Ramsay v. Miller

• Decision Date: 25 April 1911
• Citation: 202 N.Y. 72,95 N.E. 35
• Parties: RAMSAY v. MILLER et al.
• Court: New York Court of Appeals Court of Appeals

202 N.Y. 72

95 N.E. 35

RAMSAY

v.MILLER et al.

Court of Appeals of New York.

April 25, 1911.

Appeal from Supreme Court, Appellate Division, First Department.

Action by Arthur T. Ramsay against Abraham P. Miller and others. From a judgment of the Appellate Division, First Department (135 App. Div. 503,120 N. Y. Supp. 523), affirming a judgment entered on a directed verdict for plaintiff, defendants appeal. Reversed.Benjamin N. Cardozo, for appellant.

William W. Mumford, for respondent.

CULLEN, C. J.

[1] The defendants were stockbrokers in the city of New York, having a branch office in Washington, of which one Ludwig was the manager. In January, 1907, the plaintiff commenced to speculate in stocks through the Washington branch, depositing the sum of $1,000 to which were subsequently added the further sums of $3,000 and $2,000. On July 6th the plaintiff ordered the sale of all the stocks the defendants were carrying for him, and that his account be closed. On the 8th he received a message from Ludwig's wife stating that Ludwig was at home ill, and the plaintiff went to see him. Ludwig then told the plaintiff that his money was all gone, that he, Ludwig, had not given the defendants orders for the purchase of the stock the plaintiff had ordered, but for other stocks not directed by the plaintiff, and then said to the plaintiff: ‘If you will just be quiet and will not do anything about it, I will readjust this matter, and pay you your money.’ Ludwig's wife said to the plaintiff: ‘Mr. Ramsay, this house belongs to me, and you know that it is worth $4,000 or $5,000, and I will deed it to you to pay back the money that has been wrongfully used of yours.’ She also said that her brother had money, and she would send for him and they would adjust this matter. Finally, the plaintiff told Ludwig that he would wait for an adjustment to be made. On cross-examination he testified that Ludwig and his wife stated to him that, if he would be quiet and would not do anything about it, Ludwig would adjust the matter and save the plaintiff his money, and that the plaintiff told Ludwig that he would keep quiet if he would adjust the matter, as he promised. Ludwig subsequently gave to the plaintiff as security a policy of life insurance and also some shares of mining stock. These were returned to Ludwig in the winter of 1907, or in the early part of 1908. After this conversation, the plaintiff did not tell the defendants anything about the transaction until November 8, 1907, when he first communicated with the defendants about the wrong that Ludwig had done, and this action was commenced on February 5, 1908. The answer of the defendants was to the effect that the plaintiff's deposit had been exhausted except a balance of $11.02 by losses on purchases and sales made for his account, and by payments made to him of money. The defendants rendered the plaintiff a statement of his accounts showing the various transactions which they claimed to have been effected on his behalf. This account the plaintiff repudiated. On the trial it was proved by the plaintiff's testimony, which was not contradicted, that nearly all the purchases and sales assumed to be made by the defendants on his account were not authorized by him, but ordered by Ludwig without the plaintiff's authority. Excluding the unauthorized transactions, the balance due the plaintiff was the sum of $5,860 and interest. Of the items charged against the plaintiff in defendants' account $1,950 was drawn by Ludwig, by his checks as manager, on the defendants' bank account in Washington and appropriated to his own use. The defendants, after having requested the direction of a verdict against them for the balance of $11.02, which was denied, asked the court to submit the case to the jury on the question of ratification. This request was also denied, to which the defendants excepted, and the court directed a verdict in the plaintiff's favor for the full amount claimed and interest.

The question in this case is, Was the evidence sufficient to require the submission to the jury of the question whether the plaintiff had not ratified Ludwig's unauthorized orders for the purchase and sale of stocks? As to the $1,950 drawn by Ludwig from defendants' bank account and...