Larsson v. Metropolitan Stock Exch.

• Decision Date: 05 January 1909
• Parties: LARSSON v. METROPOLITAN STOCK EXCH.
• Court: United States State Supreme Judicial Court of Massachusetts Supreme Court

200 Mass. 367

86 N.E. 940

LARSSON v. METROPOLITAN STOCK EXCH.

Supreme Judicial Court of Massachusetts, Suffolk.

January 5, 1909

Jan. 5 1909.

COUNSEL

E. S Crockett and Stebbins,

Storer & Burbank, for plaintiff.

I. R Clark and G. F. Ordway, for defendant.

OPINION

KNOWLTON C.J.

The only important question in this case is whether there was evidence to warrant the finding that the releases from the plaintiff, relied on by the defendant, were procured by fraud.

The action was brought, under Rev. Laws, c. 99, §§ 4-6, to recover money alleged to have been paid by the plaintiff to the defendant as margins upon purchases and sales of stocks. It is conceded that the plaintiff's case would be made out except for releases given by him to the defendant, covering the transactions relied on. The form of the releases is as follows:

'Boston, -----, 190-.

'Received of the Metropolitan Stock Exchange ----- dollars, in full of all demands under within contract, and I hereby release and discharge the Metropolitan Stock Exchange, its officers, agents and servants and each of them therefrom, and also from any and all right of action, claim or demand under or by virtue of chapter 99 of the Revised Laws of Massachusetts, or any amendment thereof, for any payment at any time heretofore made, or value or anything at any time heretofore delivered, either on within or any other contract or transaction whatever, and I covenant never to sue therefor, them or either or any of them.

'Witness my hand and seal the day and year above written.

'$-----.

--------. [L. S.]'

These releases were given in connection with the settlement of particular transactions between the parties.

The business of the parties was done under contracts on printed blanks issued by the defendant to the plaintiff, in one form of which the defendant offered to deliver to the plaintiff certain stock, at a stated price, and the plaintiff agreed to receive it, or, upon the surrender of the contract by mutual consent the defendant was to pay the plaintiff a sum equal to the then advance in the market price of the stock. There were stipulations as to deposits, and other terms of the contract, with columns for entries, headed 'Margin,' 'Accountant's Signature,' 'Date of Deposit,' and 'Stock Order Limit.' Another from of contract was similar, except that in it the defendant promised to receive from the plaintiff certain stock at a stated price.

When the plaintiff desired to close the contract in one of these transactions the business was done in this way: The plaintiff applied to the cashier, who stood behind a small window with a little shelf 18 inches wide in front of it, and told him he wanted to close the contract. After figuring the amount due him from his deposit, increased or diminished by the rise or fall in the price of the stock, the cashier placed the contract on the shelf at the window, with a receipt in the form quoted above on the back, in which the amount due the plaintiff was plainly written after the words, 'Received of the Metropolitan Stock Exchange,' and the same amount was plainly expressed in figures at the bottom, opposite the space for the plaintiff's signature. The body of the release, comprising all but the date and amount, was stamped on the back of the contract with a rubber stamp, in quite fine print, portions of which were very dim, and almost if not quite illegible to persons whose sight was not very keen. This was put before the plaintiff on the shelf for him to sign, and, upon his signing it, the amount of money named in it was paid him and the paper was retained by the cashier. The plaintiff testified that he only had the paper before him a moment, to sign, and did not read the release, but 'supposed he was signing it for the money he got.' The rubber stamp was put on the contract after the plaintiff asked to close it. He testified that he had to wait a while before they were ready for his signature, sometimes as long as 10 minutes. He said that when he went to the window and wanted his money, the cashier would put the paper 'out that way (illustrating by laying one of the contracts down on the shelf before him with his hand resting on it and covering part of the matter stamped thereon) for him to sign his name and he would get the money if he signed his name.'

The court instructed the jury 'that fraud is not mere misunderstanding, that it was not enough that...