Court Opinion

ID: 5200446
Source: CourtListenerOpinion
Date Created: 2022-01-06 15:51:14.623777+00
Date Added: 2024-06-11T08:27:11.453415
License: Public Domain

Patterson, J. (concurring):
I am of the opinion that the exceptions of the defendants to the ruling of the trial court in directing a verdict for the plaintiffs in this action should be overruled. Equity and good conscience require tliat the money of the plaintiffs in the hands of the defendants should he restored to the real owner.- It is indisputable that $35,000 of the plaintiffs’ money, which they believed they were depositing with the defendants for the sole use and benefit of one Garbrecht, were appropriated by. the defendants to their own use and to keep alive a speculative account of one Lurman, a resident of Bremen- in Germany, who was operating in the New York market through the defendants’ agent, Garbrecht, also a resident of Bremen. That Garbrecht was the defendants’ agent cannot he doubted. The agency began as early as 1883, and was in existence at the time of the transaction out of which this action arose. It is *526also not to be denied that when the plaintiffs paid the money into - the hands, of the defendants they were ignorant of any relations existing between Lurman and the. defendants. The transaction was initiated hy a cable dispatch from Lurman to the plaintiffs by which they were requested by Lurman to pay' to the defendants' $35,000 “ for account of Garbrecht.” They believed and had eveiy reason, to believe that this was only a telegraphic transfer of money to" be paid in to the defendants for the use of Garbrecht; and the defendants admit in their answer that they received the money for the account of Garbrecht. I think it is plain that the plaintiffs intended to deposit with the defendants a sum of money available only to Garbrecht; for there was nothing to indicate to them' that" instead of making a deposit of that character they were discharging an. obligation arising out of the speculations of Lurman carried on by the defendants, and with which the plaintiffs Were in no way concerned or interested. That Lurman wás. a customer of the defendants and not of Garbrecht amply appears. Garbrecht was .the agent of the defendants to solicit business for them in Bremen. On or about the 5th of February, 1904, several customers of the defendants in Bremen, among whom was Ltinnan, were in default on margins. Garbrecht was notified of the fact. ' The largest of those in ’ default was Lurman. Garbrecht called upon him to remit $35,000 to the defendants, The whole amount Garbrecht was required by the defendants to Collect was $43,000, and $35^000 of that amount • represented the sum due from Lurman. On the day last named Garbrecht notified Lnnnan of the state of his ventures with Herklotz, Corn &• Go. and "asked him to, make a cable remittance that morning to -the defendants of $35,000 “ on account of the margins due from you.” Lurman informed Garbrecht that the payment had been made, and he likewise received confirmation to that effect from the defendants, Viz:, that the payment demandéd from Lurman had been made, but of this correspondence the plaintiffs apparently were in ignorance.1- It may be true that Herklotz, Corn & Co. did not know the names of the customers they had in Bremen, and who were procured through the, agency of Garbrecht, but they did know that they received the. plaintiffs’ money to feed the speculative accounts of customers so procured for them by their Bremen agent; and when they received the plaintiffs’ money, *527no disclosure was made of the facts nor any intimation given, so far as the record shows, that they were accepting it otherwise than as so much money paid into their hands simply and solely for the personal account of Garbrecht. It will not do to say that their receipt of the money for Garbrecht’s “ account ” was literally true. In their system of bookkeeping and by agreement with Garbrecht the speculative accounts procured by the latter were kept by the defendants in his name. That was for convenience and as a method of simplifying accounts. It cannot be assumed that when the plaintiffs paid in the money “for account of Garbrecht” they could have had in mind an account of Garbrecht as agent of the defendants. Garbrecht,- it is true, guaranteed the collection of all amounts that might be owing to the defendants from Bremen customers procured by him for the defendants, but there is nothing to indicate that those customers were not the principal debtors of the defendants, nor is there anything to show that the plaintiffs could have surmised that their moneys were to be appropriated by the defendants and put to the credit of Garbrecht in sncli an account as was kept in his name by the plaintiffs, or in other words were to be paid to the defendants to be retained as their own.
As matter of fact, Garbrecht never intended that the plaintiffs’ money should be paid in for his account. He washed his hands of the whole transaction. When he was asked by the plaintiffs to confirm the payment made by them to the defendants on his account, his answer to them by cable was “ not our,, but Lurman’s account.” And it is obvious that he meant the payment to be made for Lurman and not for himself. He evidently saw that he might be responsible for the reimbursement to the plaintiffs of this sum of money, and, therefore, he repudiated the transaction. In such circumstances, I think it is only just, reasonable and equitable that the plaintiffs should recover their money back.
If my views, as so far expressed, are not sufficient to sustain a recovery by the plaintiffs, then there is another aspect in which the case may be viewed and which justifies such recovery. The defendants insist that Garbrecht was their debtor; that the payment was made on his account unreservedly and unconditionally and that it was so accepted and that there the transaction ended. If that be so, then it is proven that Garbrecht disclaimed and dis*528avowed the relation imputed to him to the transaction and did not authorize the payment to be made on his account and would not .adopt it. The plaintiffs were misled by Lurman’s cable message and paid the money to the defendants through mistake. Such being the fact, the plaintiffs are entitled to recover back the money, unless the defendants have been pnt in such a position that they would sustain damage if they were required to make restitution — of which there is no evidence, whatever. From all that appears, they still have their claim and right of action against Garbrecht. Clearly they paid'the money under a mistake of fact, and the well-settled rule that money so paid may be recovered back, however negligent the party paying may have been in making the mistake, unless the payment has' caused such a change- in. the position of the other party that it would be inequitable to require him to refund, which has recently been reannounced in Hathaway v. County of Delaware (185 N. Y. 368), is applicable to and should be enforced in this action.
The exceptions should be overruled and judgment upon the verdict entered for the plaintiffs, with, costs. .