Court Opinion

ID: 6235734
Source: CourtListenerOpinion
Date Created: 2022-02-17 20:32:05.087594+00
Date Added: 2024-06-11T08:58:02.685907
License: Public Domain

Mr. Justice Gordon
delivered the opinion of the court,
We do not regard the acceptance by English, of the proposition made by the president of the company, in his letter of October 31st 1867, as the conclusion of a new contract, but rather the extension of the former arrangement. This previous undertaking contemplated the delivery to the plaintiff, on the 15th of June 1867, of the two hundred shares of Pennsylvania Railroad stock, •which the defendant had received as a loan from plaintiff on the 13th of the preceding April. There was no return made of these shares at the date indicated, and English was about to bring suit, when the proposition of the 31st of October was made and accepted.
Taking these two papers as one contract and we observe that it provides, generally, for the return of the stock, or its equivalent in money, on the 21st of September 1868; specialty, for payments in cash to be made from time to time, in all amounting to $10,000, the par value of two hundred shares, or if this sum was insufficient to “make good,” as the parties termed it, the said shares at the dates specified, the company undertook to pay as much more as would accomplish that object. If, on the other hand, the defendant chose to return the stock, at the time fixed by the contract, the plaintiff was required to refund the money which he had in the meantime received; finally, in case any one of the provisions of this contract was not complied with on the part of the company, English was at liberty to proceed with his suit at law.
Now, as these were independent contracting parties, bound to each other by no ties save those found in their contract, and as they by that contract, had, from the beginning, settled the compensation due English, in case of a failure to return the stock shares at the time fixed, why should we seek for any other rule of compensa*253tion than that fixed by themselves ? It is certain, had the company tendered to English the value of the shares in cash on the 21st of September 1868, he would have been obliged to receive it. On the other hand, in the absence of such tender, the plaintiff might have gone, upon that day, into the market and supplied himself with two hundred shares of the Pennsylvania Railroad Company’s stock, and have compelled the defendant to account for the price thereof. Thus, we take it, the rights of the parties were definitely fixed at the time when the breach occurred, just as would have been the case had the agreement been for the delivery of two hundred bushels of -wheat, or of any other articles of a marketable character.
It is obvious, therefore, that the court below erred in applying the rule stated in the case of The Bank v. Reese, 2 Casey 143, to the controversy in hand, since the contract itself carries it beyond the reach of that rule. Moreover that rule applies only where the parties bear to each other a trust relation. In Wilson v. Whitaker, 13 Wright 114, this court refused to adopt the above stated rule as applicable to stock contracts generally, and the learned judge who delivered the opinion in that case, whilst recognising the case of The Bank v. Reese as binding in all cases involving a trust, said, that the dicta, tending to carry the rule beyond the point stated, were not essential to the case, and were extra-judicial. A similar remark might well be made of the dicta in the case of Musgrave v. Beckendorff, 3 P. F; Smith 310, for there the plaintiff’s claim was based on an agreement for a return of the identical bonds loaned, and, as his property in them was not divested by the contract, it was a breach of trust in the defendant to sell or otherwise dispose of them; hence, as the above-stated rule might well apply on principle, the adoption of the extra-judicial dicta of The Bank v. Reese, was not necessary. Persch v. Quiggle, 7 P. F. Smith 247, was the case of an agent who had committed a breach of trust in the disposition to his own use of stock shares intrusted to his keeping. And in Neiler v. Kelley, 19 P. F. Smith 403, and Work v. Bennett, 20 Id. 485, the rule was held not to apply in cases of trover. As yet there does not seem to be any case on our books which prevents the limitation of the rule of The Bank v. Reese to cases involving a trust, or to those, the peculiar character of which renders the application of that rule necessary in order that justice may be meted oút to the parties litigant. Such,' however, is not the condition of the case in hand. The agreement of the 31st of October required that the plaintiff should be paid by instalments of cash as therein mentioned, and the return of the stock, in kind, was an option belonging to the company. As this contract was in part executed by the payment of the first two instalments by the defendants, and by the retention and sale’ of the collaterals by the plaintiff, the default cannot be treated as a rescission of the contract, but only as a breach, the damages for which must of necessity be *254measured by the money due the plaintiff at the time of such breach, with interest to the date of verdict.
It follows that English was entitled to recover from the defendant the value of the two hundred shares of stock, as of the 21st of September 1868, with the dividends and simple interest, deducting therefrom the payments as of the date when severally made.
As we think the collaterals were properly disposed of, we refuse to sustain the 15th assignment of error.
Judgment reversed, and a new venire is awarded.
A rule was granted on the 5th of March 1878, to show cause why judgment should not be entered in this case in favor of the defendant in error for the amount due him, according to the principle stated in the opinion of the 4th of March 1878, the damages to be liquidated by the prothonotary. This rule, after argument, was discharged on the 18th of March 1878.