Augusta Bonded Public Warehouse Co. v. Georgia Railroad Bank , 1928 Ga. LEXIS 225 ( 1928 )

Atkinson, J.

One of the receipts issued by the warehouse company (both being in the same form) was as follows:

“Augusta Bonded Public Warehouse Company. Incorporated and bonded under laws of the State of Georgia. Augusta, Ga., 1/26/24.

“Keceived from N. L. Willett Seed Co. the following articles on special storage: 300/100 Sacks Cottonseed. Insured under policy held by Augusta Bonded Public Warehouse Co. Bu. 1.10 a bu. The above articles will be delivered only on the surrender of this receipt, and payment of all storage charges. All goods insured by this company, unless otherwise instructed in writing by storer. Loss in weight and damage by heating at owner’s risk. [Signed] Augusta Bonded Public Warehouse Co. L. C. Doolittle, Manager.

“Indorsed: N. L. Willett Seed Co. By L. Ivey.”

N. L. Willett was president of the said seed company. R. S. Guess was vice-president and general manager and in active control of the business of the company. L. Ivey was an assistant bookkeeper and accustomed to do the duties of an assistant cashier under the direction of Guess. After the cottonseed were stored Guess delivered the warehouse receipts to Ivey to be negotiated. Ivey prepared a note for $4400 to the Georgia Railroad Bank, signed thereto the name of the N. L. Willett Seed Company, and delivered for discount the note to the bank with the above mentioned warehouse receipts so indorsed as collateral security. The note so received was discounted; the proceeds were placed on deposit in the bank to the credit of the N. L. Willett Seed Company, and thereafter were drawn out by the officers of that company in the regular course of business. Ivey immediately reported to Guess the making of the note and indorsement and delivery of the warehouse receipts in pledge; all of which was approved by him. A few days after storage of the cottonseed the N. L. Willett Seed Company delivered for storage certain soy beans to the said warehouse company, for which it received a warehouse receipt similar in all respects, except as to date and description of the articles stored, to the receipts issued for the cottonseed. This receipt was delivered to L. Ivey by Guess, for the purpose of being negotiated at the bank. Ivey prepared a note payable to the said Georgia Railroad Bank, to which N. L. Willett affixed the name of N. L. Willett Seed Company as maker. Ivey then carried and delivered to the bank the note with the warehouse receipt indorsed as the other warehouse receipts were indorsed, and the warehouse receipt was accepted as collateral, the note discounted, and the proceeds placed to the credit of the N. L. Willett Seed Company and subsequently were drawn out by that company. This transaction also was immediately reported by Ivey to Guess, and was approved by him. The proceeds of the note were drawn out by N. L. Willett Seed Company in the regular course of business.

In the circumstances above stated, the bank did not take the papers with notice of any secret equity of the warehouse company. The fraud practiced upon that company by the seed company came afterwards. The provision in the Civil Code (1910), § 2914, that “The title to cotton and other goods, wares, and merchandise stored in such bonded public warehouses shall pass to a purchaser or pledgee thereof by the delivery to him of the said warehouseman’s receipt therefor, with an endorsement thereon to such purchaser or pledgee, signed by the person to whom such receipt was originally given by said warehouseman or by the endorsee of such receipt,” is not an exclusive form for pledging warehouse receipts for a debt. The bank as pledgee acquired sufficient title, as against the warehouse company, to support an action against that company for the value, of the cottonseed and soy beans, after they had been fraudulently withdrawn from the warehouse company by the N. L. Willett Seed Company without surrender of the warehouse receipts. The receipts and indorsements thereon were admissible in evidence in connection with other evidence explanatory of the transactions referred to above.

The exception to the refusal of the judge to submit a stated question that had been approved by the attorneys for the opposing parties, which does not specify the ground of alleged error, is too indefinite to present any question for consideration other than because the opposing attorneys had approved the question. The approval of the attorneys of the question was not binding upon the court, and does not furnish ground for reversal of the refusal to submit the question.

In the light of the pleadings and the evidence, and the third question propounded to the jury and the answer thereto, to which there was no exception, the provision in the decree for a money judgment against the warehouse company, without a similar provision against N. L. Willett, was not erroneous as against the warehouse company.

Judgment affirmed.

All the Justices concur.