Shattuck v. American Cement Co.
| Decision Date | 23 March 1903 |
| Docket Number | 243 |
| Citation | 205 Pa. 197,54 A. 785 |
| Parties | Shattuck v. American Cement Company, Appellant |
| Court | Pennsylvania Supreme Court |
Argued January 13, 1903 [Copyrighted Material Omitted]
Appeal, No. 243, Jan. T., 1902, by defendant, from judgment of C.P. No. 2, Phila. Co., Dec. T., 1899, No. 216, on case stated in case of Frank R. Shattuck v. American Cement Company. Reversed.
Case stated to determine the validity of transfer of stock.
The case stated was as follows:
On September 7, 1899, plaintiff purchased from Jamison Brothers & Company 1,500 shares of the stock of the American Cement Company, being certificates Nos. 483 to 491, inclusive, and Nos. 503 to 508, inclusive, making in all fifteen certificates for 100 shares each, each certificate being in form as follows:
100 Shares.
These certificates were in the name of Jamison Brothers & Company, and contained upon the back a blank assignment and power of attorney, in the following form:
Each blank assignment and power to transfer was signed by Jamison Brothers & Company, and the certificates of stock, with the power of attorney and assignment thereon, so executed in blank by Jamison Brothers & Company, were delivered by them to the plaintiff.
Plaintiff had been in the habit of transacting business with the firm of Stahl & Straub, of Philadelphia, who were bankers and brokers, having an office at No. 505 Chestnut street, in the city of Philadelphia, the said firm being composed of Gustav Stahl and Joseph H. Straub. Plaintiff was attorney for the said firm, as well as a customer, and there was in the safe of Stahl & Straub, in their office, a large pocketbook or wallet, in which they were in the habit of keeping securities which belonged to their customers, and in this wallet was a large envelope, marked with the name of plaintiff, and in that envelope were a number of shares of stock and other securities which belonged to plaintiff and other persons, and which were kept there in the course of business for safety.
On September 7, 1899, plaintiff having the fifteen certificates of stock in the American Cement Company above mentioned in his possession, while passing the office or place of business of said Stahl & Straub, stopped there and handed the fifteen certificates of stock to a clerk in the office named Justus Straub, and instructed him to put the fifteen certificates of stock with the other securities belonging to plaintiff, and the said Justus Straub did then and there place the securities in the envelope marked with plaintiff's name which was in the wallet or pocketbook which was in the safe in the office of the said Stahl & Straub.
That no written or verbal authority was given by plaintiff to said firm of Stahl & Straub, or to either of the members thereof, or to any other person whomsoever, to use the said certificates of stock or transfer the same or take possession of the same in any way, manner, or form for any purpose whatsoever; and neither was any written nor verbal authority given by plaintiff to Stahl & Straub authorizing them to sell the same at any price or to make delivery of the same to any person; and they had no right, title or interest therein, nor any person any title or interest therein except the plaintiff herein, Frank R. Shattuck.
That Gustav Stahl, one of the partners in the said firm of Stahl & Straub, on September, 12, 1899, without the knowledge or consent of his copartner, Joseph H. Straub, or of the plaintiff, removed the said fifteen certificates of stock from the envelope in which they had been placed, and without any authority whatever from any person took ten of the said certificates of stock, to wit: certificates Nos. 483 to 490, inclusive, and certificates Nos. 507 and 508, each being for 100 shares, and amounting altogether to 1,000 shares, and removed the same from the said envelope without any authority whatever to do so, and without the knowledge and consent of his copartner, Joseph H. Straub, and delivered the same to the Corn Exchange National Bank, who thereupon made a loan to the said Gustav Stahl of $7,000, in the name of Stahl & Straub, upon the security of said shares, repayable on demand, with interest, and received from said Gustav Stahl the said ten certificates of stock assigned in blank by Jamison Bros. & Company. This loan was made by the bank in good faith in the regular course of business, without any notice of the right, title or interest of the plaintiff in the shares, and the said certificates were in nowise pledged to secure the payment of any antecedent indebtedness.
On December 26, 1899, default having been made in the payment of the said sum of $7,000 and interest, the said Corn Exchange National Bank, through Chandler Bros. & Company, brokers, sold 200 of the said shares at the Philadelphia Stock Exchange, for the sum of $8.00 a share, to Charles D. Barney & Company; and on December 28, 1899, at the same place, sold 800 more of the said shares to Edward B. Smith & Company, for the price of $8.00 per share.
That the plaintiff herein having ascertained, on December 27, 1899, that his certificates had disappeared, sent a note to the defendant company, of which the following is a copy:
In response to this letter said defendant company, under date of December 28, 1899, wrote to the plaintiff as follows:
And, under date of December 29, 1899, plaintiff replied in a letter addressed to Henry C. Boyer, Esq., of which the following is a copy:
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