Scottish Court of Session Decisions

On 29th April 1905 Thomas Hayman & Son, carting contractors, Glasgow ( nominal raisers), brought a multiplepoinding against Thomson M'Lintock, C.A., trustee on the sequestrated estates of John M'Nairn & Company, produce importers, Glasgow ( real raiser), and Moorhead Watson & Company, Produce importers, Glasgow; J. & B. Stevenson, bakers, Glasgow; J. K. Stewart, flour merchant, Greenock; M'Connell & Reid, flour merchants, Glasgow; and William Gilchrist & Company, flour merchants, Glasgow. The fund in medio was 1174 bags of “Golden Flower” flour in the stores of the pursuers, and the proceeds of the sale thereof.

The facts of the case are given in the opinion ( infra) of the Lord Ordinary ( Ardwall), who on 22nd February 1906 pronounced this interlocutor—“Finds ( first) that the claimant John Stevenson senior is entitled to be ranked and preferred to the goods in medio to the extent of 500 sacks of ‘Golden Mower’ flour; ( second) that the claimants Messrs Moorhead, Watson, & Company are entitled to be ranked on the said goods to the extent of 250 sacks of the said flour; and ( third) that the claimant Thomson M'Lintock, as trustee on the sequestrated estates of John M ‘Nairn & Company, is entitled to be ranked to the balance of 424 sacks of flour; and ranks and prefers the said claimants accordingly; and in respect that the flour has been realised and the proceeds deposited in bank, postpones granting decree for the pecuniary amounts representing the above-named quantities of flour till the real raiser's expenses have been taxed and paid …”

Opinion.—“This is an action brought for the purpose of determining who is entitled to a quantity of 1174 sacks of flour, of the brand known as ‘Golden Flower,’ that were stored in the warehouse of the pursuers and nominal raisers, Thomas Hayman & Son, at the date of the sequestration of Messrs John M'Nairn & Company.

The real raiser is Thomson M'Lintock, trustee on John M'Nairn & Company's bankrupt estate. The date of the sequestration of Messrs M'Nairn & Company was 9th February 1905, and the trustee's act and warrant is dated 18th February 1905. I shall hereafter refer to Mr M'Lintock as the ‘trustee,’ and M'Nairn & Company as the ‘bankrupts.’

The trustee claims the whole of the flour in question, on the ground that it was the property of the bankrupts, having been bought and paid for by them, and that they were never validly divested of any part thereof.

The claimant John Stevenson claims 500 sacks of the said flour in respect of bills of lading delivered to him on 5 th January 1905 in return for an advance to the bankrupts.

The claimants Messrs Moorhead, Watson, & Company, who had advanced large sums on loan to the bankrupts, and who are their creditors for a much larger amount than the value of any security they received, claim 720 sacks of the flour in respect of store warrant therefor, and other 500 sacks of flour in respect of another store warrant. Further, they claim 250 sacks of flour in respect of a bill of lading in respect of a loan on 3rd January 1905 from the bankrupts for 250 sacks of flour ex the ‘Siberian,’ one of the line of steamers owned by Messrs James and Alexander Allan. They accordingly claim the whole of the fund in medio.

The claimants Messrs M'Connell & Reid claim 221 sacks of flour, being a balance of 250 purchased by them from the bankrupts before their sequestration; and the claimant James Kelling Stewart claims 100 sacks of flour, also as a purchaser from the bankrupts.

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I shall deal first with the claims of the claimants other than the trustee, as he is entitled to the sacks forming; the fund in medio excepting those to which the other claimants can instruct a valid title as at the date of sequestration.

The flour in question was stored in Thomas Hayman & Son's stores in the manner described in the plan and inventory, and it is admitted that the sacks were stored without any reference to what ships they came from, the dates when they were stored, or the contracts under which they had been bought. They must therefore be viewed as one undivided quantity of 1174 sacks of ‘Golden Flower’ flour. I may advert for a moment to the position of Hayman & Son relative to the bankrupts. It appears from the evidence of Thomas Hayman, who is manager of that firm (the sole partner being his mother), that their Commerce Street stores had for two years prior to M'Nairn & Company's sequestration been practically devoted to the goods of that firm alone, and, to put the matter broadly, Thomas Hayman seems to have done whatever he was told by John Stevenson junior, who was the sole partner of the bankrupts' firm.

John Stevenson senior's Claim..

I propose first to deal with the claim of John Stevenson senior. This claimant is an uncle of the bankrupt John Stevenson, and on 5th January 1905 he advanced to the bankrupts on loan the sum of £3000, and in return therefor there were delivered to him, inter alia, two bills of lading, marked 117 and 118 respectively. The consigner of the flour, according to the bills of lading, was Seymour Carter, and Seymour Carter was also entered in the bills of lading as the consignee, and before being delivered to the claimant they had been duly endorsed by the said Seymour Carter. The bankrupt's name does not appear upon the bills of lading except as the party to be advised of the arrival of the vessel. These bills of lading were each for 250 sacks of flour of 280 lbs. each of the brand ‘Golden Flower,’ and the vessel by which they were to be carried was the s.s. ‘Sardinian,’ which arrived in Glasgow on 30th December 1904. It seems to have been the practice of J. & A. Allan, who carried a great deal of flour that had been purchased by the bankrupts, on the arrival of a cargo in which the bankrupts were interested, to send flour, for which the bills of lading had not been taken up and presented for delivery of the cargo direct, to Hayman's stores, there to be stored in ship's name, and as appears from the excerpts from Hayman's books, this flour seems to have been stored in the ship's name in Hayman's stores on 14th January 1905. Accordingly, when the bill of lading was transferred to the claimant, the goods were not in Messrs Hayman's store at all, but in the actual custody of the shipping company. Goods stored in ship's name could not be removed from the store except by an order from the shipping company, which the shipping company issued after the bills of lading had been presented, and all the shipping charges paid. In the present case the claimant on 9th February signed a mandate to the Commercial Bank, who held for him the shipping documents, authorising delivery of them to the firm of Bruce & Wilson, flour importers. Mr Wilson, a partner of that firm, obtained possession of the said bills of lading from the bank, and sent them the same day to Messrs J. & A. Allan, paid the freight and charges, and received from Messrs Allan a delivery order, addressed to Messrs Hayman, and ordering delivery of the goods to Bruce & Wilson. On the following day they presented the delivery order to Messrs Hayman & Son together with their own order for delivery, and delivery was refused, in consequence of Messrs Hayman having been notified that owing to the insolvent position of the bankrupts they were not to part with any flour in any way connected with them. It will thus be noticed that the bankrupts never had possession of this flour, and that the property of it was transferred to Mr Stevenson by the delivery to him of the endorsed bills of lading which he received on 5th January, being some nine days before the flour was delivered into Hayman's store. This parcel of flour accordingly truly belonged to the claimant at the time it was stored, and can no more be regarded as the property of the bankrupts by having been mixed up with flour belonging to them than if the same thing had been done with flour belonging to any stranger. It is, I think, clear, as a matter of law, that this mixing had not the effect of transferring these 500 sacks of flour to the bankrupts, but that the result was to give Stevenson or his assignees a right to get these 500 sacks of ‘Golden Flower’ flour delivered to them by Hayman & Son out of the total quantity of ‘Golden Flower’ flour in their store, preferably to the bankrupts or their assignees. The bankrupts could not give any higher right to any other party than they themselves had, and any rights they gave off to a part or the whole of the mixed lot of sacks of flour could not affect the right of Mr Stevenson to the 500 sacks which belonged to him, so long as 500 sacks of that brand of flour remained in the store. In this case the trustee can have no higher title than the bankrupt as regards that quantity of 500 sacks.

I was referred on this question to the case in re Hallett's Estate, L.R., 13 Ch D 696, in which it was held that if money held by a person in a fiduciary character had been paid by him into his account at his bank the person for whom he held the money could follow it, and had a charge on the money in the banker's hands, and that in such a case the rule in Clayton's case, better known in Scotland as Devayne's case, did not apply. A similar case of money being put into a bankrupt's own bank account, and taken out of his sequestration, will be found in the Scotch cases of Macadam v. Martin's Trustees, 11 Macph. 33, and Jopp v. Johnston's Trustees, 6 F. 1028. The principle of these cases seems to

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me to apply to the present, but in the circumstances there is no necessity for separate proceedings under the 104th section of the Bankruptcy Act.

An argument against Mr Stevenson's claim was stated for the trustee, founded on the decision in the case of Sewell v. Burdick, L.R., 10 A.C. 74, and it was maintained that there was no passing of property in the 500 sacks of flour by delivery of the bill of lading, because the bill of lading was only handed over in security for the debt, and that it depended on the intention with which it was handed over whether there was a passing of the property or not. It seems sufficient to say that in the case just referred to the circumstances were very different from those here. In particular, the goods had arrived and been warehoused at the time of the endorsation of the bills of lading, and the endorsees were bankers who never took possession of or dealt with the goods, which by this time were warehoused in a port in Russia, they being resident in Manchester, and that case proceeded on the distinction in the English law of property between what was called a special property as pawnees and a general property. This distinction seems to depend on the peculiarities of the English law of pledge. But we are here dealing with the Scotch law of pledge, and the intention of the parties must be taken to have been that a valid security should be given, and that, accordingly, the absolute property in the sacks of flour in question should pass to Mr Stevenson, leaving only a reversionary right in the bankrupt.

Another point that was made for the trustee against the rights of Mr Stevenson was, that the bill of lading was de facto taken up by the bankrupts, though that was done by money just obtained for the purpose from Stevenson, and that the bankrupt having paid the price the property of the goods contained in the bill of lading passed to him. I do not think any importance can be attached to this argument, because if the bankrupt did go personally and take up the bills of lading he did so merely as agent of Mr Stevenson and with his money (see North-Western Bank, Limited v. Poynter, Son, & Macdonald, 22 R., H.L. 1); and further, the goods were not put into the warehouse, as appears from Hayman's books, till 14th February 1905, and by that time the bills of lading were in the hands of the Commercial Bank as bankers and agents of Mr Stevenson, and had been so since the 5th of January 1905.

I accordingly hold that the property in those goods had passed to Mr Stevenson before they were warehoused, and that they were not warehoused on behalf of the bankrupts at all, but by the Messrs Allan on behalf of the owner thereof, who was Mr Stevenson. But it would have been sufficient, in my view, for the decision of this matter, that they were warehoused by Messrs Allan in their own name, and had, before the sequestration of the bankrupts, been duly transferred to a third party.

Messrs Moorhead, Watson, & Company's Claim.

The next claim to be dealt with is that of Messrs Moorhead, Watson & Company. These claimants, as already stated, make a claim for 1220 sacks of flour, which is a larger quantity than the whole fund in medio. There is no doubt that they were creditors of the bankrupts to a very large extent, and were perfectly innocent third parties. With regard to the 250 sacks of ‘Golden Flower’ flour ex s.s. ‘Siberian,’ claimed in respect of a bill of lading handed to them by the bankrupts on 3rd January 1905, I regard the claimants as in a similar position to Mr Stevenson, whose claim I have just dealt with. The ‘Siberian’ arrived in Glasgow on 16th December 1904, and the ‘Golden Flower’ flour on board of her was delivered to the bankrupts, with the exception of the 250 sacks in question, which were stored with Messrs Hayman & Son in ship's name on 31st December 1904, conform to receipt by Messrs Hayman in favour of Messrs J. & A. Allan, the shipowners. They therefore were received into Messrs Hayman's store on behalf of Messrs Allan, and not on behalf of the bankrupts, and, as I have already held in the case of Mr Stevenson, Messrs Hayman had no right to mix this flour with flour belonging to the bankrupts, and their having done so as the bankrupts' agents and warehousemen could not affect the right of Messrs J. & A. Allan or their assignees, who were entitled to demand that quantity out of the gross bulk of ‘Golden Flower’ flour stored with Messrs Hayman.

On 7th February 1905 Messrs J. & A. Allan handed to Messrs Moorhead, Watson, & Company delivery order for the 250 sacks of flour. This was presented the same day to Messrs Hayman, who, however, refused to honour it, as by this time they had received notification of the insolvency of Messrs M'Nairn, whom they understood to be mixed up in some way with the flour in question. I am of opinion that, so far as this part of their claim is concerned, Messrs Moorhead, Watson, & Company are entitled to have it given effect to on the same grounds on which I have given effect to Mr John Stevenson's claim.

The same claimants, however, claim delivery of 720 sacks of the flour in question in respect of a store warrant, and.500 sacks under another store warrant. I am of opinion that this part of their claim must be rejected, under reservation of course of any right they may have against Thomas Hayman & Son, and of their right to make such claim as they may be advised in the sequestration. Those so-called store warrants run thus:—

235. 26 Robertson Street,

Glasgow, Dec. 5, 1904.

Thomas Hayman & Son,

Storekeepers.

Store Warrant.

We have received in our Commerce Street store Seven hundred and twenty sacks flour Golden pef 280 each which are

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deliverable only on production of this store warrant.

(Signed—over three 1d. stps.)

Thos. Hayman & Son, per John Hunter.

720 sks. flour, 280 lbs.

—and it is endorsed ‘Moorhead, Watson & Co.’

“I cannot regard this document as of any avail in transferring the property of sacks belonging to the bankrupts and stored in Messrs Hayman's store. It specifies no particular sacks, and at best only conferred a right on the holder to claim delivery of the quantity of sacks therein mentioned from Thomas Hayman & Son out of any flour in their store, which, as they themselves explained, was a constantly fluctuating quantity, and upon which they gave delivery orders frequently in excess of the flour they had at the bankrupts' disposal. These documents possibly conferred a jus ad rem, but not a jus in re, either by way of security or in absolute property.

Questions were raised and discussed as to the value of these store warrants, and although what I have said is sufficient for the disposal of this case, yet I may express my opinion upon these documents generally, and that is, that they are practically worthless for any other purpose except to permit of the holder going direct to the stores and getting delivery there and then of a specified number of sacks of flour. It will be noticed that no specific goods are mentioned in them, that they are addressed to no particular person, and that they contain no obligation to deliver to anyone. A similar document was held not to be a negotiable instrument of mercantile exchange in the case of Dixon v. Bovill, 3 Macq. 1, and wharfingers' certificates in very similar terms were held not to be documents of title in the case of Gunn v. Bolckow, Vaughan, & Company, L.R., 10 Ch. Ap. 491.

It falls to be observed that these store warrants were issued to the bankrupts, who handed them over to Messrs Moorhead, Watson, & Company as securities; this is of importance in view of the argument for the claimants to the effect that the Factors (Scotland) Act 1890 (53 and 54 Vict. cap. 40), section 1, and the Factors Act 1889 (52 and 53 Vict. cap. 45), sections 3 and 9, apply to the present case; for it was decided in the case of Inglis v. Robertson & Baxter, 24 R. 759 and 25 R (HL) 70, that these sections did not apply to the case of an owner of goods pledging documents of title, and in that case the goods were properly specified.

The conditions under which constructive delivery takes place are clearly laid down by Lord President Inglis in the case of Pochin & Company v. Robinow & Marjoribanks, 7 Macph. pp. 628and 629. He points out that to the completion of constructive delivery two things are necessary—that the custodier must hold an independent position, and be neither the owner nor in any way identified with the owner of the goods ( Anderson v. M'Call, 4 Macph. 765), and that the goods themselves shall be specific in this sense, that they be capable of identification either as one total undivided quantity stored in a particular place, or at least a specified quantity forming part of an identified whole. It is plain from the terms of these documents, and from the course of dealing as explained by the witness Thomas Hayman, that these requirements were not present in the case under consideration, for it seems that Thomas Hayman & Son issued these store warrants at the bankrupts' request irrespective altogether of the question whether they had enough flour to fulfil them within their stores at the time of issue, and that they intended to satisfy them out of any flour that might happen to come into their hands on account of the bankrupts.

I am also of opinion that store warrants in the terms these are, are not capable of being regarded as negotiable instruments; among other objections to them as such it may be noted that they are not in favour of any named person, and accordingly it does not appear ex facie of the instruments who has the right to endorse them. It seems also clear that they must cease to have any value unless both the storekeeper and the person who hands them in security are strictly honest, and do not become bankrupt before the delivery takes place.

On the whole matter I arrive at the conclusion that delivery of these store wrarrants to the claimants had not the effect of transferring the property of any of the sacks of flour deposited in Messrs Hayman's stores to Messrs Moorhead, Watson, & Company. Holding this view, it is unnecessary for me to go into the question as to whether the transactions under which these store warrants were handed over to the claimants are struck at by the Act 1696, cap. 25, or the Act 1696, cap. 5, but my impression is that they are not.

“ Messrs M'Connell & Reid's and Mr J. K. Stewart's Claims.

The only other claimants whose claims fall to be dealt with are M'Connell & Reid and James Kelling Stewart.

As the claim for M'Connell & Reid is in the more favourable position of the two, I shall deal with it. These claimants were purchasers of 250 sacks ‘Golden Flower’ flour from the bankrupts on 11th January 1905. The price was paid and they received a delivery order from the bankrupts addressed to Messrs Hayman, who granted an acknowledgment in terms of the document printed in the record. Subsequently the claimants took delivery of 29 sacks of the said flour, leaving 221 which they now claim. The trustee objects to this claim on the ground that this was a contract for the sale of unascertained goods, and that, in terms of section 16 of the Sale of Goods Act 1893, no property in the goods was thereby transferred to the buyer unless the goods were ascertained. Now, it is clearly proved that these goods never were ascertained, that the claimants never asked Messrs Hayman to separate them from the other goods of a similar brand belonging to the bankrupts then in their store, and that it is not the custom in such stores to make

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such separation unless the storekeeper is specially asked to do so, and is paid for his trouble. These being the facts I think it follows that no property in these goods passed to the buyers, but that the property remained in the bankrupts till the date of the sequestration.

It was pleaded that the granting of a delivery order by the bankrupts in favour of the claimants created a bar against their trustee now claiming the goods. I am unable to give effect to this contention. I was referred to the case of Knights v. Wiffen, 1870, L.R., 5 Q.B. 660, but in that case the owner, who as unpaid vendor was refusing to deliver the goods to a subvendee, was held to be barred from continuing to refuse delivery by his special assent to the delivery order, for by giving such assent he induced the sub-vendee to rest satisfied in the belief that the property had passed, and so to alter his position by abstaining from demanding back the money which he had paid to the first vendee. I need hardly point out that this was a very different case from the present, and in my opinion the doctrine of bar is inapplicable here.

The cases of Stonard, 1810, 2 Camp. 344, and Gillett, 2 C. & M. 530, which were relied on as entitling these claimants to prevail in the present case, were actions of trover brought against warehousemen upon documents issued by them, and it was held that by these documents they had become agents or holders of goods for the plaintiffs, and were bound to deliver the goods to them. These cases seem to have no application to the present case.

I do not decide in this case what, if any, may be the rights of any of the claimants against Messrs Hayman & Son, either in respect of the transfer notes or other documents issued by them, or of any collusion with the bankrupts in issuing warrants or notes for goods which were non-existent.

The claim of Mr Stewart is in no better position than that of M'Connell & Reid, and for the same reasons I hold that it cannot be given effect to, the goods sold being unascertained goods within the meaning of the Sale of Goods Act 1893. It was pleaded with much force and plausibility that the claims lodged in the present process disclose that the bankrupts sold or pledged the whole ‘Golden Flower’ flour which they had in Messrs Hayman's store prior to their bankruptcy, and that consequently neither they nor their trustee have now any just claim to any portion thereof in competition with any of the claimants, or with the claimants taken as a whole. This plea might have been useful so far as the bankrupts are concerned, but their trustee stands in a very different position, for under his act and warrant he is vested with the property of all goods belonging to the bankrupts, and therefore of all goods in Messrs Hayman's store, the property of which had not been validly transferred at the date of the sequestration. Therefore these goods, I think, must fall into the sequestration, leaving the claimants such rights as they may be able to make good there.

In the present case it would certainly appear at first sight to be equitable that the whole fund in medio should be divided pro rata among the persons holding transfer notes, store warrants, or other acknowledgments from the warehousemen, but this could not be effected without doing violence to well-established rules of law regarding the passing of the property in moveables and the consequent transfer of the risk of loss from seller to purchaser.

I accordingly hold that the trustee must be ranked and preferred to the whole of the fund in medio with the exception of 500 sacks which belong to John Stevenson, and 250 sacks which belong to Moorhead, Watson, & Company. As the flour has been all sold, I shall not issue an interlocutor till it has been arranged between these last-named claimants and the trustee what portion of the consigned fund falls to be paid to each of them.

As I have sufficiently indicated the grounds on which I hold that the trustee is entitled to be preferred to the goods in medio with the exception of those the property of which passed by the bills of lading to other claimants, I need not do more than note the authorities which were quoted to me on behalf of the trustee's contention, in addition to the ones I have already noted in discussing the rights of the other claimants. These were— M'Ewan v. Smith, 9 D. 434, 6 Bell's Appeals 340; Hastie v. Melrose, 13 D. 880; Distillers Company v. Russell, 16 R. 479; 1 Bell's Comm. 198, and Lord M'Laren's note on the case of Whitehouse v. Frost, 12 East. 614; Benjamin on Sale, (5th ed.) 334; Anderson & Crompton v. Walls & Company, 9 Macph. 122.

This last I consider a valuable authority, as it is a decision illustrating the effect of non-appropriation of goods sold, in a direction favourable to a purchaser. The purchaser in that case had a right to 750 gallons of sperm oil out of a large undivided quantity in store, deliverable to his order. The store was burned, with all the oil stored therein. At the time of the fire 713 gallons of the oil deliverable to the purchaser had not been delivered, and although all the oil in the store, which in one sense included the said 713 gallons, was burned, yet it was held that the purchaser having had no right to obtain delivery of any specific portion of the oil destroyed by the fire, no risk attached to him in respect of the 713 gallons, and that he was therefore entitled to delivery of the balance of the oil, just as if the fire had never taken place.”

On 16th March 1906 his Lordship, in terms of the above interlocutor, decerned for payment.

M'Connel & Reid reclaimed, and argued — The reclaimers were entitled to delivery of the sacks of flour which they had bought and paid for. The storekeeper having come under an obligation, on the bankrupt's instructions, to deliver them to the claimant, was entitled to retain them against the bankrupt, and also against his trustee—Benjamin on Sale (5th ed.) 865; Stonard v. Dunkin, (1810) 2 Campbell 344;

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Wood v. Tassell, (1844) 6 A. & E. 234; Godts v. Rose, (1855) 17 Scott's C. B. Rep. 229; Knights v. Wiffen, (1870) L.R., 5 Q.B. 660; Henderson & Co. v. Williams, [1895] 1 QB 521. The reclaimers having no personal claim against the seller, had a claim for delivery against the storekeeper — Brierly v. Mackintosh, June 1, 1843, 5 D. 1100; aff. Feb. 19, 1846, 5 Bell's App. 1; Whitehouse and Others v. Frost and Others, (1810) 12 East 613; Brodie's Stair, app. p. 876; Bell's Prin. sec. 116. Alternatively and assuming that there was common property in the sacks of flour stored, the bankrupt had right to a pro indiviso share thereof—Stair, ii. 1,37—‘which had been transferred to the reclaimers, in the only possible way, and the transfer duly completed by intimation. Assuming, however, that the bankrupt owned the sacks of flour stored, the passing or non-passing of the property was not conclusive, for goods might be in the hands of a buyer so as to be secured against the seller's bankruptcy even where the property in them had not passed to the buyer, e.g., where the buyer of one article had several sent for selection. In such a case the trustee would not be permitted to keep both the price and the thing. The reclaimers had really possession of the sacks sold them, for Hayman was joint agent for both parties, and therefore delivery to him was equivalent to delivery to them. Moreover, Hayman had acknowledged that he held them for the reclaimers, who after that were entitled to look to him for delivery. Section 29 (3) of the Sale of Goods Act 1893 was not limited to the case of “ascertained” goods, and read positively was equivalent to this, that goods are delivered when a third party acknowledges to the buyer that he holds them for him.

Argued for the trustee—(1) As against the reclaimers M'Connell & Reid — The property in the sacks claimed belonged to the trustee. The trustee had right to all the sacks in the store except in so far as they had been “ascertained” and set apart for their owners. The reclaimers never got any real right to the sacks claimed, for they were neither “ascertained” nor “specific”—Sale of Goods Act 1893, secs. 1 (4), 5 (1), 16, 18, 62. Neither the transfer note nor the delivery order was sufficient to transfer the property— Black v. Incorporation of Bakers, Glasgow, December 13, 1867, 6 Macph. 136, 5 S.L.R. 107; Pochin & Company v. Robinows & Marjoribanks, March 11, 1869, 7 Macph. 622, 6 S.L.R. 417; Anderson & Crompton v. Walls & Company, November 15, 1870, 9 Macph. 122, 8 S.L.R. 115. The case of Whitehead v. Frost cited by the reclaimers had been disapproved—Benjamin on Sale, 335–8; Bell's Com. 198. The plea of personal bar was ineffectual as against the trustee— M'Ewan v. Smith, January 14, 1847, 9 D. 434, aff. March 20, 1849, 6 Bell's App. 340; Melrose v. Hastie, March 7, 1851, 13 D. 880; Distillers Company Limited v. Russell's Trustee, February 9, 1889, 16 R. 479, 26 S.L.R. 348. It was not necessary to consider whether the storekeeper had a right of retention, for he did not claim it, and had put the fund into Court. (2) As against the holders of the Bills of Lading—( a) Stevenson's Claim—The deposit of the bills of lading with Stevenson constituted a pledge of the goods leaving the property in the pledgor, i.e., the bankrupt. Being merely a security transaction it passed the possession but not the property— Sewell v. Burdick, (1884) L.R., 13 Q.B.D. 159, per Lord Bowen, 170, L.R., 10 A.C. 74; Carver's Carriage by Sea, 4th ed., sec. 497. The possession so passed could be, and had been, lost by Stevenson. It was lost by Hayman mixing the sacks stored, for after that had taken place they were no longer specific. Stevenson therefore was merely an unsecured creditor. ( b) Moorhead, Watson, & Company's Claim — Prior to the transfer of the bill of lading on 3rd January 1905 to these claimants the goods had been stored by the shipowners on the statement that bills of lading had been presented by the bankrupts. Even assuming that that statement was untrue, the shipowners were bound by it, and could not afterwards say that the property had not passed to the bankrupts. The transfer of the bills of lading on 3rd January to the claimants could not and did not transfer any right of property in the sacks in question, for after they had been mixed up in Hayman's store they were no longer specific, and the transfer of a bill of lading did not transfer the property in the goods unless the goods were specific and capable of being ascertained— Grange & Company v. Taylor, (1904) 9 Aspinall 559, 20 T.L.R. 386, 9 Com. Cas. 223. In Barber v. Meyerstein, (1870) L.R., 4 E. & I. App. 317, where it was held that the delivery of the bill of lading transferred the property even after the goods had been landed, the contract of carriage was not at an end. That distinguished that case from the present, for here the contract of carriage was ended.

Argued for the respondent, Stevenson—The Lord Ordinary was right. This claimant was the holder of a bill of lading for 500 sacks ex s.s. “Sardinian,” and there were no other sacks on board. The sacks were stored in the ship's name, not in that of the bankrupt. The bankrupt never had the property in them, and never in fact presented bills of lading for them. In these circumstances the indorsement of the bills to the claimant carried the property to him— Hamilton v. The Western Bank of Scotland, December 13, 1856, 19 D. 152; National Bank of Scotland Limited v. Union Bank of Scotland Limited, December 18, 1885, 13 R. 380, 23 S.L.R. 242, The case of Sewell v. Burdick ( cit. supra) was inapplicable, the sole question there being whether “special property” in the sense of the Bills of Lading Act 1855 had or had not passed. The transferee of a bill of lading had a right preferable even to that of the unpaid seller—Sale of Goods Act 1893, sec. 47.

Argued for respondents, Moorhead, Watson, & Company—These claimants adopted the argument for the claimant Stevenson. As to whether the effect of a bill of lading

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was'exhausted by the goods being landed, they referred to Sanders Brothers v. Maclean & Company (1883), L.R., 11 Q.B.D. 327. As to the effect of the indorsation of the bills, they referred to Short v. Simpson, 1866, L.R., 1 C.P. 248.

At advising—