49 Misc. 94 | N.Y. App. Term. | 1905
The plaintiffs sue upon a promissory note, claiming to recover the amount of its face and interest, less a small sum said to have been realized upon the sale of collateral. The defendant by way of answer sets up three counterclaims; one, apparently for damages for plaintiffs’ misconduct in executing or refusing to execute orders to buy and sell wheat, and two for damages for the conversion of certain collateral deposited with plaintiffs to cover defendant’s speculation in grain. It appears from the allegations of the counterclaims that, for some time prior to the making of the note in suit, plaintiffs, as brokers, had been engaged in buying and selling wheat for defendant, upon margin, and that, in addition to a certain cash margin, he had deposited with plaintiffs a certificate for 100 shares of a certain stock; that, on or about April 6, 1905, plaintiffs
Our conclusion is that the first counterclaim states a cause of action. As to the second and third counterclaims, their sufficiency is even more apparent. The second sets forth a cause of action for conversion of the collateral, and is quite sufficient without considering the paragraph numbered XI which may be disregarded. The third counterclaim also sets out a cause of action in conversion. It differs from the second because, while it alleges notice to defendant of the time and place of sale, it further alleges that plaintiffs promised defendant that they would not sell at the time so fixed unless and until they had given him previous notice to that effect, and that they did sell at that time without giving him such notice. This is precisely equivalent to selling without any notice at all. The object of notice is to give the owner, of the collateral an opportunity to protect himself against a sacrifice of his collateral; and to mislead him, as defendant alleges he was misled by the plaintiffs, necessarily operates to deprive him of the opportunity for self protection.
It follows that, the demurrers were properly overruled, and that the judgment must be affirmed, with costs, with leave to plaintiffs to withdraw the demurrers and reply within six days, upon payment of costs in this court and the court below.
Bischofe and MacLean, JJ., concur.
Demurrers overruled and judgment affirmed, with costs, with leave to plaintiffs to withdraw demurrers and reply within six days upon payment of costs in this court and the court below.