Clarke v. Brown

• Decision Date: 31 October 1886
• Citation: 77 Ga. 606
• Parties: Clarke, Harrison & Company. vs. Brown.
• Court: Georgia Supreme Court

77 Ga. 606

Clarke, Harrison & Company. vs. Brown.

Supreme Court of the State of Georgia

OCTOBER TERM, 1886.

Contracts. Futures. Principal and Agent. Before Judge Marshall J. Clarke. Fulton Superior Court. March Term, 1886.

C. I. Brown brought suit against Clarke, Harrison & Co., alleging that he had placed in their hands money for the purpose of handling grain for him; that their books showed that they had in hand $724.90 belonging to him; and that he had demanded it, but payment had been refused.

The defendants pleaded the general issue; and that thiswas a transaction in futures and was illegal, and no recovery could be had.

The evidence for the plaintiff was, in brief, as follows: About July, 1SS4, he deposited with defendants at different times $1,000 to be used as margins in "future " contracts. Becoming alarmed at their financial condition, he closed his contracts and demanded his money. They at first admitted that the amount sued for was due him, but failed to pay and afterwards refused payment. The amount sued for is the balance of plaintiff's original de-, posit, and not any profits from the dealing in futures.

The evidence for the defendants was, in brief, as follows: About the amount sued for was put up by the plaintiff for the purpose of buying futures. Defendants deposited it in bank to their credit, and bought grain and pork for him for future delivery. The market was adverse. All the money was exhausted and about $200 besides. Defendants carried the contracts for a time for plaintiff. The market then reacted, and the amount sued for represented the profit to the credit of plaintiff at the time the contracts were closed.

There was some testimony as to a counter-claim by defendants, not material here.

The jury found for the plaintiff. Defendants moved for a new trial on the following grounds:

(l)-(3.) Because the verdict was contrary to law and evidence.

(4.) Because the court charged as follows: " If you believe from the evidence that as he, the plaintiff, claims in this case, he did deposit various sums of money with the defendants, for them to engage in trading in grain and other products on his account; that they received this money and did engage in such trading; and that, as the result of such trading, there came into the hands of these defendants, for the benefit of the plaintiff, a certain sum of money, and that the plaintiff demanded of them thissum of money, and the defendants refused to give it to him, then the plaintiff would have a right of action against them for it. On the other hand, if you believe that these facts are not supported by the evidence, your verdict ought to be for the defendants in this branch of the case "

(5.) Because the court refused to charge as follows: " If it should appear that the plaintiff employed the defendants as his agents to buy and sell contracts in grain and pork, commonly called ' futures, 'and that the moneys deposited by the plaintiff with the defendants now sued for were deposited to make good and pay any losses that might accrue or grow out of said purchases and sales; that said moneys were consumed in the payment of margins on said contracts; that the parties knew that no grain or pork was to be delivered or received by the plaintiff, and that there was to be a settlement at a future day, when the plaintiff was to receive or pay the difference, then the contract would be illegal, immoral, and no rights could grow out of the same in favor of the plaintiff."

The motion was overruled, and the defendants excepted.

B. F. Abbott, for plaintiffs in error, cited: Code, §§2191, 2750, 263S; 3 Ga. 181; 55 Id. 235, 262; 41 Id. 315; 71 Id. 400; 75 Id. 366."

W. I. Heyward, by Walter R. Brown, for defendant, cited: 72 Ga. 223; 41 Id. 675; 39 Barb. 152; 7 Heisk. 137; 2 Wall. 81; 30 Ga. 547; 45 77. 501; 59 Id. 25; 68 Id. 299; Code, §2753; 1 Wait's Act. & Def. 225; Ewell's Ev. Ag. 436,

Jackson, Chief Justice.

The suit is brought by Brown against Clarke, Harrison &Co. for the recovery of some seven hundred dollars deposited with them to fill margins in the purchase of contracts in pork and grain for future delivery. The juryfound for the plaintiff the sum sued for; the defendants excepted, and on the denial of a new trial, the case is before us.

The point made is, whether money deposited by a principal to agents to purchase futures can be recovered by the principal from the agents, the same not being the fruits of the gambling transaction, as denominated by this court— not profits made by the agents for the principal over and above the sum deposited with them, but an amount of money within the sum total originally entrusted to the agents. It is immaterial whether it is the identical money so deposited, or deposited in bank with other deposits of the agents therein, and used by them and replaced by other funds, or used for filling margins for futures and afterwards replaced by the agents to the credit of the principal: the question is, whose money is it, the agents' or the principal's?

If it had been won as profits on the venture, it could not have been recovered back from agents, who got it for the principal with the use of the principal's money on the illegal venture, because that would be money recovered on a chance venture, and considered by this court as equivalent to a gaming venture. But when it is not at all the profits made on futures; when no profits at all were realized, but when the entire venture was over, this money was held by the agents, if, on the final accounting, it remained unspent for their principal, it was his money, won from nobody, but entrusted to his agents, for an illegal purpose it is true, yet left in the hands of the agents, after the game is over, as the sum or part of the sum he first entrusted to them. It is true that upon wagering contracts there can bo no recovery. Code, §2750. But this is not a suit upon a wagering contract. It is a suit for money in the hands of agents by the principal, furnished him to buy and sell grain for him, and it is alleged that this money now sued far is the money so furnished. There is nothing illegal in the contract set up in the declaration. It is the defencethat sets up the illegal contract. All that the plaintiff has to prove, in order to recover, is that these agents have his money that he furnished them, and refuse to turn over his own to him. Thereupon the agents say, it is true we have your money, but you...