wheat or to obtain new bills of lading, the latter represented no value, and the plaintiff was not estopped from reclaiming the property.' IV. Whether Security for Acceptance or Payment. § 255. The assignment of a bill of lading drawn to the shipper's own order as security for the discount of a draft drawn against it may be regarded as conclusive of the shipper's intention that the property shall not pass to the drawer except upon his payment or acceptance of the draft. A bill of lading so drawn shows an intent on the part of the shipper to reserve to himself the dominion over the goods shipped; and when he assigns such bill to another as security, his intention is conclusively shown that such assignee shall have a special property in the goods and the full control of them until the draft is accepted or paid; and it is immaterial whether such assignee holds the bill of lading as security for the payment or acceptance of the draft. The intention that such assignment shall confer a special property in the goods arises even when the goods have been shipped in a vessel belonging to the person upon whom the draft is drawn. It is likewise so even if the goods be delivered to the drawer as a mere warehouseman, and not as a purchaser; and a subsequent sale by him to another would confer no title against the holder of the draft or the shipper. § 256. A bill of lading is regarded as security for the acceptance of a time draft drawn against it rather than as security for the payment of such draft, in the absence of any ex 1 Marine Bank v. Fiske, 71 N.Y. 353. 2 Dows v. National Exch. Bank, 91 U. S. 618; Jenkyns v. Brown, 14 Q. B. 496; Mitchell v. Ede, 11 Ad. & E. N. S. 888; Alderman v. Eastern R. Co., 115 Mass. 233; Security Bank v. Luttgen, 29 Minn. 363, 13 N. W. Rep. 151; Mason v. Great Western R. Co., 31 U. C. Q. B. 73; People's Nat. Bank v. Stewart, 3 Pugs. & Bur. (N. B.) 268. Hathaway v. Haynes, 124 Mass. 311, 313; Security Bank v. Luttgen, 29 Minn. 363, 13 N. W. Rep. 151. 4 Turner v. Liverpool Docks, 6 Exch. 543; Schotsmans v. Railway Co., L. R. 2 Ch. App. 336; Ellershaw v. Magniac, 6 Exch. 570. press stipulation about it. It was urged in behalf of a bank which discounted certain drafts that the bills of lading were taken as security for the principal obligation, namely, the payment of the draft. But the court replied that this is an assumption of the very thing to be proved: to wit, that the transfer of the bills of lading was made to secure the payment of the drafts.' "The opposite of this, as we have seen, is to be inferred from the bills of lading and the time drafts drawn against the consignments unexplained by express stipulations. The bank, when discounting the drafts, was bound to know that the drawees on their acceptance were entitled to the cotton, and of course to the evidences of title to it. If so, they knew that the bills of lading could not be a security for the ultimate payment of the drafts. Payment of the drafts by the drawees was no part of the contract when the discounts were made. The bills of exchange were then incomplete. They needed acceptance. They were discounted in the expectation that they would be accepted, and that thus the bank would obtain additional promisors. The whole purpose of the transfers of the bills of lading to the bank may therefore well have been satisfied when the additional names were secured by acceptance, and when the drafts thereby became completed bills of exchange. We have already seen that whether the drafts and accompanying bills of lading evidenced sales on credit on requests for advancements on the cotton consigned, or bailments to be sold on the consignor's account, the drawees were entitled to the possession of the cotton before they could be required to accept; and that if they had declined to accept because possession was denied to them concurrently with their acceptance, the effect would have been to discharge the drawers and indorsers of the drafts. The demand of acceptance, coupled with a claim to retain the bills of lading, would have been an insufficient demand. Surely the purpose of putting the bills of lading into the hands of the bank was to secure the completion of the drafts by obtaining additional names 'Dows v. National Exch. Bank, 91 U. S. 618. upon them, and not to discharge the drawers and indorsers, leaving the bank only a resort to the cotton pledged." § 257. A bank or other agent, to whom a bill of lading with a time draft has been forwarded for collection, may surrender it to the consignee upon his acceptance of the draft, if the drawer has not expressly directed that the bill of lading shall not be surrendered till the draft is paid.' It is immaterial also whether the draft be indorsed "for collection" or not; for these words simply rebut the inference that the indorsee is the owner of the draft. The agent receiving a time draft accompanied by a bill of lading, by the terms of which the property is deliverable to the consignee, is entitled to infer either that the merchandise specified has been sold on credit, in accordance with the terms of the draft, or that the draft is a request for an advance upon a consignment of goods to be sold on account of the shipper. If the transaction be the former, then the consignee, being a purchaser, is entitled in the absence of any express arrangement to the contrary, to the possession of the goods on his accepting the bill. National Bank of Commerce v. 284; 'National Bank of Commerce v. Merchants' Nat. Bank, 91 U. S. 92, per Strong, J. "This would not be doubted if, instead of an acceptance, he had given a promissory note for the goods, payable at the expiration of If on the other hand the in the stipulated credit. In such case it is clear that the vendor could not retain possession of the subject of the sale, after receiving the note for the price. The idea of a sale on credit is that the vendee is to have the thing sold on his assumption to pay and before actual payment. The consideration of the sale is the note. But an acceptor of a bill of exchange stands in the same position as the maker of a promissory note. If he has purchased on credit and is denied possession until he shall make payment, the transaction ceases to be what it was intended, and is converted into a cash sale. Everybody understands that a sale on credit entitles the purchaser to immediate possession of the property sold unless there be a special agreement that it may be retained by ference to be drawn is that advances are requested upon a consignment of the goods, the consequence is the same. In such case it is plain that the acceptance is asked for on the faith of the consignment, and not on the credit of the drawer. To refuse the consignee the bill of lading would be to withhold from him the very security upon which he is asked to accept the draft. An agent for collection can not be permitted, by declining to surrender the bill of lading on the acceptance of the draft, to disappoint the obvious intentions of the parties, and the vendor; and such is the wellrecognized doctrine of the law. The reason for this is that very often, and with merchants generally, the thing purchased is needed to provide means for the deferred payment of the price. Hence it is justly inferred that the thing is intended to pass at once within the control of the purchaser. It is admitted that a different arrangement may be stipulated for. Even in a credit sale, it may be agreed by the parties that the vendor shall retain the subject until the expiration of the credit, as a security for the payment of the sum stipulated, but if so, the agreement is special, something superadded to an ordinary contract of sale on credit, the existence of which is not to be presumed. Therefore in a case where the drawing of a time draft against a consignment raises the implication that the goods consigned have been sold on credit, the agent to whom the draft to be accepted and the bill of lading to be delivered have been intrusted can not reasonably be required to know, without instruction, that the transaction is not what it purports to be. He has no right to assume and act on the assumption that the vendee's term of credit must expire before he can have the goods, and that he is bound to accept the draft, thus making himself absolutely responsible for the sum named therein, and relying upon the vendor's engagement to deliver at a future time. This would be treating a sale on credit as a mere executory contract to sell at a subsequent date." That the drawee in such a case is not bound to accept the draft except upon surrender to him of the bill of lading, see also dicta in Shepherd v. Harrison, L. R. 4 Q. B. 493, per Lord Cockburn, L. R. 5 H. L. 116, 133, per Lord Cairns; Coventry v. Gladstone, L. R. 4 Eq. 493; Gurney v. Behrend, 3 El. & Bl. 622; Schuchardt v. Hall, 36 Md. 590; Marine Bank v. Wright, 48 N. Y. 1; Cayuga Bank v. Daniels, 47 N. Y. 631; Security Bank v. Luttgen, 29 Minn. 363, 13 N. W. Rep. 151. In National Bank of Commerce v. Merchants' National Bank, 91 U. S. 92, after a review of the authorities, Mr. Justice Strong said: "We feel justified in saying, that in our opinion, no respectable case can be found in which it has been decided that when a time draft has been drawn against a consignment to order, and has been forwarded to an agent for collection with the bill of lading attached, without any further instructions, the agent is not justified in delivering over the bill of lading on the acceptance of the draft." deny to the acceptor a substantial right which is assured to him by his contract. This in brief is the reasoning of the supreme court of the United States in the leading case upon this subject. This reasoning is supported by other rational considerations. “In the absence of special agreement what is the consideration for acceptance of a time draft drawn against merchandise consigned? Is it the merchandise? or is it the promise of the consignor to deliver? If the latter the consignor may be wholly irresponsible. If the bill of lading be to his order, he may, after acceptance of the draft, indorse it to a stranger, and thus wholly withdraw the goods from any possibility of their ever coming to the hands of the acceptor. Is, then, the acceptance a mere purchase of the promise of the drawer? If so, why are the goods forwarded before the time designated for payment? They are as much, after shipment, under the control of the drawer as they were before. Why incur the expense of storage and of insurance? And if the draft with the goods or with the bill of lading be sent to a bank for collection, as in the case before us, can it be incumbent upon the bank to take and maintain custody of the property sent during the interval between the acceptance and the time fixed for payment? Meanwhile, though it be a twelvemonth, and no matter what the fluctuations in the market value of the goods may be, are the goods to be withheld from sale or use? Is the drawee to run the risk of falling prices, with no ability to sell till the draft is due? If the consignment be of perishable articles—such as peaches, fish, butter, eggs, etc., are they to remain in a warehouse until the term of credit shall expire? And who is to pay the warehouse charges? Certainly not the drawees. If they are to be paid by the vendor, or one who has succeeded to the place of the vendor by the indorsement of the draft and bill of lading, he fails to obtain the price for which the goods were sold."" § 258. But of course it may be expressly agreed that the bill of lading shall secure the payment of a time draft rather 1National Bank of Commerce v. Merchants' Nat. Bank, 91 U. S. 92, 97. |