Court Opinion

ID: 3987063
Source: CourtListenerOpinion
Date Created: 2016-07-06 10:43:09.195527+00
Date Added: 2024-06-11T07:43:59.638950
License: Public Domain

I concur. I recognize that the pleadings in this case present considerable difficulties and perhaps require what appears to be a devious course in arriving at the correct result.
It seems to me clear that plaintiff was not only a creditor, but a creditor entitled to participate in a variable fund; it was entitled to have applied to its indebtedness, in the order of filing of withdrawals, part of the moneys which fed this fund; and it is not now disputed that the fund was sufficient to liquidate at par plaintiff's certificate on July 1, 1933, when plaintiff was the owner of the certificate and requesting that it be paid.
While a creditor and debtor may deal at arm's length, and the debtor in the open market may buy in certificates of indebtedness, such as bonds, if it does not deliberately depress the market for that purpose, it always owes its creditor correct information as to the status of a fund to which his indebtedness may resort; and in this case it is not now disputed by the parties that the defendant company furnished plaintiff, owner of a matured certificate in defendant company, with information relied upon by plaintiff which upon subsequent investigation was shown to be incorrect and untrue.
Plaintiff alleged that the action taken in this case by defendant, including the giving of misinformation and the *Page 126 
subsequent acquisition of plaintiff's certificate by means of an undisclosed agent, was part of a plan purposely designed to accomplish the result of depressing the market, discouraging plaintiff, by misleading it into thinking that its turn had not come to liquidate an obligation from the fund available for that purpose, resulting in inducing plaintiff to part with its indicia of indebtedness for one-half of what the debtor was at that time under obligation to pay and able to pay. If this were the case, it presents a plain case of overreaching. We need go no further. A principle quite ultimate has been violated. A debtor so actively misleading the creditor to the benefit of the one and the detriment of the other would be violating a most fundamental legal concept and one which reaches back to the moral law crystallized in the Ten Commandments.
The trial court before which the facts of this case were fully presented found these issues against plaintiff, and that there was no scheme or intention on the part of defendant to misstate facts or defraud plaintiff. The fact remains, however, that defendant did furnish to plaintiff information vitally important to plaintiff under the circumstances, which information proved to be incorrect and untrue, and there resulted a substantial loss to plaintiff which ultimately accrued to defendant when it acquired the indicia of indebtedness from plaintiff. Under such circumstances, even though the result came from an innocent or careless impartation of information followed by the subsequent acquisition of plaintiff's certificate and not from a deliberate design on the part of the defendant, the defendant debtor cannot profit from his creditor. For restitution of this loss was the complaint filed, and such restitution do we decree. *Page 127