XjYALL GBANT J.—Mohamad 9. Eastern Bank.
Hayley, K.C. (with him Ferdinands), for respondents.—Suduwella Storesare the stores of the bank. There is a notarial lease. The entry of therubber into the stores was a delivery of possession to the bank. Therights of the bank as pledgees were complete on the deposit of the rubberin their stores. The memorandum C 3 need not be registered as theeffect of the transaction was to transfer immediately possession to thegrantee {Ex parte North-Western Bank, In re Slee >; In re Hall, ex parteClose 2; In re David AUester, Ltd. 3; Wille, **Mortgage and Pledge in SouthAfrica ”, pp. 95, 102, 114).
In the alternative there is constructive delivery of possession of therubber to the bank (Young v. Lambeth *).
H. V. Perera, in reply.—The bank is not in possession of the stores asthey charge Tarrant & Co. Rs*- 1,000 per month for the use of the stores.There is no pledge. The bank is merely a bailee and can have a lien onthe rubber for storage charges and nothing else. The document C 3 isnecessary to create a pledge and ought to have been registered.
If the bank had an intention of taking delivery of possession of therubber, it should have complied with the provisions of the Rubber TheftsOrdinance, No. 21 of 1908.
Mere possession of the keys of the stores by the bank does not amountto constructive delivery.
.August 24, 1931. Lyall Grant J.—
The facts are fully set out in the judgment of my brother Maartenszand I need not recapitulate them.
The learned District Judge has held that apart from the document C 3,there, is sufficient evidence to establish the fact that the claimant bankwas pledgee of the goods.
I agree with my brother that this view cannot be sustained. The goodsremained in the possession of Tarrant and Company, whose power ofdealing with them was uncontrolled or at any rate only partially con-trolled by the bank. They were stored in godowns which had Tarrantand Company's name conspicuously displayed outside the premises.The bank' took a lease from the owners of the godowns and affixed arather inconspicuous board on the inside of each godown intimating thatit was a godown of the Eastern Bank. This was the only hint or warningto the public of any transfer of possession of the rubber in the store fromTarrant and Company to the bank.
Otherwise everything went to show that- Tarrant and Company werethe owners. They were licensed rubber dealers (which the bank was not)and handled the rubber.
The keys were kept by a person who was paid partly by the bank andpartly by the defendants, and this servant locked the sheds at night, butduring the day the defendants had the unrestricted handling of the rubber.So far as I can find from the evidence, there was nothing to prevent themdisposing of the rubber or part of it to other persons in breach of theiragreement with the bank, and there is some evidence to indicate thatsome of the rubber in the store was in fact delivered to consignees other
than the bank.
1 (1872) t. R. 15 Eq. 69.
*(1884) Q. B. D. 386.
» (1922) Ch. 211.
• (1870) L. R. 3 P. C. 142.
LYALL GRANT J.—Mohamad v. Eastern Bank. ,
There does not in fact seem to have been any effective delivery to thebank till the rubber was shipped and the bills of lading were handedover.
If the bank's claim is to be sustained, it must then rest on C 3. Counselseemed uncertain whether this document was or was not a bill of sale.It was not registered, and if it was a bill of sale delivery of the goodspledged was necessary.
The case on which the learned District Judge relies, In re David Allester 1.is one where the debtor to a bank first transferred possession of the docu-ments of title to specific goods and afterwards received back from thebank these documents for the express purpose of realizing the goods forthe benefit of the bank.
In that case the document (a letter of trust) which the debtor gave tothe bank was held not to be a bill of sale as it merely recorded the termson which the company was previously authorized to realize the goods inthe bank and did not create a charge at all. It was held that the bank’sprevious rights as pledgee remained unaffected by “ this common andconvenient-mode of realization
In Allester*s case, however, the letter of trust was a much more precisedocument than C 3. It acknowledged the receipt from the bank ofcertain specific documents of title, thus evidencing the prior existence ofa pledge, and the signatories, the pledgors, undertook to hold these docu-ments and the goods to which they referred in trust for the bank and todispose of the latter as the bank’s trustee.
They further undertook to keep the transaction separate from anyother and to remit the proceeds to the Bank.
As the Judge in that case pointed out, the bank had its charge beforethe letters came into existence and their* object was not to give the banka charge but to enable it to realize in the usual way of business the goodsover which it had a charge.
That case therefore does not help the respondent in this case if I amcorrect' in holding that prior to, and apart from, the document C 3 thebank had no charge.
There is no evidence to show that C 3 is a document used in the ordinarycourse of business, as proof of the possession or control of goods and author-izing or purporting to authorize either by endorsement or delivery thepossessor of such document to transfer or receive, as thereby represented.
It can only have effect if it is a bill of sale completed by deliveryas there has been no registration.
For the reason above set forth, I am of opinion that there was nodelivery while the rubber remained in the warehouse. Delivery waseffected in respect, of each consignment by handing over the bills of saleafter the rubber had left the warehouse.
Bills of sale are, I understand, unknown to the Boman-Dutch -law*,and also to the South African law.
They are, I believe, the peculiar creation of English law, but they havebeen introduced into the law of Ceylon.
The principle of the Roman law was that a pledge of a movablecould only be effected by transfer of possession. English law allowed a
1(1922) L. R. 2 Chancery 211.
MAARTENSZ A..T.—Mohamad v. Eastern Bank.
pledge bywriting but, as this was foundto leadto frauds, people getting
credit ongoods apparently theirs butreallypledged, legislationwas
introduced in 1854 to compel registration of all bills of sale where actualdelivery of the goods was not given.
The principal effect of this amendment of the law is that where, as here,the document has not been registered, the English law is assimilated tothe Roman-Dutch law, at all events in a competition between creditors.
We have been referred to one or two South African cases. A generalreview ofthe South African law as setout inWille’s " Mortgageand
Pledge ” shows that the South AfricanCourtshave been strict inthe
matter of constructive possession. The guiding principle has been toguard against fraud in obtaining credit.
The fact that the bank took possession of the store two or three daysbefore this action was instituted does not, I think, make any difference.The decisive date is that on which the plaintifE sent his rubber to thedefendant’s store and gave him credit for payment. At that date he hadno notice of any arrangement between the defendant and the claimantbank.
I would therefore allow the appeal, setting aside the District Courtjudgment and continuing the mandate of sequestration over the goods orthe proceeds realized therefrom.
I would give the appellant costs against the claimant in both Courts.
Maartensz A.J.—
The appeal in this case arises from a claim made by the Eastern Bank,Limited (hereafter referred to as the bank), to certain rubber which theplaintifE in this action caused the Court before judgment to have seques-tered as the property of the defendants under the provisions of section 653of the Civil Procedure Code.
The bank claimed the property sequestered as pledgee or owner thereofby virtue of a document (C 3), called a trust receipt, and delivery ofpossession to the bank.
“ C 3 ” is in the following terms:
Trust ReceiptI. F. No. 86.
(Advance in Account Current on Produce awaiting Shipment.)
19th Feby. 1929.
To The Eastern Bank, Limited,Colombo.
H. G. Account.
In consideration of your allowing us to overdraw our current account fromtime to time, the total overdraft not at any time to exceed fifteen lacs ofrupees, we hereby agree that all cheques drawn on our current account shallbe applied by us solely in the purchase of produce, and in the event of anoverdraft being created by reason of your honouring such cheques, then,until such overdraft h&B been repaid to you, either by proceeds of bills ofexchange sold to you, or in cash, all such produce as shall be purchased by usby means of such cheques and overdraft shall be kept apart by us from allother goods and produce in our godowns and shall be held by us as agent andin trust for you, and kept fully insured by us against loss by fire, we holdingsuch insurance and all moneys receivable therefrom in trust for you, andhanding you forthwith all amounts received from the insurers.
MAA&TBN8Z A.J.—Mohamad v. Eastern Bank,<7
The intention of this agreement is, that you are to be entitled to‘ suckproduce as security for our overdraft for the time being, we holding suchproduce as agent and trustee for you, and in the event of our failing to repayto you the amount of our overdraft when called upon to do so we herebyundertake to deliver to you at any time the said produce, without raising anyquestion, to enabie you to sell or at your discretion to ship the same for thepurpose of realization under your directions.
Also we further agree and undertake immediately upon shipment of theproduce, or anypartthereof, to handtoyou the shipping doouments forthe
same, or their equivalent in cash.
We will, whenever required, give you full particulars of the produce heldby us on your behalf, and we hereby guarantee that its value shall at all timeBbo equal to and shall be maintained at the amount of our overdraft.
It is understood that the keys of the godown. remain in our possession, andwe likewise further agree and undertake to have no advance from any otherbank on the same or any other produce in our godowns in which produceunder lien to you is stored so long as we are indebted to you.
And we furtheragreethat the goodsshallalso be asecurityto you forthe
payment on demand of all other moneys which are now or shall at any timebe due to you from us either alone or jointly with any other person or persons,either on account current or of any money advanced or paid or in respect ofbills, drafts, ornotesaccepted, paidordiscounted,interest,commission,or
any other .usualor lawful charges oronany otheraccountwhatsoever,to*
gether with all costs and expenses.
Yours faithfully,
(50*ceDt stamp.)
Rubber lying in godown, &c., Sudnwella Stores, Colombo.
When C 3 was executed, the defendants were the tenants of certainstores called the Suduwella Stores, and according to the evidence of theManager of the bank, Mr. Manwaring, the produce, purchased by thecheques drawn on* the overdraft was placed in these stores, from which itwas shipped from time to time to England consigned to H. G. Gardner &Co., the documents drawn on Gardner & Co. by the defendants were sentto the bank and forwarded by the bank to its London Office. The rubberwas delivered to Gardner & Co. on payment of the draft.
On May 28, 1929, by indenture C 1 the Suduwella Stores were leasedby the landlord to the bank at a rental of Es. 1,000 a month. Thedefendants continued to- use the stores and were debited with a sum ofRs. 1,000 monthly. On June 27, 1930, the bank locked up the storeswith all the rubber in it. The balance due to the bank from the defend-ants on June 30, 1930, was Rs. 745,724.07, the value of the rubber in thestores at that date was only Rs. 150,000. Either the rubber purchasedwith the cheques drawn on the overdraft was sold elsewhere or the chequeswere used for some other purpose than the purchase of rubber.
The bank was secured as regards Gardner & Co. by their letter of creditfor £100,000 opened at or about the time C 1 was granted.
The name board of the defendants continued to remain on the outerwall of the Suduwella Stores, but to each godown was affixed a boardwith the name of the bank. One of the boards -was produced, on it was,stencilled—
“ The Eastern Bank LimitedGodown 99
MAABTKNSZ A.J.—Mohamad v. Eastern Bank.
Although according to C 3, the keys were to remain with the grantees,they were, according to Manwaring’s evidence., kept by Silva, an employeeof the bank. He opened the stores in the morning and locked them upat night but did not remain on the premises in the interval nor did heexercise any check on the rubber brought in and removed from the stores.He was paid an allowance of Rs. 65 for looking after these stores andanother store, and part of this salary was paid by the defendants.
The learned District Judge upheld the claim and this appeal is takenfrom his order. He held that G 3 was admissible in evidence and that itdid not require registration under section 17 of the Registration of Docu-ments Ordinance as the bank was in ostensible and bona-fide possessionof the goods as pledgee.
All the findings were challenged by the appellant's counsel, who con-tended that there was in law no delivery of possession of the goods to thebank, and that C 3 as a Bill of Sale was void' as against the plaintiff as ithad not been registered and was also inadmissible in evidence as the bankhad failed to prove that it had been signed by the defendants.
On the other hand it was contended that the Suduwella Stores werethe stores of the bank and that the entry of the rubber into them was adelivery of possession to the bank, that C 3 did not require registrationas the property had been actually delivered over into the possession ofthe bank. In the alternative it was contended that there was constructivedelivery to the bank.
The rubber, it was argued, either belonged to the bank or was in itspossession as pledgee. I may say at once that I do not think it an argu-able contention that the bank became the owners of the rubber from thetime it entered the stores. There is no evidence, verbal or written, of any* contract of sale.
C 3 cannot, in my opinion, be construed into a contract of sale.
In considering the question whether there was delivery of possessionto the bank regard must be paid to the fact that document C 8 wasexecuted and business done under it before the stores were leased to thebank.
There was, in my opinion, neither actual nor constructive delivery ofpossession to the bank of the rubber brought into the stores before thelease was executed. The position of the bank before the lease wasexecuted cannot be distinguished from the position of the plaintiff Dohertyin the case of Dublin City Distillery (Great Brunswick street, Dublin).Ltd. v. Dofierty x. In that case “ the .plaintiff advanced moneys to adistillery company on the security of manufactured whiskey of thecompany stored in a warehouse provided by the company on the distillerypremises in accordance with the Spirits Act, 1880. Neither the companynor the excise officer could obtain access to the warehouse without theassistance of the other and the whiskey could only be delivered out onpresentation to the excise officer of a special form of warrant supplied bythe Crown. On the occasion of each advance the company entered thename of the plaintiff in pencil in their stock book opposite the particularsof the whiskey intended to be pledged and delivered to the plaintiff (1) an
» {1914) A. C. 823.
MAARTENSZ A.J.—Mohamad t>. Eastern Bank.
ordinary trade invoice and (2) a document called a warrant which de-scribed the particulars of the whiskey and stated that it was deliverableto the plaintiff or his assigns and contained the words ' free storage *.The number of the warrant was entered in red ink against the cases ofwhiskey in the stock book. No intimation of the transaction was givento the excise officer
The warrants were not registered under section 14 of the CompaniesAct, 1900 (which corresponds to section 17 of our Ordinance No. 23 of 1927for the Registration of Documents). *
In an action by the plaintiff against the company in liquidation it washeld reversing the decision of the Court of Appeal in Ireland, that theplaintiff was not entitled to a valid pledge on the whiskey comprised inthe warrants; that assuming that a pledge was created it was, undersection 14 of the Companies Act, 1900, a mortgage or charge granted orevidenced by an instrument yi writing which, if executed by an individual,would require registration as a bill of sale, and was consequently void asagainst the liquidator for want of registration.
The only difference is that in this case an employee of thfe bank unlockedthe stores in the morning and locked them up at night. But as he did notremain on the premises and exercise any control over the disposition ofthe property by day it cannot possibly be said that the possession of thekeys by the bank amounted to constructive delivexy as was held in thecase of Wari&v. Turner l.
The position of the plaintiff in the case cited was stronger than theposition of the bani in this case; for on the occasion of each advancemade by Doherty the company purported to pledge to him a specific caskof whiskey and issued to him a delivery warrant and an invoice in thesame form as if the whiskey had been sold to him and no whiskey wasever sold without the plaintiff’s consent. In addition an entry was madein the company’s stock book of the number of the warrant againstthe casks of whiskey mentioned'in the warrant and particulars of thetransaction were also entered in the company's register of mortgages.Evidence of this nature of a pledge is entirely absent in this case.
I have now to consider whether the position of the bank was alteredby its taking a lease of the Suduwella Stores, the property sequesteredhaving been brought into the stores after the execution of the lease.
I am of opinion that the lease did not have the effect of altering theposition of the bank as the bank did not take possession of the stores.The defendants continued to occupy the stores and to deal with the rubberbrought into them in exactly the same way as they hiad done prior to theexecution of the lease. The only effect of the lease, was to substitute thebank for Delmege, Forsyth & Co., the lessors under the indenture of lease,as the defendant’s landlord and rent was paid to the bank accordingly.
Whatever expression may be used to describe the debit of Rs. 1,000 amonth, it was nothing more or less than the payment of rent by thedefendants to the bank. If the bank was in possession and the rubberwas delivered to the bank and stored in the stores for the bank there was.no reason why the defendants should have been debited with the amountof the rent.
(1751) 2 Vesey Senior 431
MAABTENSZ A .3.—Mohamad v. Eastern Bank.
I can conceive of a case of a pledgee taking produce on pledge andmaking it a part of the contract that the pledgor should pay the rent ofthe premises which the pledgee had to provide for storage. But in sucha case to establish the delivery of possession there must be cogent evi-dence that the pledgor could not deal with the property pledged exceptthrough the pledgee. As for example, by the pledgee keeping the keysof the stores and keeping out the pledgor altogether, or if the pledgor warto deal with the property for certain purposes,, by evidence thdfc * thepledgor could only take out the property on the orders of and subject tocheck by an employee of the pledgee in terms of a proper trust receipt.
The document C 3 is not A receipt at all and cannot be considered inthe same way as a letter of trust of the nature referred to in Grant on'
Banking on page 373.
A point was made and it is one of considerable force that if it was theintention of the bank to take delivery of possession of the rubber it wouldhave complied with the provisions of the Rubber Thefts PreventionOrdinance, No. 21 of 1908, as amended by Ordinance No. 39 of 1917.
flection 3 of the principal Ordinance makes it unlawful for any personto purchase rubber unless be has been licensed under the Ordinance todeal in rubber or has received from the Government Agent a permitauthorizing him to do so. A breach of the section is made an offence.
By section 2 of the Ordinance the word purchase ” includes the takingof rubber in exchange for other goods or on account of any claim orindebtedness.
The bank has not been licensed nor has it complied with any of theother provisions of the Ordinance, and I am unable to hold that the .bankby taking a lease of the Suduwella Stores took the rubber brought into iton account of a claim against the defendants.
All the cases on constructive possession were reviewed by Lord Atkinsoninthe case of The Dublin City Distillery Go., Ltd. v. Doherty {supra.)
I need only refer to the cases of (1) Henry v. Mangles (2) Whitehouse v.Frost2, and (3) Castle v. Sworder2. None of them are applicable to thepresent case. In the first case the vendor received rent from the vendeefor storing the goods. In the second the vendor accepted a deliveryorder given by the vendee to a sub-vendee. In the third case the vendorsentered in the rum book of their warehouse the purchases of rum inquestion as sold to defendants and proved that after this entry theythemselves had no power to get the goods out of the warehouse.
In the present case the defendants paid the bank for the use of thepremises; they were not warehousemen; there was no attornment tothe vendee nor was anything done which put it out of the power of thedefendants to dispose of the rubber.
I am accordingly of the opinion that the bank did not receiveconstructive delivery of the rubber in question.
The subsequent taking possession of the rubber about June 27 cannotbe deemed a delivery of possession for the purpose of creating thecontract of pledge.
1 {1803) 1 Camp. 452.* (1810) 12 East. 614.8 (1861) 6 B. 6 N. 828.
MAARTENSZ A.J.—Mohamad t>. Eastern Bank.
The learned District Judge in deciding that C 3 need not be registeredas a bill oi sale relied on the cases ot Ex parte Hubbard In re Harwich 1 andIn re David Allester, Ltd.2
I do not think either case applicable where, as in this case, there hasbeen no delivery of possession actual or constructive.
In Hubbard’s case the goods pledged were deposited with Hubbard assecurity for money borrowed and they remained in the actual possessionof Hubbard until the bankruptcy. The terms on whioh the goods weredeposited were at the time of the deposit embodied in an agreementsigned by the pledgor.
It was held that the agreement was not a bill of sale as it did not con-stitute the title to the goods and was not intended to and did not comeinto operation until possession of the goods had Actually been transferred.
In AUester’s case it was held that the letter of trust did not fall withinthe statutory definition of a bill of sale because the rights of the bankas pledgee were complete on the deposit of the documents of title and theletters of trust were mere records of the terms on which the pledgor wasauthorized to realize the goods on behalf of the pledgees, and were notissued for the purpose of creating a security.
In applying these cases the trial Judge proceeded on the assumptionthat that there was delivery of possession but he has not discussed theevidence uf possession nor has he given his reasons for that assumption.
In the case of In re HaU ex parte Close 3, to which we were referved bythe defendant’s counsel, Cave J. held that the Bills of Sale Act did notinclude a letter of hypothecation accompanying a deposit of goods orpawn tickets or, in fact, any case where the object and effect of the trans-action are immediately to transfer the possession of the chattels fromthe grantor to the grantee.
Lord Bowen in Ex parte Hubbard observed that the law was correctlylaid down by Cave J.
The ratio decidendi is the same in all three cases, namely, that a memo-randum setting out the terms on which the goods are pledged is not a billof sale within the meaning of the Act when the goods are deposited withthe pledgee at the time the memorandum is made.
It is not applicable to this case as the goods were not deposited withthe pledgee when C 3 was granted.
Ex parte North-Western Bank In re Slee * is more in favour of the respond-ent. In that case Bacon C.J. said that a letter of hypothecation createda good equitable charge and that it did not require registration under theBills of Sale Act. Cave J. in Ex parte Hubbard at page 392 referred tothis ruling as an obiter dictum-.
Bacon C.J. appears to have come' to the conclusion that it did notrequire registration for a variety of reasons arising from the facts in thatcase. The facts are in no way similar to the facts in this case.
Slee’s case was referred to in In re Hamilton Young & Co. ex parte Carter 5where the question arose whether a letter of hypothecation was void forwant of registration as a bill of sale. The Court held that it was not
1 (1SS6) L. B. 17 Q. B. D. 691.* 11884-1885) 14 L. R. Q. B. 386.
* (1922) L. R. 2 Chancery. 211.‘ (1872) L. R. 16 Eq. 69.
• (1905) 2 K. B. 772.
82MAAKTENSZ A.J.—Mohamad »■ Eastern Bank.
void as letters of lien were “ documents used in the ordinary course ofbusiness as proof of the possession or control of the goods I ventureto share the doubts expressed by Stirling L.J. whether letters of lienare either " transfers of goods in the ordinary course of business of a tradeor calling ” or " documents used in the ordinary eourse of business asproof of the possession and of control, within the meaning of section 4 ofthe Bills of Sale Act ”.
C 3 cannot, in view of the definition in our Ordinance, fall within theformer category. Section 17 of our Ordinance No. 23 of 1927 has substi-tuted for “ the transfer of goods in the ordinary course of business, &c. ”the words " contracts for the sale of goods within the meaning of theSale of Goods Ordinance, 1896, and made in the ordinary course of anybusiness, trade, or calling ”. The facts, however, in the case of Ex parteHamilton were entirely different. There the letter of hypothecationreferred to specific goods and there was evidence that they were used inthe ordinary course of business as proof of the possession and control ofthe goods.
Collins M.R. restricted the letter of hypothecation to proof of posses-sion of the goods.
There is no evidence in this case that documents like C 3 are used inthe ordinary course of business as proof of the possession or control ofthe goods and the exception does not apply.
There is, in my opinion, no evidence of a pledge apart from C 3. Inthe case of the Bublin Distillery Co., Ltd. v. Doherty (supra) Lord Parkerheld that Ex parte Close and In re Hubbard did not apply in such a case.He disapproved of the proposition that a document which itself passedthe possession to the pledgee and was not within the exception was not abill of sale (fage 855) and held that the warrants addressed to Dohertywere bills of sale and void for want of registration.
C 3 appears to me to have been granted to the bank for the samepurpose as the warrants were granted to Doherty and is a bill of salewithin the meaning of section 17 of the Registration of DocumentsOrdinance, No. 23 of 1927, which, as the property was not' delivered tothe pledgee, had to be registered under the Ordinance.
I accordingly hold that C 3 is a bill of sale within the meaning of section17 of the Registration of Documents Ordinance, No. 23 of 1927, and thatit is not valid or effectual so as to give the bank any lien, charge, claim,right, or priority over, to, or in respect of such property as it was notregistered as required by section 18 of the Ordinance.
The respondent’s counsel cited in support of the claim of the banktwo cases under the Roman-Dutch law referred to by Wille in his workon 11 Mortgage and Pledge in South Africa ”.
In the first case, Pietersz & Co. v. Landau Bros. ', “ the debtor by deedpledge*, certain furniture in his hotel to a creditor. At the same time theformer gave the latter a lease of the hotel and the furniture. The creditorsublet the hotel to a thir'd person, who in turn assigned his sub-leaseto a fourth person who was in possession of the furniture at the date ofthe debtor’s insolvency. It was held that the fact that the movables
1 (1914) S. R. 30.
MACDONELL CJ.—Attygolle v. Sabapathy.
had passed out of the physical possession of the pledgee did not destroyhis pledge or preference as he still retained in law the effective controlover the movables
This case does not help the respondent as by the lease the creditortook possession of the furniture and the sub-lessee was his agent inpossession.
Neither does the second case, Stratford's Trustees v. London & SouthAfrican Bank *. The facts were that Stratford, who was a dealer in wooland also a wool-washer, pledged to a bank certain wool belonging tohimself, but which was at the time in the possession of a third person,this third person agreeing to hold the wool at the disposal of the bank.Thereafter the wool was placed in the possession of Stratford for thepurpose of being washed in the ordinary course of business; it was heldthat this fact did not invalidate.the pledge.
The ratio decidendi in that case and the North-Western Bankt Ltd.
o.John Poynter, Son & Macdonalds2 was that the pledge was validbecause the pledged goods were not dealt with after the pledge in thesame way as they had been dealt with before. The pledgor performedsome work or did something in respect of them for the benefit of thepledgee and they were retained by him for that purpose.
They can be distinguished from the present case on another ground.In the South African case the goods were in the hands of a third personwho attorned to the pledgee. In the English case the bill of lading wasdelivered in the first instance to the pledgee who returned it with a docu-ment similar to a letter of trust. In both cases, therefore, delivery ofpossession of the goods preceded the return of the goods to the pledgor.
I would allow the appeal with costs. As regards the costs in the Dis-trict Court I would allow the appellant the amount the District Judgefixed as costs to which the respondent was entitled, namely, Rs. 105.
Appeal allowed.