190 N.Y. 24 | NY | 1907
This action is brought to recover money claimed to have been paid by mistake under the following circumstances: The plaintiffs were bankers and commission merchants and the defendants were brokers, both doing business in the city of New York. Garbrecht Company was a business firm in Bremen, Germany, and Luerman Son a firm of bankers in the same city. Garbrecht Company were the agents of the defendants, who secured for them orders in Germany for the purchase and sale of coffee, cotton and cereals. These orders were to be executed in New York and were of a speculative character. Garbrecht guaranteed the defendants for all claims against customers introduced by him arising out of the business transacted between the parties. The collection of margins was made through Garbrecht and he was paid by sharing in the defendants' commissions. All *26 the transactions had with Garbrecht's customers were charged or credited on defendants' books to Garbrecht personally. Garbrecht made up statements in the name of defendants' firm and delivered them to the German customers. Prior to February 4th, 1904, Luerman Son had been operating through the defendants, with the result that they had become indebted to the defendants in something over $27,000. On that day Garbrecht Company sent a written statement of the account to Luerman Son and asked that a cable remittance be made to the defendants that morning for the sum of $25,000. No response seems to have been made to this demand. On the following day Garbrecht made another statement which showed that the debit balance due from Luerman had been increased to $37,598.75, and asked them to make a cable remittance to the defendants of $35,000. Thereupon and on the same day Luerman Son cabled to the plaintiffs a message which, as alleged in the complaint, "requested plaintiffs to pay to defendants $35,000 for account of Garbrecht." Upon the receipt of this cablegram the plaintiffs paid the defendants $35,000, stating that it was made on account of Garbrecht, and the defendants gave them a receipt to that effect. On February 9th Luerman Son failed, and on the 10th the plaintiffs cabled Garbrecht: "Paid Herklotz, Corn Company $35,000 fifth February for your account, as per instructions from Luerman's. Please confirm by cable, our expense." To that Garbrecht replied by cable "not our but Luerman's account." Upon the receipt of the answer from Garbrecht the plaintiffs demanded of the defendants a return of the money so paid to them, on the ground that Garbrecht had not authorized the payment, with which demand the defendants refused to comply. Thereupon the plaintiffs brought this action.
The telegram from Luerman to the plaintiffs does not appear in the evidence, the court having excluded it on the objection of the defendants upon the theory that the plaintiffs were bound by the allegations as to its effect contained in the complaint. It did appear, however, from the testimony of *27 one of the plaintiffs, that the cablegram also contained this direction: "Draw on us three days or ten days." The plaintiffs did not draw any draft on Luerman, but on February 5th instructed him to pay their correspondent, a Bremen bank, the sum of three hundred seventeen thousand forty 95/reichsmark three days after the receipt of the letter, and on the same day advised said bank of their instructions to Luerman. This sum is far more than the equivalent of $35,000, and must have included other claims against Luerman. At the close of the plaintiffs' case the defendants moved for a nonsuit, which being denied, and the defendants offering no evidence, the court instructed the jury to find a verdict for the plaintiffs and ordered defendants' exceptions thereto to be heard in the first instance in the Appellate Division. The Appellate Division by a divided court overruled the exceptions and directed judgment to be entered on the verdict.
It would be much more satisfactory if we had before us the exact language of the cablegram from Luerman to the plaintiffs, and we think the learned trial court erred in its exclusion. Even if the effect of such admission were to vary the allegations of the complaint as to its import, the court might readily have allowed an amendment of the pleading in this respect. We must, however, deal with the record as it is before us. At the threshold of the case is presented the question whether it was under any material mistake of fact that the plaintiffs were induced to make the payment, for the mistake must be of a material fact to entitle the plaintiffs to relief. (Southwick
v. First National Bank of Memphis,
As I read the opinions of the judges who wrote for the majority of the Appellate Division, I do not see that either of them has placed his decision on the express ground that the cablegram purported to pledge the responsibility of Garbrecht for the repayment of the moneys advanced by the plaintiffs. One of those learned judges says the plaintiffs "knew nothing of the dealings between the defendants and Garbrecht Company, or between Garbrecht Company and Luerman Son. Presumably, Garbrecht Company had arranged with Luerman Son to have deposited with defendants a sum upon which they could draw, or with which they could deal in the ordinary course of international business. This is the fair meaning of the direction to pay or place `for the account of Garbrecht Company.' If, in fact, Garbrecht Company had made no arrangements with Luerman Son to place the money to their credit with defendants, and had not authorized it to be done, then the plaintiffs paid over the money under a mistake." Assuming for the argument only that the learned judge is correct in his statement of what presumption would arise from the cablegram, the plaintiffs had no possible interest in what Garbrecht Company might do with the money. If the credit was given exclusively to Luerman, then all that the plaintiffs were required to do was to comply with Luerman's directions. It mattered nothing to them whether Garbrecht or any one else had ordered the payment of this money, so long as the credit or responsibility of *31 the person alleged to have ordered the payment was not pledged. It is said by another learned judge: "It is proven that Garbrecht disclaimed and disavowed the relation imputed to him to the transaction, and did not authorize the payment to be made on his account and would not adopt it. The plaintiffs were misled by Luerman's cable message and paid the money to the defendants through mistake." Here again we are brought to the question already discussed. If the cablegram purported to pledge Garbrecht's credit, undoubtedly he could repudiate the transaction as unauthorized by him. But if it did not purport to impose any liability on Garbrecht, there was nothing in the transaction for him to repudiate. The money paid was not his and the claim on which it was paid also was not his, but his principal's. Therefore, in whatever aspect we view the case its determination (at this stage) turns on the single proposition that the plaintiffs in paying the defendants relied solely on the responsibility of Luerman, and neither in fact nor in their belief extended any credit to Garbrecht. Hence, there was no mistake as to any material fact.
The judgment should be reversed and new trial granted, costs to abide the event.
GRAY, O'BRIEN, VANN, WERNER, WILLARD BARTLETT and CHASE, JJ., concur.
Judgment reversed, etc.