309 Mass. 354 | Mass. | 1941
This is an action of tort or contract which arises out of various transactions between the plaintiff and the defendant as a result of which the plaintiff claims to have been damaged. The declaration is in three counts.
The evidence in its aspect most favorable to the plaintiff would warrant the jury in finding the following facts: The plaintiff is a widow seventy-seven years of age. She had no “school education” after she was “sixteen” and married when she, was “twenty-one.” She became a widow in 1905. By inheritance she was possessed of various stocks and bonds. From 1881 up to 1932 she had banking connections only with the defendant. She was not well informed in the matter of investments. She did know that bonds were better than stocks “because if a firm went out of business the money for the bonds was paid before the money for the stocks.” She cut coupons on bonds when
One Leland became president of the defendant bank a few years before 1927. Prior to that time the plaintiff consulted with one Mosher, who was then president of the bank, about buying and selling securities. It was her custom to take all papers sent to her about the purchase of stock to Mosher. “She took his advice” which was freely given and just as freely accepted and acted upon. Mosher introduced the plaintiff to Leland when he became president of the bank and said, in effect, that Leland, as representative of the bank, would take care of her. Leland asked her to come to him if she needed his or the bank’s assistance. Thereafter, and until some time in April, 1932, the plaintiff consulted Leland with regard to her financial affairs and transactions and relied upon his advice relative to the purchase and sale of securities. She always consulted him at the bank. He never visited her home. There was no evidence that any of the directors of the bank knew, either before or after April 4, 1927, that the plaintiff was receiving advice from Leland and was relying on him for advice in relation to buying and selling securities, though they knew that prior to 1927 the bank’s customers habitually sought advice of its officers as to investments. On April 4, following a vote of March 22, 1927, the directors of the bank established a “bond department” in accordance with a plan submitted to them by Leland. This action was recommended by Leland to save the time of bank officers, much of which had been consumed formerly by persons seeking advice with regard to investments. The directors knew that the function of the new department was to deal with investments for the bank’s depositors.
The bond department, also known as the “investment department,” was organized under the terms of an agreement with the brokerage house of Harris, Forbes & Com-
It was the practice of the bank, prior to 1927, to charge a commission for pinchases of securities made for its customers, but up to that time none of the statements received by the plaintiff indicated that the defendant was charging
“During the years 1925-1926 . . . [the plaintiff’s] purchases totaled $55,896.18.” On April 11, 1927, her bank balance was $109.20. During the period 1927-1932 the plaintiff engaged in three hundred six transactions with the bond department upon the advice of Leland, except that in at least two instances he arranged to purchase securities for the plaintiff before consulting her. She acquiesced in these purchases, however, before they were actually made. In one instance, on his advice, she sold one of her favorite investments “when loath to do so.” On one occasion Leland told her that he sometimes talked with the Harris Forbes company representative after banking hours and “got his advice.” In many instances securities purchased by the plaintiff were paid for through debit slips put through the bank’s draft department and sent to her with her “monthly cancelled checks.” The debit slips read, in part, “as per bill of Harris Forbes & Co.” Checks for her security purchases were often "made out” by Leland and on other occasions by “somebody” in the bank. The inference is that they were signed by the plaintiff. On or about April 29, 1932, she closed out her checking account in the bank and withdrew her securities from her vault.
The auditor found that there was no evidence that Leland or anyone connected with the bank knew or ought to have known that, in buying or selling the securities that the plaintiff bought and sold during the period in question, it
The parties have argued at some length the question whether the evidence would warrant a finding that Leland was authorized to advise the plaintiff with reference to the purchase and sale of securities and .to arrange therefor. We are of opinion that, on all the evidence and in the light of the facts which we have.already said the jury could warrantably find, they could also properly find that Leland had at least ostensible or apparent authority to enter into the transactions in question in behalf of the bank as part of its business and for profit, and that the plaintiff relied upon the manifestation of authority. See Nowell v. Equitable Trust Co. 249 Mass. 585, 594; England Brothers, Inc. v. Miller, 274 Mass. 239, 242; Lonergan v. Highland Trust Co. 287 Mass. 550, 556; Federal National Bank of Boston v. O’Connell, 305 Mass. 559, 566-567; Schleifer v. Worcester North Savings Institution, 306 Mass. 226, 228-229. Am. Law Inst. Restatement: Agency, § 27. See also Welch v. Corey, 201 Mass. 165. There is nothing, however, in the
The question remains whether in the transactions involved a fiduciary relationship existed between the parties. The auditor found that "so far as it was a question of fact, . . . there was no fiduciary relationship between the plaintiff and the defendant.”
In Hawkes v. Lackey, 207 Mass. 424, 432, the court said: “ Wherevér two persons stand in such, a relation that, while it continues, confidence is necessarily reposed by one, and the influence which naturally grows out of that confidence is possessed by the other, and this confidence is abused, or the influence is exerted to obtain an advantage at the expense of the confiding party, the person so availing himself of his position will not be permitted to retain the advantage, although the transaction could not have been impeached if no such confidential relationship had existed.” In Comstock v. Livingston, 210 Mass. 581, at page 584, the court said: "Mere respect for the judgment of another or trust in his character is not enough to constitute such a relation. There must be such circumstances as indicate a just foundation for a belief that in giving advice . . . one is acting not in his own behalf, but in the interests of the other party. If the relation is a business one, the existence of mutual respect and confidence does not make it fiduciary.” In the present case we are of opinion that the evidence would require a finding that the relations between the parties were of a business character. In dealing with the plaintiff, Leland was engaged in the business of the bank in buying and selling securities for its customers, in the pursuit of which it had established its bond, sometimes called investment, department. Its bond department occupied space in the banking quarters. It derived a profit from the conduct of this department. We think that the evidence would not warrant the jury in finding that in all the circumstances the plaintiff could reasonably
At the trial before the jury certain testimony offered by the plaintiff had been admitted by the judge de bene. This testimony was to the effect that before Leland became president she consulted Mosher about buying and selling of stocks. Thereafter she always went to Leland. She had these “inheritances.” She “didn't do any business with them . . . the stocks and bonds . . . [she] didn't pretend to manipulate them at all.” When “things came up to be changed, or stock added, or to be sold, when any business matter came up relative to what . . . [she] owned . . . [she] went right to Mr. Leland.” Sometimes she would receive a message from him to go to the bank and see him and she would do so. She did not know from whom she was buying the stocks and bonds “but through the bank, that is all I can say.” When she went to Leland’s office he would say, “'Now, Mrs. Snow, I have sent for you to come in. I want to ask you, I want to tell you what I am going to do, I’m going to sell this, or sell that and then I think
The only other exception of the plaintiff is to the exclusion of the testimony of an expert offered by the plaintiff to prove the type and character of the securities that she had purchased on the advice of Leland. This evidence was excluded by the judge on the ground that the witness was not qualified to testify as an expert on any issue in the case. We cannot say that there was error in refusing to admit this testimony. Except in rare instances where, as matter of law, the exclusion of the proffered evidence would be unwarranted, the preliminary question of the qualification of a witness called as an expert must rest with the trial judge. Biancucci v. Nigro, 247 Mass. 40, 44. Langis v. Danforth, 308 Mass. 508, 510, 511, and cases cited.
Judgment is to be entered for the defendant on the directed verdict.
So ordered.