Knickerbocker v. Gould

• Decision Date: 08 October 1889
• Parties: KNICKERBOCKER et al. v. GOULD.
• Court: New York Court of Appeals Court of Appeals

115 N.Y. 533

22 N.E. 573

KNICKERBOCKER et al.

v.GOULD.¹

Court of Appeals of New York.

Oct. 8, 1889.

Appeal from supreme court, general term, first department.

Action by Henry W. Knickerbocker and others against Charles W. Gould, on an account arising from stock transactions. On trial the court directed a verdict for plaintiffs, and the judgment entered thereon having been affirmed on appeal to the general term, defendant again appeals.

F. F. Andrews, for appellant.

Delos McCurdy, for respondents.

EARL, J.

This action was brought by the plaintiffs, stock-brokers, doing business in the city of New York, against the defendant, their customer, residing in the county of Saratoga, to recover a balance of account. The plaintiffs bought for the defendant certain shares of stock, receiving from him a portion of the purchase price as margin, and advancing for him the balance, and holding the stock. The defendant failed, upon demand, to put up more margin, and they sold the stock, and the amount claimed in the complaint is the balance due them resulting from the transactions. The facts alleged in the complaint are sufficient to entitle the plaintiffs to recover for moneys advanced to the defendant, and for commissions and expenses, and also upon an account stated. The evidence shows that the plaintiffs bought for the defendant 100 shares of Erie stock on the 3d day of January, 1883, and sold the same on the 6th day of January at a profit, which they remitted to him. On the 9th day of February, 1883, they again bought for him 100 shares of Erie stock at 37 3/8 per cent. of the par value thereof, and this stock they held until December 26, 1884, when they sold it at 13 5/8 per cent. of the par value. About the 30th day of June, 1883, they fendered to the defendant a statement of their account with him, which debited him with all the money they had advanced for him, and with the interest thereon and their commissions, and credited him with the money received by them from him, showing a balance due them of $2,807.06. On or about December 31st of the same year they sent him another statement of their account, which consisted of the precise balance, with interest to date, showinga balance due them of $2,893.14, and the 100 shares of Erie stock in their hands. Upon that account was written a request of the defendant for additional margin. To that request, on the 7th day of January, 1884, the defendant replied by letter, saying that he did not have cash on hand, and wished them to accept a bond and mortgage as collateral, and allow him to buy more stock on that security. To that letter they replied, declining to take the bond and mortgage, and requesting him to send his check for enough to make the Erie stock ‘to the market price, and keep it up so from time to time.’ On the 19th day of April they again wrote him, saying that, unless he sent $1,000 by return mail ‘to margin Erie stock’ they were carrying for him, they would sell at the market, and hold him responsible for any loss. On the 30th day of June they sent him a statement of their account, containing the previous balance, with the addition of interest, and showing a new balance of $2,980.90. On the 4th day of December they wrote him a letter, in which they said they had repeatedly called upon him for margins to make good his account, and notified him that unless the margins were made good within five days they would sell the 100 shares of Erie stock at public auction to the highest bidder, and, after crediting his account with the proceeds of the sale, would look to him for the payment of the balance. On the 8th day of December he wrote them, apparently in reply to the last letter, that he would be in the city the first of the next week. He did not call upon them, and did not respond with further margin; and on the 26th day of December they sold the stock at public auction, and obtained therefor the market price, to-wit, 13 5/8 per cent. of the par value thereof; and on the same day they sent him a formal statement of their account, in which the defendant was debited with the previous balance, and interest thereon to date, and with...