Maitland v. Martin

86 Pa. 120 | Pa. | 1878

Mr. Justice Mercur

delivered the opinion of the court,

This action was brought by the defendant in error for money had and received for her use. The money sought to be recovered came into the hands of the plaintiffs in error under the following circumstances : In August 1873, being brokers in the city of Philadelphia, they purchased for the defendant in error five South Carolina bonds, of the nominal value of $1000 each. She left the bonds in their possession. They were sealed up in an envelope, her name endorsed thereon, and deposited in the safe of the plaintiffs in error in the “Fidelity.” They thus remained until May 1875, when she instructed the plaintiffs in error to sell them at thirty-three per cent. There being no market in Philadelphia for them, on the 12th of May they directed their correspondents, Cecil, Stout & Thayer, brokers in New York, to sell them. By dispatch, on the 14th of May, they advised the plaintiffs in error that they had sold at the price named. Immediately thereafter the plaintiffs notified the defendant of the sale. On the same day the plaintiffs forwarded the bonds to their correspondents by express, and requested a draft to be remitted for net proceeds. On receipt of the bonds, Cecil, Stout & Thayer remitted the proceeds to plaintiffs in error on the 15th May. On the 17th May, and while the proceeds remained in the hands of the plaintiffs in error, they were notified by Cecil, Stout & Thayer that three of the bonds were not fund-able, and not a good delivery at the price for which they had sold them; and, therefore, they had purchased others at the same .price to supply the place of those not fundable, and held the plaintiffs in error for the sum thus advanced. On the same day the plaintiffs in error advised the defendant of the substance of this notice, and further requested her to consider the sale of 3000 of the bonds reported by them sold, as cancelled. They also directed Cecil, Stout & Thayer to return the three bonds not accepted, and draw on them for the sum paid. Thereupon Cecil, Stout & Thayer returned the bonds, and the plaintiffs in error paid them the sum which they had advanced.

The plaintiffs in error offered to return the three bonds to the defendant, and account for the proceeds of the two others ; but she denies their right to hold her responsible for the money thus paid by them, and seeks to recover the whole sum agreed to be paid for the five bonds.

It appears, by the evidence, that about the 1st of June 1874, the treasurer of the state of South Carolina issued a notice that certain bonds of that state had been declared null and void by the legislature, and would not be recognised. Thereupon, June 2d 1874, the New York Stock Exchange made an order that the bonds embraced in said notice should not pass, as a good delivery, on a sale of Tegular “South Carolina bonds,” after that date. Three of these bonds appear to have been repudiated by the legislature, and at the time of the sale, in May 187 5, were not fundable, and as a consequence were almost worthless. Cecil, Stout & Thayer professed to sell “ fundable bonds” only. They supposed all of the five to be of that class. The.purchaser had a right to suppose he was buying such. Discovering that three of them were not of that kind, he refused to accept them. Cecil, Stout & Thayer thereupon replaced them with such bonds as filled the contract.' If these facts be proved, they undoubtedly had a valid claim against the persons in whose behalf they agreed to make the sale. At the time the plaintiffs in error directed them to make the sale, they did not disclose the name of their principal; yet this in no manner changed the legal rights and liabilities between her and them. The specific bonds were her property. The plaintiffs were her agents to effect a sale. It was to be made for her benefit. The plaintiffs were bound to due care, prudence and diligence in the execution of the powers committed to them. These they appear to have exercised. They kept their principal informed of their action. The defendant is not shown to have sustained any damage by reason of any information being withheld from her. These bonds had depreciated while owned by her. If the plaintiffs in error, while acting as her agents in effecting the sale, without any fault on their part, became liable, she, and not they, must bear the loss.

The object to be effected was a sale of the bonds. The plaintiffs in error, as well as Cecil, Stout & Thayer, were acting as agents to reach that end. An agreement to sell fundable bonds, and a payment by the purchaser to one agent, and his transmission to another agent, did not necessarily complete the transaction.

It required a delivery, or a readiness to deliver the bonds, of the kind sold, according to the contract. Anything less than that left the transaction incomplete, unless further fulfilment was waived.

In fully perfecting a sale the plaintiffs in error were strictly in the line of their duty. We discover nothing affecting their good faith. If, then, without fault on their part in the honest management of the business of the defendant, they incurred damages, those damages must be borne by her and not by them: Stocking v. Sage, 1 Conn. 519; D’Arcy v. Lyle, 5 Binn. 441; Whart. on Agents, sect. 316.

If the plaintiffs in error in good faith carried out the contract made with the purchaser, they did not thereby adopt the loss as their own and relieve the defendant from her legal obligation to reimburse them. Although they took back the bonds, without the express consent and authority of the defendant, yet they did not thereby necessarily accept them as their own. If the facts are found to be as stated, the purchaser was justified in refusing to accept the bonds. If so justified, it was clearly within the general scope and authority of the plaintiffs in error, as her agents, to fulfil the contract, and their acts, in contemplation of law, became her acts. Although, by failing to disclose their principal, the plaintiffs in error may have become personally liable to Cecil, Stout & Thayer, yet that does not bar the right of the plaintiffs in error to require the defendant to make their loss good. It therefore follows that many portions of the charge were too unfavorable to the plaintiffs in error, and the assignments are substantially sustained.

Judgment reversed and a venire facias de novo awarded.