Eulette v. Merrill Lynch, Pierce, Fenner and Beane

• Decision Date: 25 March 1958
• Docket Number: No. 57-344,57-344
• Citation: 101 So.2d 603
• Parties: Kenneth Kasper EULETTE, a/k/a Kaspar Eulette, Appellant, v. Merrill LYNCH, Pierce, Fenner and Beane, a partnership doing business in the State of Florida, Appellee.
• Court: Florida District Court of Appeals

Page 603

101 So.2d 603

Kenneth Kasper EULETTE, a/k/a Kaspar Eulette, Appellant, v. Merrill LYNCH, Pierce, Fenner and Beane, a partnership doing business in the State of Florida, Appellee.

No. 57-344.

District Court of Appeal of Florida, Third District.

March 25, 1958.

Rehearing Denied April 16, 1958.

Ward & Ward, and Dunn & Hickey, Miami, for appellant.

Worley, Gautier & Dawes, Miami, for appellee.

HORTON, Judge.

In 1932 and 1936, Otto Kaspar purchased stocks in various industrial corporations and caused the certificates representing said shares to be placed in the name of his grandson, Kaspar Eulette. These certificates represented 83 shares of stock. An additional certificate representing 250 shares of Autopoint Company stock was purchased by him in the following name: 'Otto Kaspar, Trustee for Kaspar Eulette'. At the time the various stocks were purchased, Kaspar Eulette was a minor. In a proceeding in the Circuit Court for Dade County, Florida, in 1947, Marion Eulette, the mother and next friend of Kaspar Eulette, a minor, obtained a declaratory decree adjudicating that the certificate representing 250 shares of stock of Autopoint Company purchased by Otto Kaspar, Trustee for Kaspar Eulette, was in truth and in fact the property of Kaspar Eulette and appointing her as successor trustee in the place and stead of Otto Kaspar who had passed away in 1944.

During his lifetime, Otto Kaspar apparently held physical possession of the stock, received the dividends therefrom and to all intents and purposes exercised exclusive dominion and control over said stocks. Kaspar Eulette reached his majority in October, 1948. In addition to the knowledge imparted to him by his mother when she obtained the declaratory decree in 1947, he had been advised by his grandfather that he, Otto Kaspar, held certain stocks in the name of Kaspar Eulette. This latter disclosure apparently was made when the grandson interrogated his grandfather regarding certain letters that came to the home addressed to Kaspar Eulette. After the death of Otto Kaspar, the stock apparently was either in the physical possession of the wife of Otto Kaspar and/or the mother of Kaspar Eulette, and the dividends from these stocks during that time apparently were used by Otto Kaspar's wife or the mother of Kaspar Eulette. There was no probate of the estate of Otto Kaspar.

The bill of complaint brought by Kaspar Eulette alleges in substance that he was the owner of the aforesaid stock, and that on October 10, 1949 and January 14, 1952, the defendant, a stock brokerage firm, without his knowledge or consent, sold these stocks; that the signatures appearing on the endorsements of the stock certificates were forgeries and that no one was authorized to sign his name. It is further alleged that checks in the sums of $6,014.94 and $5,749.22 respectively were issued in the name of Kaspar Eulette by the defendant-brokerage firm but that he, Kaspar Eulette, had never received the proceeds of said checks or any part thereof and that the signatures appearing thereon as his endorsement were in fact forgeries. It was also charged that in the negotiation of the stocks, the brokerage firm guaranteed the signatures of Kaspar Eulette appearing on the endorsements of the stock certificates as being genuine when in fact they were foregeries. The complaint sought an accounting of the transactions involving the sale of the stocks and a decree that Kaspar Eulette should be awarded the value of the stocks, including interest, as a result of the aforesaid actions of the defendant-brokerage firm.

The defendant denied in substance the material allegations of the complaint and affirmatively alleged that Kaspar Eulette was not the legal owner of the stock certificates in question or that he had ever acquired ownership or possession of said certificates. The appellee admitted the delivery of the certificates of stock to it; that instructions to sell were given and that the stocks were sold and the proceeds transmitted as directed by the individuals delivering the stocks to it. The affirmative defenses of the statute of limitations and laches were also urged by the defendant in its answer.

The cause was referred to a special master in chancery who heard the witnesses, received the evidence submitted by the respective parties and filed a report in which, inter alia, he recommended that the court require the defendant-broker to pay Eulette the sum of $25,780.25 which represented the full value of the shares plus dividends and interest. Exceptions were filed to the master's report which were sustained by the chancellor, who thereupon entered a final decree from which this appeal was taken. The lower court by its decree found the equities to be with the appellee, as the appellant had failed to establish ownership of the stock, and further, that he had been guilty of laches and thus dismissed the complaint with prejudice.

At the time of the institution of this suit, both Mrs. Mayme Kaspar, the appellant's grandmother, and Marion Eulette, the appellant's mother, had died. There was no probate of the estate of Mrs. Mayme Kaspar and the time for the filing of creditors' claims in the estate of Marion Eulette had expired.

Both parties concede that the signatures appearing on the various stock certificates, purporting to be that of the appellant, were...