Wright v. Bank of the Metropolis

• Decision Date: 02 October 1888
• Citation: 18 N.E. 79,110 N.Y. 237
• Parties: WRIGHT v. BANK OF THE METROPOLIS.
• Court: New York Court of Appeals Court of Appeals

110 N.Y. 237

18 N.E. 79

WRIGHT

v.BANK OF THE METROPOLIS.¹

Court of Appeals of New York.

October 2, 1888.

Appeal from supreme court, general term, Fourth department.

About the 7th of January, 1878, one Henry C. Elliott received from his correspondent in Rome, N. Y., (B. Huntington Wright,) his check for $2,000, payable to the order of Elliott, with a request from Wright that he (Elliott) would meet some drafts Wright would draw on him, and obtain payment from the check. He accordingly honored the drafts, and, having indorsed the check, procured its discount by the defendant. It was not paid when presented, and Elliott being unable to learn the reason, went to Rome to see the drawer of the check. He then learned that the drawer had made a general assignment for the benefit of his creditors, and stated his inability to do anything for Elliott. Finally, Elliott succeeded in obtaining a number of shares of stock in different railroad companies, as collateral security to the check then lying protested in the hands of the defendant. The history of the interview resulting in the procuring of the stock by Elliott is contradictory, but the verdict of the jury shows that they believed that which was given on the part of the plaintiff. From the evidence thus given it appears that the stock was in reality the stock of Benjamin H. Wright, the father of B. Huntington Wright, and that it was delivered by the old gentleman to Elliott voluntarily, and for the purpose of being used as a collateral to his own note at six months, which was to be used to take up the check; but the stock was not to be sold for six months, as it was then selling in market much below what the father thought the stock was really worth. The stock was owned by Mr. Wright, as he said, for an investment, and he had no idea of selling it; but he allowed Elliott to take it because he felt sorry for his situation, and wanted to help him, as far as he reasonably could, out of the difficulty he was in. Elliott took the stock and went to New York, and had a talk with the cashier and vice-president of the defendant, who reserved their decision as to whether they would take the note and the stock. Subsequently, and on the 17th of January, the cashier wrote that the stock being non-dividend paying, and the note six months paper, it would be impossible to get it through the board; and he suggested it would be much better to obtain Mr. Wright's consent to sell the stock, and to make his (Elliott's) account good in that way. Elliott inclosed this note to Mr. Wright in a letter addressed to ‘B. H. Wright;’ and in response, and on the 22d day of January, Benjamin H. Wright, the owner of the stock, wrote Mr. Rogers, the cashier of defendant, refusing to sell the stock, or to permit of its being sold. Mr. Rogers had never seen either of the Messrs. Wright, and did not know there were two; and subsequently, and about the 29th of January, Elliott told him that Mr. Wright authorized the sale of the stocks, and they were immediately sold, less commission for $2,261.50. On the part of the plaintiff it was claimed that Mr. Wright, the true owner of the stocks, never gave any such authority to sell them, and that he was unaware that they had been sold until May 9, 1878. February 14, 1881, the stock reached the highest price, down to the day of trial, selling on that day for $19,003. This action was commenced October 7, 1879. Mr. Wright, the owner of the stock, was about seventy-six years of age in May, 1878, and in the latter part of that year went south, and returned early in the year 1879. On the 9th of May, 1878, he made a demand upon the defendant for the stocks, and tendered to it the amount of the check and interest, being something over $2,000. The cashier stated the stocks had been sold by the authority of the owner thereof, as he supposed, given through Mr. Elliott, and refused to deliver them or their value. The original plaintiff died since the first trial of the case, and Henrietta N. Wright, his personal representative, was duly substituted. The court charged the jury that if they found for the plaintiff he was entitled to recover the highest price at which the stocks could have been sold in the market between the date of their actual conversion and a reasonable time thereafter, and that the jury should fix the reasonable time, not arbitrarily or through sympathy or prejudice; but they were to say what, under all the circumstances, would be a reasonable time within which to commence this action, and also, it may be, reasonable diligence in prosecuting it; because if the action were commenced in fact within a reasonable time after the conversion of the stock, and had been prosecuted with reasonable diligence since, then the plaintiff was entitled to recover the highest market price that the stock reached between the date of the conversion and the time of the trial, less the amount of the check and interest, and with interest on the balance. This charge was duly excepted to. The jury found a verdict for $3,391.25. There is no evidence which shows when the stock reached that value. Upon the rendition of the verdict both parties moved to set it aside, the plaintiff on the ground that he was entitled, under the charge, to the highest value of the stock down to the trial, and the defendant on the ground that the damages were excessive and contrary to evidence. The court granted the motion of the plaintiff, and set the verdict aside on the ground stated, and denied the motion of the defendant. The defendant appealed to the general term from both of such orders. That court reversed the order setting aside the verdict, and ordered judgment thereon, and affirmed the order made on defendant's motion, refusing to set aside the verdict. Judgment was then entered upon the verdict of the jury, and from that judgment both sides appeal to this court, and they also appeal from the orders of the general term upon which the judgment was entered.

RUGER, C. J., and ANDREWS and DANFORTH, JJ., dissenting.

W. E. Scripture, for plaintiff.

Joseph H. Choate and John Delahunty, for defendant.

PECKHAM, J., ( after stating the facts as above.)

This case comes before us in a somewhat peculiar condition. As both parties appeal from the same judgment, which is for a sum of money only, it would seem as if there ought not to be much difficulty in obtaining its reversal. It is obvious, however, that a mere reversal would do neither party any good, as the case would then go down for a new trial, leaving the important legal question in the case not passed upon by this court. This, we think, would be an injustice to both sides. The case is here, and the main question is in regard to the rule of damages, and we think it ought to be decided. By this charge the case was left to the jury to give the highest price the stock could have been sold for, intermediate its conversion and the day of trial, provided the jury thought, under all the circumstances, that the action had been commenced within a reasonable time after the conversion, and had been prosecuted with reasonable diligence since. Authority for this rule is claimed under Romaine v. Van Allen, 26 N. Y. 309, and several other cases of a somewhat similar nature, referred to therein. Markham v. Jaudon, 41 N. Y. 235, followed the rule laid down in Romaine v. Van Allen. In these two cases a recovery was permitted which gave the plaintiff the highest price of the stock between the conversion and the trial. In the Markham Case the plaintiff had not paid for the stocks, but was having them carried for him by his broker (the defendant) on a margin. Yet this fact was not regarded as making any difference in the rule of damages, and the case was thought to be controlled by that of Romaine. In this state of the rule the case of Matthews v. Coe, 49 N. Y. 57-62, came before the court. The precise question was not therein involved; but the court, per CHURCH, C. J., took occasion to intimate that it was not entirely satisfied with the correctness of the rule in any case not special and exceptional in its circumstances; and the learned judge added that they did not regard the rule as so firmly settled by authority as to be beyond the reach of review whenever an occasion should render it necessary. One phase of the question again came before this court, and in proper form, in Baker v. Drake, 53 N. Y. 211, where the plaintiff had paid but a small percentage on the value of the stock, and his broker, the defendant, was carrying the same on a margin, and the plaintiff had recovered in the court below, as damages for the unauthorized sale of the stock, the highest price between the time of conversion and the time of trial. The rule was applied to substantially the same facts as in Markham v. Jaudon, supra, and that case was cited as authority for the decision of the court below. This court, however, reversed the judgment, and disapproved the rule of damages which had been applied. The opinion was written by that very able and learned judge, RAPALLO, and all the cases pertaining to the subject were reviewed by him, and in such a masterly manner as to leave nothing further for us to do in that direction. We think the reasoning of the opinion calls for a reversal of this judgment. In the course of his opinion the judge said that the rule of damages, as laid down by the trial court, following the case of Markham v. Jaudon, had ‘been recognized and adopted in several late adjudications in this state in actions for the conversion of property of fluctuating value; but its soundness as a general rule, applicable to all cases of conversion of such property, has been seriously questioned, and is denied in various adjudications in this and other states.’ The rule was not regarded as one of those settled principles in the law as to the measure of damages, to which the maxim stare decisis should be applied. The principle upon which the case was decided rested...