Court Opinion

ID: 8188906
Source: CourtListenerOpinion
Date Created: 2022-09-09 23:11:46.113896+00
Date Added: 2024-06-11T16:40:22.724974
License: Public Domain

TimuiN, J.
Tbe pivotal question is whether there was evidence to take tbe case to tbe jury. Ordinarily, and in those cases in which the law does not, from the act in question, conclusively infer the intent, the question of intention is a question of fact for the jury in actions at law. Contracts in form for the sale or purchase of commodities, where neither party intends to deliver or accept the property nominally sold, but where it is intended by both parties that the transaction shall be settled by the payment of the difference in prices according to the rise and fall of the market, are gambling contracts and void. Atwater v. Manville, 106 Wis. 64, 81 N. W. 985, and cases cited in opinion. In the instant case the plaintiffs testified expressly to their intention to make delivery. The defendant’s manager, who made the contracts for it, testified there was no intention on the part of defendant to make delivery. The real inquiry was: What was the intention of both parties, plaintiff and defendant? Express evidence by a party that delivery was intended or was not intended may be overborne by inferences from facts and circumstances. Atwater v. Manville, supra. In many of the cases we find the expression “settled by the payment of differences.” In Bartlett v. Collins, 109 Wis. 477, 85 N. W. 703, the expression used is “betting on future prices.” An examination of the facts under consideration in such cases shows that the foregoing expressions were applied to, or at least included, the case of a broker, member of a board of trade, selling in his own name for future delivery for an undisclosed principal, with the intention of merely buying in for the same principal before the delivery day on the board an equal amount, and offsetting the sale against the purchase and paying or receiving the loss or gain, as the case might be. Such was the case of Bartlett v. Collins, 109 Wis. 477, 85 N. W. 703; Lowry v. Dillman, 59 Wis. 197, 18 N. W. 4; Everingham v. Meighan, 55 Wis. 354, 13 N. W. 269; Barnard v. Backhaus, 52 Wis. 593, 6 N. W. 252, 9 N. W. 595; *92Donovan v. Daiber, 124 Mich. 49, 82 N. W. 848; De Mary v. Burtenshaw's Estate, 131 Mich. 326, 91 N. W. 641; Embrey v. Jemison, 131 U. S. 336, 9 Sup. Ct. 116; Harvey v. Merrill, 150 Mass. 1, 22 N. E. 49; Wagner v. Hildebrand, 181 Pa. St. 136, 41 Atl. 34; Jamieson v. Wallace, 167 Ill. 388, 47 N. E. 762. An intention to “settle by the payment of differences,” “betting on future prices,” or “closing up without delivery by the payment of differences,” is equivalent to and means an intention by on© who has sold for future delivery to buy on the same board for the same delivery, and to offset the purchase against the sale and receive or pay the difference.
Was there any evidence in the present case to show that the parties plaintiff and defendant in this action both intended that the sales made by the plaintiffs for the defendant on the Detroit board of trade should be offset by corresponding purchases and payment or receipt of the differences ? Before considering this further it may be well to say that it amply appears from cases last above cited that the intention which is the object of judicial investigation in such eases is the intention that existed between both parties to the litigation, and not the intention which might have existed between the two brokers, members of the board of trade, who made the actual contracts. Not that such latter intention is wholly irrelevant, but the controlling intention in a suit by the broker against his principal, like the instant case, is the intention entertained by the broker and his principal. All of the foregoing cases also support the rule laid down in Jamieson v. Wallace, supra, as follows:
“The intention of the parties -to a contract for the purchase and sale of stocks may be established not merely by their assertions, but from all the circumstances attending the transaction, and is a question to be determined by the jury, or by the court in trials without a jury.”
If, therefore, in the case at bar the plaintiffs and the defendant intended from the beginning that the sales made by *93the plaintiffs for the defendant on the Detroit board of trade should'before the day appointed for delivery be met by purchases of a corresponding amount for the same date of delivery by the plaintiffs for the defendant, and closed by offsetting these purchases against the sales and paying or collecting the difference, this case would be within the rule of the decisions above cited.
The evidence which we think sufficient to take the case to the jury upon this proposition is: First. The fact that the transactions in question were board of trade contracts, which is relevant as tending in some degree to indicate an intention that no delivery was contemplated, because a very large majority of the transactions on such boards are not real transactions, but are closed in the manner aforesaid. Bartlett v. Collins, 109 Wis. 477, 85 N. W. 703; Barnard v. Backhaus, 52 Wis. 593, 6 N. W. 252, 9 N. W. 595. Second. In the several prior dealings in which the defendant, through the plaintiffs, purchased beans on the Detroit board of trade, the purchases were closed out, not by deliveries but by making sales against the purchase before the day of delivery, and offsetting one against the other. Gardner v. Meeker, 169 Ill. 40, 48 N. E. 307. Third. On September 26, 1902, the defendant wrote, asking the plaintiffs to remit the surplus margin, and saying: “You may change buying five cars Oct. and sell same for Nov. or Dec. at 6c. discount. We would prefer you to sell December, but do the best you can.” True, this was not the act of the plaintiffs, but it was very suggestive to them and they received this communication from defendant, indicative at least of his intention. On September 27th the defendant wired plaintiffs: “If cannot do better change them at eight cents to December.” Again, on the same day: “You may change the beans to Nov. or Dec. at 7 to 8 ets. difference.” On September 29th plaintiffs wired defendant : “Think buy Oct. and sell November ten cents down. Shall wTe change? Answer quick.” Plaintiffs did not ask for any money with which to make this purchase. Melchert *94v. Am. U. Tel. Co. 11 Fed. 193. This may be understood as advising a purchase for October delivery to offset tbe October sales, and to change the sales for October delivery, or some of them, to sales for November delivery. Plaintiffs also wrote defendant on September 29th, stating that they had the order to sell two cars, 500 bags, of November beans, at $1.94, and to buy five cars, 1,250 bags, October, and sell the same amount of November at six cents discount. This might indicate their understanding of the manner in which the sales should be closed. On September 30th plaintiffs wrote defendant, saying, among other things: “We think the sooner you get out of your Oct. sales the better. Possibly it may be best to take them in altogether, or it may be best to change them into Nov. However, we would advise covering them as soon as possible.” On October 3d plaintiffs wired and wrote defendant, advising it to take in its October sales. Fourth. The defendant’s manager testified that no deliveries were intended on the part of defendant.
This evidence seems to us to have been sufficient to take •the case to the jury on the question of the intention of both parties to this transaction between plaintiffs and defendant, notwithstanding the direct testimony of the plaintiffs of their intention to make deliveries. It must be borne in mind that it is not inconsistent with the gambling intention on the part of plaintiffs and defendant that transactions on the Detroit board of trade may be perfectly legitimate as between brokers, the immediate parties to such transaction. Even legitimate transactions furnish many opportunities for collateral wager contracts and gambling, and two persons, broker and principal, knowing the usual way of settling on the board of trade, and knowing that delivery can be insisted upon by either party who is a member of the board of trade and a party to the sale or purchase, but at the same time knowing that, notwithstanding this, these deliveries are very rarely insisted upon, may well enter upon a single trade or a series *95■of trades with the intention, that no actual commodities shall be received or delivered but the transactions closed in the manner before described. Whether or not the plaintiffs and •defendant in the instant case had such intention was a question of fact and should have been submitted to the jury.
This renders unnecessary the consideration of other questions argued.
By the Court. — The judgment of the circuit court is reversed, and the cause remanded for a new trial.. .