Wolff v. Campbell

• Citation: 110 Mo. 114,19 S.W. 622
• Parties: WOLFF v. CAMPBELL.
• Decision Date: 23 May 1892
• Court: United States State Supreme Court of Missouri

19 S.W. 622

110 Mo. 114

WOLFF v. CAMPBELL.

Supreme Court of Missouri, Division No. 1.

May 23, 1892.

CUSTOM — WHEN MAY BE PROVEN — DIRECTION OF VERDICT.

1. Where a broker represents that he has certain stock in his possession, when in fact he has no such stock, and a sale is closed on the faith of this representation, in an action to recover the price paid, evidence of a custom among brokers to sell stock in their own name, and to become personally liable to perform the contract, is inadmissible.

2. It is not error to direct a verdict for a party, where the case, as made by the pleadings and certain written instruments, shows the said party to be entitled to judgment, and there is nothing in the parol evidence having the least tendency to show anything different.

Appeal from St. Louis circuit court; LEROY B. VALLIANT, Judge.

This was a suit by Marcus A. Wolff against James Campbell. Judgment for plaintiff. Defendant appeals. Affirmed.

John H. Overall and Silver & Brown, for appellant. Leverett Bell, for respondent.

BLACK, J.

Marcus A. Wolff brought this suit against James Campbell to recover $2,500 and interest. The facts, which are not disputed, are: The plaintiff is a real-estate agent, and the defendant a dealer and broker in notes and other securities. On the 20th October, 1887, defendant called at plaintiff's office, and offered to sell 25 shares of stock of the Fifth National Bank of St. Louis. After some negotiations, the plaintiff agreed to take the stock at par, and give his note therefor for $2,500, due at 90 days, the note to be secured by the stock. No particular shares were mentioned, nor did defendant state that he was acting as broker for any other person. On the 31st October, 1887, the defendant sent a messenger boy to the plaintiff's office with a note. The plaintiff at that time signed the note, thereby promising to pay to the defendant or order the sum of $2,500 in 90 days, with interest from date. At the same time plaintiff executed a writing to defendant pledging the shares of stock to defendant as collateral security for the note. There was also delivered to the plaintiff at the same time a receipt, signed by the defendant, whereby he acknowledged that he held 25 shares of stock, to be delivered to plaintiff on payment of the note. The plaintiff retained the receipt, and delivered to the messenger boy the note and agreement pledging the stock. No certificates were then produced or attached to the note. Subsequent events disclosed the fact that the defendant did not then own or have the stock in his possession, nor did he disclose the fact that he had no stock to the plaintiff. The bank failed in seven or eight days after the date of the note, and the stock then became worthless. A few days before the note matured, to wit, on the 26th January, 1888, the defendant borrowed 10 shares of stock from one person, and 15 from another, giving them his receipts therefor, and stating therein that the stock was "to be returned on demand." He then attached the certificates for the stock thus borrowed to the note, and sold the note to a Mr. Trash for a valuable consideration. Trash sued plaintiff on the note, and recovered judgment, which plaintiff paid, and then commenced this suit to recover back the money so paid on the judgment. The plaintiff avers in his petition that defendant represented that he held 25 shares of stock, and could and would deliver the same to plaintiff in consideration of the latter's note; that, relying upon such representations, he accepted the offer, and was thereby induced to execute to defendant his note and the writing pledging the stock, and to accept the defendant's receipt for the stock as held as collateral security for the note; that such representations were false and fraudulent; and that the defendant had and held no stock. The answer of the defendant admits the sale of the stock, and the execution of the note and other papers, but denies that any representations made by him were false. He then avers that he was a banker and broker engaged in buying and selling bonds and other securities for his customers; that pursuant to a custom, well established and known to the plaintiff, he uniformly sold and purchased in his own name, without disclosing the name of the person for whom he acted; that he sold the stock to plaintiff in accordance with that custom, to be delivered to plaintiff on payment of the note; that his customer, for whom he sold the stock referred to, accepted the terms of sale, whereby, according to the custom, defendant became personally liable for the performance of the contract; and that he was ready and willing and offered to deliver the stock according to the contract. On motion of the plaintiff, the court struck out the averments of the answer concerning the alleged custom, to which ruling the defendant excepted. Plaintiff denied the other averments of the answer setting up new matter. Plaintiff produced considerable evidence, including the deposition of the defendant. This evidence discloses the facts before stated, most of which were admitted by the pleadings. The only real issue in the case was as to the alleged false representations. As bearing on this issue, the plaintiff testified that defendant came to his...