Court Opinion

ID: 5215865
Source: CourtListenerOpinion
Date Created: 2022-01-06 16:22:53.779252+00
Date Added: 2024-06-11T08:27:26.340839
License: Public Domain

Kellogg, J.
(dissenting):
The judgment in this case is right, Defendant sold the stock to plaintiff January 19,. 1903, on which day he forwarded the application to the company. He received the stock from the company by letter dated January twenty-fourth, and immediately delivered it. Nothing was said in either letter about any agreement to take back the stock, and the defendant’s evidence shows that no such agreement was ever made with reference to this stock until two or three months after the sale. - He produces letter-press copies of letters to the Company, but is not able to produce any letters from the company bearing upon his authority. The company wrote him-February eighteenth, a month and nineteen days.before lie executed the guaranty in question, “ We do; not care to give any more guarantees on any stock.” ■ His own' evidence shows that they only permitted the guaranty in exceptional cases, and where actually necessary to make a sale. While he swears to many guaranties issued by him, *599a careful perusal of his testimony shows that most of the -guaranties he mentioned were made from the New York office, or were expressly authorized in each case. He wrote the company advising them to make the guaranties, and asking it to permit him to make them in his own name, and most of the guaranties he made were in fact in his own name and did not purport to bind the company.
The sale of stock in question was the first one to the plaintiff, and was made without any suggestion that there was to be a guaranty. The defendant says: “ The purchase of the stock was before the guarantee. I admit that part, but the guarantee was given two months after the stock was purchased and" paid for through the fact that this Vail matter had been brought to Mr. Sherman’s attention. While I cannot recollect all the details, as I recollect, he wanted to know ‘Mr. Vail has a guarantee, can’t I have a guarantee too from Daugherty & Albers ? ’ -1 said ‘ yes ’ that Albers had authorized me to give-guaran tees if I had to use them in the sale of stock. * * * I am just stating that Albers informed me that I had authority to make these guarantees. I gave this guarantee, as I recollect it, it was two months after the original stock was delivered at the suggestion of Mr. Sherman. I told him I had authority to give it and I gave it to him. I signed the agreement for Daugherty and Albers. It was delivered in Kingston. I forget whether I delivered it or Mr. Pultz. It was written by Pultz and I think it was signed in Kingston when he bought the second block of stock. I think the first and second agreement were given at the same time.” “ As I recollect the matter, this stock was purchased and paid for before anything was said about the guarantee. The guarantee was given two months later.”
After this sale was completed, and after the company had notified the defendant that it could not give any more guaranties, he made other sales of stock to the plaintiff, giving his personal guaranty, and in order to- help make these additional sales he gave the company’s guaranty to cover the former sale, which he concedes was made without guaranty.
The by-laws in evidence ¡prima facie negative the authority of the defendant to issue this guaranty. It cannot be implied from a power to make a sale, for the reason that it is no part of a sale where the agent gets ten per cent for making it, to have the *600principal agree to purchase back the property sold for the full purchase price at any time the purchaser may elect. It is a most extraordinary agreement, the authority to make which must appear,' as. the agreement itself is practically inconsistent with the terms of sale.
Viewing .the evidence most favorably to the defendant it shows that in several cases where he specially called the attention of the company to the transaction they reluctantly gave this guaranty. He gave many such guaranties in his own name, and apparently for the reason that the company would not make them, as he feared it AVould not. This sale to the plaintiff was made without any suggestion of guaranty, and was an absolute sale of the stock. He was permitted, if he could not sell the stock without the guaranty, to use it, and did use it in two or three cases. February eighteenth, before the guaranty Avas given, the company notified him it would give no further guaranties, and thereafter he gave guaranties in his own name, and about March, twenty-seventh thereafter did induce the sale of other stock to the plaintiff upon his guaranty, and at the plaintiff’s request he gave this guaranty to the plaintiff, saying that lie had authority to give it. He had no authority; whatever authority he had to give guaranties had been revoked; this sale had been made without guaranty, and there was never any authority in him to guarantee it. He was receiving ten per cent commissions on sales, and in order to make new sales under his own guaranty lie executed this guaranty in violation of his express instructions. It is immaterial, therefore, whether we take the plaintiff’s version or the defendant’s version of the transaction ; the guaranty was issued without authority and for his own benefit. The judgment should, therefore, be affirmed.
t/OOHEANE, J., concurred.. .
Judgment reversed on law and facts, referee discharged and new trial granted, with costs to appellant to abide event.