Prior to the enactment of the statute, a bailee might "excuse himself for a failure to deliver the property to the bailor when called for, by showing that the property was taken out of his custody under the authority of valid legal process, and that within a reasonable time he gave notice of that fact to the owner." 98 No doubt the rule is the same under the statute if no negotiable warehouse receipt is outstanding. The officer of the law in the case supposed is a "person lawfully entitled to possession." But under Sections 10, 11 and 25 of the statute a warehouseman, who delivered the goods after garnishment without requiring the surrender of the negotiable receipt, was held liable to the indorsee of the receipt.99

Section 10.-[WAREHOUSEMAN'S LIABILITY FOR MISDELIVERY.] Where a warehouseman delivers the goods to one who is not in fact lawfully entitled to the possession of them, the warehouseman shall be liable as for conversion to all having a right of property or possession in the goods if he delivered the goods otherwise than as authorized by subdivisions (b) and (c) of the preceding section;1 and though he delivered the goods as authorized by said subdivisions he shall be so liable, if prior to such delivery he had either

(a) Been requested, by or on behalf of the person lawfully entitled to a right of property or possession in the goods, not to make such delivery, or

(b) Had information that the delivery about to be made was to one not lawfully entitled to the possession of the goods. 1a

properly indorsed, the warehouseman would be protected if he delivered the goods innocently, though he would not be bound to deliver to him.

98 Roberts v. Stuyvesant Safe Dep. Co., 123 N. Y. 57, 65, 25 N. E. 294, 9 L. R. A. 438, 20 Am. St. Rep. 718. See also Stiles v. Davis, 1 Black, 101, 17 L. Ed. 33; Britton v. Aymar, 23 La. Ann. 63; Schrauth v. Dry Dock Sav. Bank, 86 N. Y. 390; Burton v. Wilkinson, 18 Vt. 186, 46 Am. Dec. 145. See

also Allswede v. Central Warehouse Co. (Mich.), 169 N. W. 13, and analogous cases relating to carriers, infra, § 1094.

99 Manufacturers' Mercantile Co. v. Monarch Refrigerating Co., 266 Ill. 584, 107 N. E. 885.

1 Blaisdell v. Hersum, 233 Mass. 91, 123 N. E. 386.

1a See Schouler, [1905] §§ 44, 45; Velsian v. Lewis, 15 Oreg. 539, 16 Pac. 631.

§ 1050. Cancellation of receipts on delivery of goods.

Section 11.-[NEGOTIABLE RECEIPTS MUST BE CANCELLED WHEN GOODS DELIVERED.] Except as provided in Section 36, where a warehouseman delivers goods for which he has issued a negotiable receipt, the negotiation of which would transfer the right to the possession of the goods, and fails to take up and cancel the receipt, he shall be liable to any one who purchases for value in good faith such receipt, for failure to deliver the goods to him, whether such purchaser acquired title to the receipt before or after the delivery of the goods by the warehouseman. 16

Section 12.-[NEGOTIABLE RECEIPTS RECEIPTS MUST BE CANCELLED OR MARKED WHEN PART OF GOODS DELIVERED.] Except as provided in Section 36, where a warehouseman delivers part of the goods for which he had issued a negotiable receipt and fails either to take up and cancel such receipt, or to place plainly upon it a statement of what goods or packages have been delivered he shall be liable, to any one who purchases for value in good faith such receipt, for failure to deliver all the goods specified in the receipt, whether such purchaser acquired title to the receipt before or after the delivery of any portion of the goods by the warehouseman.

§ 1051. Effect of alteration.

Section 13. [ALTERED RECEIPTS.] The alteration of a receipt shall not excuse the warehouseman who issued it from any liability if such alteration was

(a) Immaterial,

(b) Authorized, or

(c) Made without fraudulent intent.

The section does not apply to nonnegotiable receipts, because usage and mercantile necessity frequently require delivery in such cases without surrender of the receipt.

If the alteration was authorized, the warehouseman 16 It is an obvious requirement of the mercantile use of negotiable receipts that the goods shall remain in the warehouse as long as the receipt is outstanding, and statutes similar in effect to this section have been previously in force in some States.

shall be liable according to the terms of the receipt as altered. If the alteration was unauthorized, but made without fraudulent intent, the warehouseman shall be liable according to the terms of the receipt, as they were before alteration.

Material and fraudulent alteration of a receipt shall not excuse the warehouseman who issued it from liability to deliver, according to the terms of the receipt as originally issued, the goods for which it was issued, but shall excuse him from any other liability to the person who made the alteration and to any person who took with notice of the alteration. Any purchaser of the receipt for value without notice of the alteration shall acquire the same rights against the warehouseman which such purchaser would have acquired if the receipt had not been altered at the time of the purchase.2

§ 1052. Delivery of goods when receipt is lost.

OR

DESTROYED

Section 14. [LOST OR RECEIPTS.] Where a negotiable receipt has been lost or destroyed, a court of competent jurisdiction may order the delivery of the goods upon satisfactory proof of such loss or destruction and upon the giving of a bond with sufficient sureties to be approved by the court to protect the warehouseman from any liability or expense, which he or any person injured by such delivery may incur by reason of the original receipt remaining outstanding. The court may also in its discretion order the payment of the warehouseman's reasonable costs and counsel fees.

The delivery of the goods under an order of the court as provided in this section, shall not relieve the warehouseman from liability to a person to whom the negotiable receipt has been or shall be negotiated for value without notice of the proceedings or of the delivery of the goods.3

2 This section adopts the prevailing rule of the common law. Even fraudulent alteration cannot divest the title of the owner of stored goods and the warehouseman is therefore liable to redeliver them to the owner.

3 As it is for obvious reasons for

bidden and indeed made a criminal offence, [Section 52] to issue an additional negotiable receipt, it is evident that even when receipts are supposed to have been lost or destroyed, great care must be used in permitting such an issue or (what is the same thing) the

§ 1053. Effect of a duplicate receipt.

Section 15. [EFFECT OF DUPLICATE RECEIPTS.] A receipt upon the face of which the word "duplicate" is plainly placed is a representation and warranty by the warehouseman that such receipt is an accurate copy of an original receipt properly issued and uncancelled at the date of the issue of the duplicate, but shall impose upon him no other liability.1

§ 1054. Adverse claims to goods.

Section 16. [WAREHOUSEMAN CAN NOT SET UP TITLE IN HIMSELF.] No title or right to the possession of the goods, on the part of the warehouseman, unless such title or right is derived directly or indirectly from a transfer made by the depositor at the time of or subsequent to the deposit for storage, or from the warehouseman's lien, shall excuse the warehouseman from liability for refusing to deliver the goods according to the terms of the receipt."

Section 17. [INTERPLEADER OF ADVERSE CLAIMANTS.] If more than one person claims the title or possession of the goods, the warehouseman may, either as a defense to an action brought against him for non-delivery of the goods, or as an original suit, whichever is appropriate, require all known claimants to interplead."

4 See note to Section 6.
5 See supra, § 1036.

Section 18. [WAREHOUSEMAN HAS REASONABLE TIME TO DETERMINE VALIDITY OF CLAIMS.] If some one other than the depositor or person claiming under him redelivery of the goods, without the surrender of the original receipt. It is not enough that the parties agree that the goods shall be given up or a new receipt issued. It is essential that a court shall pass upon the question and make sure that the original is lost or destroyed and that a proper indemnity is taken, for the rights of possible innocent purchasers of the original receipt are involved. This is especially important, because under the laws of many States a warehouseman may be and frequently is of slight financial responsibility.

The case of Crawshay v. Thornton, 2 Myl. & C. 1, unfortunately held that interpleader was not a proper remedy in such a case. It is, however, the only adequate remedy and is probably generally allowed in this country. 3 Am. & Eng. Encyc. of Law, 762. Under the statute interpleader was allowed in New Jersey &c. Trust Co. v. Rector, 76 N. J. Eq. 587, 75 Atl. 931; Manhattan &c. Warehouse Co. v. Benquiat Art Museum, 155 N. Y. App. Div. 196, 139 N. Y. S. 1073.

has a claim to the title or possession of the goods, and the warehouseman has information of such claim, the warehouseman shall be excused from liability for refusing to deliver the goods, either to the depositor or person claiming under him or to the adverse claimant, until the warehouseman had has a reasonable time to ascertain the validity of the adverse claim or to bring legal proceedings to compel all claimants to interplead."

Section 19. [ADVERSE TITLE IS NO DEFENSE EXCEPT AS ABOVE PROVIDED.] Except as provided in the two preceding sections and in sections 9 and 36, no right or title of a third person shall be a defense to an action brought by the depositor or person claiming under him against the warehouseman for failure to deliver the goods according to the terms of the receipt.8

§ 1055. Warehouseman is liable for the non-existence or misdescription of goods.

Section 20. [LIABILITY FOR NON-EXISTENCE OR MISDESCRIPTION OF GOODS.] A warehouseman shall be liable to the holder of a receipt for damages caused by the non-existence of the goods or by the failure of the goods to correspond with the description thereof in the receipt at the time of its issue. If, however, the goods are described in a receipt merely by a statement of marks or labels upon them, or upon packages containing them, or by a statement that the goods are said to be goods of a certain kind, or that the packages containing the goods are said to contain goods of a certain kind, or by words of like purport, such statements, if true, shall not make liable the warehouseman issuing the receipt, although the goods are not of the kind which the marks or labels upon them indicate, or of the kind they were said to be by the depositor."

7 It seems obviously proper that the warehouseman should be protected for such brief period as may be necessary to enable him to determine the rights of the claimants. See Zuber v. Mehrle, 112 N. Y. S. 1093.

8 Supra, § 1036.

This section imposes on the warehouseman a stricter rule than that generally in force in this country in that it makes a warehouseman liable for an innocent misdescription of the goods. See Hale v. Milwaukee Dock Co., 23 Wis. 276, 99 Am. Dec. 169; but