Forrestier v. Bordman. That in the absence of any invariable custom, the plaintiffs were not legally bound to send a duplicate invoice on learning, that the case No. 13 had not gone in the Formosa. That the defendants or their agents in New York were guilty of neglect, in not making search for case No. 13, among the cargo of the François I., it being shown, that when goods did not accompany the invoice, they were invariably looked for in the next packet. 1 The jury found for the plaintiffs. FORRESTIER v. BORDMAN. A supercargo is not bound to observe the exact terms of his instructions, if thereby the interests of the owner would be sacrificed or his objects frustrated. In cases of necessity or great urgency it is only necessary, that the supercargo should act bond fide and with reasonable discretion, in order to bind the owner. If the owner receive the proceeds of a sale by the supercargo without objection, it is a ratification of the sale. All sales but those by del credere commission are at the risk of the shipper. The validity of a sale on credit depends upon the usage of trade in the place, where the sale is made, and such usage is a question of fact for a jury. Where the usage of trade allows discretionary sales on cash or credit, a credit sale is at the risk of the shipper, unless some agreement can be shown restricting him to a cash sale. Where a commission merchant or factor has sold goods upon credit, he is bound to exercise due discretion in enforcing payment, and not to sue or put the owner to expense, unless there is reasonable ground to believe, that he will be benefited. 1 The case of Brycons v. Nix (4 Mees. & Welsby, 791), contains some remarks of Mr. Baron Parke, very strong to the point of this case, when the property vested in Andrews. Forrestier v. Bordman. Where a commission merchant sells on credit to a person, who becomes insolvent, and does not give notice of that fact to the owner within a reasonable time, he is liable for all the damage the owner suffers in consequence of not receiving such notice. THIS was an action of assumpsit brought by the plaintiff, a merchant of Batavia, to recover of the defendant, a merchant of Boston, $1637, the amount advanced by the plaintiff on a sale of flour made by him for the defendant on credit, the purchaser having become insolvent. It appeared in evidence, that in the year 1830, the defendant shipped in the Shylock, 1000 barrels of flour, and placed it in the keeping of Stephen H. Williams, as supercargo. The vessel sailed for Rio Janeiro, and 775 barrels of the flour were there sold. She then put into Monte Video, but the state of the market being very unfavorable, the supercargo concluded to carry the remaining portion to Batavia. He did so, and requested the plaintiff to sell it, and invest the proceeds, together with the proceeds of that sold in South America, for the benefit of the shipper. The market was glutted and the flour was somewhat damaged, but it was sold by the plaintiff to one Johannis, on a credit of six months, and the proceeds, deducting the interest, were invested in coffee, which was shipped to the defendant and by him received. No guaranty commission was charged in the account of sales, and Mr. Williams had no knowledge, that the flour was sold on a credit of six months, until after the sale was made. After the coffee had been shipped to the defendant, Johannis, to whom the flour was sold, became insolvent, and the plaintiff not being able to obtain payment from him for the flour, claimed in this action to recover of Bordman the amount of the advance. C. P. Curtis, for the plaintiff, objected, that the defendant ought not to be permitted to deny the authority of Williams, Forrestier v. Bordman. the supercargo, to make the sale at Batavia. Williams was admitted as a witness under exception by the plaintiff ; he was not competent to prove such a defence as this, without a release, which had not been given him. If this point is insisted on, Williams's testimony ought to be rejected entirely. The sale by Williams at Batavia was a justifiable act. He found, that he could not dispose of the flour at Rio Janeiro, and went to Batavia, where he employed plaintiff to sell it and invest the proceeds in coffee, which the defendant received and appropriated to his own use without objection. This was a ratification by him, if any were needed. (Story on Agency, 248, &c.) In the next place the defendant objects to the recovery by the plaintiff, because he sold the flour on credit. The flour was consigned to the plaintiff for sale in the usual manner, without specific instructions, and it is proved by the testimony in the case, that sales on credit are usual and customary at Batavia. The flour was damaged, the sale dull, and the purchaser was in good credit when he made the purchase. Williams was in the plaintiff's counting-room almost all the time, and might have inquired about the transaction, and decided in relation to it, but he did not; he left the whole to the plaintiff's discretion, and the plaintiff was justified by the usages of the place in making the sale in the manner proved. (Story on Agency, 60-220; Paley on Agency, 212; 5 Cowen R. 473.) But, it is alleged by the defendant, that the plaintiff, by advancing the amount of the sale and investing it in merchandise consigned to the defendant, assumed the risk of collection at maturity; and that, if this was not so, yet by his neglect to notify the failure of the purchaser to the defendant, he made the debt his own, and so ought not now to recover the amount claimed. As to the first of these averments, the plaintiff replies, that his account of sales showed, that the sale was on six months' credit, and his account current contained Forrestier v. Bordman. no charge of a guaranty commission, which would have appeared there, if the plaintiff had assumed or guarantied the sale. The charge of "discount" was the rebate of interest on the amount of the sale, for six months, at nine per cent. per annum, which is the usual rate of interest at Batavia. This was for cashing the sales. Williams testifies, that Barrell, the plaintiff's clerk, told him the sale was guarantied to him; but Barrell had no authority to make such a declaration for his employer; and the plaintiff was not bound by it; and the documents (which are in Williams's own handwriting), namely, the account sales and account current show no such thing, but negatively prove the contrary. As to the other averment of the defendant it is true, that a considerable time elapsed before the defendant had notice of the insolvency of the purchaser of his flour and of the plaintiff's reclamation on himself; and if defendant has sustained any loss through the plaintiff's neglect in this particular, he is entitled to a deduction to that extent. (Story on Agency, 196; Paley, 39.) The defendant, however, received notice of the loss of the debt, and of the plaintiff's intention to call on him for reimbursement in May, 1833. He has received the plaintiff's money and has had the use of it ever since November, 1830; and if he now pays it back, he will be just, where he would have been, if the plaintiff, instead of advancing the amount of the sales of flour, had waited for the maturity of Jordan Johannis's note. The evidence shows clearly, that the plaintiff has done all that he could to collect the amount, and in fact succeeded in getting something on account of it, for which he has given the defendant credit. It is said by defendant, that the plaintiff settled his account and paid over the balance, intending such payment to be final. That is the very question. We deny, that such was the plaintiff's intent; his conduct shows the contrary; it shows only that he was willing to accommodate the defendant, by advanc Forrestier v. Bordman. ing the amount, but not that he intended to assume the ultimate responsibility of the debt, without compensation. The plaintiff is entitled to a credit for the balance of his advance with interest. S. Hubbard and Willard Phillips, for the defendant. This claim is a surprise upon the defendant. It is the first one of the kind in the history of the East India trade, yet no one can doubt, that innumerable bad sales have been made by factors in the course of that trade. There are now outstanding debts for sales in India to vast amounts, which would be equally good ground of reclamation by the factors there, against American and European consignors. In order to recover, the plaintiff must show, that a sale by the factor, on credit, at the risk of the consignor, was previously authorized or subsequently ratified by the consignor. It is no violation of duty in the factor to sell on credit in any case, provided he pays over an amount, equal to the net proceeds, to his principal, and assumes the outstanding debt for the sales himself. This we contend the plaintiff did in this case; and this we contend is generally done, where the sales are on credit in India, and there is no express explicit understanding between the principal and factor, that the outstanding debt is at the risk of the principal. Sales are usually made on credit in all places, where commerce and civilization have made any progress; but this credit is in many places generally, and in individual cases in all places, a distinct concern between the factor and the vendee, and does not affect the consignor. The naked fact, therefore, that sales are made on credit, to a greater or less extent at any place, is no ground of presumption, that the credit is at the risk of a distant consignor. Whether it be at his risk must depend upon all the circumstances of the case, showing that the parties so understood it ; for the general presumption is, that the consignor does not |