Source: http://masscases.com/cases/sjc/299/299mass523.html
Timestamp: 2019-04-18 14:57:03+00:00

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INDEMNITY INSURANCE COMPANY OF NORTH AMERICA vs. ERNEST G. PAIGE.
to whom by his authority and that of the pledgee the securities had been delivered for sale with directions to account to the pledgee.
Negligence of an employee of a stockbroker in the payment of money to the wrong person by mistake of fact did not preclude recovery of the money by the stockbroker where nothing occurred after the payment in the way of a change in the position of the one who received the money which rendered recovery unconscientious.
CONTRACT. Writ in the District Court of East Norfolk dated July 1, 1935.
The Appellate Division for the Southern District ordered dismissed a report by Mulhall, J., who found for the plaintiff in the sum of $2,623.11 and interest. The defendant appealed.
M. H. Goldman, (S. Fishman with him,) for the defendant.
M. Jenckes, for the plaintiff.
FIELD, J. This action of contract was brought in a district court to recover money paid by the plaintiff's assignor, Elmer H. Bright and Company, to the defendant. The declaration is in two counts, the second count having been added by motion allowed at the trial at the close of the evidence and amended by motion allowed by the Appellate Division. The trial judge denied certain so called requests for rulings made by the defendant and made certain so called rulings requested by the plaintiff, made special findings of fact and found for the plaintiff. There was a report to the Appellate Division which was dismissed. The defendant's contentions are directed to the allowance of the amendment of the declaration at the trial, the admissions and the exclusions of evidence and the denial of the requests for rulings made by him.
Banks v. Chase Securities Corp. 298 Mass. 285, 290. In accordance with these principles the finding for the plaintiff was warranted.
The transaction in outline, as the evidence tends to show and the trial judge in substance found, was as follows: The defendant was indebted to the Granite Trust Company -- herein referred to as the bank -- in the sum of $2,430 on three notes, one for $1,450 due November 7, 1934, one for $800 due November 9, 1934, and one for $180 due later. The first two notes were secured by pledge of securities owned by the defendant, the third was secured otherwise. On November 5, 1934, certain of the pledged securities were delivered to Elmer H. Bright and Company -- herein referred to as the brokers. These securities were sold and the proceeds of the sale (or sales) amounted to $2,623.11 and $310.18. On November 7, 1934, the brokers gave the defendant a check for $2,623.11. This check was collected by him. On November 9, 1934, the brokers paid to the bank the sum of $2,623.11 and "also the balance of the proceeds of the sale of $310.18." Thereafter the bank settled its account with the defendant, delivered to him the notes as paid and discharged, and also delivered to him the unsold securities which had been pledged. The brokers' assignee brings this action to recover from the defendant the sum of $2,623.11, the amount paid to him, as above stated, on the ground that the payment was made by mistake.
findings of fact, as such, are not reviewable on this appeal. Woodman v. Haynes, 289 Mass. 114, 116.
According to warranted special findings the bank was authorized by the defendant to deliver the pledged securities in question to the brokers to be sold by them for the purpose of "liquidating" obligations of the defendant to the bank, and the bank made such delivery, receiving a receipt for the securities running to it, and instructed the manager of the brokers' Quincy office to pay the proceeds of the sale of the securities to the bank, which the manager agreed to do. The conclusion follows from these facts that it was the duty of the brokers to make such payment to the bank -- and not to the defendant -- whether or not, as to third persons, the bank lost its lien on the securities by delivering them to the brokers. See, however, Kellogg v. Tompson, 142 Mass. 76, 79. This conclusion is not inconsistent with the special finding that the defendant "advised the bank that he had notified Elmer H. Bright & Co. about the sale of his stocks, and he wanted to deliver the stock personally to Bright but the bank refused to allow him to do so." Evidence contrary to this conclusion and to the special findings could have been disbelieved. Furthermore, from these findings it could have been inferred that the defendant knew that he was not entitled to receive from the brokers the proceeds of the sale of the securities.
employees. The defendant accepted and cashed the check . . . and he knew that he was neither legally nor morally entitled to the same, and he also knew that he was committing a fraud on Bright & Co."
which renders it unconscientious to recover the money back," because of change in the defendant's position. Appleton Bank v. McGilvray, 4 Gray 518, 523. See also Quimby v. Carr, 7 Allen 417, 419; Merchants' National Bank v. National Eagle Bank, 101 Mass. 281, 285; Worcester North Savings Institution v. Farwell, 292 Mass. 568, 574.
2. The denial of the other so called requests for rulings made by the defendant was not error. They need not be discussed separately. Some of the requests were for findings of fact which, even if warranted by the evidence, the judge was not required to make. Other requests were for rulings which stated the law incorrectly or were rendered immaterial by special findings. Nor was there prejudicial error in the admission or exclusion of evidence. And no question with respect to the propriety of the allowance of the amendment of the declaration at the trial is reported so as to be before us for decision. Woodman v. Haynes, 289 Mass. 114, 116. See, however, G. L. (Ter. Ed.) c. 231, §§ 51, 141; Bucholz v. Green Bros. Co. 290 Mass. 350, 354. Nor is any other question relating to the pleadings presented by the report. No one of the rulings requested was based upon the pleadings. Pacheco v. Medeiros, 292 Mass. 416, 419.

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