Kurth v. Maier.
| Citation | 31 A.2d 835 |
| Decision Date | 30 April 1943 |
| Docket Number | No. 217.,217. |
| Parties | KURTH v. MAIER. |
| Court | New Jersey Supreme Court |
OPINION TEXT STARTS HERE
Appeal from Court of Chancery.
Suit by Herman Kurth against Arthur Maier for an accounting and other relief. From an order denying defendant's motion to strike out the bill of complaint, defendant appeals.
Reversed.
Laurence Semel, of Newark, for appellant.
Paul M. Strack, of Newark, for respondent.
This is an appeal from an order denying defendant's motion to strike out the bill of complaint. The reason advanced in support of the motion was that the complainant had an adequate remedy at law. The learned Vice-Chancellor, conceiving that the bill of complaint ‘sets forth a joint venture,’ etc., retained the bill. We proceed to examine the bill of complaint.
Its allegations are that in 1933 the complainant purchased, on margin, 100 shares of preferred stock in a corporation known as Warren Brothers; that the market price of the stock declined and the complainant, Mr. Kurth, was required to supply additional money or to sell out the account; that in order to acquire the stock outright complainant borrowed money from the defendant and between them it was orally agreed that the stock be pledged to the defendant as collateral for the loan; that the defendant transfer the stock to his own margin account carried on with another broker for the purpose of strengthening that account; that the stock should remain the property of the complainant. It was also agreed that complainant's stock would not be sold without complainant's permission and that it would be returned to the complainant by the defendant upon the payment of the debt with interest; further, that should the defendant's position on margin with his own broker become imperiled the complainant's stock was not to be sold but rather defendant would dispose of all his own securities and that, in the event that a swift decline in the market should necessitate the sale of all the securities in the defendant's account (including the complainant's) the defendant would reimburse the complainant for his equity in the stock pledged. The bill then alleges that complainant repaid the loan in full and made demand on the defendant for the return of the 100 shares of stock. The final installment on the loan was paid on June 30, 1940. The defendant refused to return the stock and then admitted he had sold fifty shares of it, at a low figure, in May, 1940. Repeated demands were made by complinant for the return of the entire lot of the stock. Defendant countered by offering to return the fifty unsold shares plus the amount of money realized from the sale of the balance of the stock in May, 1940. Complainant had paid $28 a share for the stock. The fifty shares sold by defendant brought a price of five and one-eighth dollars per share. At the time of the filing of the bill (Aug. 4, 1942) the stock was selling on the Exchange at $23.50 a share. To these allegations complainant adds that he has no adequate remedy at law and prays that the defendant account and ‘be ordered and decreed to deliver to complainant forthwith one hundred shares of...
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