Holden v. Metropolitan National Bank, 138 Mass. 48

138 Mass. 48 | Mass. | 1884

W. Allen, J.

This is an action of contract by the receivers of the Reading Savings Bank. The declaration alleges that certificates of shares of bank stock which belonged to the savings bank came into the hands of the defendant, and that the defendant sold said shareg.

The report shows that the defendant held and sold certificates of stock standing in its own name. It never had in its possession, or in any way meddled with, the certificates that stood in the name of the savings bank. It did not accept an assignment of those certificates, or a transfer of the stock they represented, and did not surrender the certificates or procure the issue of new ones upon the transfers. These things were all done by Nathan P. Pratt, the treasurer of the Reading Savings Bank; and after they had all been done, the defendant, in good faith, advanced money upon the pledge of the new certificates, and stood in the position of a bona-fide purchaser of them for value. Pratt assumed to act for and by authority of the savings bank. If he had authority, the assignments and transfers of the stock, and the surrender of the old certificates and the issuing of the new ones, were valid, and the new certificates represented stock which belonged to the savings bank as general owner, and the plaintiffs are entitled to the surplus of the proceeds of the sale of it above the amount for which it was pledged. If Pratt’s acts were not authorized, they may be ratified with the same effect as if there had been previous authority ; if not authorized or ratified, the assignments and transfers, and surrender of the old and issue of the new certificates, were all null and void as to the plaintiffs, whose stock remained un assigned and held, in legal contemplation, under the old unsurrendered certificates, and the plaintiffs had no interest in the new certificates or the stock they represented. The plaintiffs cannot both deny and affirm the validity of the transfers of their stock to the defendant. By denying the validity of the transfers, they necessarily disclaim the ownership of stock represented in the certificates issued upon such transfers; by affirming the validity of the transfers, they ratify the pledge of the stock. In the one case, the stock sold would not belong to the savings bank; in the other, the sale would be authorized by the savings bank. In neither case can the plaintiffs recover in this action, which is founded on an unlawful sale of stock belonging to the savings bank. Pratt v. Taunton Copper Co. 123 Mass. 110. Machinists’ National Bank v. Field, 126 Mass. 345. Boston & Albany Railroad v. Richardson, 135 Mass. 473.

R. D. Smith & D. C. Linscott, for the defendant. S. Bancroft, for the plaintiffs.

New trial ordered.