The freight upon a shipment of goods is payable, according to
general rules, when the merchandise is in readiness to be delivered
to the person having a right to receive it, and when the consignee
has had the opportunity to examine
Page 62 U. S. 528
the goods, to see if the obligations of the bill of lading have
been fulfilled by the shipowner.
Where the consignee of a ship gave notice to the consignee of
the goods, requiring payment of the freight of the goods as they
should be landed from the ship on the wharf, and the consignee of
the goods offered to pay the freight of such of the merchandise as
had been landed, the latter did all that he was bound to do under
the notice, although not bound to do so by the commercial law, and
the refusal of the consignee of the ship to receive such
pro
rata freight was unjustifiable.
When the shipmaster has a larger shipment under one bill of
lading than can be landed in the business hours of one day, he must
take care not to land it in such quantities as to be unable to
ascertain the
pro rata freight. Unless he takes this care,
the goods landed will be under his care and responsibility without
additional expense to the consignee of them until they shall be
ready for delivery.
Where the entire freight was demanded when only a part of the
goods was ready to be delivered, and the entire freight was refused
when the goods were all landed except upon the condition that the
consignee of the goods would pay cartage and storage, this was
contrary to the general law upon the subject.
This general law and the nature of freight examined and
explained.
Neither party can require from the other that the merchandise
shipped under one bill of lading shall be put up into parcels for
delivery or for the payment of freight. If the shipment is large,
or cannot be landed in a day, the master has a right to ask for
security or arrangement for the
pro rata freight. But he
cannot demand the payment of the freight of the entire shipment
before the consignee has an opportunity to examine the goods.
The ship is not bound to land an entire shipment in a day, and
when landed on different days, if the shipper disregards the notice
that such will be the case, and shall not be present to receive the
goods, and has made no arrangement for the freight, then they may
be stored in the shipowner's name, to preserve his lien upon them
for freight, for safekeeping, at the consignee's expense and
risk.
A stamp upon the back of the bill of lading stating, amongst
other things, "that the entire freight was payable prior to
delivery, if required," which was put there by the ship's owner,
but which there was no evidence was recognized by the shipper as
part of his contract, cannot vary the obligations of the contract
so as to authorize a demand for freight before the goods were ready
for delivery.
The general rule is that the delivery of the goods at the place
of destination, according to the bill of lading, is necessary to
entitle the ship to freight. The conveyance and delivery is a
condition precedent, and must be fulfilled.
This general rule may be varied by stipulations, but they must
be in writing, and be signed by the parties, before they can
control the operation of the law merchant.
It is not enough to establish that this was the mode of doing
business by the shipowner, nor that a practice prevailed in
conformity with it at the port to which the goods were carried and
delivered to a consignee.
Page 62 U. S. 529
Such a stamp is not equivalent to a memorandum upon a policy of
insurance, which is always on the face or the margin of the policy.
The rules with respect to policies of insurance explained.
The practice at San Francisco cannot be received as a custom,
and therefore obligatory. Moreover, the practice is not established
by evidence.
This was a libel filed by Brittan under the circumstances stated
in the opinion of the Court. The district court dismissed the
libel, and the circuit court affirmed the decree.
Page 62 U. S. 531
MR. JUSTICE WAYNE delivered the opinion of the Court.
This cause involves an important commercial principle, of daily
recurrence in practice, which does not appear to be well understood
and settled in San Francisco. Our decision will correct the
misapprehension there in regard to the delivery of merchandise by
shipowners, and the payment of freight for its transportation.
The libellant was the owner and consignee of goods of a value
exceeding four thousand dollars, which were shipped in good order
and condition at New York on board of the ship
Alboni, to
be carried and delivered in San Francisco, in the same order, at a
rate of freight expressed in the bill of lading. It amounted to two
hundred and forty-seven dollars and twelve cents, including eleven
dollars and seventy-seven cents for primage. The bill of lading,
upon its face, is in the ordinary form, but there was a stamp upon
the back of it in these words:
"That the goods were to be delivered at the ship's tackles when
ready for delivery -- not accountable for loss or damage by fire or
collision; freight payable prior to delivery, if required; contents
unknown."
The proctors in the cause agreed that those words were stamped
on the original bill of lading.
The ship arrived at San Francisco. Notice of it was given to the
libellant by the consignee of the ship, and he also required
payment of the freight of the goods as they should be landed from
the ship on the wharf, and that if it was not paid, and the goods
received by four o'clock of the day, such of them as had been
landed would be placed in a warehouse for safekeeping, at the
expense of the libellant. The notice and the requirement are taken
from the second article of the respondent's answer to the libel. He
adds that the libellant had refused to pay the freight according to
the terms of the bill of lading.
The testimony discloses what the respondent considered to be its
terms, and the refusal of the libellant to acquiesce in his
interpretation.
Page 62 U. S. 532
The goods were landed from the ship in parcels, on different
days, from the 24th to the 27th of October, inclusive. The clerk of
the libellant attended on each day to receive them. In conformity
to the notice which had been given, he offered to pay the freight
of such of the merchandise as had been landed. The consignee of the
ship refused to receive it or to deliver such goods, claiming that
he had a right to demand the freight upon the whole shipment when
he was only ready to deliver a part of it. In the assertion of this
right (certainly not in conformity with the notice he had given to
the libellant) the respondent from day to day warehoused the
goods.
The libellant did all he was bound to do under the notice which
had been given to him. He could not have done more. The
respondent's refusal to deliver the parcels as they were landed
cannot be justified, under the notice he had given, by any delay
there may have been in the delivery, either from the necessity of
weighing or measuring them or from the claim made by him to have
the freight paid upon the whole shipment before he would deliver a
part of it. He had taken his course, and the libellant acquiesced
in it by offering to pay the freight on each parcel as it was put
on the wharf, though not bound to do so by the commercial law. The
respondent's refusal has no justification either in law nor can it
be vindicated by any evidence in the cause.
We do not mean to say that the libellant had a right to take the
parcels on the days they were landed without the payment of a
pro rata freight, but where a shipmaster has a larger
shipment under one bill of lading than he can land in the business
hours of a day, as he has the control of unloading the cargo, he
must take care not to do it in such quantities that he may not be
able to have the
pro rata freight ascertained in the only
way in which it can be done. Until it shall be done, he is not in
readiness to deliver such part or to demand the freight which may
be due upon it. Goods so landed will be under his care and
responsibility, without additional expense to the consignee of
them, until they shall be ready for delivery.
Ordinarily no difficulty arises between the ship's owner and
Page 62 U. S. 533
the consignee of the goods; their interest, convenience, and
responsibilities, usually suggest to them some arrangement for the
freight beforehand by which goods landed from day to day may be
taken without delay by the consignee of them. In this instance,
however, no opportunity was given to the libellant to make such an
arrangement, the consignee of the ship having absolutely demanded
the whole freight of the shipment as the condition for the delivery
of any part of it.
On the fourth day, when all of the libellant's shipment had been
landed and before they were sent to a warehouse, he demanded from
the consignee of the ship a delivery order for all the merchandise
specified in the bill of lading, tendering at the same time, in
gold, the whole freight due. The delivery order was refused, the
answer being that the goods were subject, in addition to the
freight, to a charge for storage and cartage. The last was also
warehoused by the respondent, as those of the three previous
landings had been.
The foregoing is a sufficient statement of the facts and
evidence in this case for the decision of it. It will not be
necessary to notice again the attendance of the clerk of the
libellant on the days of landing, to receive the goods and pay the
freight.
The word "freight," when not used in a sense to imply the burden
or loading of the ship or the cargo which she has on board, is the
hire agreed upon between the owner or master for the carriage of
goods from one port or place to another. That hire, without a
different stipulation by the parties, is only payable when the
merchandise is in readiness to be delivered to the person having
the right to receive it. Then the freight must be paid before an
actual delivery can be called for. In other words, the rule is, in
the absence of any agreement to the contrary of it, that freight,
under an ordinary bill of lading, is only demandable by the owner,
master, or consignee of the ship when they are ready to deliver the
goods in the like good order as they were when they were received
on board of the ship. Such is the general rule. Neither party can
require from the other that the merchandise shipped under one bill
of lading shall be put up into parcels for delivery or for the
payment of freight. They may do so by stipulation in the bill of
lading,
Page 62 U. S. 534
or by subsequent agreement, for either of the purposes just
mentioned. The master is bound to deliver the goods in a reasonable
time. What may be so depends upon the facilities there may be for
the discharge of the cargo at the port of delivery and the
impediments in the way of it. When the shipment is large, or, from
the master's storage of it, it cannot be landed in a day, if he
lands a part of it, his lien upon the whole gives him the power to
ask from the consignee of the merchandise a satisfactory security
for the payment of the entire freight as called for by the bill of
lading. But a security or arrangement is all that he can ask. He
may not demand that the whole freight of the shipment should be
paid before the consignee has had the opportunity to examine his
goods, to see if the obligations of the bill of lading have been
fulfilled by the shipowner. Nor is the ship bound to land an entire
shipment in a day, for the proper storage of the goods is the
master's care, and he may do it in such a way as may be most
advantageous to the ship, taking care that it shall not be done to
the injury of the goods or in such a manner as to produce
unreasonable delay in the delivery of them. And when landings of
the same shipment are made on different days, if the shipper
disregards the notice given to him that such will be the case, and
he shall not be present to receive the goods, and has not made an
arrangement to secure the payment of the freight, they may be
stored for safekeeping at the consignee's expense and risk, in the
shipowner's name, to preserve his lien for the freight. This course
was not pursued in this case by the consignee of the ship. He
attempts to justify what he did upon the allegation in his answer
to the libel that the bill of lading contained a stipulation that
the freight to be earned on the whole shipment was payable when a
portion of it had been landed.
The bill of lading, upon the face of it, is the ordinary one
between parties for the transportation of merchandise. The
merchandise mentioned in it was to be carried from New York to San
Francisco at fixed rates for freight, with primage and average
accustomed. There is no other stipulation or condition in it than
the undertaking for carrying the goods, and
Page 62 U. S. 535
that of the shipper to pay the freight. But the consignee of the
ship claimed that the stamp upon the back of the bill of lading was
equivalent to one. So his counsel contended in argument. This stamp
was in red ink, and was put on the bill of lading by the ship's
owner. We will suppose it had been made by Captain Barnaby before
he signed the bill of lading. But it was not signed by the parties,
nor is there any proof that it was ever recognized by the shipper
as a part of his contract. Nothing seems to have been said about it
when the bill of lading was signed, nor until it was claimed in San
Francisco to be a part of it. It no doubt has a relation to the
subject matter of the bill of lading, and was put there by Captain
Barnaby for that purpose; but unless it received the assent of the
shipper, it cannot vary the obligations of the contract so as to
authorize a demand for freight before the goods were ready for
delivery. The question we are now considering is not what effect
might be given to such a stamp upon a bill of lading by proof that
the parties, at the time it was made, adopted it as a stipulation
or agreement that the shipper was to pay the whole freight upon his
shipment when a portion of it had been landed from the ship, but
the question is whether such a stamp,
of itself, upon a
bill of lading can change the well known commercial rule in respect
to the delivery of goods and the payment of freight. It is that
which is asked in this case by the respondent. There is not a word
of proof that the shippers in New York or the consignee in San
Francisco ever regarded it in such a light; none that Captain
Barnaby considered the stamp to be a part of the bill of lading
assented to by the shipper until it was asserted by him to be so in
his answer after the consignee of the ship had attempted to enforce
it as a part of the contract upon the libellant. It was properly
resisted. The personal obligation to pay freight rests upon a bill
of lading, when one has been given, and the payment of it is made a
condition of delivery. The general rule is that the delivery of the
goods at the place of destination according to the bill of lading
is necessary to entitle the ship to freight. The conveyance and
delivery is a condition precedent, and must be fulfilled. 3 Kent
218.
Page 62 U. S. 536
Such a stamp cannot be considered a "stipulation" according to
the legal meaning of that word. All writers upon commercial law use
the word "stipulation" to denote a particular engagement, which may
be insisted upon, before it can control the general operation of
law, or vary a contract. Such stipulations are not uncommon between
shipowners and shippers of merchandise in charter parties and in
bills of lading. But when done in either, they must be made in
words sufficiently intelligible to indicate an agreement that the
operation of the law merchant in respect to those instruments is
not to prevail, and the stipulation must be in writing and be
signed by the parties before it can be received as an auxiliary to
explain how the contract is to be performed. A memorandum or stamp
upon the back of a bill of lading is insufficient for such a
purpose, though the shipowner may have made it as an intimation of
his mode of doing business, or that a practice prevailed
in conformity with it at the port to which the goods were to be
carried and delivered to a consignee. An attempt was made to
assimilate the stamp in this case to a memorandum on a policy of
insurance. In the first place, as loose, indefinite, and dangerous
as some of the decisions in the English and American reports are
concerning memorandums of that kind, no case can be found in either
in which effect has been given to any memorandum which was not on
the face or in the margin of the policy. But if such a case can be
found, we should not feel ourselves at liberty to extend it to a
bill of lading for the transportation of merchandise.
Those instruments of commerce are construed by very different
principles and usages. The cases cited by counsel to show that the
memorandums upon the face of the one were analogous to a stamp put
upon a bill of lading, do not apply. Neither do the texts from Duer
75, 141, do so. The rule in respect to policies of insurance is
that it is not material whether the written words of a policy are
inserted in the body of the instrument or written on its face or on
the margin of it, but they must be there in fact; must have been
written before the execution of it, or by mutual consent after the
execution, and before the commencement of the risk. Thus they
Page 62 U. S. 537
then form parts of the contract, it having been determined, from
the usages of insurances that the parties contracted in reference
to them and that the signature and acceptance of the policy was
proof that they had done so. All of the other cases cited are
agreements, varying in some particulars the payment of notes of
hand entered into contemporaneously with the execution of the notes
and which, by proofs, were shown to have been meant by the parties
to be a part of them. An attempt was also made to show that a
practice prevailed in San Francisco which gave an effect to the
stamp upon the bill of lading, so as to control the general rules
of commercial law in respect to the payment of freight and the
delivery of merchandise from ships. Whatever may be the practice
there or however general it may be, it is too recent in its use to
make an exception on the ground that it was a custom. The trade of
San Francisco is already large; every day develops its resources
and the advantages of its position for commerce. No doubt it has
not as yet those facilities for the landing of merchandise and
loading of ships which our older ports have; but that will not give
to any practice there, however general it may have become, the
force of custom to release its merchants from the obligation of an
ordinary bill of lading. If inconveniences exist in the particular
just mentioned, it will be best for the merchants of San Francisco,
and those with whom they deal in other parts of the world, that the
contract of a bill of lading should have its fixed meaning and
obligation and that it is only alterable by express stipulations
made in the way which has been already stated in the decision.
The testimony, however, in this case shows a very uncertain
opinion and a fluctuating practice in San Francisco upon the
subject of the delivery of shipments of goods and the payment of
freight; that such a demand as was made upon the libellant to pay
his freight upon all the merchandise mentioned in his bill of
lading, when only a portion of it had been landed upon the wharf,
had only been acquiesced in by many of the merchants there to avoid
trouble, to get early possession of their importations, and from an
unwillingness to be troubled with lawsuits. There are also
differences of opinion as to the efficacy
Page 62 U. S. 538
of such a stamp as there was upon the bill of lading in this
case, many of them, from their experience and knowledge of trade
elsewhere, having a more correct apprehension of the commercial law
than the reverse of it, which was attempted to be imposed upon the
libellant. Nor can any previous assent to the usage of a particular
firm engaged in the shipping business, though acquiesced in by one
who had had other dealings with it, be interpreted into an
agreement so as to deprive him of a right under an ordinary bill of
lading subsequently made.
The view which we have given of this case determines the whole
controversy. It comprehends every point raised by the record or
made in the argument of it. The respondent having in the first
instance demanded the entire freight called for by the bill of
lading without any right to do so, and having refused to deliver
the merchandise belonging to the libellant when the last parcel of
it was landed on the wharf, and when the freight due upon the whole
of it was tendered, on the ground that there were due charges for
cartage and storage, did so without
color of law for such
refusal. Our judgment is that those charges must be paid by the
respondent, and we shall reverse the decision of the court below
and direct a mandate to be sent to the circuit court to order a
decree for the libellant for the sum of four thousand three hundred
and sixty-seven dollars forty-five cents, with interest from the 2d
day of November, 1855. 9th vol. Stat., 181.
The sum mentioned is proved to have been the value of the
libellant's merchandise after freight and primage had been
deducted, when it was wrongfully detained by the respondent. The
respondent will also be charged with the costs which have been
incurred in the prosecution of this libel.
MR. JUSTICE DANIEL dissents to the decision in this case upon
the grounds that the court of admiralty in this country, as in
England, can take no cognizance of charter parties or bills of
lading, and because this case was within the plain jurisdiction of
the courts of the State of California, either at common law or in
equity.