Casto v. Wrenn
| Decision Date | 01 March 1926 |
| Citation | 255 Mass. 72,150 N.E. 898 |
| Parties | CASTO v. WRENN et al. |
| Court | United States State Supreme Judicial Court of Massachusetts Supreme Court |
OPINION TEXT STARTS HERE
Appeal from Superior Court, Suffolk County; Morton, Judge.
Suit in equity by Charles E. Casto against Philip W. Wrenn and others to recover, from defendants, shares of corporate stock standing in plaintiff's name. Decree for plaintiff, and the defendants appeal. Affirmed.R. M. Russell, of Boston (E. C. Mack, Jr., of Boston, on the brief), for appellants.
F. W. Campbell, of Boston (G. S. Harvey, of Boston, on the brief), for appellee.
This suit was brought to recover from the defendants twenty-five shares of the preferred stock of General Baking Company, purchased in 1918 by and standing in the name of the plaintiff, and deposited by him with one of the partners of the brokerage firm of F. G. Roberts & Company, to whom he said that he valued this certificate more than any of his other possessions and that they must in no event permit it to go out of their hands. The representative of the brokerage firm replied:
‘All right, I will keep it in the same envelope, and you will get the same certificate back with the others, when I get them.’
The certificate was indorsed in blank by the plaintiff and placed in an envelope with his name and telephone number marked upon it and F. G. Roberts & Company gave him a receipt therefor, having stricken out, at the plaintiff's request, the printed part of the receipt relating to their right to pledge certificates. Five days later F. G. Roberts & Company deposited the certificate with the defendants as additional collateral on one of four accounts which F. G. Roberts & Company had with them. At the time of its acceptance by the defendants they were unaware that F. G. Roberts & Company held it under any special agreement. Within a short time thereafter, F. G. Roberts & Company made an assignment for the benefit of creditors, and on the same day filed a petition in bankruptcy, and, on August 6, 1919, were adjudicated bankrupts. Immediately after filing the petition in bankruptcy, the defendants began to liquidate the four accounts referred to by selling the securities pledged by F. G. Roberts & Company. Three of the accounts were liquidated, leaving in each instance a balance to the credit of F. G. Roberts & Company or their trustees in bankruptcy. The defendants then attempted to liquidate the account on which the General Baking Company stock was held as collateral. The report states that after the securities had been sold their transfer was stopped by injunction pending a decision as to the rights of the parties. Whereupon, in order to carry out their contract for such sale, the defendants purchased in the open market and made delivery of a like amount of stock, thus leaving a balance in favor of the defendants of $144 to secure which there are held in the transfer offices twenty-five shares of preferred stock of General Baking Company together with certain shares in another company. The fact that this other stock was held to secure the same claim has become immaterial, by reason of the plaintiff's waiver of any right of contribution and his assumption of the obligation to pay the defendants the $144 and interest. The defendants in their answer admit that at the time when the bill was filed they had in their possession the certificate for the twenty-five shares of stock to which the plaintiff asserts title. While the case was pending before the master, the defendants filed a cross-bill to recover dividends already paid and to restrain the plaintiff from collecting further dividends on the stock represented by this certificate. It was adjudicated by the final decree that the plaintiff was owner of the twenty-five shares above referred to, subject to the defendants' lien for $144 and interest at six per cent. from October 3, 1919: and upon deposit of said sum with the clerk of court, the defendants were directed to deliver to the plaintiff the certificate and...
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