245 Mass. 479 | Mass. | 1923
The plaintiffs in the first case, constituting the firm of Blake Brothers and Company, stockbrokers (herein referred to as the plaintiffs), seek to recover from their customer, Friedman (referred to hereafter as the defendant), the balance alleged to be due on his margin account with them. In the cross action Friedman sues to recover from the brokers a sum representing the securities and cash he had deposited with them, on the ground that they had failed to make actual purchases and sales on his
The auditor found: “ When Friedman employed the brokers to make purchases and sales as above set forth, there was nothing said between him and the brokers other than his request to them t.o make such purchases and sales.” His report further states: “ There were forty-six different orders for the purchase or sale of stocks given by Friedman to the brokers. I find that all orders for the purchase of stocks so given by Friedman were duly executed by the brokers, and certificates for the stocks purchased were duly received by the brokers. I find that all orders for sales of stocks given by Friedman to the brokers were executed by the brokers, and the certificates of stocks delivered by the brokers in pursuance of such sales were, with the exceptions hereinafter noted, either the identical certificates which had been purchased by them for Friedman’s account or certificates into which such certificates originally purchased had been converted.” In case of dividend paying stocks, if dividend days were approaching, new certificates in the name of the brokers were obtained through the transfer offices. “ The said identical certificates purchased or the certificates into which some of them had been transferred, as above stated, from the time of purchase to the time of sale were always within the actual possession or control of the brokers.” WTien, in the ordinary course of business, some of the certificates were pledged with banks it was always under agreements giving the brokers the right to withdraw them by substituting other collateral. And the auditor expressly finds that the brokers “ always had in their possession or control, available for delivery to Friedman or upon his order, shares of stock in the companies and to the amount ordered by Friedman.” In short, it appears that in every instance there was an actual delivery or receipts of certificates, and that all the purchases and sales ordered were actually made.
As the plaintiffs fully carried out their contract with the defendant, and “ there was an actual transfer of title to and manual delivery of a certificate of stock pursuant to every order for purchase or sale ” by the defendant, the relations of the plaintiffs to other customers were immaterial. In other words, in the case here disclosed, it was not necessary for the brokers to show that they had within their control certificates of shares of the kind they were carrying for Friedman sufficient to meet their commitments for all their customers. Barrell v. Paine, 236 Mass. 157, 164. Crehan v. Megargel, 235 Mass. 279, 283.
As to the cross action. The case was not one under the wagering act, G. L. c; 137, §§ 4r-7. It was not brought to recover for any damages suffered by breach of contract. Friedman cannot recover the value of the money and securities deposited by him because actual purchases and sales were made by the brokers pursuant to his orders. They fully performed their obligations to him, and' no fraudulent conduct on their part is shown.
In accordance with the report, the entry in each case must be
Judgment on the verdict.