51 Ga. App. 179 | Ga. Ct. App. | 1935
Lead Opinion
Moody brought his action against the Fulton National Bank to recover 53 shares of stock in the Coca-Cola International Corporation, represented by one certificate issued to him in his name. The bank admitted possession of the stock, which had been issued to Moody, and that Moody had a good title thereto
In June, 1931, Wesley Shropshire secured a loan of $10,000 from the Fulton National Bank and pledged to it, as security therefor, certain other stock and the Coca-Cola stock sued for in this case, to which stock was attached the blank power of attorney sent him by Moody. The power of attorney came into the possession of Wesley Shropshire by reason of the fact that it was sent him by Moody for the purpose of being used in the cancellation of the bank stock above referred to and the issuance of new stock. Mrs. Moody was authorized to act for her son in any manner affecting the exchange of the stock-certificates placed in her safety-deposit box. When she desired to enter such box she would go to the Trust Company of Georgia and turn over the key of the deposit box to Shropshire, who would unlock the vault and take therefrom the metal box containing her securities and also containing the sealed envelope in which Charles Glenn Moody’s securities were placed. Shropshire would bring the metal box to Mrs. Moody from the basement to the main floor, and when Mrs. Moody had finished with the box he would take it back to the basement floor and return the key to her. This was done on many occasions. Mrs. Moody testified: that she remembered when the First National Bank was formed and the stock of the Atlanta & Lowry Bank and the Trust Company of Georgia was exchanged for stock of the First National Bank; that she delivered the sealed
Mr. Justice Day in the ease of National Safe Deposit Co. v. Hibbs, 229 U. S. 391, 395 (33 Sup. Ct. 818, 57 L. ed. 1241), used the following language, which exactly expresses the contentions of the parties iii the present case. “In this case conflicting legal principles are invoked and relied upon. For the defendant in error [plaintiff in error here] the familiar principle that ‘where one of two innocent persons must suffer by the acts of a third, he who has enabled such third person to occasion the loss, must sustain it’ is advanced. The plaintiff in error [defendant in error here] invokes the principle that where the owner of property, such as stock certificates, has lost it by the criminal or fraudulent act of another, the owner not voluntarily or negligently conferring upon such other the indicia of ownership or apparent title can not be deprived of his property by the attempted transfer of title to a third person for value, no matter how innocent the purchaser may be of knowledge of the crime or fraud by which the property was
In the case at bar it is not questioned that the Fulton National Bank was a bona fide purchaser or pledgee of the stock certificate sued for, and that it was without notice of any limitation on the right of Shropshire to sell or dispose of the stock certificate. He had possession of the certificate and was clothed with an indicia of authority to transfer the same. If this possession of the stock was obtained by theft on the part of Shropshire without the element of trust reposed entering therein, no title would be passed to a purchaser from Shropshire, however innocent. Moody entrusted the blank power of attorney to Shropshire, and did so charged with notice of the power to deceive that he was putting into another’s hands. As was said in the case of Scollans v. Rollins, 179 Mass. 346 (60 N. E. 983, 88 Am. St. R. 386) : “If the owner of the instrument intrusts it to another, he does so charged with notice of the power to deceive which he is putting in another’s hands, and if deception follows he must bear the burden.” See authorities there
Did the possession of the Coca-Cola stock certificate itself come as a result of a simple larceny or was it a larceny after trust? Mrs. Moody, as agent for her son, intrusted to Shropshire the possession of the sealed envelope and also its contents, for it is disclosed that she authorized Shropshire to break the seal of the envelope and take from its contents the stock of the Lowry Bank. By this action Shropshire was trusted with access to the contents of this envelope. But this circumstance by itself was not an intrusting of the certificate of Coca-Cola stock to Shropshire. As was said in Knox v. Eden Musee, supra: “The certificates were at all times after their surrender and before they were abstracted by Jurgens from the safe of the defendant in legal possession of the company. The company never placed them in the possession of Jurgens or invested him with the indicia of ownership. He had access to the safe as a mere servant of the defendant.” “It is not true as a general rule that a man may not intrust his property to
We can not fail to notice and admire the fairness, frankness, and candor of counsel for both sides in presenting this case. As was said in the brief of attorney for plaintiff in error: “ The exact differences between counsel are of relatively narrow range. They relate to a disagreement over the first of the ultimate facts on which we predicate our defense. That ultimate fact was that Moody voluntarily placed in Shropshire’s hands (1) the power of attorney executed in blank, and (2) the stock certificate. Opposing counsel deny both parts of this statement. Their legal position in effect concedes that if this statement is true Moody was not entitled to recover.” We are prepared to agree that this is a correct statement and we think the law as we have attempted to set out above is assented to by counsel for both sides. Eor the defendant in the court below to prevail it must establish its affirmative defense,—that is, that Moody intrusted both the power of attorney signed in blank to Shropshire and also the Coca-Cola stock certificate. Unless both of these alleged facts are established by evidence, the defendant was not entitled to prevail. With the first statement, that is, that the blank power of attorney was voluntarily intrusted to Shropshire, we are inclined to agree. Moody was charged with notice of the power to deceive he was placing in Shrop
Judgment affirmed.
Dissenting Opinion
dissenting. I am in agreement with the majority, that generally, “where the owner of propertj', such as stock certificates, has lost it by the criminal or fraudulent act of another, the owner not voluntarily or negligently conferring upon such other the indicia of ownership or apparent title,” he can not be deprived of his property by the attempted transfer of title to a third person for value, no matter how innocent the purchaser may be of knowledge of the crime or fraud by which the property was acquired. However, I can not concur in their construction and application of this principle to the case at bar. The article in dispute is a stock
Furthermore, in a case of this character, a delivery of possession, should certainly be a sufficient entrusting to Shropshire for one purpose, and he used it for another. Shropshire brought the
However, I may go further and assume that Moody’s acts did not amount to a voluntary entrusting of the certificate of Coca-Cola stock, yet certainly, if he came into possession of it under the second inference stated above, he was negligently entrusted with its possession. What more startling example could be thought of, of negligence, than in the present case? Moody first sends to Shropshire two blank powers of attorney executed by him, and then, without investigating what was in the envelope which he was turning over to him with power to open, he turned it over to him. True he may'have trusted Shropshire; true he may have not intended to give him possession of any certificates other than the bank stock, but did not the duty evolve upon him to ascertain what stock he was putting into the possession of Shropshire, knowing that Shropshire with his (Moody’s) consent already had a power of attorney which if attached to any of his stock would apparently clothe Shropshire with the full ownership thereof according to all the tests usually applied by business men under such circumstances ? Will he be heard to say that his intention was not what it seemed to be, where his acts, intentional or otherwise, were sufficient under the law, “according to the custom of trade and the common knowledge of the world,” to place in Shropshire’s hands the power of defrauding another. I can see but one answer.
This case is distinguishable from those cases in which a servant is entrusted with a man’s property with no power, expressed or
One of two innocent persons, Moody or the Fulton National Bank, must suffer a loss in this case. I can not escape the conclusion that Moody, whose misplaced confidence caused him to put it into the power of Shropshire to inflict the injury, must bear the loss. I, therefore, think the court below erred in directing a verdict for the plaintiff.