52 N.Y.S. 560 | N.Y. App. Div. | 1898
In disposing of this case it is necessai’y to consider but one of the questions discussed on argument. As it comes before us that question is, whether as to the particular transactions forming the basis of the respondents’ claim, the appellant is bound by a term implied in those transactions, which authorized the respondents to close them out, as they did, and impose upon the defendant a legal liability for the balance claimed herein. It appears by the un contra-
On the twenty-first of October, the respondents were carrying for the appellant the 2,000 bales referred to, and on that day the market price of January futures having declined very considerably at the Cotton Exchange, efforts were made on the part of the respondents to communicate with the appellant, and to demand from him further margin. The market had fallen off from the eighteenth, and a check of the appellant for $1,049 had been given to the respondents on account of the transactions, but that check was not paid on presentation, although it was subsequently honored. On the afternoon of October twenty-first, the respondents, not receiving any more margin from the appellant, closed out the transactions, the result of which showed a debit balance of three thousand and odd dollars for which this suit was brought. The respondents justify the course they pursued, and claim the right to recover this balance on the ground that it was one of the understood terms upon which the business was done, and, therefore, part of the contract, and that, when margins were near exhaustion, they had the right to close the transactions out at their discretion, without further notice to their customer.
The rights of the parties in this particular action, we think, are to be determined in view of the special circumstances of the case, and the relations, they assumed to each other, under the course of dealing established between them by a series of transactions with which those had in October were, as matter of fact, connected. We do not mean to say that independent transactions had between a broker and his customer are, under all circumstances, to be affected
It is suggested that there was no promise made that the appellant would pay any losses incurred upon closing out the transactions, but such a promise is implied. It was held in Bibb v. Allen (149 U. S. 482) that where a broker is employed to sell property for future delivery a promise is implied on the part of the principal to repay or reimburse the broker for losses or expenditures necessitated by, or resulting from, the performance of the employment. The losses in this case were settled and adjusted in accordance with the rules of the Cotton Exchange. The appellant was not ignorant of the method by which such losses were settled or adjusted, and there was an implied promise on his part to make the losses or liabilities of the brokers resulting from the transactions good to them. The view we have taken of the case makes it unnecessary to consider any other proposition urged by the appellant as a ground for reversal of the judgment.
The judgment and order appealed from must be affirmed, with costs.
Van Brunt, P. J., O’Brien, Ingraham and McLaughlin, JJ., concurred.
Judgment and order affirmed, with costs.