Thompson Bros. v. Cummings & Co

• Decision Date: 30 September 1881
• Citation: 68 Ga. 124
• Court: Georgia Supreme Court
• Parties: Thompson Brothers et al. vs. Cummings & Co.

68 Ga. 124

Thompson Brothers et al. vs. Cummings & Co.

Supreme Court of the State of Georgia

SEPTEMBER TERM, 1881.

Contracts. Cotton Futures. Principal and Agent. Actions. Before Judge Stewart. Newton Superior Court. March Term, 1881.

Reported in the decision.

A. B. Simms, for plaintiffs in error.

Clark & Pace, for defendants.

Crawford, Justice.

This suit originated on a sight draft for $364.95, drawn by Thompson Bros., on Swnan & Stewart, December 12th, 1879, which they refused to pay, and Cummings & Co. sued them and Thompson Bros., the drawers.

The defence set up to this suit was—

(1.) That the draft was drawn to pay the losses upon the purchase of cotton "futures" from the plaintiffs, both parties knowing that there was no cotton held by either, and that the same was nothing but a mere speculation upon chances.

(2.) Defendants further pleaded that the plaintiffs received and were indebted to the drawers the sum of $478.76, which they had put up as a margin in the hands of the plaintiffs to cover losses in the event of a decline in the price of cotton.

(3.) That John T. Thompson, the drawer of the draft sued upon, was intoxicated when the same was drawn, and that the said intoxication was procured by the plaintiffs.

It was also claimed on the argument that a plea of duress had been pleaded, but as none such as can be so held appears in the record, it cannot be considered.

Under the testimony and charge of the court the jury found a verdict for the plaintiffs for the full amount of their draft. The defendants claimed that they found contrary to evidence and contrary to law, and that they were therefore entitled to a new trial, which the court refused, and they excepted.

Whether this verdict was right or wrong, must be determined by the evidence.

1. The sale of cotton to be delivered at a future day, where both parties are aware that the seller expects to purchase himself to fulfill his contract, and no skill and labor or expense enters into the consideration, but the same is a pure speculation upon chances, is contrary to the policy of the law, and can be enforced by neither party. But where such a contract is executed, an agent who may be employed by his principal to make the contract, can recover from him any money he may have advanced in the transaction by his authority. 45 Ga., 501. Code, §2638.

That this was a transaction in what is known as "cotton futures " seems to be admitted; and besides, that as between the buyer and the seller, the law is settled that the whole contract would be void. This then leaves the naked question to be decided by the jury, were Cummings & Co. the agents or the principals in the transaction?

The defendant, J. T. Thompson, a member of the firm of Thompson Bros., testifies that he was the purchaser of the "cotton futures, " and bought them directly from Cummings & Co., and that they were not his agents to buy from others. That he bought from telegrams that were posted every hour on a blackboard in their office. That both himself and Cummings & Co. knew that there was no cotton held by either, that it was a speculation upon the price of cotton in the future. That he never expected any cotton to be delivered. That whenever a telegram was posted, they would say that customers must trade in ten minutes, or not at all, on that telegram.

H. E. Cummings, one of the plaintiffs, testified: "That in trading or selling futures in cotton J. F. Cummings & Co. required their customers to pay so much money on each bale as a margin, and if the cotton declined at any time after the contract or sale, sufficient...