Hanna v. Flint
Before: Baldwin
Synopsis
Whebe a broker buys wheat for E. & H. with their funds, and an agreement is made between the three that the broker shaü dispose of the wheat, and that the profits shall be equally divided, the broker is neither partner nor joint owner of the wheat.
Where, in such case, the defendants, warehousemen, deliver the wheat to third persons, who bought from the broker for his own debt, on the ground that they held the storage receipt of defendants to one S. who had loaned money to E. & H. on the wheat as collateral, and had indorsed the receipt, “ deliver to bearer, or E. & H.” the defendants knowing at the time of said delivery that E. & H. claimed the wheat as their property, they are liable to E. & H. for a conversion.
Query, whether defendants could have refused to deliver the wheat to E. & H. while the storage receipt to S. was outstanding?
But when they gave the wheat to the wrong claimant they became responsible for its value to the right one.
Baldwin, J. delivered the opinion of the Court—Terry, C. J. concurring.
This case turns chiefly on the construction of the following instrument:
“ Whereas, John T. Little, as broker for David H. Ellis and Bobert G-. Hanna, has purchased three lots of Mexican wheat, (describing it,) it is hereby agreed between the said Little, David H. Ellis, and Bobert G. Hanna, that the said Little is to dispose of the said wheat, and that the profits arising- therefrom shall be equally divided between Little, Ellis, and Hanna—said Ellis having furnished the sum of seven hundred and sixty dollars, and is to furnish the further sum of twenty-two hundred and forty dollars, as it may be needed in making the payment forth e purchase of said lots of wheat.”
(Signed.)
1. It is quite clear that Little, under this agreement, and the facts connected with it, was not a partner or joint owner of this wheat. The wheat was bought for Ellis and Hanna, and with their funds. Little was the mere broker, and was to dispose of it for them. It is true, he was to receive his compensation out of the profits, but this gave him no ownership in the wheat itself, nor did it constitute him a partner. Any broker selling on commission would be a partner if this were the rule, for there is no difference between a certain and a contingent compensation—■ between so much on gross sales and so much on profits. (Gallop [76]v. Newman, 7 Pick. 282, and Cases; 17 Mass. 197; 6 Vt. 119; Ch. on Cont. 213.)
2. The defendants having given the wheat under bond of indemnity to Kendrick and Smith, who, it seems, bought of Little for his own debt, with notice of the claim of Ellis and Hanna, are liable to this action as for a conversion, though the order given by defendants to Little or bearer was outstanding. Whether the defendants could have refused to deliver the wheat to the plaintiff or not, that order being out, it is not necessary to decide, but when the defendants gave the wheat to the wrong claimants, they became responsible for its value to the right one on the proof by the latter of his title.
Judgment affirmed.
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