Dana v. Wildey Sav. Bank
| Decision Date | 27 May 1936 |
| Citation | 2 N.E.2d 450,294 Mass. 462 |
| Parties | DANA v. WILDEY SAV. BNAK. |
| Court | United States State Supreme Judicial Court of Massachusetts Supreme Court |
Suit in equity by Herbert W. Dana against the Wildey Savings Bank. From a decree for plaintiff, defendant appeals.
Reversed, with directions.
Appeal from Superior Court, Suffolk County Beaudreau, Judge.
J. A Boyer, of Boston, for appellant.
R. B. Owen and E. R. Anderson, both of Boston, for appellee.
This is a suit in equity to redeem shares of stock pledged by the plaintiff with the defendant to secure a loan to him and alleged to have been sold illegally by the defendant. The case was heard by a judge of the Superior Court, who made a finding of material facts and ordered the entry of a final decree in favor of the plaintiff for substantial damages. The evidence is reported in full. The findings of fact made by the trial judge, based upon conflicting oral testimony, are amply supported by evidence. A careful examination of the record convinces us that they cannot be pronounced plainly wrong. They must therefore be accepted as true. Lindsey v. Bird, 193 Mass. 200, 79 N.E. 263; Potier v. A. W. Perry, Inc., 286 Mass. 602, 605, 190 N.E. 822.
The material facts thus found and pertinent to the grounds of this decision are these: On June 15, 1931, the plaintiff obtained on his note for $7500 a loan for that sum from the defendant. It was reduced until, on March 15, 1932, there was due $5500. On the latter date the plaintiff paid the loan by giving a new note for that amount. As collateral for the payment of this note, he deposited with the defendant a number of shares of stock in various corporations. The note bore interest at five per cent., was payable in three months, and contained the following provision: On April 1, 1932, at the request of the defendant, the plaintiff paid $500 on the note, thereby reducing it to $5000. On the same date the defendant released to the plaintiff forty shares of the common stock of ‘ Electric Bond and Share’ which were among the shares of stock originally pledged, and the plaintiff pledged with the defendant fifty shares of ‘ United Corporation’ standing in the name of his wife, together with a power of attorney signed by her in blank. On that date the market value of the collateral pledged by the plaintiff exceeded $6500, the amount to which the plaintiff was required to maintain his collateral under the pledge agreement contained in the note. On April 6, 1932, the plaintiff received a letter from the defendant requesting him to furnish $800 additional security by noon of April 7, 1932. On April 6, 1932, the stocks held by the defendant in pledge as security for the note of the plaintiff had a market value of $5841.38. On April 7, 1932, at the opening of the stock exchange, these stocks had a market value of $6131.88, and at the close on that day $5830.13. No additional collateral was deposited by the plaintiff with the defendant by noon of April 7, 1932. On the morning of April 8, 1932, the assistant treasurer of the defendant, one Roe, visited the plaintiff at his office. There was conflict in the testimony as to what was said and done at that interview. The trial judge found that Roe informed the plaintiff that the defendant was about to sell the pledged securities. The plaintiff asked him to refrain from taking that course and offered to him as additional security certain shares of stock which he had procured and which were of sufficient market value, if accepted and added to the collateral then held by the defendant, to make the total value in excess of $6500. Roe refused to accept these additional shares, returned to the banking quarters of the defendant, and proceeded to sell the shares of stock held by the defendant as collateral for the note. On April 12, 1932, the plaintiff was informed by the defendant that it had sold the collateral. Remittance was made to him of the balance due from such sale after payment of the note. On the same day the plaintiff remonstrated with officers of the defendant concerning the sale of the securities.
It was agreed that the total market value of the collateral sold by the defendant was less than $5000 on May 31, 1932, and on June 15, 1932, the due date of the note, and that the market value of the additional securities offered by the plaintiff was less on each of those dates than it was on April 8, 1932. The trial judge found that, if the additional securities offered by the plaintiff on April 8, 1932, had been accepted by the defendant, the total value of all the collateral would have been $6574.88, or slightly more than the $6500 then required. He concluded that the defendant was not warranted in refusing to accept these additional securities and that the sale of the collateral was illegal as to the plaintiff.
A main issue is whether the plaintiff was in default under his agreement with the defendant at the time of the sale of the securities. Neither the record nor the argument of the plaintiff discloses any contention that the sale was not properly conducted, or that there was not compliance with all preliminary requirements, provided the defendant had authority to sell the securities when it did.
The rights of the parties depend upon the terms of the pledge agreement signed by the plaintiff and delivered to the defendant. Fay v. Gray, 124 Mass. 500, 502; Whitman v. Boston Terminal Refrigerating Co., 233 Mass. 386, 389, 124 N.E. 43; Palmer v. Mutual Life Ins. Co. of New York, 114 Minn. 1, 8, 130 N.W. 250, Ann.Cas.1912B, 957.
The plaintiff contends that under the terms of the pledge agreement he was not in default at the time the collateral was sold. That contention rests upon the meaning which he urges ought to be attached to the requirement that, after the pledged securities had fallen below the thirty per cent margin ‘ immediately’ additional securities should be deposited. He contends that he had a reasonable time within which to make such deposit. The word ‘ immediately,’ like most other words, has no inflexible import. It has a relative signification. It must be interpreted in connection with its context and all attendant conditions. Everson v. General Accident Ins. Co., 202 Mass. 169, 174, 88 N.E. 658; Rhoades v. Cotton, 90 Me. 453, 38 A. 367. When used in policies of insurance to describe the time within which certain notices must be given to the insurer, it imposes on the insured an obligation to use nothing less than due diligence to act with reasonable promptness in all the circumstances. Friedman v. Orient Ins. Co., 278 Mass. 596, 599, 180 N.E. 617; Wilcox v. Massachusetts Protective Association, Inc., 266 Mass. 230, 237, 165 N.E. 429; Wainer v. Weiner, 288 Mass. 250, 192 N.E. 497. In conjunction with other factors it may require a different construction. One of its primary meanings is that action must be taken or an event come to pass instantly, without any delay, or without interval of time. It is used in this sense in that part of the ...
To continue reading
Request your trial