -we sue, claiming this was a proper delivery and collect for same?</p> - -<p class='c013'>Reply: When goods are to be delivered in a number of -instalments, as in this case, the buyer’s refusal to accept -delivery of any one instalment is a breach of the whole contract; -the seller may declare the contract at an end, from -that moment, and may sue and recover any damage that the -breach of contract may have caused him. The seller has the -choice of three remedies. He may keep the goods as his -own and sue for the damages; he may hold the goods as -agent of the buyer, informing the buyer that they will be -delivered to him upon his demand, and sue for the contract -price of the goods; or he may sell the goods, for account -of the buyer, giving the latter prior notice of the time and -place of sale and then hold the buyer for any deficiency. -A delivery of the goods upon the sidewalk in front of the -buyer’s place of business would be of no advantage to the -seller and it might make him liable for that part of the goods -if the buyer neglected to take charge of them. The seller -cannot sue for the price of each instalment, when it has been -tendered and refused. This would be to put the buyer to -the expense of defending a number of suits, all arising out -of one contract, and this the law does not sanction. Though -it calls for delivery at different times, the contract is one -and not several, and it may be made the basis of only one -action. Suit may be brought as soon as there is a breach -of it, it is true, but that suit must be for all the loss arising -by reason of the buyer’s unjustifiable act, not simply for the -value of the single instalment tendered and refused. When -any suit is brought the court will assume that it is for all -the loss arising out of the contract and further suits upon -the same cause of action will be barred.</p> - -<p class='c014'><b>Opinion No. 5.</b></p> - -<div class='chapter'> - <span class='pageno' id='Page_15'>15</span> - <h2 class='c004'>INTERPRETATION OF “F. O. B.” SHIPPING POINT OR DESTINATION.</h2> -</div> - -<p class='c008'>As there seem to be many opinions on the question of “ownership -in transit,” or delivery of lumber F. O. B., and as the association -has received numerous inquiries from members covering -various phases of the subject, the question has been submitted by -the association to Mr. Walter W. Ross, General Counsel to the Car -Stake and Equipment Complaint Executive Committee, and an experienced -railroad attorney, for opinion. While it must be conceded -that such an opinion can cover only a specific case, it will probably -be of value to many of our members when the question of ownership -in transit arises, and if followed, if adopted as a practical solution, -will help to bring about a better understanding between shipper -and buyer, always keeping in mind however, that the laws differ in -various States.</p> - -<p class='c009'>His opinion is as follows:</p> - -<p class='c013'>If A sells lumber to B and the contract of sale provides -that A shall deliver the lumber free on board (F. O. B.) -cars at a certain point, the title to the lumber remains vested -in A, the seller, until he has delivered the lumber at the point -agreed upon to the buyer or his agent the carrier.</p> - -<p class='c013'>If the lumber is damaged while in the possession of the -carrier in transit to the point of agreed delivery, the question -of the loss is between the seller A and the carrier. If -the lumber is damaged after delivery at the point agreed -upon, but while in possession of the carrier the question of -loss is between the buyer and the carrier.</p> - -<p class='c013'>The question arises what constitutes delivery f. o. b. -In the case of shipment of lumber by rail it is customary for -the shipper to load the lumber properly on the car. It has -been held by some of the courts that it is not necessary for -the shipper having completed the loading to give formal -notice of delivery to the carrier in order to place the consignment -in the possession of the carrier—(but it is safer to -notify the carrier of such fact thereby eliminating a possible -controversy). If the sale is f. o. b. point of shipment the -delivery by the seller to the carrier is delivery to the buyer -and from that time the carrier until it has performed its -contract of transportation is the agent of the buyer. This -principle of law is subject to the exceptions arising under -the law of stoppage in transit, as for instance if the buyer -becomes insolvent after the shipment has been made—but -before arrival at destination.</p> - -<p class='c013'><span class='pageno' id='Page_16'>16</span>It has been held that the liability of the carrier begins -as soon as the consignment has been placed in its possession, -even though the bill of lading has not been issued.</p> - -<p class='c013'>The question also arises when does the liability of carrier -as such terminate by delivery to the consignee.</p> - -<p class='c013'>The general rule is that when the carrier has placed the -car of lumber on the track which is the usual and customary -place for the consignee to unload and consignee has had reasonable -opportunity to unload, then its liability as carrier -terminates and it is liable only as a warehouseman while the -consignment remains on such track, which means that the -carrier is required to exercise only the degree of care which -an ordinarily prudent person would exercise to protect his -property from loss or destruction. In some states the statutes -provide, or the courts hold, that the carrier having placed -the car in such position for unloading by the consignee, it -is then the duty of the carrier to send due notice of that fact -to the consignee; and until such notice and reasonable opportunity -has been given, the carrier’s liability as such continues. -In other states the carriers are not required either -by statute or rule of the courts to give such notice of arrival -of consignments, it being held to be the duty of the consignee -to keep himself informed as to the time of arrival of his -freight. This rule is gradually being superseded in most -states by the more reasonable rule that it is the duty of the -carrier to send due notice to consignee of arrival of freight.</p> - -<p class='c014'><b>Opinion No. 8.</b></p> - -<div class='chapter'> - <h2 class='c004'>BUYING AND SELLING AGENT NEEDS NO LICENSE IN NEW YORK CITY.</h2> -</div> - -<p class='c008'>Very often out of town members who contemplate opening an -office in New York City, inquire as to whether it is necessary to -obtain a license in order that their agent may legally represent -them. The following appears to cover the ground:</p> - -<p class='c009'>Question from Baltimore, Md.—I am acting here as a buying -and selling agent for a lumber company outside of the State, they -supplying me with the money with which to buy the lumber to ship -to them on their orders, and I crediting them with the proceeds of -the sales of lumber shipped to me to sell for their account, my -compensation being a commission on the sales and purchases. -Under these conditions I do not pay a license here in Baltimore, -but as I expect shortly to move the office to New York, I will thank -you to let me know if I would require a license to conduct this -business in that city, and if so, where should I apply for same?</p> - -<p class='c013'><span class='pageno' id='Page_17'>17</span>Reply: No license is required in New York City in -order to carry on such a business as our correspondent describes. -One who simply buys and sells here, as agent, need -not make a report or pay a fee to any public officer. But -if at any time he carries on a general mercantile business, as -agent, he must register and pay a fee. The statute is as -follows: “Any person now carrying on or conducting a -general mercantile or manufacturing business within this -State, or hereafter commencing such business at or in a fixed -location as agent or manager for another or others, shall—at -the commencement of such business, file a sworn statement, -verified by such agent and principal or principals, in -the county clerk’s office of the county within which said -business is carried on, stating the nature of the business -and the full name and residence of such principal or principals.” -The fee is $1.00, and failure to file the statement -is a misdemeanor.</p> - -<p class='c014'><b>Opinion No. 3.</b></p> - -<div class='chapter'> - <h2 class='c004'>RETAINING LUMBER SHIPPED CONSTITUTES ACCEPTANCE.</h2> -</div> - -<p class='c008'>The acceptance of lumber, where the grade is disputed, is the -subject of the following correspondence:</p> - -<p class='c009'>Question.—We recently shipped a car of lumber to a dealer, -who claims that same is not up to the grade bought. We have -asked him to return shipment and guaranteed to replace same with -material that was absolutely right. He refuses to do so, and states -that he will not return it until he receives lumber to replace the -lot he refused to accept. We have sold this car to another party, -who asks for delivery. We believe that the original purchaser is -making an unjust claim. Can we demand that the lumber be -shipped back to us, as the party has refused to accept same and -has not paid for it? In case he refuses to return it are we under -any obligation to make a second delivery?</p> - -<p class='c013'>Reply: The purchaser in a case of this kind has no -right to any material that previously belonged to the seller -except under the contract which he has with the seller. -When the seller sends the purchaser any lumber and the -purchaser keeps it, he keeps it either wrongfully or else -as being in compliance with his contract. But the courts -will not allow any man to claim, for his own advantage, that -he is a wrong-doer when there is a possible and reasonable -explanation of his act which makes it lawful. For this reason, -<span class='pageno' id='Page_18'>18</span>among others, a buyer of lumber when there has been -no warranty of quality, who retains the lumber sent to him, -and refuses to return it, is always held to retain it as being -perfectly satisfactory and in compliance with the contract. -Any complaint he may make about the delivery is of no -importance; it is his act that counts. The courts will insist -upon taking the most charitable view of his conduct, whatever -he may say, and the most charitable view is that he -is doing right, and not wrong, and is keeping the lumber -because it is a good delivery under the contract. Our correspondents -can demand that the lumber be returned if they -choose to do so, but they cannot enforce the demand. If the -buyer does return the lumber, in answer to such a demand, -he will have a claim against the sellers for another delivery, -and a valid one under the contract, or for a breach of the -contract in failing to make a good delivery in the first place. -If no such demand is made, or if it is made and not complied -with, the buyer can be compelled to pay the contract price -of the goods on the theory that his holding them is an acceptance -under the contract. It is idle for him to say that he -does not accept them; keeping them is acceptance. No second -delivery need be made unless the first delivery is promptly -and properly refused and returned.</p> - -<p class='c014'><b>Opinion No. 6.</b></p> - -<div class='chapter'> - <h2 class='c004'>OBTAINING CERTIFICATES PERMITTING FOREIGN CORPORATIONS TO DO BUSINESS AND MAINTAIN AN ACTION IN NEW YORK OR NEW JERSEY.</h2> -</div> - -<p class='c008'>Almost every State in the Union, and especially the States of -New York, New Jersey, Pennsylvania, Massachusetts, Connecticut, -etc., require foreign corporations, that is, corporations formed under -the laws of other States, to procure a license or certificate to do -business within such State, and in default thereof penalties or fines -are imposed.</p> - -<p class='c009'>In considering the necessity of such license the first question -is to ascertain whether the corporation is transacting its business -in a manner which could be interpreted as “doing business” in its -legal sense, and this means generally filling all orders obtained -in that State when more than two or three incidental orders have -been obtained or the maintaining of a place of business in such -State. The difficulties in obtaining the certificates are not great -but the details are technical and the expense ranges from $10 upwards, -<span class='pageno' id='Page_19'>19</span>depending upon the laws under which the company is incorporated, -there being retaliatory laws in some States. The average -expense is about $25, and the certificates are generally good for an -indefinite period; the only annual requirements being a formal -report which does not involve the giving of the details of the corporation’s -business and there is no annual taxation unless the corporation -has both property and is doing business within such State.</p> - -<p class='c009'>In many cases where valid claims exist in favor of a corporation -of another State against a New York debtor, a serious obstacle -arises where the foreign corporation has not obtained a certificate -to do business in this State, and, therefore, cannot maintain the -action. By the statutes as last amended this prohibition covers also -any one to whom such foreign corporation has assigned the claim -for collection. The provisions of the New York corporation law -in this matter are easily complied with. There has to be a sworn -copy of the charter of such foreign corporation and the designation -of some person on whom process can be served.</p> - -<p class='c009'>The objection to complying with the statute in this respect is -the possible liability to taxation after the corporation gets its name -on the State Register. All that is taxable in New York State is -the amount of capital used in the State, and this would be so small -as to be unimportant provided, of course, that the proper returns -to the tax departments at Albany and New York are made out each -year. This, we understand can be done in ordinary cases, at a -charge of $10, for the two reports, one to Albany and one to New -York, and this sum is a very small tax to pay for what must be -the advantages of selling lumber and maintaining the legal rights -connected with such sales in New York State.</p> - -<p class='c014'><b>Opinion No. 17.</b></p> - -<div class='chapter'> - <h2 class='c004'>A CARRIER IS BOUND TO DELIVER LUMBER AS DIRECTED.</h2> -</div> - -<p class='c008'>Question.—My shipper consigns me a car of lumber and marks -the bill of lading “via P. R. R. delivery.” If this car arrives by -the C. R. R. of N. J., can I be compelled to accept same from -them, or does my original contract entitle me to insist on P. R. R. -delivery?</p> - -<p class='c013'>Reply: One of the important and imperative duties of -a carrier is to deliver the lumber as he is directed to deliver -it. A direction to deliver it to a specified connecting carrier -<span class='pageno' id='Page_20'>20</span>or delivery concern cannot be fulfilled by delivering it -to another, any more than a direction to deliver it to a certain -consignee can be carried out by delivery to another -individual. If the carrier makes a wrong delivery, as here -described, he is guilty of conversion. The consignee is not -bound to accept the lumber from the connecting carrier to -whom it has been wrongly delivered. He may sue the original -carrier for the value of the lumber as soon as he learns -that a different delivery from that directed by the bill of -lading has been made.</p> - -<p class='c014'><b>Opinion No. 11.</b></p> - -<div class='chapter'> - <h2 class='c004'>IF A BUYER REFUSES TO TAKE LUMBER ORDERED THE SELLER HAS A CHOICE OF REMEDIES.</h2> -</div> - -<p class='c008'>Question.—Some time in March last we received an order for -two cars of 32–inch lath. A few days after the order came to hand -we received a letter from our customer requesting us to defer shipment -on account of the threatened strike in the coal regions, which -request was complied with. The difficulties between the miners -and operators have of course been adjusted and operations were -resumed some time ago, but our customer has so far failed to furnish -shipping directions for the lath, which we had cut especially -for his order and piled on our docks ready for shipment at the time -his request was received to hold the order. Would we not be justified -in loading this stock up and putting cars in transit in accordance -with the original order and insisting upon acceptance of same -upon arrival?</p> - -<p class='c013'>Reply: This buyer has not, in our opinion, lost his right -to select the route by which the goods shall be shipped to him. -There is no question that his delay in giving such instructions -has been unusually great, but the sellers on their part -have given no indication of an objection to such delay. It -is clearly their right now to demand that he send shipping -instructions immediately and to inform him that they will -send the goods by a route of their own selection if he does -not name a route by return mail; then, if the buyer does not -reply, or if he refuses to issue shipping instructions, or undertakes -to repudiate the contract, the sellers will have a choice -of three remedies: They may ship the goods to him by any -suitable carrier and compel him to pay for them; they may -inform him that the goods are held subject to his order, to -be shipped in whatever manner and at whatever time he may -<span class='pageno' id='Page_21'>21</span>select, and then compel him to pay for them, or they may -name a time and place at which the goods will be sold at -auction for his account, giving him sufficient opportunity to -be present at the sale, and may then sell them at such time -and place, holding him liable for the necessary expenses of -advertisement and sale and for any amount, by which the -selling price may be less than the contract price.</p> - -<p class='c014'><b>Opinion No. 12.</b></p> - -<div class='chapter'> - <h2 class='c004'>UNDER CERTAIN CONDITIONS THE ACCEPTANCE OF PART OF A DEBT DOES NOT RELEASE THE REMAINDER.</h2> -</div> - -<p class='c008'>Question.—One of our customers recently sent us a check for -less than the amount of his bill, saying in his letter that he was -remitting the full amount due us. If he had taken advantage of -the regular discount on his last purchase (which he did not do) -the amount now due us would have been within a few dollars of -the size of the check, but even then the check would not represent -the exact amount due to us. He does not say in so many words -that he is claiming a discount, just sends the check and writes, -“enclosed please find amount of my bill to date.” Something of -this kind happens rather frequently, and we would like you to advise -us whether we must forego using that check until we can -write and straighten out the matter with him. More is due to us -than he has paid us, and it seems a hardship that we should be -kept out of even this part of our claim during the week or month -which it may take to have a full understanding with our customer.</p> - -<p class='c013'>Reply: The creditor, in a case of this kind, is justified -in cashing the check and still demanding the amount yet due; -this amount he can recover by suit if it is not paid voluntarily. -The buyer, it seems, was not entitled to a discount, and he -has not made a specific claim to any. Being indebted to a -certain amount he simply sends a check for part of that -amount. He does not say that he claims a discount. If this -check for less than the full amount due had been accompanied -by a demand that it be either accepted as payment in -full, or else returned, a different question might have arisen; -but even then the check might safely have been cashed under -the facts of this case. This case is simply that of a man who -owes $100 and who sends his creditor a smaller amount. The -<span class='pageno' id='Page_22'>22</span>proper course for the creditor is to accept what is sent as a -payment upon account and still maintain his claim for what -is yet due.</p> - -<p class='c014'><b>Opinion No. 18.</b></p> - -<div class='chapter'> - <h2 class='c004'>BANKRUPTCY AVOIDS AN ASSIGNMENT FOR CREDITORS.</h2> -</div> - -<p class='c008'>Question.—We made a sale to a firm who became embarrassed -and offered a compromise to their creditors. We accepted the settlement -offered, 25 per cent. cash and 25 per cent. by note at one -year. The note given us was not paid and after some delay the -concern now goes into bankruptcy. Please inform us whether our -claim in the bankruptcy proceedings would be the note only or the -full amount due under the original sale?</p> - -<p class='c013'>Reply: The compromise in this case, in so far as it -has not been carried out, will probably be set aside and all -the bankrupt’s estate be held liable to his creditors under the -bankruptcy proceedings. It has been held that “an adjudication -of bankruptcy at the instance of the bankrupt’s creditors -on the ground of a general assignment, avoids such assignment -and subjects the property assigned to the jurisdiction -of the bankruptcy court to be administered under the Bankruptcy -Act which the creditors have invoked.”</p> - -<p class='c009'>Opinion No 14.</p> - -<div class='chapter'> - <h2 class='c004'>AN INDIVIDUAL MAY TRANSACT BUSINESS UNDER A CORPORATE TITLE IN NEW JERSEY.</h2> -</div> - -<p class='c008'>Frequently the question arises regarding a person’s legal right -to start business under a corporate title; for instance, as “Can John -Smith conduct business as the Pine Lumber Company,” etc.</p> - -<p class='c009'>Question from New Jersey.—A person wishes to start a lumber -business in New Jersey. Can he adopt a style such as “The Crescent -Lumber Company” without being incorporated, the manager -being the sole proprietor? Is there anything necessary to be done -in such a case beyond hanging out his sign at his place of business?</p> - -<p class='c013'>Reply: In New York no person is now allowed to establish -a business under any name, corporate or individual, -except his own name, until he has first placed on record in -the county clerk’s office, in the county in which the business -is to be carried on, a statement of the facts. So far as -we can find, however, there is no similar statute in New -Jersey. It is a comparatively recent law in this State and -<span class='pageno' id='Page_23'>23</span>there are not many other States that have adopted it. The -public cannot be misled to its detriment by such a method of -doing business as our correspondent proposes, and there is no -common law rule against it. If any creditor supposes that -the business is being carried on by a corporation he will not -be harmed by the mistake, because the liability of an individual -owner, or of a firm, is greater than that of the stockholders -of a corporation. A creditor who learns that his business -belongs to an individual, instead of a corporation, will -be benefited by the knowledge, not damaged. If there should -be a statute just enacted requiring registration, the county -clerk will know of it.</p> - -<p class='c014'><b>Opinion No. 10.</b></p> - -<div class='chapter'> - <h2 class='c004'>WHETHER FREIGHT IS PREPAID OR ALLOWED DOES NOT AFFECT TITLE TO LUMBER.</h2> -</div> - -<p class='c008'>Question.—A dealer in Buffalo sells a car of lumber to a dealer -in Baltimore with the understanding that freight is to be allowed -from Buffalo to Baltimore. Please state whether there is any distinction -as to the ownership of the lumber in transit, whether the -Buffalo dealer prepays the freight in Buffalo or allows the Baltimore -dealer to deduct the amount of freight in settlement. If the -freight is prepaid in Buffalo at the time of shipment, and the lumber -be lost in transit prior to delivery, is the ownership of the lumber -vested with the Buffalo or the Baltimore dealer?</p> - -<p class='c013'>Reply: If lumber is sold with an understanding that the -seller is to pay the freight, it makes no difference at all, as -to ownership during transit, whether freight is prepaid and -included in the price, or whether it is deducted from the price -and left for the buyer to pay. A seller is not bound to carry -the lumber to its destination and deliver it there unless he -has expressly agreed to do so. This is true whether the -seller pays the freight or not; in either case a valid delivery, -transferring risk and title, may be made, if the seller so -chooses, at the beginning of the transportation unless the -seller has agreed to deliver the goods elsewhere.</p> - -<p class='c014'><b>Opinion No. 9.</b></p> - -<div class='chapter'> - <h2 class='c004'>OBTAINING CERTIFICATES PERMITTING FOREIGN CORPORATIONS TO DO BUSINESS IN PENNSYLVANIA.</h2> -</div> - -<p class='c008'>A recent attorney’s opinion contained some valuable information -regarding the filing of certificates in New York State, permitting -<span class='pageno' id='Page_24'>24</span>foreign corporations to transact business in that State and -maintain an action. We have been asked for information regarding -the requirements of the Commonwealth of Pennsylvania in this -matter and our attorney at Philadelphia, William S. Furst, Stephen -Girard Building, has forwarded the following opinion.</p> - -<p class='c011'>Herewith follows an opinion embodying the essential points in -re foreign corporations doing business in the State of Pennsylvania.</p> - -<p class='c011'>The Act of Assembly approved April 22, 1874, provides that -no foreign corporation (this includes corporations created by other -States) shall do any business in this Commonwealth until such corporation -shall have established an office and appointed an agent -for the transaction of its business therein, and it shall not be lawful -for any such corporation to do any business in this Commonwealth -until it shall have filed in the office of the Secretary of the -Commonwealth a statement under seal of such corporation, and -signed by the President or Secretary thereof, showing the title and -object of said corporation and the name of its authorized agent, -with a penalty attached thereto for violation, that a person shall be -guilty of a misdemeanor, etc.</p> - -<p class='c011'>The words “doing business” do not include a sale in a foreign -State, although the goods are delivered in this State, or taking -orders, or making sales by salesmen through agents going into -Pennsylvania from another for that purpose.</p> - -<p class='c011'>In short, a foreign corporation engaged in strictly interstate -commerce, may advertise its goods, send agents to solicit orders, -take orders, make contracts of sale respecting the same, and ship -them to customers in Pennsylvania, without violating the act, and -may sue to recover the price of any merchandise without filing the -statement required by the act, although the foreign corporation in -question has no office or place of business in Pennsylvania and no -part of its capital invested here.</p> - -<p class='c011'>A foreign corporation, which has not complied with the Act above -stated, but has an office or place of business in Pennsylvania, or -any of its capital invested within the State, cannot enforce contract -rights in the courts of Pennsylvania.</p> - -<p class='c011'>It has been recently decided by the Supreme Court of the State -of Pennsylvania (the court of last resort) that a foreign corporation -which invests most of its capital in the State of Pennsylvania -for a period of six months while constructing a railway, -employs large numbers of men, but does not file a statement in the -office of the Secretary of the Commonwealth, as required by the -provisions of the Act until two months after completion of the -work, cannot recover for labor and materials furnished in doing -such work.</p> - -<p class='c011'>With respect to the taxes imposed upon foreign corporations -<span class='pageno' id='Page_25'>25</span>doing business in the State of Pennsylvania, the Act of May 8th, -1901, provides that all foreign corporations shall pay to the State -Treasurer for the use of the Commonwealth a bonus of one-third -of one per centum upon the amount of their capital actually employed -or to be employed wholly within the State, and a like bonus -upon each subsequent increase of capital so employed. This is not -an annual tax. It has been defined to be the price paid the Commonwealth -for the privilege conferred on such corporation by its charter. -It is therefore in no sense a tax, and the payment thereof -does not relieve any corporation from any tax to which it is otherwise -subject.</p> - -<p class='c011'>Respecting the taxation of foreign corporations, they are taxable -like domestic corporations on so much of their capital stock -as is invested within the Commonwealth under the provisions of the -Act of Assembly approved June 8th, 1898. The tax is imposed -annually at the rate of five mills upon each dollar of the actual -value of the whole capital stock of all kinds invested or represented -by capital invested within the State.</p> - -<p class='c011'>The tax is settled by the accounting officers upon the basis of a -report required to be made by all companies subject to the tax, and -particularly upon the appraisement of the value of the stock contained -in such report. The report is filed between the first and fifteenth -of November in each year.</p> - -<p class='c011'>Foreign corporations are also obliged to file a bonus report annually, -from which should appear whether there has been any -increase in the amount of the capital actually invested within the -State, so that the proper bonus charges may be made upon any -such increase as above stated.</p> - -<p class='c014'><b>Opinion No. 19.</b></p> - -<div class='chapter'> - <h2 class='c004'>PAYMENT OF CLAIMS BY AN EXECUTOR—TIME FOR FINAL ACCOUNTING.</h2> -</div> - -<p class='c008'>Occasionally the question arises as to what length of time an -executor has to close an estate, and the following, particularly the -second section, may be helpful:</p> - -<p class='c009'>Question—Can an executor pay a bill of $10 or less, or what is -the largest amount he can pay, without having the claim verified -before a notary, according to law?</p> - -<p class='c009'>2.—Within what time do the laws require that an executor’s -accounts shall be made up and ready for final settlement?</p> - -<p class='c013'>Reply: 1. The law makes no distinction as to the -amount of the claim against the estate for which an executor -should require vouchers and an affidavit. The statutory provision -is as follows: “The executor or administrator may -<span class='pageno' id='Page_26'>26</span>require satisfactory vouchers in support of any claim presented, -and the affidavit of the claimant that the claim is justly -due, that no payments have been made thereon, and that there -are no offsets against the same to the knowledge of the claimant,” -see Code of Civil Procedure, Section 2718. If an executor -should pay a claim of any considerable size, without this -precaution, and the claim should afterwards turn out to be -unjust, he could be, or probably would be, required to repay -the amount to the estate.</p> - -<p class='c013'>2. The laws of this State do not fix any definite time as -the limit within which an executor must make his final accounting. -Whenever a year has expired since the grant of -his letters, the surrogate may compel the executor to make -an accounting of all that has been done up to that time. If -the estate is then in a condition to be definitely settled this -may be done. If there has been any remissness on the part -of the executor this may properly be dealt with by the surrogate. -If the executor has used due diligence, and still is not -ready to make a final accounting, he may have further time, -always, of course, under the supervision of the court.</p> - -<p class='c014'><b>Opinion No. 23.</b></p> - -<div class='chapter'> - <h2 class='c004'>A SELLER MAY CONTRACT AGAINST LIABILITY FOR DELAY IN SHIPPING.</h2> -</div> - -<p class='c008'>Question—A company in Boston sells to A in New York 800,000 -feet of lumber and on the sales slip are the words, “for delivery, one -cargo in June, and one in July.” The lumber was shipped in four -cargoes, about 200,000 feet in each. The first two were shipped -in July; the third cargo on the 18th of August, and the fourth on -the 21st of August. The first two cargoes were accepted at the -contract price, $27, but the customer refuses the third and fourth -cargoes, claiming that we were late on the deliveries. It is a well -known fact that all through this year vessels have been very hard -to obtain. Has the New York dealer a right to refuse to accept the -third and fourth cargoes at the contract price? The price has -dropped from the spring to the present time from $27 to say $24. -The customer claims the last two cargoes at the going market price -prevailing at the time they arrived. Inasmuch as the cargoes cannot -be sold over again, except at a less price than the New York customer -offered, we were obliged to let him unload the last two cargoes. -We claim that the customer has no right to deduct anything, -owing to the lateness of delivery, because our orders read, “subject -to delays caused by fires, strikes or other causes beyond our control.”</p> - -<p class='c013'><span class='pageno' id='Page_27'>27</span>Reply: We suppose the clause quoted by our correspondent, -“subject to delays,” etc., is incorporated in the contract -or is so prominently printed on the order blank that -the buyer cannot fail to understand that the sale is made -subject to it. If that is true, and if it is also true that the -delay in this case actually arose from a cause beyond the -control of the sellers, then the buyer’s position was not tenable -at the beginning. It is possible, however, that the buyer -can maintain his position now by reason of the acquiescence -of the sellers. The buyer had a right to ask that a deduction -in the price be made by reason of the delay. If the sellers -had refused this request and demanded expressly that the -cargo be accepted at the contract price, or not accepted at all, -they could have enforced their demand. It does not appear -very clearly what answer the sellers made to the buyer’s -request for a lower price. Our correspondent says: “Inasmuch -as the cargoes cannot be sold over again, except at a -less price than the New York customer offered, we were -obliged to let him unload the last two cargoes.” There was -plainly a dispute as to whether the delay was one which was -excusable under the terms of the contract, and, if the act -of the sellers, or their answer to the request of the buyer -for a lower price, can be construed into an acquiescence in -that request, the sellers are now bound by such acquiescence. -If the sellers have always insisted that the contract price -must be paid, that the goods must be accepted in strict accordance -with the contract, or rejected, then they are in position -to collect the full contract price for all the lumber.</p> - -<p class='c014'><b>Opinion No. 24.</b></p> - -<div class='chapter'> - <h2 class='c004'>WHEN LUMBER IS SOLD FOR DELIVERY THERE IS A BREACH OF CONTRACT IF NOT DELIVERED.</h2> -</div> - -<p class='c008'>Question from Buffalo, N. Y.—A sells B a carload of lumber -at a given price delivered, Boston rate of freight for shipment from -the West. B gives directions which are accepted by A for shipment -of car to a point taking a Boston rate of freight. The lumber -is shipped as per contract, and the consignee pays a sight draft with -bill of lading attached according to terms. While in transit the -lumber is destroyed. Is the shipper not responsible to the consignee -for the lumber, as it was not delivered, as the contract called for; -and after the lumber is destroyed does the consignee have an option -of insisting on having the shipment replaced or canceling the order?</p> - -<p class='c013'><span class='pageno' id='Page_28'>28</span>Reply: Our correspondent calls attention to the fact -that the contract in this case called for a delivery of the lumber -at the end of transportation. This being so, the seller -was bound to carry and deliver the lumber, as well as to -furnish it. The carrier was an agent of the seller and if the -lumber is not delivered the seller is to look to the carrier for -damages, while the buyer looks to the seller. What the -seller undertook to do in this case was to supply the lumber, -to carry it, and then to deliver it. If he fails in either point -he is guilty of a breach of contract. He has failed to deliver -the lumber; the buyer may regard this as a breach of contract, -which it is, and sue for such damages as may have -come upon him as a result of the breach. The buyer cannot -compel the seller to replace this lumber with other; but if -the seller would rather do that than pay damages, and if the -buyer is willing to have it done, then, of course, it may be -done.</p> - -<p class='c014'><b>Opinion No. 22.</b></p> - -<div class='chapter'> - <h2 class='c004'>A LIQUIDATED DEMAND CANNOT BE SETTLED EXCEPT BY PAYMENT OF THE WHOLE AMOUNT.</h2> -</div> - -<p class='c008'>Question—An individual in Providence, R. I., who was indebted -to me, forwarded a check for less than the amount of his entire -indebtedness. He stated on the face of it “settlement in full.” This -in nowise discharged his obligation to me and I wrote him that I -would credit his check on account and requested a remittance of -the balance. He takes the position that under the Rhode Island -law he has discharged his indebtedness. Please advise what rights -I hold in the premises.</p> - -<p class='c013'>Reply: We do not find any statute or decision in Rhode -Island to the effect that a payment of this kind constitutes -payment in full. All the reported decisions by the courts of -that State we have been able to find lay down practically the -same rules upon the subject that are enforced by the courts -of New York. This payment was made in New York, and -the laws of this State govern it in any event. The law upon -the subject here (and, so far as we can learn, in Rhode -Island, too), is briefly this: If there is no doubt, and no -dispute, as to the amount due, then payment of less than -that amount will not discharge the debt, even though the -creditor agree to accept it as a discharge, if there is no release -under seal and no new consideration given. If the debt is -unliquidated, if there is a doubt or dispute as to the amount -of it, then the debtor’s offer of so much as payment in full -<span class='pageno' id='Page_29'>29</span>constitutes his estimate of the amount really due. The creditor -cannot accept the money without accepting the estimate. -The debtor has a right to go into court to have the dispute -settled, and if the creditor is unwilling to accept the condition -under which the money is sent he is bound to return -the remittance and allow the whole matter to be determined in -some authoritative way. For decisions to the effect that part -payment of a debt that is liquidated and certain is not payment -in full, even when the creditor accepts the money and -uses it, see 23 N. Y., 684; 108 N. Y., 470; 1 R. I., 496; -and 8 R. I., 381.</p> - -<p class='c014'><b>Opinion No. 20.</b></p> - -<div class='chapter'> - <h2 class='c004'>PRIVILEGE OF STOPPING LUMBER IN TRANSIT WHEN BUYERS BECOME INSOLVENT.</h2> -</div> - -<p class='c008'>Question—When lumber has been sold and shipped, and the -seller afterwards directs the carrier not to deliver it to the buyer -but to return it to him, is the carrier under any obligation to return -it, or must he go ahead and deliver it to the buyer, or may he exercise -his own will in matter? What are the legal rights of all parties -in such a case?</p> - -<p class='c013'>Reply: If one who has sold lumber on credit learns, -after it has been delivered to the carrier, that the buyer -is insolvent it is his right to demand that the lumber be not -delivered to the buyer, but be returned to him. This is known -as the right of stoppage in transit, and it is founded upon -the theory that one who buys on credit is bound by an implied -contract to keep his credit good until the date of payment -arrives. In order that the seller may be entitled to -exercise this right the buyer must be actually insolvent, that -is, unable to meet his just obligations as they fall due; the -lumber must be still in the hands of the carrier, and not yet -delivered into the actual or constructive possession of the -buyer. If the lumber is represented by a bill of lading making -it deliverable to the buyer or his order that must be still -under the buyer’s control; if he has transferred it to a third -person, who has taken it for value and in good faith, the -seller’s right of stoppage is gone. If a seller who has a right -to stop the lumber attempts to exercise the right by directing -the carrier not to deliver it the carrier is bound to obey the -direction. The carrier, however, acts at his peril in any case. -If he obeys the instruction and refuses to deliver the lumber -to the buyer, and the buyer is solvent, he may bring an action -of trover against the carrier immediately. On the other -hand, if the carrier disobeys the instruction, and delivers up -<span class='pageno' id='Page_30'>30</span>the lumber, he makes himself liable to the seller, at least to -the extent of the buyer’s indebtedness for the lumber, if -it is a case in which the seller is justified in exercising his -right of stoppage in transit. Because of these difficulties of -his situation, the carrier is entitled to a reasonable time in -which to investigate the financial condition of the buyer; but -if he finally delivers the lumber to the buyer in any case in -which the seller had a right to countermand the order for -their delivery, and had done so, the carrier must answer -for it.</p> - -<p class='c014'><b>Opinion No. 27.</b></p> - -<div class='chapter'> - <h2 class='c004'>SALES FOR FUTURE DELIVERY.</h2> -</div> - -<p class='c008'>Frequently the question of credit arises after a contract for -future delivery has been made, and the following may be helpful:</p> - -<p class='c009'>Question—Will you kindly give us your opinion in the following -matter: A makes a sale to B of a certain quantity of lumber for -future delivery, payments to be made on a credit of sixty days’ -time. Before the delivery of lumber begins, A has reason to believe -that the responsibility of B is not satisfactory to him and -refuses to ship the lumber except for cash with discount for the -difference in time. What redress has B in this matter, if he is not -in a position to pay cash?</p> - -<p class='c013'>Reply: The refusal of A to ship the lumber to B under -these circumstances constitutes a breach of contract, for B -has an action against A for damages. Something more than -dissatisfaction with B’s financial responsibility is necessary -to furnish A with a valid excuse for his refusal to ship -except for cash.</p> - -<p class='c014'><b>Opinion No. 30.</b></p> - -<div class='chapter'> - <h2 class='c004'>IN MOST STATES A CONSIGNEE MUST BE NOTIFIED OF THE ARRIVAL OF HIS LUMBER.</h2> -</div> - -<p class='c008'>Question—Is a railroad company obliged to notify the consignee -of the arrival of lumber when it is billed and the bill of -lading reads: “Order of shipper, notify consignee,” and if the -carriers fail to notify the consignee, have they the right to charge -demurrage or storage for the lumber so held? Would it make any -difference if the lumber were billed direct to the consignee and -were not an “Order notify shipment?” Have the courts made any -rulings of this matter, and where can we find them?</p> - -<p class='c013'><span class='pageno' id='Page_31'>31</span>Reply: A railroad company is, of course, bound to comply -with the undertaking set forth in its own bill of lading. -If it accepts goods to be carried and delivered under a bill -which expressly directs it to “notify the consignee” there is -no ground upon which it can escape its obligation actually to -notify the consignee except the impossibility of finding him -by the ordinary means. If the consignee can readily be found -the carrier has not fulfilled the task which it has expressly -and in definite terms undertaken to fulfill until it has found -him and notified him. It has no right to charge demurrage -or storage until such notification has been duly given. If -the consignee cannot be found by the exercise of reasonable -diligence then the attempt to find him will serve the carrier -as well as an actual notification. If the bill of lading does -not, in express terms, direct the carrier to notify the consignee -this duty still rests upon the carrier by common law -as it is interpreted in this State. In some States (Massachusetts, -for example) the carrier is not bound to notify the -consignee of the arrival of his goods unless the contract of -carriage expressly so directs. But in New York the courts -hold that this is one of the carrier’s duties, as carrier, without -any special stipulation regarding it. This is the rule, as -the courts of New York have announced it. “The rules as to -the delivery of goods at their place of destination by a carrier -that prevail in this State are as follows: If the consignee -be present upon the arrival of the goods, he must take them -without unreasonable delay. If he be not present, but live at -or in the vicinity of the place of delivery, the carrier must -notify him of the arrival of the goods, and then he has a -reasonable time to remove them. If he be absent, unknown, -or cannot be found, then the carrier can place the goods in -its freight house, and if the consignee does not call for them -in a reasonable time, its liability as a common carrier ceases.”</p> - -<p class='c014'><b>Opinion No. 25.</b></p> - -<div class='chapter'> - <h2 class='c004'>OBTAINING CERTIFICATES PERMITTING FOREIGN CORPORATIONS TO DO BUSINESS IN NEW YORK.</h2> -</div> - -<p class='c008'>A previous opinion contained some information regarding foreign -corporations obtaining certificates to do business in New York. -The following additional information, from our attorney in New -York, Mr. Eustace Conway, 15 William Street, regarding amendments -effective November 1st, will be interesting:</p> - -<p class='c011'>There went into effect on November 1st, 1906, various important -amendments to the corporation Tax Law. The annual -<span class='pageno' id='Page_32'>32</span>franchise tax is placed on a different basis from what it has been -heretofore for foreign corporations, and the license tax which foreign -corporations have to pay for doing business in this State is -also changed as to its method of determination. Under the new -law the measure of amount of capital stock employed in this State -(on which the tax of ⅛ of 1 per cent. is to be paid for this corporation -license to do business here) is to be such a proportion of -the issued capital stock as the gross assets employed in any business -within this State bear to the gross assets wherever employed -in business. As no action shall be maintained in any of the courts -of this State by such foreign corporation without obtaining a receipt -for this license fee, it is important to foreign corporations expecting -to do business here to comply with the statute and take out the -certificate. This tax, of course, is only to be paid once for the -license, unless later an increased amount of capital stock is employed -in the State, but this is not likely to occur. The annual franchise -tax is, of course, a different tax, but it is based on the same proportion, -except that the amount of dividends is also to be considered.</p> - -<p class='c014'><b>Opinion No. 26.</b></p> - -<div class='chapter'> - <h2 class='c004'>THE NEW JERSEY LIEN LAW PROTECTS MATERIAL MEN.</h2> -</div> - -<p class='c008'>Question—Please state whether or not, under the laws of the -State of New Jersey, a seller of building materials comes in under -the mechanics’ lien law the same as the man selling his labor.</p> - -<p class='c013'>Reply: Persons furnishing materials for the erection of -a building are called “material men” in the Mechanics’ Lien -Law of New Jersey, and they have a lien which is protected -like that of a laborer. The first section of the law provides -that “every building hereafter erected or built within this -State shall be liable for the payment of any debt contracted -and owing to any person for labor performed or materials -furnished for the erection and construction thereof, which -debt shall be a lien on such building, and on the land whereon -it stands.” It is further provided, in a later section, that -“whenever any master-workman or contractor shall, upon -demand, refuse to pay any person who may have furnished -materials used in the erection of any such house or other -building—it shall be the duty of such—material man to give -notice in writing,” etc. As a result of this notice his lien -attaches and his claim is protected.</p> - -<p class='c014'><b>Opinion No. 21.</b></p> - -<div class='chapter'> - <span class='pageno' id='Page_33'>33</span> - <h2 class='c004'>OBLIGATION OF CARRIERS AS TO NOTICE OF ARRIVAL TO CONSIGNEE.</h2> -</div> - -<p class='c008'>Question—Is a railroad company, which has accepted lumber for -transportation to a certain point, legally obligated to notify the consignee -at the respective point of the arrival of lumber?</p> - -<p class='c013'>Reply: The law relating to the obligation of a railroad -company to notify the consignee of the arrival of the lumber -at the point of destination is not uniform in all the States. -The rule adopted in New York and in most of the States is -that the carrier must give notice of arrival to the consignee, -and that until notice is given, or a reasonable effort to give -notice is made, the carrier’s liability as carrier continues in -force.</p> - -<p class='c014'><b>Opinion No. 28.</b></p> - -<div class='chapter'> - <h2 class='c004'>BUYERS’ POSITION WHERE, ON ARRIVAL, LUMBER IS NOT IN ACCORDANCE WITH CONTRACT.</h2> -</div> - -<p class='c008'>Question—A has sold to B a carload of lumber to be delivered -on or before November 24, payment cash promptly after arrival -and examination. The lumber arrives on the 24th, and A gives on -that day to B an examination order for the lumber, which examination -order B accepts. B uses proper diligence in trying to examine, -but, owing to congestion of cars at the depot the lumber is -not unloaded for several days, and he can only examine it on the -28th. He finds it to be of a quality inferior to the grade contracted -for and rejects it, and his rejection is sustained by arbitration. -B claims the right to go into the market on the 28th, buy a -carload of lumber of the grade contracted for and demand from -A the difference between the contract price and the price paid by -him on the 28th. A maintains that he can only be held responsible -for the difference between the contract price and the ruling market -value on November 24, the last date stipulated in the contract. -Who is right?</p> - -<p class='c013'>Reply: This lumber was sold for delivery at the buyer’s -end of the route, the purchase price was to be paid only after -arrival and examination. The carrier was an agent of the -seller, and he did not give the buyer an opportunity to make -examination until November 28. No valid delivery was -made, or could have been made, before November 28, inasmuch -as an examination by the buyer was to precede such -delivery. When delivery was tendered on November 28 the -<span class='pageno' id='Page_34'>34</span>lumber was found to be such as the buyer was at liberty to -reject. He was, accordingly, authorized to go into the market -on that day and buy at the price then prevailing in order -to place himself in as good a position as he would have been -in if the seller had done his duty and had not been guilty of -a breach of contract. The buyer has a right to demand that -the seller shall place him in this position.</p> - -<p class='c014'><b>Opinion No. 37.</b></p> - -<div class='chapter'> - <h2 class='c004'>LIABILITY OF TRANSPORTATION COMPANY IN DELIVERING WITHOUT SURRENDER OF BILL OF LADING.</h2> -</div> - -<p class='c008'>Question—Can a transportation company be held responsible -for delivering a shipment of lumber to a consignee without surrender -on the part of the consignee of signed bill of lading, originally -issued when shipment was made?</p> - -<p class='c013'>Reply: Until lumber shipped has been completely delivered -to the person entitled to receive it, the bill of lading -represents the lumber, but no longer. The transfer of a bill -of lading passes the title of the transferor to the transferee. -If, therefore, a transportation company delivers the shipment -to consignee without a surrender of the bill of lading it is -liable to a person who has obtained a valid title to the shipment -by transfer of the bill of lading from the consignee.</p> - -<p class='c014'><b>Opinion No. 29.</b></p> - -<div class='chapter'> - <h2 class='c004'>IF NO SPECIFIC TIME OF SHIPMENT IS NAMED A REASONABLE TIME IS UNDERSTOOD.</h2> -</div> - -<p class='c008'>Question—On October 25th we bought of a manufacturer a -carload of lumber through their agent. On the 30th we received -confirmation of the order. Nothing was said about the time of -shipment, except that in sending the sizes on October 26th, we told -them to “ship at once.” On November 1st they wrote that they -would ship it “the coming week.” No part of it has been shipped -yet. We could have disposed of the carload during this time at a -very good profit. During all this time we have been completely out -of this kind of lumber. Have we a just claim for damages?</p> - -<p class='c013'>Reply: It does not appear whether the confirmation -received by the buyers on October 30 was sent by the sellers -before or after their receipt of the instruction to “ship at -once.” The only importance of this point is this: If the -<span class='pageno' id='Page_35'>35</span>sellers confirmed the order after receiving the instruction to -“ship at once,” they were bound to ship at once. If they -confirmed the order before receiving this instruction, then -the instruction formed no part of the contract, and is not -to be taken into account; in that case the sellers were bound -simply to ship the lumber within a reasonable time—within -the time within which these sizes commonly are shipped. If -they have not done so, they are guilty of a breach of contract -and the buyers may recover any damages the breach has -caused them. They are entitled to be placed by the sellers in -as good a position as they would be in if the sellers had carried -out their contract according to its terms. The letter of the -sellers of November 1, saying they would ship the goods “the -coming week,” forms no part of the contract. The agreement -was made before that letter was written, and it is binding -as originally made. The letter is of importance, however, -as showing an estimate of the sellers themselves as to what -was a reasonable date of shipment. The letter is not binding -upon the buyers, if they can prove that an earlier date would -have been reasonable; but it is binding upon the sellers, who -wrote it.</p> - -<p class='c014'><b>Opinion No. 36.</b></p> - -<div class='chapter'> - <h2 class='c004'>ONE WHO BUYS LUMBER IS LIABLE THOUGH HE TRANSFERS IT BEFORE DELIVERY.</h2> -</div> - -<p class='c008'>Question—An individual buys a carload of lumber for future -delivery and before it is delivered he forms a partnership with two -other persons and turns the order over to the firm. Delivery of -the lumber is made to this firm. Please say whether the individual -is liable, or only the partnership. It is a limited partnership and -the buyer has only a certain definite amount at stake with it.</p> - -<p class='c013'>Reply: This is simply the case of an individual who has -purchased goods and then has sold or transferred them before -they have come into his actual possession. Such cases, -that is, of a second sale before delivery to the first purchaser, -are very common, and the original purchaser remains liable -precisely as if delivery has been made to him and he had -afterward disposed of the goods as he saw fit. In the case -our correspondent puts the seller may look to the first buyer -unless he has agreed to release him and look to the firm.</p> - -<p class='c014'><b>Opinion No. 38.</b></p> - -<div class='chapter'> - <span class='pageno' id='Page_36'>36</span> - <h2 class='c004'>A LUMBER SALESMAN GENERALLY HAS NO POWER TO BIND HIS PRINCIPAL.</h2> -</div> - -<p class='c008'>Question—One of our traveling salesmen has just sent in a -larger order than we feel safe in filling for that particular customer -on the liberal terms of credit allowed him in the same contract. -Are we compelled to fill the order, or may we reject it without -incurring any legal liability?</p> - -<p class='c013'>Reply: Ordinarily a traveling salesman is authorized -merely to take orders and submit them to his principal for -acceptance or rejection. He has no power to bind his employer -irrevocably by a contract of sale. Our correspondents -are justified in refusing to fill an order sent in by their salesman -unless the latter was expressly authorized to make a -valid and binding sale upon his employers’ behalf, or unless -traveling salesmen are usually clothed with this power. In -the latter case each salesman will be presumed to have the -powers usually possessed by men of this class, unless the -buyer had notice of a limitation upon this general and usual -power in the case of the salesman with whom he was dealing.</p> - -<p class='c014'><b>Opinion No. 35.</b></p> - -<div class='chapter'> - <h2 class='c004'>USING LUMBER WITHOUT CONSENT OF SHIPPER WHERE QUALITY IS DISPUTED.</h2> -</div> - -<p class='c008'>Question—We shipped a carload of lumber to a party and they -complained of the quality and refused to settle in full. We insisted -upon a settlement in accordance with invoice, or re-inspection of -the entire carload by an inspector that would be satisfactory to -both parties. We sent a man to look at the lumber and found that -it was put in a dry kiln without our consent, and this, of course, -prevented an inspection of the lumber in its original condition. Are -we correct now in insisting upon a settlement in full as invoiced, -and can we maintain our action in a lawsuit?</p> - -<p class='c013'>Reply: If your lumber was received by the company -and, without authorization from you they put it in the dry -kiln, so as to prevent your examining it or taking it back, -they would be liable to you for the invoice price. They cannot -accept the lumber, use it and then refuse to pay. By their -acceptance they waive any defects in quality or quantity, -which can be ascertained upon an inspection of the lumber -upon arrival. They do not waive any defects that are what -we call “latent,” that is, that are not readily ascertainable -<span class='pageno' id='Page_37'>37</span>upon an examination of the lumber on arrival, but only show -after the lumber may be put in use. As we take it, such -complaints as have been made relate to alleged defects which -they ascertained as soon as they received the lumber. In -that case they had no legal right to use it, and if they used it, -they are liable for the invoice price.</p> - -<p class='c014'><b>Opinion No. 34.</b></p> - -<div class='chapter'> - <h2 class='c004'>IN AN F. O. B. SALE, SHIPPING POINT, THE CARRIER IS THE BUYER’S AGENT.</h2> -</div> - -<p class='c008'>Question—If I buy goods f. o. b. point of shipment and part -of the goods invoiced are lost in transit can the consignor enforce -payment for the goods not received?</p> - -<p class='c013'>Reply: When goods are bought f. o. b. place of shipment -they are delivered to the buyer at the place of shipment. -Title to the goods passes to the buyer as soon as -delivery is made to the carrier and the carrier is an agent -of the buyer to bring his goods to him. If the goods are lost -on the way the buyer must pay for them, just as if they had -reached him; they have reached his agent and have been -delivered to him, and that is all the buyer can ask. When -goods are sold the presumption always is that the buyer is to -take charge of them in the place in which they are at the -time of the sale. There is no presumption that the seller -is to carry the goods to any place the buyer may select and -deliver them to the buyer there. The seller may do this, of -course, and he frequently does do it; but he is never bound -to do it unless he has expressly so agreed. If the buyer, -in any case, declared that the goods were to be brought to -him by the seller he must show some clause in the contract -that has this meaning; in the absence of such a clause the -buyer, either in person or through an agent, is to take possession -of the goods in the place they occupy at the time of -the sale. The words, “free on board,” are sufficient to prevent -the seller from making a good delivery while the goods -are in his own warehouse, as he otherwise might do. These -words place upon him the duty of taking the goods to the boat -or cars and meeting the expenses necessary actually to start -them on their way; but when this much is done the seller’s -whole duty is done. The goods then belong to the buyer -and have been delivered to him; that is all that is necessary -to raise an obligation on his part to pay for them.</p> - -<p class='c014'><b>Opinion No. 33.</b></p> - -<div class='chapter'> - <span class='pageno' id='Page_38'>38</span> - <h2 class='c004'>BUYERS CAN INSIST THAT LUMBER, PURCHASED ON CREDIT, BE DELIVERED.</h2> -</div> - -<p class='c008'>A retailer says: “Lumber was sold to us by a special written -contract on a six months’ credit, the lumber to be ordered out as -fast as we saw fit. We have taken a little more than half and only -about two of the six months have expired. We order another -small shipment to be made. The seller replies that he will send this -car, but that he can make no more deliveries unless we are ready -to discount part, at least, of our bill. He says that he has already -extended credit to us as far as he feels justified in doing. He seems -to pay no attention to the contract, under which we were entitled -to order out all of the lumber at once, or in such shipments as -suited us, and were to have a credit upon the whole bill of six -months. Will he be sustained in the stand he has taken? If we -have a remedy please say what it is?”</p> - -<p class='c013'>Reply: When lumber has been sold and part of it delivered, -it is too late for either the buyer or the seller to alter -the contract without the consent of the other. If the sale is -upon credit, as in this case, the terms of credit are such as -have been agreed upon in the beginning. Either the buyer or -the seller may ask, of course, to have the terms changed before -all of the deliveries have been made, but if the other does -not agree to the change the contract must be performed as it -was made. It would be as reasonable for the buyer to refuse -to accept the remainder of the lumber unless the terms of -credit were made more favorable to him, as for the seller to -refuse to continue his deliveries as agreed unless his new proposal -as to credits were accepted. If the seller, in the case -our correspondents put, refuses to go on with the contract in -its original form, the buyers will have the same remedy they -would have had if no deliveries at all had been made. They -may go into the open market, when the time for delivery -arrives, buy lumber enough to finish out the contract, and then -hold the seller for such amount as they are compelled to pay -over and above that named in the contract. Or, if they do -not choose to do that, they may establish the amount of the -loss arising from the seller’s breach of contract in any way in -which it can be shown to the satisfaction of a jury and collect -the damages so established. Or the buyers may cancel the -remainder of the contract if they prefer that course. There -is only one exception to this rule. Any one who has bought -goods on credit is bound by an implied agreement to keep his -credit good, and if he fails to do so he cannot require the -seller to deliver the goods. Accordingly, if a buyer, before all -of the lumber is delivered, shows an inability to pay any just -<span class='pageno' id='Page_39'>39</span>claim in the ordinary course of business, when it falls due, -those who have sold him on credit may lawfully refuse to -go on with the deliveries and the buyer will have no remedy.</p> - -<p class='c014'><b>Opinion No. 39.</b></p> - -<div class='chapter'> - <h2 class='c004'>ONE CUSTOMER CANNOT DEMAND THAT CREDIT BE EXTENDED TO ANOTHER.</h2> -</div> - -<p class='c008'>Question—Lumber corporation No. 1 bought from lumber corporation -No. 2 several carloads of lumber for future delivery. Corporation -No. 1, before the agreed time of delivery, commenced proceedings -of dissolution. Out of corporation No. 1, however, a -new corporation, No. 3, was formed. Corporation No. 3 now -demands of corporation No. 2 that they deliver this lumber. No. 2 -declines on the ground that the personal, as well as the financial, -standing of the new corporation is entirely changed. Do you think -that corporation No. 2 has a legal right to do this? Where the word -corporation is used we mean that one company is incorporated under -the laws of one State, while the other two companies are existing -under charters from different States.</p> - -<p class='c013'>Reply: If any person or corporation has been willing -to extend credit to corporation No. 1 that same person or -corporation cannot for this reason be compelled to extend -credit to corporation No. 3, or to any other person or corporation. -If a corporation has bought goods and paid for -them it may assign its right under that contract, which is -simply a right to demand delivery of the goods to another -corporation; but if it has bought goods on credit, and has -then gone into dissolution, it cannot demand that the credit -of any other corporation be substituted for its own.</p> - -<p class='c014'><b>Opinion No. 40.</b></p> - -<div class='chapter'> - <h2 class='c004'>GIVING A BAD CHECK DOES NOT PREVENT DISCHARGE IN BANKRUPTCY.</h2> -</div> - -<p class='c008'>Giving a worthless check for goods and disposing of them immediately -is not a ground for refusing a discharge from bankruptcy. -Judge Hough of the United States District Court has recently -granted a discharge to a party who filed a petition in bankruptcy -on October 24, 1906, with liabilities of $11,577 and no assets. His -discharge was opposed by a creditor, who said that on June 6, 1892, -the debtor bought $1,964 worth of goods, giving a check in payment, -<span class='pageno' id='Page_40'>40</span>which was deposited in bank and came back marked “no -funds.” The creditor went at once to debtor’s place of business -and found that he had sold out and left the city. When debtor’s -application for a discharge came up for a hearing he excepted to -the specifications of objections, and Judge Hough sustained the -exception on the ground that the objections are not within the -statutory list.</p> - -<p class='c014'><b>Opinion No. 41.</b></p> - -<div class='chapter'> - <h2 class='c004'>WHAT IS CONVEYANCE ON F. O. B. SHIPMENT?</h2> -</div> - -<p class='c008'>Question—What is the meaning of f. o. b. Philadelphia, Pa.? -What is the meaning of f. o. b. cars Philadelphia, Pa.? Is there -any difference between the two above? If so, what is it?</p> - -<p class='c009'>2.—In selling goods f. o. b. New Orleans, and same are delivered -alongside of steamer, does the shipper or consignee have to -pay cost of handling charges in transferring from cars to steamer; -that is, on goods shipped from New York to New Orleans.</p> - -<p class='c013'>Reply: (1) When goods are sold f. o. b. place of shipment -the meaning is that the seller, for the amount named in -the contract, will supply the goods and will bear the expense -of delivering them on board that conveyance which is to carry -them to their destination. The only difference between the -two phrases set down above is that the latter binds the seller -to deliver the goods on the cars at Philadelphia without any -expense to the buyer; while the former binds him to deliver -them at his own expense on some conveyance not yet specified, -which will carry them to the buyer.</p> - -<p class='c013'>(2) If goods are sold f. o. b. New Orleans, and they -are to be carried to the buyer at some other place in a steamer, -all expenses necessary to deliver them aboard the steamer are -to be borne by the seller. The conveyance on board which -the goods are to be delivered is that which is to take them to -their destination. If goods are to be carried to a buyer on -a steamer there is no reason why he should bind the seller -to load them on freight cars and make a tender of them there.</p> - -<p class='c014'><b>Opinion No. 42.</b></p> - -<div class='chapter'> - <h2 class='c004'>FAILURE TO DELIVER ONE INSTALLMENT CAUSE FOR CANCELLING ORDER.</h2> -</div> - -<p class='c008'>Question—We purchased a quantity of lumber to be shipped in -February, March and April in equal monthly shipments. The first -<span class='pageno' id='Page_41'>41</span>shipment has not been made in February and we would like to -know whether this entitles us legally to cancel the entire contract -or only the February lot. In other words, does the breaking of a -contract in one instance cancel the entire contract?</p> - -<p class='c013'>Reply: When goods are to be delivered in instalments -the courts of this State hold that the seller’s failure to deliver -one instalment justified the buyer in refusing to accept that -tender and also in rescinding so much of the contract as is -yet unfulfilled. It is one contract, not several, and the seller -cannot insist on a right to deliver only such instalments as -he finds it convenient to deliver and to have them accepted. -The buyer has not agreed to pay anything at all for part of -the goods. His contract is that he will pay a certain amount -for all of them. If he is not to have all of them, it is quite -conceivable, and is often a fact that any part less than all is -of very much less than proportionate value to him; it may -have practically no value to him at all. In any event, the -seller has agreed to do a certain service and the buyer has -agreed to pay a certain sum of money. The court will not -infer from that an obligation to pay half the money for half -the service or to accept half the service on any condition, if -the other half is to be, or has been, withheld.</p> - -<p class='c014'><b>Opinion No. 43.</b></p> - -<p class='c008'>Question—A customer places an order with the mill for November, -December, January and February, proportionate shipments. -The mills are unavoidably delayed in executing the order, but are -finally able to make shipment of practically the whole order in -February. The customer refuses to pay invoices for all the goods -shipped in February, but claims dating on proportionate amounts -in April, May and June. Is he justly or legally entitled to the dating -and could he hold the goods subject to sellers’ order?</p> - -<p class='c013'>Reply: There seems to have been no clause in this contract -releasing the mill in case of such a delay as has occurred. -In the absence of such a clause the buyer was justified in -refusing to accept the goods when all of them were shipped -in February. He is entitled to hold the goods subject to the -seller’s order, or to return them. He cannot, however, force -another contract upon the seller than that which was actually -made. The mill may take back its goods or allow the buyer -to accept them upon such new terms as may be agreed upon. -The buyer is justified in receiving the original contract. This -is upon the supposition that the buyer has not during the -past four months said or done anything to lead the seller -<span class='pageno' id='Page_42'>42</span>to suppose that he was satisfied with the delay, that he would -accept all of the goods as readily in February as if shipment -had been made in strict accordance with the terms of sale. If -he has done that he is estopped now from making any objection -to the tender.</p> - -<p class='c014'><b>Opinion No. 44.</b></p> - -<div class='chapter'> - <h2 class='c004'>AMOUNT OF CLAIM FOR DAMAGE AGAINST CARRIER.</h2> -</div> - -<p class='c008'>Question—We made a shipment via two connecting railroads. -When it reached a junction prior to delivery at destination, i. e., -a point on the second road, was badly or entirely damaged in a -wreck, and our customer asked that we immediately replace the -shipment, which we did, and made another shipment of the same -kind of lumber four days later, but in the interim between the -time of the first shipment and the time we received the replacing -order from the customer, the price advanced, and in our second -invoice we naturally charged the customer for the advance. The -claim department of the railroad now offers to settle with us at -the original invoice price of the first shipment and declines to entertain -a settlement at the advanced price. We claim that our -position is entirely legal in the matter, and that we are entitled to -the advanced price for the shipment that was lost, the same representing -the value of the goods at the time the goods were destroyed.</p> - -<p class='c013'>Reply: Usually the measure of damages in a case of this -kind is based upon the value of the goods at the time and -place and in the condition in which they ought to have been -delivered; the freight is to be deducted from this, if it has -not been prepaid, and then interest is to be added from the -day on which delivery ought to have been made to the day -of payment; there is to be added also any expense to which -the owner of the goods has been put as a necessary and natural -result of the loss. What the carrier is bound to do is -to put the owner of the goods as nearly as possible in the -same position he would have occupied if the carrier had -done his full duty in the first place. If the carrier had done -his duty the owner could have sold the goods at the market -price on the day of delivery at the place of delivery, he would -have had the interest on the money thereafter, he would -have escaped all incidental expenses arising out of the loss, -and he would have been called upon to pay freight to the -carrier, if it had not been paid in advance. There is only one -exception to the rule that is at all common. If the goods -have already been sold for delivery at destination, at a price -<span class='pageno' id='Page_43'>43</span>less than that which chances to prevail when the day of delivery -arrives, and if the carrier, at the time of shipment, had -actual or constructive knowledge of this fact, then the owner -can demand only the selling price with interest. In that case, -if the carrier had done his duty, the owner would have -obtained for his goods, not the market price, but only the -contract price. Whether the carrier had or had not notice -of the sale makes a difference in this respect; that a carrier -is not to be held for a larger loss than he had in contemplation -when the freight rate was fixed and the degree of care -demanded of him was settled. If he had no knowledge of -the sale, actual or constructive, he is bound for damages -based upon the market price, as in the other case. The fact -that other goods at a different price were sent to replace the -lost shipment does not enter into the matter.</p> - -<p class='c014'><b>Opinion No. 46.</b></p> - -<div class='chapter'> - <h2 class='c004'>RISK IN SENDING CHECK TO DRAWER’S BANK FOR CERTIFICATION.</h2> -</div> - -<p class='c008'>Question—We received a check from one of our customers and -sent it to the customer’s bank for certification. The bank failed before -the end of the next day and our check was not paid. Can -we not return it to the maker and demand the face of it from -him?</p> - -<p class='c013'>Reply: If the drawer of the check in this case had sufficient -money on deposit to meet it our correspondents have -no other recourse except against the assets of the insolvent -bank; the depositor is discharged. The usual rule is that -when a check is delivered that is drawn upon a bank in the -same place in which the payee resides the drawer guarantees -the solvency of the bank during the remainder of the day on -which the check was delivered and the whole of the next day. -The holder has this much time in which to present the check -and draw the money; if the bank fails meanwhile the loss is -upon the drawer of the check and the holder takes the risk -of failure after the second day. But this rule does not apply -when the holder of the check takes it to the bank and has it -certified before the end of the next day after he receives it. -Certification binds the bank and releases the drawer. So far -as the drawer and holder are concerned, the effect is precisely -the same as if the holder had drawn the money and had then -deposited it to his own credit in the same bank.</p> - -<p class='c014'><b>Opinion No. 45.</b></p> - -<div class='chapter'> - <span class='pageno' id='Page_44'>44</span> - <h2 class='c004'>A CONTRACT MAY BE CANCELLED WHEN ONE PARTY IS GUILTY OF BREACH.</h2> -</div> - -<p class='c008'>Question—Lumber has been sold for delivery in installments -running through a considerable period. Payments are to be made -in installments also. The buyer has been very lax in this regard, -however; he has not made a single payment strictly on time, and in -some cases has delayed until the seller has been compelled to -threaten suit. Is the seller bound to go on making deliveries to the -end of the time named in the contract, getting his money whenever -and however the tardy buyer sees fit to pay it?</p> - -<p class='c013'>Reply: If a seller agrees to deliver the goods at certain -times, and the buyer agrees to pay for them in installments -at given dates, each promise is a consideration for the other. -If either the buyer or the seller fails to do his full duty under -the contract he is in no position to demand that the other shall -do what he has agreed to do. In other words, as soon as -either is guilty of any breach of the contract the other may -declare the whole agreement at an end; he may refuse to do -anything further under the contract himself, and may demand -damages of the person who was guilty of the breach. If a -buyer fails to meet any payment promptly when it is due, the -seller, if he chooses to do so, may immediately rescind the -contract and bring suit for the unpaid installments and for -damages. If he had not this privilege he might be compelled -to go on for months delivering his goods to one who had -already shown his unwillingness or inability to make good his -promise of payment.</p> - -<p class='c014'><b>Opinion No. 47.</b></p> - -<div class='chapter'> - <h2 class='c004'>LUMBER ON A CONSIGNEE’S SIDE-TRACK IS IN CUSTODY AND AT THE RISK OF THE CONSIGNEE.</h2> -</div> - -<p class='c008'>Question—When does the railway’s liability end and the consignee’s -begin on lumber delivered in cars on the consignee’s side-tracks; -i. e., if a carload was burned in forty-eight hours after being -placed for the consignee, would the loss fall on the transportation -company or the consignee?</p> - -<p class='c013'>Reply: When a carload of merchandise is delivered upon -the consignee’s own side-track and the consignee has notice, -express or implied, of that fact, then all liability of the railroad -company for the safety of the merchandise ceases at -once. The goods are still in the company’s cars, but that is -not sufficient to make the company liable, for the cars themselves -<span class='pageno' id='Page_45'>45</span>are in the custody of the consignee and upon his premises. -The goods have been delivered to the consignee, and -that is the last of the duties the carrier undertook to perform. -A railroad company cannot be expected, and in some cases -would not be allowed, to place its watchmen in private -freight yards and to extend over and through those yards its -system of protection against fire. When cars containing goods -have been delivered upon the consignee’s premises the goods -themselves have been delivered there. The carrier is no -longer liable, either as carrier or as warehouseman and the -courts have so decided.</p> - -<p class='c014'><b>Opinion No. 48.</b></p> - -<div class='chapter'> - <h2 class='c004'>WHERE A SELLER REFUSES TO MAKE DELIVERIES, BUYER CAN PROTECT HIMSELF.</h2> -</div> - -<p class='c008'>Question—A places a contract with B for future delivery of -lumber beginning in October; B, for certain reasons, does not care -to deliver this contract. A has the opportunity to buy the identical -goods for the same delivery from competitors at the same price, -after being notified by B that he does not care to deliver this contract. -Does the fact that A has the opportunity to cover himself -on the same conditions release B of damages arising from non-delivery -of the contract, or can A wait until the time of delivery -before buying goods in the open market against the contract of B -which the latter refuses to deliver?</p> - -<p class='c013'>Reply: If B is under contract to deliver goods to A in -October, and if, before October, he notifies A that he does -not intend to fulfill his contract obligation, A may accept that -statement as final and protect himself at once. He may make -other arrangements for an October delivery and compel B -to pay the loss, if any, or he may sue at once for breach of -contract. The buyer is not bound to pursue this course, however. -He may act upon the supposition that, upon further -consideration of the matter, the seller will conclude to do his -duty after all; and so the buyer, A in this case, may wait -till the time arrives for the October delivery, and may then -buy goods to replace those that the seller ought to have delivered, -holding the seller liable for the loss, if any, or he -may then sue for breach of the contract. If this costs the -seller more than the other plan might have cost him, the -fault is his own. He will not be heard to complain because -the buyer has taken it for granted that he really would -perform his contract obligation when the time arrived, in -spite of his previous statement that he did not intend to do -so.</p> - -<p class='c014'><b>Opinion No. 49.</b></p> - -<div class='chapter'> - <span class='pageno' id='Page_46'>46</span> - <h2 class='c004'>ALL CONDITIONS OF A CONTRACT MUST ACTUALLY BE EMBODIED IN THE CONTRACT.</h2> -</div> - -<p class='c008'>Question.—The following is a general form that is frequently -printed across the top of the letter heads of manufacturers: “All -agreements are contingent upon fires, strikes, delays of carriers, -accident and other contingencies beyond our control.” What effect -does this have on a contract when such letter heads are used when -quoting prices and when accepting the order?</p> - -<p class='c013'>Reply: Any provision that is intending to form part of a -contract ought to be introduced into it in express terms or -else referred to so that there can be no mistake regarding it. -In the particular case under consideration the clause should be -incorporated in the contract or acceptance, or the contract -should state that the sale is made subject to the terms and -conditions printed across the top of the paper. Either one -of these would be a simple, easy procedure and would remove -all doubt. A contract usually begins with the name of the -place and a date, or with the names of the parties; and it -ends with one or more signatures. Both parties are bound -by all that lies within these limits and by everything beyond -that is referred to as forming part of the agreement; but -neither party is, as a rule, expected to look anywhere else—even -around the margins of the same paper—to ascertain -his rights and liabilities. It may be possible, in some cases, -to make a provision printed on the margin of the paper containing -the contract part of the contract itself, but there is -always more or less doubt upon this point, and no doubt -should be left where it is so easy to make the meaning plain. -If the marginal printing is to be useful at all it will be -mainly in connection with a statement that the contract was -made subject to a certain usage of the business, or a certain -custom of that particular house, and that this custom was -well known to the buyer; as proof of this fact the words -across the top of the paper would be useful.</p> - -<p class='c014'><b>Opinion No. 50.</b></p> - -<div class='chapter'> - <h2 class='c004'>A CARRIER IS LIABLE FOR ANY LOSS CAUSED BY HIS DELAY IN DELIVERING GOODS.</h2> -</div> - -<p class='c008'>Question.—Inform us what recourse we would have against a -railroad for a shipment of lumber from Buffalo to New York, -which has already been on the road eighteen days, as shown by the -shipping documents, and has not arrived yet. In the meantime the -market dropped some 10 per cent. in price. This lumber was -bought f. o. b. Buffalo.</p> - -<p class='c013'><span class='pageno' id='Page_47'>47</span>Reply: A carrier is bound, not only to deliver the lumber -entrusted to him for carriage, but to deliver it with reasonable -promptness. The courts recognize the fact that promptness -of delivery has an importance second only to the fact of -delivery itself. What is to be held as constituting reasonably -prompt delivery is to be decided in accordance with nature -of the goods and all the circumstances of the particular case; -it is such delivery as carriers of the kind in question, carriers -by rail or vessel, as the case may be, ordinarily make -in handling goods of the same kind as those in question. -When the time arrives for delivery to be made, under this -rule, and the goods are not delivered the consignee is entitled -to sue for their value at destination on the day on which -delivery ought to have been made. If the carrier is able to -deliver the goods, and offers to do so, at any time before he -has been required to pay for them as goods lost, the consignee -cannot refuse to accept them and still recover their full value. -He is bound to accept the goods whenever they are tendered, -no matter how great the delay may have been; but in such -a case he still has a valid claim for any loss he may have sustained -as a result of the delay. His damages are at least as -great as that amount by which the market value of the goods -on the day of delivery is below their market value on the day -on which delivery ought to have been made; to this is to be -added any other loss or expense brought upon him as a -direct result of the carrier’s delay.</p> - -<p class='c014'><b>Opinion No. 13.</b></p> - -<div class='chapter'> - <h2 class='c004'>THERE IS NO REMEDY AFTER ACCEPTING LUMBER.</h2> -</div> - -<p class='c008'>Question.—I purchased some lumber from a party in New York -State at a given figure f. o. b. shipping point, and had it forwarded -by the railroad company according to my instructions. Upon arrival -my customer reported to me a shortage of several hundred feet, -of which I in turn notified the party from whom I bought. He -stated that he hardly thought such a shortage was possible and -asked me to retally the lumber. I communicated with my customer, -who told me that the shortage reported was correct, and that -he had used up the lumber as he was in need of the lumber, although -I requested him to hold it intact. My customer in settling -with me deducted for the full amount of the shortage, -whereas the party who sold to me refuses to accept settlement on -this basis, offering me an affidavit from his shipper that the quantity -alleged to have been shipped by him was correct. Am I compelled -according to the New York court rulings to remunerate the -<span class='pageno' id='Page_48'>48</span>party who sold to me as per his invoice? He claims that the lumber -ceased to belong to him when he placed it at the railway company’s -depot subject to my instructions. For this reason he demands -full payment. I am in a position to furnish an affidavit -from the party to whom I sold the lumber to the effect that the -shortage actually occurred at destination, although the lumber was -received in good condition.</p> - -<p class='c013'>Reply: This lumber was sold f. o. b. shipping point and -it is true, as the seller says, that title passed to the buyer at -that point. This fact, however, does not excuse the seller -for delivering short count or tally, if he made such delivery. -He undertook to deliver a certain quantity of goods at the -shipping point, and his contract obligation was not fulfilled -unless he delivered that quantity. It does not appear, however, -that the contract was such as to allow the buyer to -accept less than the quantity sold at a pro rata price. As the -contract is described to us, it was a sale of a definite quantity -for a stipulated price, with no other provision. That being the -case, the buyer, when tender was made to him had no choice -other than to accept the tender as satisfactory, or else to -reject it and claim damages for breach of contract. He did -accept the goods and he used them. It is too late now for -him to say that the tender was in any respect unsatisfactory. -The buyer might have rejected the goods on account of short -tally, and then he could either have claimed damages for -breach of contract, as we have suggested, or he could have -communicated with the seller, offering to take the shipment -at less than the contract price—could have made a new contract, -in short. He did neither. He accepted the goods. He -will not be heard now to say that they were, in any respect, -not such goods as the contract called for. Our correspondent -can be compelled to pay for these goods the full contract -price, and the person to whom he sold them can be compelled -to do the same.</p> - -<p class='c014'><b>Opinion No. 31.</b></p> - -<div class='chapter'> - <h2 class='c004'>PROPOSED FREIGHT RATE ADVANCE.</h2> -</div> - -<p class='c008'>In view of the agitation regarding the proposed advance in -freight rates it is suggested that our members protect themselves -as fully as possible in making quotations. It is believed advisable -to use a clause either printed or stamped on the letter-head or quotation -stating substantially the following:</p> - -<p class='c013'>“All quotations made and orders accepted are based -on present freight rates.”</p> - -<p class='c009'><span class='pageno' id='Page_49'>49</span>Where this clause is used it should be printed or stamped in -such a way that it becomes a part of the quotation or correspondence. -Stamping the clause on the margin of a letter-head is considered -inadvisable.</p> - -<p class='c014'><b>Opinion No. 110.</b></p> - -<div class='chapter'> - <h2 class='c004'>ACCEPTANCE OF AN AMOUNT OFFERED AS “PAYMENT IN FULL” MAY OR MAY NOT CANCEL THE DEBT.</h2> -</div> - -<p class='c008'>Question—A customer sends me a check for a certain amount -and inserts the following on the face of his check: “In full to June -1.” Does my indorsement give my receipt in full to this date or -not? Can I indorse his check and write him a letter advising him -that I am using the check only to apply on the account?</p> - -<p class='c013'>Reply: Suppose A owes B a certain sum of money and -there is no doubt or dispute as to the amount actually due. -Then if A pays to B less than the amount, in cash or by check, -saying at the time, “this I tender as payment in full,” B may -keep the money or cash the check without losing the right he -previously had to demand what was still due and unpaid. -No man, without the consent of his creditor, can discharge the -whole of his debt by paying part of it, if the amount is -liquidated and certain. Suppose, however, that there has -been no agreement as to the amount due or that there is an -honest and well-founded dispute concerning the matter. Then -when the debtor sends any reasonable amount, with a statement -that it is tendered and is to be accepted, if at all, as -payment in full, that is his estimate of the sum due. The -creditor cannot accept the tender without accepting the estimate; -if he does accept the tender the amount due is thereby -agreed upon and fully paid. If the creditor is not willing to -accept the tender as payment in full he must return it. Then -an agreement may be reached as to the amount actually due, -or if the two cannot agree the matter may be left to the -courts. The debtor has this privilege, in a case of this kind, -because it would be unfair to him to allow the creditor to -keep what the debtor honestly believed to be the whole sum -due, and still allow him to sue for more, when, if he had -brought his suit in the first place it is possible he might not -have been able to recover even as much as the debtor has -already paid him.</p> - -<p class='c014'><b>Opinion No. 51.</b></p> - -<div class='chapter'> - <span class='pageno' id='Page_50'>50</span> - <h2 class='c004'>PROTEST IS NOT NECESSARY TO HOLD PARTIES PRIMARILY LIABLE.</h2> -</div> - -<p class='c008'>Question—Is it necessary, or is it in any way helpful to have a -note or an accepted draft protested, regard being had only to the -maker of the note or the acceptor of the draft?</p> - -<p class='c013'>Reply: The object of a protest is to inform a person who -is secondarily liable upon a bill or note that the person primarily -liable has been properly called upon and has refused -to pay the amount. There could be no object in conveying -formal information of this kind to the parties primarily -liable, because they know what the facts are, they know, -that is, that demand has been duly made of them and that -they have failed to comply with it. Accordingly it is held -that protest and notice are not necessary to charge the maker -of a promissory note or the acceptor of a bill of exchange. -We believe this to be the sound rule in all cases.</p> - -<p class='c014'><b>Opinion No. 52.</b></p> - -<div class='chapter'> - <h2 class='c004'>F. O. B. SHIPMENTS.</h2> -</div> - -<p class='c008'>Question.—Please advise us, what the position of a shipper is -who takes an order for a full carload of material at a price including -freight to destination, but where the shipper takes out a bill of -lading in the name of the buyer. The shipper claims he simply -guarantees freight to destination, and having the bill of lading -issued in the name of the buyer places the risk of loss or damage -in transit on the buyer.</p> - -<p class='c013'>Reply: A buyer of goods takes title to them wherever -they may be at the time of the sale unless the contract provides -otherwise or unless the seller by some act of his own -reserves the title to himself during transportation. A mere -agreement on the part of the seller to pay the freight is not -sufficient to rebut the presumption that title was to pass -on delivery to the carrier. When goods are sold -f. o. b. destination the seller undertakes to carry them to -their destination and there deliver them. They are his -goods, and the risk is his, until he has tendered -delivery at that place; this is true because the buyer cannot -be compelled to accept a tender made at any other place; -but a mere agreement that, for a given price, the seller will -furnish the goods and pay freight upon to a given place, does -not make him liable for their delivery in that place. If he -was bound to deliver them at destination the contract would -say nothing about freight; an obligation on the seller’s part -<span class='pageno' id='Page_51'>51</span>to deliver the goods at destination is, in itself, an obligation -to pay freight upon them or to carry them himself, and it is -not for the buyer to choose which he shall do. If the agreement -to pay freight did place the risk on the seller during -transportation he could not escape that obligation by his own -act in taking out a bill of lading in a particular form. If he -was at liberty, under the contract, to deliver the goods at the -shipping point, however, he could increase his obligation by -his own act, and taking the bill of lading to his own order -would, if not otherwise explained be sufficient for this purpose. -In this case the bill of lading was taken in the name -of the buyer, and that is consistent with the seller’s claim that -a valid delivery could be and was made at the shipping point -and the carrier was an agent of the buyer.</p> - -<p class='c014'><b>Opinion No. 53.</b></p> - -<div class='chapter'> - <h2 class='c004'>PAYMENT OF FREIGHT NOT ALWAYS TRANSFER OF TITLE.</h2> -</div> - -<p class='c008'>Question.—Please advise us if in selling lumber freight paid -to destination we are liable for damage in transit. As we understand -it, when we sell lumber delivered at destination we are liable, -but when we sell it freight paid the buyer is liable.</p> - -<p class='c013'>Reply: The person who owns goods while they are in -transit must bear the expense of damage or loss if they are -not insured. If the goods have been sold the title during -transit may be either in the seller or the buyer. It is sometimes -perfectly clear that title is in one or the other, while -in some cases it is a very difficult question. Payment of -freight is one item to be taken into consideration, but it is -generally not alone absolutely conclusive of the question one -way or the other. Our correspondent is correct in saying: -“When we sell goods delivered at destination we are liable.” -It is equally correct to say: “When we sell them, otherwise -than for delivery at destination the buyer is liable.” It is -not always true, however, that the buyer is liable when the -seller pays the freight. Goods that had not been ordered, for -example, or goods slightly different from those ordered might -be sent in the expectation that the buyer would accept them. -In such a case the seller would probably prepay the freight -but title would remain in him, and the risk would be his, -until the buyer had received the goods and accepted them. -If the contract requires the seller to pay freight that is good -evidence, if there is nothing on the other side to offset it, that -title and risk are to be in the buyer during transit; this is so -because if the seller was bound to deliver the goods at the -<span class='pageno' id='Page_52'>52</span>buyer’s end of the route he would be bound to pay the -freight, as a part of this obligation, and would not separately -agree to pay the freight. If the contract is silent on that -subject the mere fact that the seller pays the freight is not -sufficient to show that he reserves title. All the facts of the -case are to be taken into consideration, the presumption being -that title passes when the goods are delivered, properly directed, -to the carrier. If the buyer claims that title did not -pass to him at that instant the burden of proof is on him, and -the mere fact that the seller paid the freight is not alone -sufficient to overcome the presumption.</p> - -<p class='c014'><b>Opinion No. 54.</b></p> - -<div class='chapter'> - <h2 class='c004'>FILING CERTIFICATES IN MARYLAND.</h2> -</div> - -<p class='c008'>Some of our members have recently received communications -from the Secretary of State of Maryland calling their attention to -a law which went into effect in Maryland June 1st, 1908, regarding -filing certificates permitting foreign corporations to transact business. -The Secretary of State’s letter reads in part as follows:</p> - -<p class='c011'>“The name of your company appears on the records of this office -as a Foreign Corporation doing business in Maryland. As the recently -enacted Act of the Legislature repeals the law under which -you are authorized to transact business in this State, it will be necessary -for you to comply with the provisions of the new law, a copy -of which I enclose herewith, together with a blank form, convenient -for use in connection therewith.”</p> - -<p class='c009'>Our attorney at Baltimore writes as follows regarding the necessity -of complying with the provisions of the law above referred to:</p> - -<p class='c011'>“It is not necessary for a foreign corporation who maintains no -office or agency, or has no assets in this State, to file a certified -copy of its charter, the required certificate under the act and the -franchise tax. A foreign corporation under the facts above stated -may send any number of salesmen for the purpose of making sales -in this jurisdiction without having to comply with the foreign corporation -law.”</p> - -<p class='c014'><b>Opinion No. 55.</b></p> - -<div class='chapter'> - <h2 class='c004'>RAILROADS CAN INSIST ON ACCEPTANCE OF DELAYED SHIPMENTS.</h2> -</div> - -<p class='c008'>Question.—I shipped a carload of lumber to a customer consigned -to myself and it was apparently lost in transit. The delay -caused my customer to cancel this order with me, whereupon I -notified the railroad that I would not accept delivery and would hold -<span class='pageno' id='Page_53'>53</span>it responsible for not only the value of the car, but any damages -resulting to me. The car has just turned up and the railroad insists -that I must take it and put in claim for loss. Am I compelled -to accept the car?</p> - -<p class='c013'>Reply: If the road offers to deliver the lumber now the -consignee should accept it. A carrier is not a dealer, and -goods tendered by it cannot be refused, however late the tender -may be, or however seriously the goods may be damaged, -provided they are recognizable as the goods actually shipped -and have any value at all. The consignee cannot leave them -in the hands of the carrier and demand full value for them. -He must accept them and do the best he can with them. His -acceptance of them does not relieve the carrier of its liability, -and the consignee is entitled to recover all loss caused by -delay, or by damage to the goods, as soon as the loss has been -ascertained. If the market price has declined since the day -on which delivery should have been made that difference in -value is to be included in the damages; usually that is the -principal part of the loss, and frequently it is the whole of it.</p> - -<p class='c014'><b>Opinion No. 56.</b></p> - -<div class='chapter'> - <h2 class='c004'>QUESTION OF DISCOUNT.</h2> -</div> - -<p class='c008'>Question.—I take an order from my customer, the terms of -payment being stated 2 per cent. 10 days. The buyer makes settlement -in 20 days and claims that he is entitled to the discount by -paying interest for the extra time which he has taken over and -above the ten days. On the other hand, I claim that the bill not -having been paid within the discount period becomes net, and that -face amount of the bill therefore becomes due on the eleventh day -Which is right?</p> - -<p class='c013'>Reply: If a contract of sale gives the buyer no right to -a discount he has no such right. If the contract does give -him a right to a discount, upon certain terms, he must comply -absolutely with those terms in order to entitle himself to the -discount. The situation is just this: A seller who is entitled -to demand the full face of his bill, says to the buyer, “I will -deduct part of the amount if you will do a certain thing at a -certain time in a certain way.” The buyer cannot fail to do -the thing so specified at the time and in the manner named, -and still claim a discount as if he had done it. The buyer -is entitled to no discount at all in the case here put.</p> - -<p class='c014'><b>Opinion No. 57.</b></p> - -<div class='chapter'> - <span class='pageno' id='Page_54'>54</span> - <h2 class='c004'>LUMBER MAY BE RETURNED TO THE CONSIGNOR IF THE CONSIGNEE WILL NOT ACCEPT IT.</h2> -</div> - -<p class='c008'>Question.—We ordered a carload of lumber from a shipper in -the South and advanced $200 on account before the shipment arrived -at its destination. This shipper received from the railroad -company a bill of lading in his name marked “non-negotiable,” -which he indorses to us and mails to us and notifies the railroad by -letter that the shipment is for us. On arrival we find that the -lumber is not in accordance with our order and we refuse to accept -it, whereupon the railroad stores it for account of the owner. We -notified the railroad that we would release the car to the shipper -upon the latter paying to us the $200 advanced. The railroad has -since delivered the car back to the shipper on the latter’s instructions -by their giving the railroad the usual bond, which the railroad -insisted upon having, and we still retain the original bill of lading -indorsed to our order. We put in a claim against the railroad -company for the $200 advanced, taking the position that they had -no right to deliver the car to the shipper without the bill of lading -or an order from us. The railroad refuses to pay our claim, saying -that the bill of lading was a non-negotiable one, and inasmuch as -the shipper took it out in his own name he had a right to regain -possession of the car, and that we waived our rights, although -retaining the bill of lading, by refusing to accept the lumber on -arrival. We did not pay the freight. What course can we pursue -to recover the $200 advanced?</p> - -<p class='c013'>Reply: If a consignee refuses to accept goods shipped -under a non-negotiable bill of lading they may be returned to -the consignor. The carrier is not bound to act as agent or -intermediary for the settlement of any differences between -the two. Here our correspondents have simply extended a -credit of $200 to the shipper. If he does not voluntarily -meet the obligation the amount may be recovered by suit.</p> - -<p class='c014'><b>Opinion No. 58.</b></p> - -<div class='chapter'> - <h2 class='c004'>RAILROADS MUST PAY VALUE AT DESTINATION FOR DAMAGES ON LOST LUMBER.</h2> -</div> - -<p class='c008'>Question.—Should the railroad in settling claims for shortage -of lumber pay for it at our cost price or at the current market price?</p> - -<p class='c013'>Reply: Unless the contract between the shipper and carrier -provides for some other measure of damages, the principal -<span class='pageno' id='Page_55'>55</span>amount to be paid by the carrier when the lumber is -lost or destroyed is the market value at destination. If the -freight has not been paid in advance it is to be deducted from -market value. There is to be added, on the other hand, interest -at the legal rate from the day on which delivery should -have been made to the day of settlement; and there is -to be added also any incidental expense to which the consignee -may have been put as a direct result of the carrier’s -failure to do his duty. This is the only way in which the -consignee can be placed in as favorable a position as he would -have occupied if the carrier had done his duty, the only way -in which the whole of the loss can be placed upon the carrier, -who has caused it; and this is what the law aims to do in -every case.</p> - -<p class='c014'><b>Opinion No. 59.</b></p> - -<div class='chapter'> - <h2 class='c004'>SUIT CAN BE INSTITUTED IN NEW JERSEY ON JUDGMENT OBTAINED IN ANOTHER STATE.</h2> -</div> - -<p class='c008'>Question.—Some time ago I secured a judgment in Pennsylvania -against a party who now lives in New Jersey, and has some property -there. Can I make collection in New Jersey?</p> - -<p class='c013'>Reply: A judgment of a Pennsylvania court can be enforced -by a levy on property in New Jersey, without regard -to the place of residence of either the plaintiff or defendant. -If this judgment was secured in Pennsylvania it is without -force in New Jersey. In that case, however, another suit can -be started in New Jersey, and the proceedings will be brief -and inexpensive; he will have to prove merely that suit was -previously brought in Pennsylvania, in a court of competent -jurisdiction, and judgment rendered in his favor. Judgment -in New Jersey will follow immediately and as a matter of -course; under that judgment he can levy on property in New -Jersey.</p> - -<p class='c014'><b>Opinion No. 60.</b></p> - -<div class='chapter'> - <h2 class='c004'>NOT ALWAYS NECESSARY FOR CARRIER TO NOTIFY CONSIGNOR THAT SHIPMENT IS REJECTED BY CONSIGNEE.</h2> -</div> - -<p class='c008'>Question.—Have we a claim on the transportation company for -the invoice value of the shipment under the following conditions: -We made a shipment of a car of lumber, and when it arrived at -destination the railroad offered it to consignee and he refused it. -Some time later the railroad sold the lumber for what it would -bring, which, it appears, was only about 50 per cent. of our invoice. -<span class='pageno' id='Page_56'>56</span>Is the transportation company under obligation, in a case of this -kind, to notify the shipper that the lumber is at destination refused -and thereby give the shipper an opportunity to dispose of the lumber -without loss?</p> - -<p class='c013'>Reply: If a carrier has no notice to the contrary, he is -entitled to assume that the consignee is owner of the lumber -and that any delivery or disposition of it of which the consignee -cannot complain will be satisfactory to all persons. If -the goods are sent C. O. D. or if the carrier is instructed not -to deliver them to the consignee until they are paid for, or -if he receives any instructions from which he may infer that -the consignor retains title to the goods, in any such case, it -becomes the carrier’s duty to inform the consignor of the consignee’s -refusal to accept the goods. The same result follows -if the carrier is expressly directed to give such notice and if -he accepts the goods under these directions. In any other case -the carrier is not bound to assume that the goods have been -sold and that the consignor is retaining title to them to secure -payment of the purchase price, or that the consignor has any -interest in them at all. He may assume that the consignee -has already paid for them, or that they were the property of -the consignee before shipment. The consignor has put it in -the power of the consignee to take the goods and do as he -pleases with them, and the carrier is bound merely to -act in such manner that the consignee may have no valid -ground of complaint. In the absence of special instructions -to the carrier, or of knowledge on his part that the goods -belong to the consignor, the rule is simply this: That the -carrier is not to be expected to deal with two different persons -with reference to a single shipment or the disposition -to be made of it; that he may safely assume such an understanding -between consignor and consignee that they will keep -each other informed, if necessary, and that anything that -satisfies the consignee will satisfy the consignor. There is -nothing in the question asked to show that it was the carrier’s -duty to notify the consignor in this case.</p> - -<p class='c014'><b>Opinion No. 61.</b></p> - -<div class='chapter'> - <h2 class='c004'>LUMBER IS ACCEPTED UNLESS REJECTED PROMPTLY.</h2> -</div> - -<p class='c008'>Question.—A retailer goes away leaving his son in charge of -the business. The son asks us to ship a car of lumber and we sell -it to him, acting for his father, invoicing the car and mailing the -bill of lading. The car arrives, the son surrenders the bill of lading -to the railroad and orders the car placed on his father’s siding for -<span class='pageno' id='Page_57'>57</span>unloading. For some reason the son decides not to unload the car -before the arrival of the father, which will be in about a week. When -the father arrives he claims the lumber is not up to grade and refuses -to accept same, unless we make an allowance. Does not the acceptance -of the bill of lading and its surrender to the railroad constitute -a delivery of the lumber and entitle us to our money without -question whether we are right or wrong about the quality of the -lumber? It is possible, of course, that a very small proportion -of this lumber may be a little off, but the difference is very slight, -and would show only the difference that any two inspectors would -make in going over the car of lumber.</p> - -<p class='c013'>Reply: A buyer of goods is bound to inspect them with -reasonable promptness, after he has an opportunity to do so, -and then accept or reject them at once. Reasonable promptness -is greater promptness than was shown in this case, -unless there were some unusual facts in connection with it of -which we are not informed. A buyer is seldom justified in -delaying his inspection beyond the next day after arrival of -the goods. If he does not reject the goods with reasonable -promptness, whether he sees fit to inspect them or not, then -he is held to an implied acceptance. They are placed in his -hands. He may do as he likes about examining them, but he -must reject them promptly, if he is to reject them at all. If -he does not reject them promptly any remedy he may have -had is gone unless the goods were sold to him under a warranty -of quality.</p> - -<p class='c014'><b>Opinion No. 62.</b></p> - -<div class='chapter'> - <h2 class='c004'>NEW YORK INCORPORATION LAW.</h2> -</div> - -<p class='c008'>In view of a recent decision regarding the corporation law of -New York State and its probable effect upon foreign corporations -doing business in this State, we have asked our attorney in New -York for information, and the following is submitted:</p> - -<p class='c011'>“At the end of January last there was handed down a decision -in the Court of Appeals, which was later printed in 190 N. Y., settling -the disputes which had arisen as to the necessity for obtaining -certificates of license to do business in this State as a condition -precedent to suing here.</p> - -<p class='c011'>“It holds that in compliance with the General Corporation Law -it must be alleged and proved by a foreign corporation in order to -establish a cause of action in the courts of this State. The cases -holding otherwise, should be regarded as overruled and the conflict -of authority ended.</p> - -<p class='c011'><span class='pageno' id='Page_58'>58</span>“And it is further held that an objection to a complaint on -this ground is not waived by the failure to raise it in the defendant’s -pleadings, but can be raised at any time.</p> - -<p class='c011'>“A little later the court also held that this rule applied just as -much as to the assignee of a foreign corporation’s claim, except as -to negotiable paper taken in good faith from the corporation before -maturity.</p> - -<p class='c011'>“It follows that any foreign corporation desiring to do business -in New York, whether on a large or small scale, must comply with -the statute and take out a license and pay the franchise at the end -of the first year, and I suggest that this should be brought to the -attention of your foreign lumber corporations.”</p> - -<p class='c011'>(If further information is wanted by any members whose business -is incorporated under a State law other than New York, we -shall be pleased to hear from them.)</p> - -<p class='c014'><b>Opinion No. 63.</b></p> - -<div class='chapter'> - <h2 class='c004'>NEW JERSEY INCORPORATION LAW.</h2> -</div> - -<p class='c008'>Question.—Under New Jersey laws a New York corporation -doing business in New Jersey must register in Trenton. We did -a large amount of business before we were aware of this, but ultimately -registered. In suing one of our customers we were nonsuited -because we were not registered at the time the goods were -sold, but this was in an inferior court. Does the fact that we were -not registered in Trenton at the time the goods were sold completely -shut us off from recovering in the State of New Jersey?</p> - -<p class='c013'>Reply: We believe that our correspondents will not be -allowed to maintain this suit; they are prevented from maintaining -it as much by the laws of their own State of New -York as by those of New Jersey. The law of the case stands -thus: The New Jersey statute requires all foreign corporations -to file certain documents with the Secretary of State and -to take out a certificate authorizing them to do business in -New Jersey. It is further provided that “until such corporation -so transacting business in this State shall have obtained -said certificate of the Secretary of State, it shall not maintain -any action in this State, upon any contract made by it in this -State.” If this were all our correspondents could take out a -certificate any time and then sue; this section only forbids -them to sue before taking out a certificate. It is further provided, -however, that when another State imposes any greater -penalties on New Jersey corporations than the laws of New -Jersey impose upon corporations of that State, the same penalties -shall be imposed on corporations of such other State -<span class='pageno' id='Page_59'>59</span>doing business in New Jersey. Now, it is provided by the -General Corporation law of this State (Sec. 16) that foreign -corporations must take out certificates as in New Jersey, and -that “no foreign stock corporation doing business in this -State shall maintain any action in this State upon any contract -made by it in this State unless prior to the making of such -contract it shall have procured such certificates”; that is the -reason a New York corporation doing business in New Jersey -is not allowed to sue in the courts of that State on a contract -made therein unless it had taken out its certificate before -the contract was made.</p> - -<p class='c014'><b>Opinion No. 64.</b></p> - -<div class='chapter'> - <h2 class='c004'>A LARGE CONTRACT SHOULD BE IN WRITING.</h2> -</div> - -<p class='c008'>Question.—In the summer one of our salesmen sold a car of -lumber for September delivery, the salesman handing the buyer copy -of the order at the time of purchase. On previous purchases made -by this same customer he has been in the habit of sending in a confirmation -of the order on which appear the words “No order valid -unless signed by one of the members of the firm.” No such confirmation -was received by us for the last order placed, the same -having been overlooked by us, and we shipped the goods to them -upon the agreed delivery date. And they write us now that as no -confirmation was given they cannot accept the goods and hold them -subject to our order. They write further that their former buyer -brought up the memorandum order for these goods, but that they -declined to confirm; but of this latter act we had no knowledge. -Please inform us where we stand in this matter.</p> - -<p class='c013'>Reply: In nearly every State there is a statute declaring -that the purchaser of goods to the value of $50 or more shall -not be legally liable unless he signs a written contract or part -of the price is paid or part of the goods are accepted. The -wording of the statute in New York State is as follows: -“Every agreement, promise or undertaking is void, unless -some note or memorandum thereof be in writing, and subscribed -by the party to be charged therewith, or by his lawful -agent, if such agreement, promise or undertaking—is a contract -for the sale of any goods, chattels or things in action -for the price of $50 or more, and the buyer does not accept -and receive part of such goods, or the evidences, or some of -them, of such things in action, nor at the time pay any part -of the purchase money.”</p> - -<p class='c014'><b>Opinion No. 65.</b></p> - -<div class='chapter'> - <span class='pageno' id='Page_60'>60</span> - <h2 class='c004'>USING CHECKS MARKED “IN FULL SETTLEMENT.”</h2> -</div> - -<p class='c008'>In connection with several claims recently handled by our Collection -Department in Pennsylvania and the question of using checks -marked “in full settlement” or “in settlement of all demands to -date,” we have the following communication from a prominent -attorney in Pennsylvania:</p> - -<p class='c011'>“I desire to state that it is elementary law that if pending the -adjustment of a disputed claim, the debtor sends the money to his -creditor in full payment of the demand, the latter cannot receive -and retain it as a credit upon a larger sum claimed by him, without -discharging the debtor as to the whole.</p> - -<p class='c011'>“123 Pa., p. 576. 147 Pa., p. 607. 70 Pa., p. 315.</p> - -<p class='c011'>“These cases have been decided by the Supreme Court of Pennsylvania, -the court of the last resort. Therefore it does not lie in -the province of your members to cancel the words ‘in full settlement’ -without destroying their right in respect to prevailing for the balance.</p> - -<p class='c011'>“I might further state that in the absence of any dispute in -respect to any claim, the payment of a smaller amount will not -operate to discharge the whole, because there is no accord and -satisfaction; the absence of any dispute in respect to the amount -being the material circumstances in this regard.”</p> - -<p class='c014'><b>Opinion No. 66.</b></p> - -<div class='chapter'> - <h2 class='c004'>A CUSTOMER BUYING ON CREDIT MUST KEEP HIS CREDIT GOOD.</h2> -</div> - -<p class='c008'>Question.—If a bill of lumber is sold on credit and before delivery -to the customer the seller considers he has good reason to -question the purchaser’s ability to settle when the bill is due, can -the seller withhold the delivery and demand either better terms or -cash without making him liable for the non-fulfillment of the -contract?</p> - -<p class='c013'>Reply: A man who has bought goods on credit is -bound, as the courts phrase it, “to keep his credit good.” -If he does not do that the seller need not ship the goods; -if he has shipped them and then finds that the buyer has not -kept his credit good, he may stop the goods and take them -back into his own possession at any time before they have -actually been delivered to the buyer or his agent. In making -his decision the seller must, of course, take his own -risks. He has entered into a contract and he must fulfill -it or pay the resulting damages unless he has a legal excuse -for refusing to go on with it. It is not sufficient that, as -<span class='pageno' id='Page_61'>61</span>the question says, “the seller considers he has good reason -to question the purchaser’s ability to settle”; nor that the -seller has good grounds for believing that the buyer’s credit -is impaired. It is not a question of any man’s belief, but -a question of fact. The goods must be shipped unless the -buyer is actually insolvent. This does not mean that he -must have made an assignment or gone into bankruptcy or -made any other public acknowledgment of the fact that he is -insolvent. It means he has become unable to pay his debts -as they fall due. The seller must be able to show that at -least one debt has fallen due against the buyer and that he -has not paid it promptly. Of course, it must be a debt the -validity of which the buyer himself does not dispute upon -any tenable ground. If he has paid his debts as they fell -due he has “kept his credit good,” no matter what any one -may suspect as to the future; if he has failed to pay any -just debt promptly he has not kept his credit good. If the -seller has no right to refuse delivery of the goods altogether -he has no right to demand better terms than his contract -gives him.</p> - -<p class='c014'><b>Opinion No. 67.</b></p> - -<div class='chapter'> - <h2 class='c004'>DISCOUNT MUST BE IN ACCORDANCE WITH THE CONTRACT.</h2> -</div> - -<p class='c008'>Question.—We sold to a concern and the terms of sale were -“2 per cent. discount for cash in ten days or sixty days net.” The -buyer in his settlements has taken fifteen to twenty days’ time and -has deducted 2 per cent. discount and has added 6 per cent. per -annum for the extra days beyond ten. We claim that this settlement -is entirely wrong, and if he wishes the discount in full he -must send a check within ten days after the date of the bill.</p> - -<p class='c013'>Reply: No debtor is to be excused from paying the full -amount of his debt except in strict accordance with some -provision to that effect in his contract. Here is a debtor who -would have been bound to pay the full amount immediately -if there had been no special provision to the contrary. Any -such provision as there may be is a kind of grace to him -and it is not to be extended beyond the strict terms in which -it is expressed. He may take 2 per cent. off if he pays at -any time within ten days. When the ten days are passed -the contract stands precisely as if it had said nothing at -all about discount for payment within ten days. This debtor -had no right to deduct the 2 per cent. He is trying to take -an advantage which his contract does not give him. If he -<span class='pageno' id='Page_62'>62</span>were asked to point out a clause in the contract giving him -a right to take off the discount later than the tenth day, -of course, he could not do it.</p> - -<p class='c014'><b>Opinion No. 69.</b></p> - -<div class='chapter'> - <h2 class='c004'>A BILL OF LADING TO ORDER RETAINS TITLE TO THE GOODS.</h2> -</div> - -<p class='c008'>Question.—If a shipper sells a carload of lumber f. o. b. shipping -point with draft attached to bill of lading and bills the car -to his own order, notify the purchaser, and if the car should be -wrecked in transit or should never reach its proper destination, -would the buyer who bought the car f. o. b. be compelled to pay -the draft and take up the bill of lading and seek recourse against -the carriers? Should the shipper bill a car to the order of a bank, -notify the f. o. b. purchaser and sell the draft and bill of lading -to the bank outright, would the purchaser be compelled to pay for -same?</p> - -<p class='c013'>Reply: When a sale is made f. o. b. shipping point the -seller can make a valid delivery at that point. If he delivers -the goods to a carrier there, takes a bill of lading making -them deliverable to the buyer and forwards it to the latter, -his full duty is done and the goods are at that moment, in -legal effect, delivered to the buyer; they are actually delivered -to the buyer’s agent, the carrier, and that is equivalent -to a delivery to the buyer himself. This is the kind of delivery -the seller is at liberty to make, under the contract, but -he may not do so. He might, conceivably, carry the goods -in his own arms to the buyer, or he may deliver them to one -who is unquestionably his own agent. In either of these -cases delivery to the buyer does not occur until the goods -reach their destination. If A ships goods to the place in -which B resides and takes the bill of lading to his own order -the goods are not in any sense delivered to B or to his agent. -They are A’s goods. He can stop them where he will and -take them back into his own possession. When they reach -their destination he can take charge of them or have them -delivered to anyone he may choose to name. Those goods -could be seized by a creditor of the seller and they could -not be seized by a creditor of the buyer. If they are lost -in transit it is the seller’s loss. A seller must either deliver -the goods or retain them. He cannot do both. He cannot -deliver them so as to make the buyer liable in case of loss -and still retain them so that they will be his, to do with as -he will if there is no loss. The same result follows if the -<span class='pageno' id='Page_63'>63</span>bill of lading is sold to a bank. A bill of lading represents -goods in transit and transfer of the bill transfers the goods. -The direction to the carrier to “notify” one person or another -is of no importance. Goods may be consigned to B -and the carrier, for one reason or another or for no reason -at all, may be directed to “notify” X or Y or Z of the fact -that they have arrived. Notification is not to be substituted -for delivery.</p> - -<p class='c014'><b>Opinion No. 70.</b></p> - -<div class='chapter'> - <h2 class='c004'>ONE WHO BUYS ON CREDIT MUST KEEP HIS CREDIT GOOD.</h2> -</div> - -<p class='c008'>Question.—A, in New York, has with B, a manufacturer, three -separate contracts made in December, February and March, respectively, -each contract specifying the grade and price of material, -date of delivery and terms of payment. The deliveries called for -in the December contract have been completed by A; the date for -the first delivery of the February contract is due this month; but -B is overdue 30 days on his payment on the first delivery of the -December contract and payment on the delivery of balance of the -December contract is now due. Because B has failed to comply -on his part with the conditions of the first contract, must A deliver -the material according to the terms of the second and third contracts, -thereby unduly increasing the amount of credit extended to -B beyond his general credit limit? From information obtained -which would lead A to question the credit of B, such as his taking -a contract at a loss (this occurring since the contracts were made) -can A demand payment before delivery of the goods, although -the contract specifies 30 days from certain dates? Can A cancel -the two uncompleted contracts for any of the above reasons, viz., -non-fulfillment of the condition of the first contract by B or doubt -as to B’s credit? If cancelled by A would B have any legal redress -such as buying the quantity and grade of material stipulated by -the contracts in the open market and compelling A to pay the difference -in price should the present market price be higher than the -prices stipulated in the contracts?</p> - -<p class='c013'>Reply: When a man buys goods on credit it is always -an implied condition of the contract that he shall “keep his -credit good,” as the courts phrase it, till the time of delivery -arrives. If he becomes insolvent before that time he cannot -demand that the seller shall ship the goods. If the seller -<span class='pageno' id='Page_64'>64</span>does ship them, and then learns of the insolvency, he may -stop the goods before they reach the buyer and take them -back into his own possession. A buyer on credit has no -right to demand that the goods shall be delivered to him at -a time when he is insolvent and when there is reason to -believe, accordingly, that the goods may have to be sold to -pay his other debts. That is the situation in the case our -correspondent puts, and the seller is certainly not bound to -deliver the merchandise. By insolvency, in a case of this -kind, is not meant an actual assignment for creditors; neither -does it mean that the buyer has gone into bankruptcy or -made any other public acknowledgment of the fact that he -is insolvent. It means that he has become unable to pay his -debts as they fall due. The seller must be able to show that -at least one debt has fallen due against the buyer and that -he has not paid it promptly. Of course, it must be a debt -the validity of which the buyer himself does not dispute upon -any tenable or reasonable ground. The buyer in this case -has failed to pay such a debt. The seller has ample proof -of the fact because the debt was owing to him. The buyer -has not “kept his credit good,” and he has no right to -demand that goods sold to him on credit shall be delivered. -If they are not delivered he will have no legal ground of -complaint or cause of action against the seller. It is not the -seller who is guilty of a breach of contract, but the buyer; -he is guilty of a breach of the implied condition which enters -into all such contracts—the condition that the buyer shall -“keep his credit good.”</p> - -<p class='c014'><b>Opinion No. 71.</b></p> - -<div class='chapter'> - <h2 class='c004'>A SELLER IS BOUND BY HIS OWN MISTAKE UNLESS IT IS OBVIOUS.</h2> -</div> - -<p class='c008'>Question.—We sent an inquiry for certain sizes of lumber to -a mill asking for quotations. Our inquiry was delayed in the mails, -and, as it did not reach the mill in time enough to quote we placed -the order with the mill, but did not specify prices. The mill -acknowledged our order, saying, “We have entered your order as -per enclosed carbon,” and after each item they named a price. The -lumber was shipped and an invoice sent us, but on two of the -items a larger amount is charged than specified in the communication -from the mill, saying our order had been entered. In remitting -we deducted the difference between the prices mentioned in reply -from the mill and the invoice, but the mill claims they made a -clerical error and that we are bound to pay the invoice price. What -is our position in the matter?</p> - -<p class='c013'><span class='pageno' id='Page_65'>65</span>Reply: When a seller puts a price on his goods and the -buyer accepts them at that price it is then too late for the -seller to demand more except in the following case: If the -buyer knew that a mistake had been made, or if the mistake -was so gross and palpable that he ought to have known -it to be a mistake, then it may be corrected. If a seller were -to quote $1.25 when all buyers knew that $12.50 was about -the market price, the buyer would not be allowed to claim -the goods at the quotation without making special inquiry as -to its accuracy; if the quotation was only slightly under the -market, so that no suspicion attached to it, and if there was -nothing else to show that a mistake had been made, and if -the buyer had no actual knowledge of the fact, the seller -is bound. Taking the whole class of sellers together, it -would not be a safe rule to allow them to come around and -collect more after a sale had been made and concluded upon -the plea that they had not asked as much as they intended -to ask.</p> - -<p class='c014'><b>Opinion No. 72.</b></p> - -<div class='chapter'> - <h2 class='c004'>A CARRIER SHOULD PAY VALUE AT DESTINATION FOR LUMBER LOST.</h2> -</div> - -<p class='c008'>Question.—On what basis must a railroad company settle a -claim by a consignee on lumber damaged or lost? Must the consignee -supply the original invoices, or is he entitled to the selling -price in his market?</p> - -<p class='c013'>Reply: If the contract does not provide otherwise, a -carrier who fails to deliver goods must, as a rule, pay to the -consignee the value of the goods at the time and place at -which delivery should have been made. The carrier is to -retain his freight charges out of this amount, of course, if -freight has not been paid in advance. This is the only rule -by which the whole of the loss can be placed upon the carrier, -where it belongs. If he had done his duty and delivered -the goods the consignee could have sold them at the prices -there and then prevailing. If the carrier pays the consignee -less than this amount the consignee himself must bear part of -the burden of the carrier’s negligence. Of course, if the -contract provides that settlement shall be upon some other -basis, original cost, for example, the contract will be enforced. -The only other exception to the rule is that which arises when -the goods have already been sold for an amount which is -not so great as the market price at the place and time at -which delivery ought to have been made. If delivery had -been duly made, in such a case the owner of the goods -<span class='pageno' id='Page_66'>66</span>could not have taken advantage of ruling market prices; he -had already bound himself to deliver the goods at a price -which proves to be less than the market on the day fixed for -delivery, and this selling price is all that he can claim. The -object in every case, except where there has been a special -contract of carriage, is to place the owner of the goods as -nearly as possible in the same position he would have occupied -if the carrier had done his duty and to put upon the -carrier, where it belongs, the whole burden of his negligence -and breach of contract.</p> - -<p class='c014'><b>Opinion No. 73.</b></p> - -<div class='chapter'> - <h2 class='c004'>LIABILITY OF SHIPPER WHERE PART OF SHIPMENT IS ADMITTED BELOW GRADE.</h2> -</div> - -<p class='c008'>Question.—I received from a customer an order for a carload -of lumber of a certain grade. A fair sized car would be 14,000 -feet. The car arrives and 2,000 feet of the lumber is admitted by -me to be of a grade lower than the order called for. Can I compel -my customer to accept the balance of 12,000 feet, which is up -to the requirements of the order? He claims that inasmuch as the -car I have offered is not all up to grade, I cannot compel him to -accept even so large a proportion as 12,000 feet, notwithstanding -the fact that 12,000 feet will still be a pretty fair sized car of -lumber.</p> - -<p class='c013'>Reply: According to this statement the shipper undertook -to carry out an order and deliver a carload of lumber. -According to the admission 2,000 feet of the carload -were contrary to the terms of the contract. Under the circumstances -a carload of lumber has not been delivered -and we doubt very much if you can find a way to compel -acceptance of a carload of lumber that is admitted on the -face of it as not being strictly according to the terms of -the contract.</p> - -<p class='c014'><b>Opinion No. 76.</b></p> - -<div class='chapter'> - <h2 class='c004'>NECESSITY OF FOREIGN CORPORATIONS FILING CERTIFICATES.</h2> -</div> - -<p class='c008'>The Association has made some inquiry regarding the necessity -of so-called foreign corporations filing certificates in States other -than those under whose laws the corporation was organized. If -any corporate members are interested and desire information along -these lines we shall be pleased to render such assistance as we can.</p> - -<p class='c009'><span class='pageno' id='Page_67'>67</span>In some States the requirements are strict, and recently some -Western States, particularly Oklahoma, have enacted legislation of -much importance to foreign corporations shipping into those States.</p> - -<p class='c014'><b>Opinion No. 77.</b></p> - -<div class='chapter'> - <h2 class='c004'>COURSE TO PURSUE WHEN LUMBER IS REFUSED ON ARRIVAL.</h2> -</div> - -<p class='c008'>Question.—We took an order from a customer for a carload of -lumber to be shipped not later than September 15th. The car was -shipped within the specified time but did not reach destination as -promptly as it should, and our customer claims that he has been -damaged to such an extent that he refuses to take in the car, saying -it arrived too late for his use. The lumber is exactly in accordance -with the order and is a special worked car. We will be put -to some expense in disposing of this elsewhere and will probably -have to sell it at a lower price. What method should we pursue?</p> - -<p class='c013'>Reply: There are three courses:</p> - -<p class='c013'>First: The shipper may store the lumber for the buyer -and sue him for the invoice price.</p> - -<p class='c013'>Second: He may retain the property as his own and -recover the difference between the market price at the time -and place of delivery and the contract price.</p> - -<p class='c013'>Third: He may sell the lumber, acting as the agent for -the purchaser and recover the difference between the contract -and the price of resale.</p> - -<p class='c013'>This last course is usually considered best because it -gives the seller the use of the money realized on the resale. -Of course in reselling the lumber care must be taken to -obtain the best possible price, and in the event of the resale -the seller is entitled to recovery from the purchaser of all the -costs which he was obliged to lay out in bringing to pass a -sale of the property in question.</p> - -<p class='c014'><b>Opinion No. 78.</b></p> - -<div class='chapter'> - <h2 class='c004'>A CARRIER MUST STOP GOODS IN TRANSIT IF PROPERLY ORDERED TO DO SO.</h2> -</div> - -<p class='c008'>Question.—A makes a shipment to a customer in another State -and several days after he receives information that leads him to -believe it prudent to hold up the shipment and have the goods -reconsigned to himself. He immediately takes the matter up with -<span class='pageno' id='Page_68'>68</span>the initial carriers with the request that they take immediate steps -to stop the shipment in transit and have same reconsigned to himself, -all charges to follow. In the event that the initial carrier fails -to take prompt action and it develops that the goods are delivered -after the initial carrier has been notified not to deliver them, thereby -causing A the loss of the value of the shipment, cannot A hold the -initial carrier responsible for the value of the shipment?</p> - -<p class='c013'>Reply: When goods are sold on credit and the buyer -becomes insolvent or gives proof of insolvency, before the -goods are delivered to him, it is the right of the seller to -take them back into his own possession and refuse delivery -altogether; this is because one who buys on credit is bound -by an implied contract that he will keep his credit good and -be able to pay for the goods when the due date arrives. -When the carrier is called upon to return the goods to the -seller he must act at his own peril. If he does return them -and the buyer was not insolvent, the carrier must answer to -the buyer for his damages. On the other hand, if the carrier -fails to return the goods and the seller can show that the -buyer was insolvent the carrier must respond to the seller for -the value of the goods or for such part of it as the seller -finally loses. The seller, in the case under consideration, -must first establish the fact that he had a right, within these -rules, to stop the goods. Then if he can show also that this -might have been done except for negligence or delay on the -part of the initial carrier, he can hold that carrier liable for -his loss.</p> - -<p class='c014'><b>Opinion No. 79.</b></p> - -<div class='chapter'> - <h2 class='c004'>ACCORD AND SATISFACTION.</h2> -</div> - -<p class='c008'>Frequently inquiries are sent us inquiring as to the advisability -of accepting checks marked “In full settlement of account to date,” -etc. The situation is not the same in all States but usually the -questions are covered in the doctrine of accord and satisfaction -explained as follows:</p> - -<p class='c011'>If an account between two parties be actively and openly in -dispute and the debtor sends to his creditor a remittance for a -specific sum and states that such sum is offered in full settlement, -and if such sum be accepted by the creditor he is bound thereby and -cannot thereafter recover anything on the account from his debtor. -The mere sending of a remittance, however, for an amount less -than the amount due, where there is no dispute between the parties, -does not affect the right of the creditor to bring suit for the -balance due even though it is stated in the letter accompanying the -remittance that said remittance is in full settlement.</p> - -<p class='c011'><span class='pageno' id='Page_69'>69</span>The question as to whether a dispute is open or active can -usually be easily determined. If the seller and buyer have been in -correspondence regarding a dispute, that determines its activity, -and if after such correspondence a remittance is made marked “In -full settlement,” etc., the acceptance is binding.</p> - -<p class='c014'><b>Opinion No. 80.</b></p> - -<div class='chapter'> - <h2 class='c004'>ACCEPTANCE IN NEW JERSEY MAY BE AFFECTED BY STATUTE.</h2> -</div> - -<p class='c008'>Our attention has been called to a law passed by the New Jersey -Legislature in 1907, from which the following is quoted:</p> - -<p class='c011'>“Where the seller delivers to the buyer the goods he contracted -to sell mixed with goods of a different description not included in -the contract, the buyer may accept the goods which are in accordance -with the contract and reject the rest, or he may reject the -whole.”</p> - -<p class='c011'>We are receiving inquiries as to the responsibility of a customer -where he had used part of a shipment of lumber of one description, -the customer claiming the statute above quoted permitted him to -use such of the shipment as was up to grade and reject the balance. -Commenting on the law above referred to where a shipment contains -lumber under one description it would seem to be the law -that if the consignor delivers to the consignee the goods contracted -for of the same description included in the contract, the debtor, -with his right of inspection must either reject or accept, and if the -consignee does any act by which it could be inferred that he is exercising -the right of ownership of any part of the merchandise so -shipped and delivered, we believe he is liable for the entire amount -of lumber shipped and received. He cannot take out what he wants -of the order and reject the balance.</p> - -<p class='c011'>The New Jersey law covers mixed shipments, for instance, in -a shipment of barn boards, siding and moulding, the buyer would -have the right to accept either of these items without prejudicing -his claim, or waiving his privilege of rejection on the other two, -but where a straight car of barn boards is ordered the buyer is not -privileged to use a portion of them and reject the balance as not -being up to contract.</p> - -<p class='c014'><b>Opinion No. 81.</b></p> - -<div class='chapter'> - <h2 class='c004'>CONDITIONAL CLAUSES REGARDING TERMS ON LETTERHEADS, INVOICES, ETC.</h2> -</div> - -<p class='c008'>It seems again necessary to call the attention of our members -to the custom of printing a clause on the top of letter-heads used -<span class='pageno' id='Page_70'>70</span>for quotation to the effect that agreements or contracts are contingent -upon strikes, accident, other causes, etc. It frequently happens -that this clause is so printed on the letter-head or quotation -form as not to make it a part of the contract, and the following -attorney’s opinion is pertinent:</p> - -<p class='c011'>When a man has a proposal to make to another in writing he -begins, usually and naturally, with the name of the place from -which he writes and the date. Then he makes his proposal and -closes by signing his name. The paper upon which he writes may -have printed at the top or somewhere in the margin the name and -address of the firm; the telephone number and the number of the -firm’s post office box; the cable address; a list of five or six cable -codes used by the concern; names of the various articles in which -it deals; facsimiles of some of its trade-marks; pictures of certain -gold medals that have been awarded to its goods at fairs of one -sort or another. Frequently there is much other matter. There -may also be something to the effect that agreements are contingent -upon strikes. Of course, the person to whom the proposition is -addressed is not concerned with any of these things. What he has -to read and consider is the matter found between the address and -the signature, and nothing more. That is the reasonable interpretation -of the matter, and, is, very naturally, the view that the courts -have taken of it. In 153 Ill., 102, to quote only one case, the -Supreme Court of Illinois decided that “the words ‘all sales subject -to strikes and accidents,’ printed as part of the letter-head of a -reply, do not form any part of the contract.” No court could very -well reach any other conclusion, so far as we can ascertain, and no -court has done so.</p> - -<p class='c011'>In the same manner a postscript on a letter or quotation blank -is not an actual part of the contract unless it is signed.</p> - -<p class='c011'>Other members have also attempted to enforce terms printed -on their invoices where such terms were not referred to in the -original order or contract of sale. The following opinion will be -helpful in such matters:</p> - -<p class='c011'>The question of the invoice may be settled with little difficulty. -Nothing upon the invoice is binding upon the buyer, whether it -is written or printed and whether it stands in the body of the document -or in the margin. A contract is made by two persons, and -it is binding only in so far as both have agreed to be bound by it. -An invoice is made, after all the terms of the contract have been -irrevocably fixed, and it is made by only one person. The seller -would have things very much his own way if he could go off alone, -after a contract had been made, and alter or amend or limit or explain -it by his own act. He has no such power, of course, and he -cannot put anything upon his invoice in writing or in print, that -will bind the buyer.</p> - -<p class='c014'><b>Opinion No. 82.</b></p> - -<div class='chapter'> - <span class='pageno' id='Page_71'>71</span> - <h2 class='c004'>INTERPRETATION OF “REASONABLE TIME,” “DUE NOTICE,” ETC.</h2> -</div> - -<p class='c008'>Frequently our members ask what constitutes shipment within a -reasonable time, or what is the meaning of “due notice,” etc.</p> - -<p class='c011'>The courts are always careful not to give any general definition -of such words as “due,” “reasonable” and the like. What is -due or reasonable notice in one case might not be so in another; and -each case is made to stand on its own facts. “Due notice,” in one -case or in any other, is such notice as, all of the circumstances and -conditions being duly considered, would permit the person receiving -the notice to do that which was required of him. Evidence is -to be presented, on the one side, and on the other, to show whether -due notice, within this definition, was or was not given. Due notice -is sufficient notice, and that which is sufficient in one case may be -too much or too little in another.</p> - -<p class='c014'><b>Opinion No. 83.</b></p> - -<div class='chapter'> - <h2 class='c004'>IF SHIPMENTS ARE NOT TENDERED IN TIME THE BUYER NEED NOT TAKE THEM.</h2> -</div> - -<p class='c008'>Question.—In December, 1909, we placed an order for nine cars -of lumber to be delivered in March, 1910. Part of the shipment -was made in February and March, leaving about a third unshipped -on the first of April. We wrote the sellers to cancel the order. -They object to this cancellation, saying that the delay was caused -by a breakdown of their mill which was unavoidable and say for -this reason the order is in force, as they are ready to make delivery -of the balance of the goods to-day, April 7th, one week after the -contract date expired. Have we a legal right to cancel under these -conditions?</p> - -<p class='c013'>Reply: The man who runs a mill is entitled to all the -profit he can make from it; but if there is an interruption of -the running it is he who must stand the loss. He cannot ask -a customer to wait for goods, at his own expense and inconvenience, -until it may be found practicable and advisable to -start up the works again. The buyers may refuse to accept -the belated delivery, in the case our correspondent puts, and -may demand damages for the sellers’ breach of contract. -If a breakdown of the mill is to excuse the seller the contract -of the sale must contain an explicit stipulation to that effect.</p> - -<p class='c014'><b>Opinion No. 84.</b></p> - -<div class='chapter'> - <span class='pageno' id='Page_72'>72</span> - <h2 class='c004'>WHEN A BUYER ACCEPTS A SHIPMENT, A WRITTEN CONTRACT IS NOT NECESSARY.</h2> -</div> - -<p class='c008'>Question.—A customer called at our yards and arranged to -buy six cars of lumber, asking that one car be shipped at once. He -took this car, but refuses to order the balance out as per agreement. -He offers to pay for what he has already had, but he says we cannot -hold him for any more because the contract was not in writing. -Is he right?</p> - -<p class='c013'>Reply: This buyer can be held for the value of the six -cars. A written contract or memorandum is not necessary -where part of the goods have been delivered and accepted. -There are three ways in which a sale of goods for $50 or -more may be made valid and binding: (1) By a written -contract or memorandum; (2) by delivery and acceptance of -part of the goods; (3) by payment of part of the purchase -price. Thus a buyer sometimes pays a small part of the -price at the time of the agreement, “to bind the bargain,” -as he says, and it has that effect.</p> - -<p class='c014'><b>Opinion No. 86.</b></p> - -<div class='chapter'> - <h2 class='c004'>IT IS TOO LATE TO CLAIM DAMAGE FOR DELAY IN SHIPMENT WHEN LUMBER IS ACCEPTED.</h2> -</div> - -<p class='c008'>Question.—We took an order from a customer for ten cars of -lumber to be shipped one car every two weeks. The first three cars -were shipped on time, but there was a lapse of four weeks before -the fourth car got out and weather at the mill delayed our getting -the balance out as per agreement, although we finally got off all -the cars. When the delayed shipments began to arrive our customer -complained of the delay, and said he would charge us back -with any cost he had to allow his customer. We objected, but -our customer said we agreed to time deliveries, and would hold us -to same. He took in all the shipments, but now wants to charge -us with a loss he claimed he allowed his customer.</p> - -<p class='c013'>Reply: If the lumber was offered to the buyer at a time -later than any date agreed upon at time of sale, the buyer -could have refused to accept it, and would have had a claim -against the seller for damages occasioned by the delay. On -the other hand, the buyer might accept the goods, notwithstanding -the delay, if he chose to do so. He had no option -except one of these two, accept the goods and pay for them, -or reject them as not having been sent in time to constitute -a fulfillment of his order. He could not accept the goods at -<span class='pageno' id='Page_73'>73</span>any other than the contract price. This is the situation in -which the case would have stood if there had been no correspondence -between the ordering of the goods and their shipment. -It is barely possible that the correspondence may contain -some modification of the original contract, introduced -into it by mutual consent, which would give the buyer the -right he now claims. If the original contract was allowed to -stand as made then the buyer has mistaken his remedy if -he had any remedy at all. The goods were offered in fulfillment -of the contract. He could accept them as such, or -reject them. Having rejected them, it is possible that he -would have had a claim against the seller for failure to -deliver the goods in time. This much, however, is perfectly -well settled. The buyer had no right to the goods at all -except in fulfillment of his contract. If he accepts them, the -contract is fulfilled and he cannot turn about and demand -damages because it is not so. If he thinks the delivery is not -a good one, because of delay, let him refuse it and then -say that the contract has not been carried out. It has been -or it has not been, and his acceptance of the goods shows -that it has been.</p> - -<p class='c014'><b>Opinion No. 87.</b></p> - -<div class='chapter'> - <h2 class='c004'>NOTICE TO AN AGENT IS NOTICE TO THE PRINCIPAL</h2> -</div> - -<p class='c008'>Question.—A, a shipper in the South, ships to B, in New York, -a carload of lumber at a price based on delivery f. o. b. New York -City. The material is offered to B on a lighter at the agreed upon -point of destination, and B, on inspecting it, comes to the conclusion -that it is not what he ordered, and refuses to accept it, simply telling -the railroad that the material is not what he ordered, and -refuses to unload. B does not notify the shipper, A, and the latter -knows nothing of B’s rejection or refusal to accept until about a -month later, when he receives a notice from the railroad that B -has rejected the material. A claims that B should have notified -him immediately by mail or telegram that the material was not -what he ordered, but B claims that he was not compelled to do -so and that the fact that the railroad did not notify A until a month -after was no concern of his. Is he right?</p> - -<p class='c013'>Reply: There is no rule of law known to us which would -have required the buyer to notify the seller of his determination -not to accept the goods in this case. If the buyer had -taken the goods from the carrier he would have been bound -to notify the seller of this subsequent rejection. If delivery -had been made at the shipping point instead of f. o. b. destination, -<span class='pageno' id='Page_74'>74</span>so that the carrier should have been agent of the -buyer and not of the seller, the buyer’s duty to give notice -would have been the same. As the case actually stands it is -this: The seller himself or his agent, which amounts to the -same thing, tenders the goods to the buyer and the buyer -rejects them without having taken them into his custody. -The seller or his agent immediately knows that they are rejected. -How could notice add anything to that knowledge? -If it is the seller’s agent who knows, and if the seller himself -does not know, that is because the seller has not given -proper instructions to his agent or because the agent has -failed to follow them if they were given. In neither case is -the buyer to blame. He has notified the seller’s agent that -the goods are refused; that is all he can be required to do. -If the refusal is not justified the seller has his remedy, of -course. If it was justified the seller has sufficient notice -of it. Our correspondent says the seller complains because -the buyer did not notify him “immediately by mail or telegram -that the material was not what he ordered.” That is -absurd in any case. The seller knew as well as the buyer, -and knew before the buyer did whether the goods sent were -such as the buyer had ordered or not. Why should he -be notified of a fact that he knew already.</p> - -<p class='c014'><b>Opinion No. 88.</b></p> - -<div class='chapter'> - <h2 class='c004'>ASSESSMENT OF FOREIGN CORPORATIONS.</h2> -</div> - -<p class='c008'>Inquiries are frequently made at this office as to the amount of -tax which a foreign corporation must pay in States where a certificate -is issued to such foreign corporations, authorizing them to do -business under the State statutes. In computing the assessment or -tax the State auditor gets his information from the reports which -ought to be filed annually. The amount of tax assessed is predicated -upon the amount of capital actually employed within the State, -and if no capital is employed, no tax can be legally levied.</p> - -<p class='c014'><b>Opinion No. 89.</b></p> - -<div class='chapter'> - <h2 class='c004'>A PRIVATE CUSTOM MAY BE ESTABLISHED TO SUPERSEDE A GENERAL CUSTOM.</h2> -</div> - -<p class='c015'>It seems to be a generally accepted custom in the lumber trade -that using a shipment of lumber, even though there be a dispute -regarding the grade, constitutes an acceptance of the shipment as -invoiced unless the shipper has authorized the purchaser to use a -part or all of the lumber in dispute. Our Legal Department has received -some claims for members on disputed shipments where, from -<span class='pageno' id='Page_75'>75</span>an examination of the correspondence, it appeared the member had -a valid claim for the full amount of the invoice. After negotiations -with the buyers it developed that in past transactions allowances -were made on several shipments where the grade was in dispute, -after the lumber had been used. We have had occasion to go into -such matters with our attorneys and the latter are of the opinion -that where a sufficient number of adjustments have been made -on such a basis, practically acquiescing in the buyers using a part -of the lumber, would prejudice a claim on a subsequent shipment -where the shipper attempted to take advantage of his right of recovery. -Frequently disputed claims of this character are small and -have to be tried before a local jury and our attorneys have stated -that the custom of having made allowances in the past after lumber -was used would have some bearing with a jury on a subsequent -deal, and possibly be construed by the court as a private custom -apart from the general trade custom.</p> - -<p class='c014'><b>Opinion No. 90.</b></p> - -<div class='chapter'> - <h2 class='c004'>AN ORDER MAY BE CANCELED ONLY WHEN BUYER BECOMES INSOLVENT.</h2> -</div> - -<p class='c008'>Question.—A buyer places an order with a mill for five cars of -lumber, deliveries to be one car a month. At the time of the purchase -the buyer is in good financial standing and signed copies of the -contract are exchanged between the buyer and seller. After three -deliveries have been made information reaches the seller that the -financial standing of the buyer has changed for the worse; that is, -he has committed no act of bankruptcy, but a commercial agency -has reduced his capital and credit rating. The seller requests the -buyer to anticipate the payment of some of the previous shipments -before he will agree to make further shipments. The buyer refuses -to comply with this request and asks for the delivery of the balance. -The seller thereupon makes no further deliveries, but when the bills -for the goods delivered become due, demands payment. The buyer -refuses on the ground that the seller has not carried out his part of -the contract. On these facts please tell us what the law in this case -would be.</p> - -<p class='c013'>Reply: One who has sold goods on credit is not justified -in refusing delivery simply because the buyer’s financial -standing changes for the worse between the time of sale and -the time of delivery. In the case here put, for example, there -is nothing to show that the buyer is not now amply able to -pay for the goods, or that the contract would have been -declined by the seller if the buyer’s rating at the time had been -<span class='pageno' id='Page_76'>76</span>what it is now. The seller is entitled to refuse delivery only -if the buyer, before delivery is made, commits any act of -insolvency. He need not become a bankrupt or make an -assignment for creditors. He is insolvent, within the meaning -of this rule, if he fails to pay any just and admittedly -proper debt promptly upon its due date. As long as he is -paying his bills whenever they fall due the seller has no -ground upon which to declare that he is not “keeping his -credit good,” if the buyer in this case is not solvent, as the -word is here defined, the seller need not continue the deliveries. -If the buyer is solvent the seller is not justified in his -position. In that case the buyer need not pay for the goods -already delivered until the time named in the contract for -payment arrives, and he has a valid claim for damages arising -out of the seller’s failure to make the other deliveries in -strict accordance with the contract.</p> - -<p class='c014'><b>Opinion No. 91.</b></p> - -<div class='chapter'> - <h2 class='c004'>A BUYER HAS A CLAIM WHEN HE ACCEPTS A DRAFT ON INFERIOR LUMBER.</h2> -</div> - -<p class='c008'>Question.—We bought a car of lumber through a broker. Terms -were: Sight draft with bill of lading attached for three-fourths of -the amount of the invoice, the balance to be paid on arrival and -inspection. We accepted the draft on presentation and when the car -arrived we instructed our truckmen to draw the lumber in. Upon -examination we found that it was all more or less below grade. -We wired shippers accordingly and asked for instructions. We also -wrote them a letter to the above effect and told them that we could -not use the lumber and that we would hold it for their instructions. -Do we need to keep the shipment? Can we compel sellers to return -us the amount of the draft and freight charges?</p> - -<p class='c013'>Reply: The buyers are not bound to accept any lumber -not in accordance with the order. They have a valid claim -against the sellers for the amount already paid towards the -purchase of the goods, for the amount expended for freight -and for any other useless expense to which the buyers were -put as a result of the sellers’ failure to do their contract -duty. The buyers also have a claim for damages, if any, -caused by the breach of contract on the part of the sellers. -The latter were bound to supply lumber regularly sold and -accepted by the trade under the terms covering the grade in -question, and their failure so to do was an actionable breach -of contract.</p> - -<p class='c014'><b>Opinion No. 92.</b></p> - -<div class='chapter'> - <span class='pageno' id='Page_77'>77</span> - <h2 class='c004'>CONTRACT OF SALE.</h2> -</div> - -<p class='c008'>Delivery by Installments—Successive Recoveries by the Vendee -Not Permissible.</p> - -<p class='c009'>When a party contracts to deliver goods by installments, for -example—Several carloads of lumber to be shipped at different -intervals but fails to deliver one or more of such installments, the -vendee may repudiate the contract and sue for damages. If he brings -the action prior to the time for the delivery of the last installments, -he can only recover for such installments as are past due and such -recovery bars him from afterwards bringing an action and recovering -thereon for the remaining installments or deliveries.</p> - -<p class='c014'><b>Opinion No. 93.</b></p> - -<div class='chapter'> - <h2 class='c004'>DUTY OF VENDOR TO MINIMIZE LOSS WHEN VENDEE REFUSES TO ACCEPT GOODS.</h2> -</div> - -<p class='c008'>It occasionally happens that a purchaser of a car of lumber -refuses to accept same and leaves it at the mercy of the railroad company -or common carrier. In this way demurrage piles up and other -loss may arise and the shipper hesitating, for fear of compromising -himself, refuses to do anything with the lumber on his part. This -is generally a mistake because it is the duty of the shipper to make -the loss, if any, as small as possible and it is always safe to first -notify the vendee, who has refused to receive the goods that he, the -shipper, will endeavor to dispose of them in the best possible manner -and hold the vendee responsible for any loss or damage thereby. -In this case he may have to have the goods sold elsewhere or -returned to him, and it is always advisable to endeavor to have -them inspected by two or three competent parties in order to establish -the market value and to ascertain that the defects, if any, -claimed by the vendee, do not exist.</p> - -<p class='c014'><b>Opinion No. 94.</b></p> - -<div class='chapter'> - <h2 class='c004'>ACCORD AND SATISFACTION.</h2> -</div> - -<p class='c008'>If a buyer of lumber, disputing the quantity or quality, sends a -check for an amount less than the invoice to the seller, does the -seller in accepting the same preclude himself from recovering the -balance of the account? This situation occurs, we believe, often in -lumber circles and very frequently the remittance is accompanied by -<span class='pageno' id='Page_78'>78</span>a letter or some notice written on the check to the effect that it is -sent as a settlement in full and some go so far as to add that if -accepted by the creditor it must be at his peril so far as the remainder -of the invoice or account is concerned. The law on this point is -generally similar to that of the State of New York wherein it is well -settled that the acceptance or use of such a remittance does not stop -or prevent the creditor from recovering the balance of the debt -from its debtor unless there has been an honest dispute as to the -amount of indebtedness or the existence of any indebtedness at all. -This is what is termed an unliquidated account or claim and in such -a case, when one tenders an amount to be accepted in full or rejected -and the other accepts the remittance, it is a complete accord and -satisfaction. The rule is different when the amount or debt is certain -and there is only a dispute between the parties concerning -questions of shortage, quality, etc. This is what is termed a liquidated -claim and the acceptance of a remittance to be a full settlement -does not preclude the creditor from using the remittance, crediting -the same to the account of the debtor and suing for the balance.</p> - -<p class='c014'><b>Opinion No. 95.</b></p> - -<div class='chapter'> - <h2 class='c004'>CANCELLING AN ORDER BEFORE SHIPMENT—EFFECT OF SAME.</h2> -</div> - -<p class='c008'>Many lumbermen take orders from their customers through -traveling men or other representatives. Usually the orders are written -down in a manifold book and often are signed by the buyer. -The order is usually taken subject to confirmation by the house or -home office. This acceptance or confirmation is customarily made -by acknowledgement of the order in writing to the purchaser. The -question in point is whether or not, if an agent has taken an order -as above, can the purchaser cancel the order and his obligation to -accept the lumber? In a case in this State a purchaser of merchandise -placed the order with the traveling man and later wrote to the -house cancelling the same, as he found he could buy similar goods -for less money. The purchaser wrote before the seller had communicated -any acceptance or intention to fill the order which had -been given to the seller’s representative. Some correspondence -ensued in which the seller refused to cancel the order and later -shipped the goods to the purchaser, who refused to receive them. -The action resulted in a judgment in favor of the seller, which was -reversed on appeal, in which numerous authorities were cited by the -<span class='pageno' id='Page_79'>79</span>Appellate Court holding substantially as follows—“An order or -request in writing, addressed to a dealer or his agent to ship to the -writer on or before a date named, goods of a kind specified, for -which the writer agreed to pay a price named, does not constitute a -contract until accepted or acted upon by the vendor and may be -withdrawn at any time before acceptance.”</p> - -<p class='c009'>It is obvious that the result would be different were the vendor -to have signified his acceptance of the order prior to the cancelling -or withdrawal of same by the purchaser, as we would then have a -valid contract, which could not be cancelled without mutual agreement.</p> - -<p class='c009'>In this connection it might be well to add that in business transacted -by mail, the general rule is that the time of the mailing or -depositing in the mail of a letter is the presumptive time of the communicating -of the facts therein to the party to whom the letter is -addressed, hence when an order is sent by mail, another letter withdrawing -the order, if mailed prior to the mailing of the acceptance -by the other party, is a complete cancellation of the order in the -first letter. In other words, the law does not take into account the -periods elapsing by reason of the means of communication but only -the acts of the parties in so far as the time of such acts is considered -to have taken place.</p> - -<p class='c014'><b>Opinion No. 96.</b></p> - -<div class='chapter'> - <h2 class='c004'>DISCHARGE IN BANKRUPTCY—WHAT WILL PREVENT.</h2> -</div> - -<p class='c008'>Under the amendment to the National Bankruptcy Law as -amended in February, 1903, the rules relating to discharge of bankrupts, -are somewhat changed. Many parties are interested ofttimes -in preventing the discharge of a bankrupt for no other reason than -that they are creditors who believe that the bankrupt has not been -honest in his dealings and irrespective of motives of personal enmity -feel that the welfare of the business community is served by preventing -the bankrupt from being discharged and re-entering into -business. Probably the act that will prevent a discharge that most -often appeals to the creditor is that the bankrupt obtained goods on -a false statement in writing. This, if shown, will prevent the discharge, -the law reading in this respect, as follows: “Obtained -property on credit from any person upon materially false statement -<span class='pageno' id='Page_80'>80</span>in writing made to such person for the purpose of obtaining such -property on credit.” It is obvious that the party who urges this -objection must be the one who has been injured thereby.</p> - -<p class='c009'>Other debts not dischargeable in bankruptcy are taxes levied by -the United States, the State, county, district or municipality in -which bankrupt resides, and others of no practical interest to merchants. -In addition to the above are those debts which have not been -duly scheduled by the bankrupt in the proceeding in time for proof -and allowance, with the name of the creditor if known to the bankrupt, -unless such creditor had notice or actual knowledge of the -proceedings in bankruptcy; or were created by his fraud, embezzlement, -misappropriation, or defalcation, while acting as an officer or -in any fiduciary capacity.</p> - -<p class='c014'><b>Opinion No. 97.</b></p> - -<div class='chapter'> - <h2 class='c004'>SALES—OF AN INDEFINITE QUANTITY.</h2> -</div> - -<p class='c008'>A purchaser of a quantity of merchandise ordered by letter two -hundred to three hundred tons of a certain article to be delivered -within the following six months as wanted. The vendor duly -acknowledged receipt of the order and accepted same, stating that -they would deliver a certain quantity in the immediate future and -balance as ordered within the following six months. Thereafter, -the vendor delivered a certain portion of the merchandise for which -it was paid with the exception of one installment, which the vendee -refused to pay for alleging that the vendor had refused to deliver -further installments. The purchaser sued the vendor for damages -for breach of contract in failing to deliver the balance of the contract. -The Court held that by the terms of the order the vendor -could not insist on the purchaser taking more than the two hundred -tons but the purchaser on his part could insist within the six months -period upon the vendor delivering the remaining hundred tons, it -appearing that two hundred tons had been already delivered. In -fact, it was an option which the vendee could enforce but not the -vendor.</p> - -<p class='c009'>The above is a brief outline of an action decided in the Appellate -Court in New York and applies as well to an executory sale of -lumber, many similar orders being placed among lumbermen.</p> - -<p class='c014'><b>Opinion No. 98.</b></p> - -<div class='chapter'> - <span class='pageno' id='Page_81'>81</span> - <h2 class='c004'>LIABILITY OF BANK FOR FAILURE TO GIVE NOTICE OF PROTEST TO ENDORSER UPON NOTE RECEIVED FOR COLLECTION.</h2> -</div> - -<p class='c008'>That it is the legal obligation of a bank, which receives a note for -collection to use all diligence to give notice of its dishonor to all -endorsers is set forth in a decision of the Appellate Division of the -New York Supreme Court (Howard vs. Bank of Metropolis, 95 -App. Div. 342).</p> - -<p class='c009'>One H., who was the owner of a promissory note made by one S., -and indorsed by G., delivered the note to a bank for collection and -left with it a card giving G.’s full name and address, stating that he -wished the note carefully protested as he expected to hold the -endorser, the maker not being responsible, and that he would not -be in the city when the note fell due. The maker of the note having -failed to pay it when due, the bank sent it to its Notary for protest, -but failed to deliver to the Notary the card bearing the name and -address of the endorser, and informed the Notary that the endorser’s -address was unknown. The Notary made out two notices of protest, -one directed to H. and the other to G. Both notices were placed -in an envelope and sent to H., who did not receive them, being out -of town.</p> - -<p class='c009'>The Court held the bank responsible and in rendering its opinion -referred to a prior New York case entitled First National Bank -vs. Fourth National Bank (77 N. Y. 320) and quoted “it is the duty -of an agent who receives negotiable paper for collection, in case such -paper is not paid, so to act as to secure and preserve the liability -thereon of all the parties prior to his principal, and if he fails in this -duty and thereby causes loss to his principal, he becomes liable for -such loss.”</p> - -<p class='c014'><b>Opinion No. 99.</b></p> - -<div class='chapter'> - <h2 class='c004'>ACCOUNTS STATED.</h2> -</div> - -<p class='c008'>The Settlement of Accounts and Striking of a Balance Between -Parties—What It Consists Of.</p> - -<p class='c009'>Upon merchandise accounts which embrace many items or cover -transactions running through a long period it is often wise to -strike a balance or to bring about an agreement between the creditor -and debtor as to the exact amount owing thereon. The value of such -<span class='pageno' id='Page_82'>82</span>arrangement becomes of great moment when at a later date attempt -is made to enforce collection of the account. It obviates the necessity -proving various material matters such as the delivery of the -various items charged to the debtor; that they were accepted by the -debtor; that they were of the kind called for by the contract of sale; -that there was a full number or count; that the agreed prices were as -charged. The fixing of a balance upon a running account is legally -known as the <i>stating of an account</i> and an account so fixed is an -“account stated.”</p> - -<p class='c009'>A running account becomes an “account stated” by agreement -either express, or implied by acquiesence, between the parties, that -a definite amount or sum is owing from one to the other. No particular -form of words is essential and neither must it be in writing, -although a written expression is of more ready proof and, therefore, -preferable. An express admission, either verbally or by letter, -of the correctness of an account constitutes an account stated.—(Vernon -v. Simmons, 7 N. Y. Supp. 649.)</p> - -<p class='c009'>In the above case the debtor retained accounts received from his -creditor without objection or replying and subsequently acknowledged -orally the receipt of the letter containing them and promising -to pay later on, and it was held that the creditor could sue upon an -account stated. It is not necessary that the account should be -signed by the parties to make it an account stated. It is enough -that it has been examined and accepted by the party and this acceptance -need not be expressed; it may be implied from circumstances -such as keeping it without objection beyond a reasonable time. As -to what is an unreasonable time depends on circumstances largely -and it has been held that two months was sufficient, although generally -a longer time would be more conclusive. This acquiesence, -however, may be explained by the debtor, which would nullify the -apparent acceptance, but without such satisfactory explanation the -situation is prima facie against him. Where the indebtedness has -been expressly denied, the retention of the account does not bind the -debtor.—(Austin v. Wilson, 11 N. Y. Supp. 565.)</p> - -<p class='c009'>In bringing an action on an account stated if the plaintiff is -defeated through failure to prove the agreement as to the amount -or the fact that an “account was stated;” he would not be debarred -from bringing another action to recover for the various items comprising -the account.</p> - -<p class='c014'><b>Opinion No. 101.</b></p> - -<div class='chapter'> - <span class='pageno' id='Page_83'>83</span> - <h2 class='c004'>ACCEPTANCE OF GOODS—WHEN SUFFICIENT TO BIND PURCHASER.</h2> -</div> - -<p class='c008'> It is a daily occurrence in the lumber trade that a purchaser -finds some objection to the quality or quantity of lumber shipped to -him on order. Frequently in such case, without any communication -with the shipper a purchaser feels warranted in using such portion -of the lumber as suits him, relying on an assumed right to lay aside -the balance for the account of the shipper, with the idea that he -may reject it entirely or obtain some reduction in the price. The -general rule laid down by the courts in cases of this sort is as follows: -Where the vendee of goods, purchased without warranty, -after full opportunity for an inspection, accepts them without objection -when delivered, he cannot, in an action against him to recover -the price defend upon the ground that they did not conform to the -contract of sale.—(Smith vs. Coe, 170 N. Y. 162.)</p> - -<p class='c009'>If the purchaser, upon the receipt of the goods, makes objection -to the quality, but, without the express permission of the seller, -uses a portion, it is held that by so doing he tacitly waives his objection -and his acts amount to an acceptance of the entire lot.—(Coplay -Iron Co. vs. Pope, 108 N. Y. Appeals, 232.)</p> - -<p class='c009'>In the above case, which involved a transaction in pig iron, the -purchaser complained of the shipment and upon being sued for the -purchase price set up a claim for damages by reason of the alleged -defective quality and it was held “where after discovery or opportunity -to discover any defect in goods delivered under an executory -contract of sale, the vendee neither returns or offers to return the -property nor gives the vendor notice or opportunity to take it back, -in the absence of a collateral warranty or agreement as to quality, -he is conclusively presumed to have acquiesced and may not thereafter -complain of the inferior quality.”</p> - -<p class='c009'>When a car constitutes but a portion of the order, which was in -the nature of one contract for a number of cars, the purchaser cannot -object to the quality and retain the initial car and decline to -receive the balance of the shipment. The contract of sale being an -indivisible one in law, the purchaser by his acceptance of the initial -shipment and failure to return it, is conclusively presumed to have -acquiesced in the quality of the lumber offered him and waived any -objection to the remainder of the shipment order provided it is the -same as the first car.</p> - -<p class='c009'><span class='pageno' id='Page_84'>84</span>In the case of Weil vs. The Unique Electric Device Co., Reported -in 39 Misc. (New York 1902), page 527, a vendor sought to recover -the stipulated purchase price of certain merchandise sold to the -defendant, consisting of some 3,000 electric batteries, of which 1,000 -were delivered and paid for, but the purchaser refused to accept the -balance on the ground that the quality was not according to the -agreement. The court held that the contract of sale was an entire -one and it was the duty of the purchaser to receive balance of the -order, provided they were of similar quality to the lot already delivered. -That when the purchaser received the first lot and found them -unsatisfactory, it was its duty to rescind the sale and return, or offer -to return the goods; and its failure so to do was an acquiesence on -its part of the quality of the goods in question.</p> - -<p class='c009'>The above discussion leaves for further consideration the question -when a purchaser though bound to take goods and chargeable -with their full price, may hold the seller liable for damages for -breach of express or implicit warranty.</p> - -<p class='c014'><b>Opinion No. 102.</b></p> - -<div class='chapter'> - <h2 class='c004'>CONTRACT OF SALE—STATING ESTIMATES OF MAXIMUM AND MINIMUM AMOUNT.</h2> -</div> - -<p class='c008'>It is the custom of many merchants, with a view doubtless of -securing the best possible terms and yet to leave a loophole, whereby -they can take only such an amount as they desire, to give the vendor -a general idea of their requirements.</p> - -<p class='c009'>In Heisel vs. Volkman, reported in Volume 55, New York -Appellate Division, page 607, a dealer wrote to a manufacturer of -certain kinds of merchandise asking for “prices for supplying our -requirements,” stating “we estimate our yearly requirements at from -five to ten million pieces. Are confident that they will not be less -than the smaller amount and reasonably certain that they will come -up to or exceed the larger one,” to which the manufacturer replied, -“I would be willing to make a yearly contract with you from five to -ten million pieces, etc.” The purchaser did not take the minimum -amount of five million pieces during the period in question and the -manufacturer sued to recover the purchase price of the difference, -having, of course, done what was necessary in respect to making a -tender of delivery. The court held that the purchaser was obligated -to take and pay for at least five million pieces, even if his -requirements for the year fell substantially short of that amount -<span class='pageno' id='Page_85'>85</span>and that the seller in making his price had a right to rely upon the -minimum amount stated by the buyer.</p> - -<p class='c009'>Attention is called to this for the reason that the same rule -would apply to a transaction in lumber and because many of the -trade are in the habit of making contracts upon similar conditions -and referring in elastic terms to their probable requirements.</p> - -<p class='c014'><b>Opinion No. 103.</b></p> - -<div class='chapter'> - <h2 class='c004'>CERTIFICATION OF CHECK—RELEASES THE MAKER.</h2> -</div> - -<p class='c008'>Attention is called to the fact that under the law of New York -State the procuring of the certification of a check by the holder from -the bank or banker upon which it is drawn is equivalent to the -acceptance of a bill of exchange and releases the drawer.—(Meurer -vs. Phœnix National Bank, 94 App. Div. (N. Y.) 331.)</p> - -<p class='c014'><b>Opinion No. 104.</b></p> - -<div class='chapter'> - <h2 class='c004'>SALES—STOPPAGE IN TRANSIT.</h2> -</div> - -<p class='c008'>The right to stop a shipment in transit is based on the existence -of a lien in favor of the seller, which continues until the goods have -reached the actual physical possession of the buyer. So long as the -goods are in the hands of a carrier the seller may, given the proper -conditions, reclaim the goods. This is so even if the carrier is one -designated or selected by the purchaser. A fraudulent sale of the -goods by the purchaser to third parties will not defeat the right of -stoppage, nor will seizure under attachment or execution issued -against the purchaser provided the right is exercised before the -transit is at an end.</p> - -<p class='c014'><b>Opinion No. 105.</b></p> - -<div class='chapter'> - <h2 class='c004'>FOREIGN CORPORATION LAWS.</h2> -</div> - -<p class='c008'>Necessity of Filing Certificates, Etc., in West Virginia, Indiana, -Tennessee, Mississippi, Kentucky, Ohio, -Michigan, New York.</p> - -<p class='c009'>One of our members recently had an attorney examine the corporation -laws of several States and give an opinion concerning -the advisability of filing corporate certificates, securing so-called -licenses, etc., in the various States wherever the member was making -<span class='pageno' id='Page_86'>86</span>sales. The States referred to are West Virginia, Indiana, Tennessee, -Mississippi, Kentucky, Ohio, Michigan and New York. This information -may be helpful to other members, and a copy of the opinion -follows:</p> - -<p class='c011'><span class='sc'>West Virginia.</span>—Every corporation whose principal -place of business is located out of the State must pay an -annual license tax as follows: If the authorized capital is -not more than $25,000, $20; not more than $100,000, $50; -not more than $1,000,000, $50; an additional forty cents on -each $1,000 in excess of $100,000. No other taxes are assessed -unless it has personal or real estate in West Virginia. Such -foreign corporations may be authorized to hold property and -do business in the State by certificate of the Secretary of the -State that they have filed with him a copy of their articles of -association, which certificate with a copy of the charter must -be filed with and the certificate recorded by, the Clerk of the -County Court of such county in which their business is conducted. -A foreign corporation obtaining the above mentioned -certificate authorizing to hold property and do business in -West Virginia has the powers, rights and privileges and is -subject to the same regulations, restrictions and liabilities that -are conferred by statutes of West Virginia on domestic -corporations.</p> - -<p class='c011'>Every foreign corporation which shall do business in the -State without having obtained such certificate and having it -filed and recorded according to law shall be guilty of misdemeanor, -and upon conviction shall be fined not less than $50, -nor more than $1,000 for each month its failure so to comply -shall continue.</p> - -<p class='c011'><span class='sc'>Indiana.</span>—Every foreign corporation, except railroad and -telegraph companies, built before March 15, 1901, and insurance -companies must maintain a public business office in -Indiana and must designate a representative in Indiana on -whom service of process may be had. Such foreign corporations -are subject to the liabilities, restrictions and duties -imposed upon domestic corporations. They must before being -permitted to do business in Indiana file in the office of the -Secretary of State certified copy of its articles of incorporation, -and a statement sworn to by the principal or agent in -Indiana of the proportion of the capital stock of such corporation -represented by its property located and business -transacted in Indiana, and must pay in the office of the Secretary -of State upon such proportion incorporation fees equal -to those required of domestic corporations. The Secretary of -State shall then issue a certificate authorizing such corporation -to do business. Until this law is complied with, demands -of a foreign corporation, whether arising out of contract or -<span class='pageno' id='Page_87'>87</span>tort, cannot be enforced in the courts of Indiana, and such -corporation is subject to a fine of not less than $1,000. Fee -for filing articles of incorporation of a corporation with capital -stock of $10,000 or under is $10, over $10,000, one-tenth -of one per cent. upon authorized capital. No annual State tax -on corporation as such.</p> - -<p class='c011'><span class='sc'>Tennessee.</span>—Foreign corporations must file in the office -of the Secretary of State a copy of its charter and cause an -abstract of same to be recorded in the office of the Register of -each county in which such corporation purposes to carry on -its business or to acquire and own property. Penalty for -failure to do so shall subject the offender to a fine of not less -than $100 nor more than $500. They must pay in the office of -the Secretary of State a tax or license of $100 to exercise -such privilege.</p> - -<p class='c011'><span class='sc'>Mississippi.</span>—Foreign corporations may sue and be sued -and are liable to be proceeded against by attachment or otherwise, -as individual non-residents are liable. The acts of their -agents shall have the same force as the acts of agents of -private persons within the scope of their power. They cannot -recover on any contract made in the State or cause action -originating therein which is in violation of laws or policies of -States. No general statutes about taxation of foreign corporations. -Subject governed in main by common rule as to -taxes, but they are required to file with the Secretary of State -certified copy of their charter for record, for which a graduated -fee is fixed.</p> - -<p class='c011'><span class='sc'>Kentucky.</span>—If the corporation be organized under the -laws of another State a board shall fix the value of the capital -stock determined from the amount of the gross receipts of the -corporation in Kentucky and elsewhere the proportion which -the gross receipts in Kentucky bear to the entire gross receipts. -The same proportion of the value of the entire capital stock, -less the assessed value of tangible property in the State, shall -be the correct value of the corporation franchise for taxation. -Reports must be made and failure is a misdemeanor punishable -by a fine of $1,000 and $50 for each day.</p> - -<p class='c011'><span class='sc'>Ohio.</span>—Foreign corporations are forbidden to do business -until they have procured from the Secretary of State certificate -that they have complied with the requirements of law -which authorize them to do business in the State, and until -said companies shall have caused the proportion of their -capital stock employed within the State to be determined by -the Secretary of the State, and shall have paid to him a fee of -one-tenth of one per cent. upon such amount and obtained his -certificate of such payment. No foreign corporation doing -business in the State can maintain any action upon any contract -made by it in the State until it has procured such certificate. -<span class='pageno' id='Page_88'>88</span>The corporation must file with the Secretary of State -due copy of its charter and statement under seal of the -amount of its stock, the nature of its business and state which -is to be its principal place of business, designating a person -upon whom process against such corporation may be served. -The person so designated must have an office where the corporation -is to have its principal place of business within the -State. Corporations complying with these requirements are -exempt from attachment on the ground that they are foreign -corporations.</p> - -<p class='c011'><span class='sc'>Michigan.</span>—Foreign corporations filing in the office -of the Secretary of State certified copy of articles of incorporation -and an appointment of an agent in this State for -service of processes may carry on their business in Michigan. -Foreign corporations may bring suits on furnishing security -for costs.</p> - -<p class='c011'><span class='sc'>New York.</span>—No foreign corporation shall do business -without first procuring from the Secretary of State certificate -that it has complied with requirements of law. License fee -shall be paid. No foreign corporation can do business in New -York or sue on contract made there unless it has procured -such certificate prior to the making of the contract. Selling -goods through a factor within the State is not covered by -this prohibitive clause. Before granting such certificate foreign -corporation must file with Secretary of State copy of its -charter and a statement setting forth its business, its principal -place of business within the State and designating the person -upon whom processes may be served. Such person must -have an office within the State, where the principal place of -business of such corporation is located. Foreign corporations -must pay to State Treasurer a license fee of one-eighth of one -per cent. for privilege of exercising its corporate franchise in -New York, to be computed upon the amount of capital stock -employed within the State during its first year of business.</p> - -<p class='c014'><b>Opinion No. 106.</b></p> - -<div class='chapter'> - <h2 class='c004'>CONTRACTS FOR CARLOADS SEPARABLE.</h2> -</div> - -<p class='c008'>Where a contract was made for three carloads of a company’s -No. 1 white cedar shingles and the purchaser accepted and paid for -two carloads, but refused to accept the third because of alleged inferior -grade and quality, and because the shingles were not made by -said company, the Supreme Court of Minnesota holds that the contract -as to the three carloads was separable, so that the purchaser’s -payment and the seller’s acceptance of payment for two carloads did -<span class='pageno' id='Page_89'>89</span>not prevent the seller from beginning an action to recover the purchase -price of the third carload nor the purchaser from defending -therein. The court also holds that a buyer, seeking to reject an -article as not in accordance with the contract of sale, must do nothing -after he discovers the true condition inconsistent with the seller’s -ownership of the property.—Duluth Log. Co. vs. John C. Hill Co., -124 N. W., 967.</p> - -<p class='c014'><b>Opinion No. 107.</b></p> - -<div class='chapter'> - <h2 class='c004'>WARRANTY SURVIVES ACCEPTANCE.</h2> -</div> - -<p class='c008'>Where one attempting to sell shingles stated in a letter that “They -are mighty good shingles, they are as good as you could get anywhere,” -it was a warranty of their quality. Where a buyer of -shingles accepts shingles which he knows are of a grade inferior to -what the seller warranted, the buyer does not waive the warranty, -and he can defend against an action for the price on that ground. -(Texas Court of Civil Appeals.) Harroll vs. McDuffie, 128 S. W. -Rep., 1149.</p> - -<p class='c014'><b>Opinion No. 108.</b></p> - -<div class='chapter'> - <h2 class='c004'>ACCEPTANCE OF LESS THAN INVOICE PRICE.</h2> -</div> - -<p class='c008'>On arrival of a carload of shingles, the buyer complained of their -quality, and for the purpose of securing an immediate settlement and -avoiding further negotiations the seller agreed to accept a less -amount for them than the full price if payment was made before a -specified time. The buyer failed to make payment within such -specified time and in a suit to recover for the full amount of the -invoice it was held by the court that the seller could require payment -under the circumstances of the full price. (Texas Court of Civil -Appeals.) Harroll vs. McDuffie, 128 S. W. Rep., 1149.</p> - -<p class='c014'><b>Opinion No. 109.</b></p> - -<div class='nf-center-c0'> -<div class='nf-center c016'> - <div><span class='sc'>press of</span></div> - <div><span class='sc'>John A. Phillips</span></div> - <div><span class='sc'>new york</span></div> - </div> -</div> - -<div class='pbb'> - <hr class='pb c003' /> -</div> -<div class='tnotes'> - -<div class='chapter'> - <h2 class='c004'>TRANSCRIBER’S NOTES</h2> -</div> - <ol class='ol_1 c002'> - <li>Silently corrected typographical errors and variations in spelling. - - </li> - <li>Retained anachronistic, non-standard, and uncertain spellings as printed. - </li> - </ol> - -</div> - - - - - - - - -<pre> - - - - - -End of the Project Gutenberg EBook of Lumber Legal Opinions, by Anonymous - -*** END OF THIS PROJECT GUTENBERG EBOOK LUMBER LEGAL OPINIONS *** - -***** This file should be named 60134-h.htm or 60134-h.zip ***** -This and all associated files of various formats will be found in: - http://www.gutenberg.org/6/0/1/3/60134/ - -Produced by Richard Tonsing and the Online Distributed -Proofreading Team at http://www.pgdp.net (This file was -produced from images generously made available by The -Internet Archive) - -Updated editions will replace the previous one--the old editions will -be renamed. - -Creating the works from print editions not protected by U.S. copyright -law means that no one owns a United States copyright in these works, -so the Foundation (and you!) can copy and distribute it in the United -States without permission and without paying copyright -royalties. 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