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Commercial Law Keyed to Whaley
Procter & Gamble Distributing Co. v. Lawrence American Field Warehouse Corp.
Citation:
16 N.Y.2d 344 (1965)Facts
Procter & Gamble sold goods to Acker, Merrall & Condit Co., a liquor retailer, and received warehouse receipts issued by Lawrence American Field Warehouse Corp. as security. Lawrence had established a field warehouse operation on Acker’s premises, with a Lawrence employee designated as warehouse custodian. However, the warehouse custodian conspired with Acker’s president to issue receipts for non-existent liquor. When Acker went bankrupt, Procter & Gamble discovered that the warehouse receipts represented goods that did not exist. The plaintiff sued Lawrence for damages, claiming that Lawrence was liable for issuing false warehouse receipts upon which Procter & Gamble had relied when extending credit to Acker.
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