Court Opinion

ID: 6375388
Source: CourtListenerOpinion
Date Created: 2022-06-24 23:54:36.61236+00
Date Added: 2024-06-11T15:50:09.319166
License: Public Domain

Lamorelle, P. J.,
Whichever rule we apply, the result is the same. If one of two innocent parties must suffer, then the loss must fall upon the claimant, Lou D. Shurtleff, because she was negligent in delivering the securities to her debtor for the purpose of having them exchanged for new shares of stock. If, on the other hand, the decedent bought from the committee of creditors his brother’s loans, taking over the collateral then with the loans without knowledge that his brother, the debtor of Lou D. Shurtleff, had obtained these shares of stock for another purpose, the claimant has no equity to compel his estate to refund and make good the loss.
The claimant was unable to show knowledge in the decedent, though wide latitude was given her as a witness. The fact that the decedent paid her interest on the loans is not helpful. The notes themselves were ordinary promissory notes, and did not call for collateral; in fact, the certificates which at one time the claimant had were issued and dated some years after the giving of the notes themselves, which would imply that the loans were not made on the collateral at all, but on the simple promise of the debtor. At no time were the exchanged shares of stock in any name other than that of the debtor (until Sept. 24, 1918, when they were transferred to J. Warren Hale following his purchase of his brother’s loans from the committee of creditors), and there was nothing to put any one dealing with him on notice.
An exhaustive examination of the record demonstrates that the auditing judge was correct in his findings of fact, his deductions from these facts and in his application of the law. The cases cited support his ruling, and those referred to by the exceptant are not in point in view of the facts as found.
We see no reason to add anything more, except to say that there is a fund held in trust, among other things, to pay the claimant the principal and inte'r*290est of her notes, so that it is possible she will not lose anything because of the misconduct of her agent in failing to return to her the collateral.
Accordingly, all exceptions are dismissed and the adjudication is confirmed absolutely.