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for the transportation of passengers, were not enti that the doctor consulted disclosed the true nature of tled to the rights of passengers; and while such is
the disease; that he advised the removal of the in
jured man to the hospital, about fifteen miles distant, not the law in this State, it would be unreasonable
or at least to a suitable place on shore; that he proto require of a carrier of passengers, who at some
nounced it dangerous to carry the mate back to New time may gratuitously or without hire furnish a York without an operation, if a delay exceeding hand-car, or other vehicle not adapted to or in twelve days was involved; that the plaintiff requestended for the carriage of passengers, manned by ted a removal to the hospital or to the shore, with the
provision usual in such cases and necessary to his supa crew that had been employed simply to work on
port; but that the master refused these requests, and the track, and run the car for their own conven
kept him on board till the home voyage was begun and ience, but had never been accustomed to look after ended, and more than twenty days after the doctor's the safety of others, and had not been selected or warning, landed the mate in New York, and placed employed for such purpose, a greater degree of him in a hospital, where amputation became necesskill, care or diligence than would be required in
sary because of the long delay and destructive pro.
gress of the disease. It is of little consequence to the carrying passengers for hire on regular trains,
liability of Yates whether he be regarded as master or although it might be, in fact, more dangerous to
owner, for in either character the negligence was his, ride on such improvised conveyance than upon reg and drew with it a personal responsibility. ular passenger coaches.” In Hoar v. Me. Cent. Ry. The maritime law is sensitive to the rights of seaCo., 70 Me. 65; S. C., 35 Am. Rep. 299, it was
men, and sedulous for their protection. When sick or
injured, they are entitled to be cared for and cured at held that one riding as a passenger on a hand-car
the expense of the ship, and not to be turned adrift in by invitation of the section foreman has no remedy. strange lands without adequate provision. They are
exposed to hardship,confronted with dangers, and grow
occasionally reckless by their very familiarity with SHIP AND SHIPPING-LIABILITY OF JOINT peril. The master's authority is quite despotio, and OWNERS FOR CARE OF SEAMEN.
sometinies roughly exercised, and the conveniences of
a ship out upon the ocean are necessarily parrow and COURT OF APPEALS OF NEW YORK, OCT. 18, 1887. limited. That which on land would be contributory
negligence, the maritime law scarcely recognizes, and SCARFF V. METCALF.
readily execuses, (The City of Alexandria, 17 Fed. One of the owners of a vessel made an arrangement with M., Rep. 395), and in many ways throws its protection
the other owner, to sail the vessel for one-half the gross around the seaman. When he falls sick or suffers inearnings, he to pay from that half the victualing and man jury, the owners owe to him the duty of rendering ning of the vessel, but M. exercising some control over it. such care and medical jaid as circumstances permit, Plaintiff, a mate on board, was burt on a voyage, and and in the performance of that duty the master stands sued both owners for injuries resulting from neglect on as the agent and representative of the owners, and the part of the captain. Held, that as there was no actual his negligence is theirs. Petersen v. Swan, 50 N. Y. demise of his interest in the vessel by M., he retaining Super. Ct. 47; The City of Alexandria. supra; Reed v. some authority over it, a judgment against both owners Canfield. 1 Sum. 195; Harden v. Gordon, 2 Mason, 543. was correctly given.
The last cited case considers the effect of the act of Joseph A. Shoudy, for appellant.
Congress requiring the ship to be supplied with a suit
able medicine chest, and holds that such requirement Wm. Sullivan, for respondent.
does not subvert the general duty imposed upon the Finch, J. The verdict of the jury requires us to owners by the maritime law, but merely regulates a adopt the plaintiff's version of the facts, since the judg- single detail of its exercise. This duty the owners who ment was in his favor, and the negligence of the remain at home, and do not sail upon the sbip, can master thereby established. If that judgment was only perform, beyond supplying the medicine chest, against him alone, very little question would arise; through the master, who becomes their agent for its but it involves another owner, not on board the vessel, performance. The mate, although an officer, is a seabut remaining at home, and so situated in his rela- | man. Holt v. Cummings, 102 Penn. St. 212; The Ocean tion to the facts as to make necessary their careful | Spray, 4 Sawy. 105; The Minna, 11 Fed. Rep. 759. consideration. The barkentine upon which plaintiff While both he and the master are servants of the was injured while employed as mate was owned by | owner, and so fellow-servants, they are not such in Yates and Metcalf. She was sailed by Yates as master, respect to the owner's duty to the seamen which the on shares, by virtue of an agreement with Metoalf to master performs in their behalf, and as their representhat effect. The agreement was not in writing, and is tative, and the contention in this case that the masdetailed solely by the two owners, each of whom testi- ter's neglect was that of a fellow-servant cannot prefied to its existence. The vessel started on a voyage | vail. to Sagua la Grande in Cuba, and when some distance | Where the duty of the owner to the seaman is perat sea, the plaintiff received an injury in the perform-formed, the cost of nursing and medical attendance ance of his duty which developed into an aneurism of falls upon the ship, (The North America, 5 Ben. 486,) the popliteal artery, causing him great pain, and and that has been ruled even where the patient had largely incapacitating him for active service. The been removed to his own house, (Holt v. Cummings, vessel was provided with a proper medicine chest, and supra). But where that duty is not performed, and no complaint is made, that before arriving at the port the seaman suffers injury from the neglect, the ship in of destination, the master treated his mate otherwise a proceeding in rem, and the owners in a suit against than with kindness and care, and with such means as them, are liable for the damages suffered. Couch v. his limited kuowledge and opportunity enabled him Steel, 77 E. C. L. 402; Brown v. Overton, 1 Spr. 463; to use. But on reaching port and consulting a physi Mosely v. Scott, 14 Am. Law. Reg. 599; Tomlinson v. cian, it was made apparent to the master that surgery, Hewett. 2 Sawy. 278; Petersen v. Swan, supra. These and not medicine, was needed to cure the injury. At principles settle the liability of Metcalf, unless he is this point of the case the contradictions become plen- discharged by force of his arrangement with the tiful; but we must asssme, in support of the verdict, master, to which attention must now be directed.
There is very much of authority for the doctrine, and therefore leaves some possession, authority and that where there is a charter of the vessel which strips control in the owner, although narrowed and restricthe owner of all authority, possession and control, the ted by the terms of the agreement. Unless there is an charterer becomes owner pro hac vice, and the general actual demise of the vessel which destroys the relation owner ceases to be liable for the contracts or torts of of master and owner, and substitutes that of bailor the master, except for the wages of the seamen. There and bailee, the relation must contique, and the master seem to be limitations upon that doctrine, and doubts remain servant and agent of the owner. about it, although the main drift of authority is in Now the arrangement between Yates and Metcalf that direction. Hallett v. Insurance Co., 8 Johus. 209; was neither in form por substance a demise of the Thorp v. Hammond, 12 Wall. 408; Thomas v. Osborn, vessel. The latter says that the captain sailed her on 19 How. 22; Reynolds v. Toppan, 15 Mass. 370. But I shares; that he (Metcalf) had nothing to do with the have arrived at the conclusion that this doctrine, even manning of the vesset or victualing of the crew, and if broadly maintained, applies only to cases in which nothing to do with hiring the seamen or paying the there has been an actual demise of the vessel, such as running expeuses; that the freight paid expenses and to take from the owner all possession, authority and the balance was divided up. The master testified: “I control, and not to cases where there has been merely had an agreement with the owners to sail freight ou a contract about the vessel for the division of earn what is known as shares; that is, I have half of the ings and expenses. There are cases which may justly gross stock of earnings of the vessel, and pay for the be cited as not in accord with that couclusion, ('ag victualing and manning of the vessel, and pay the gard v. Loring, 16 Mass. 336; Culler v. Winsor, 6 Pick. tonnage out of my part of the gross earnings; " and he 335); but the current of authority in this State runs added that the owner had nothing to do with hiring in its favor, and I am strongly convinced that it is the seamen, victualing them, or furnishing supplies. sound in principle, and just in its application. In This seems to me but a mode of paying the master for Hallet v. Insurance Co., supra, there was an actual his services. It was not said that he should dictate charter of the vessel, the owners receiving a stipulated the voyages, decide as to cargo, fix rates of freight, price for its use. In Thorp v. Hammond, supra, the and absolutely control the vessel to the exclusion of arrangement, although a letting on shares, is described Metcalf. Indeed it appears that she was consigned to by the court as in effeet a chartering of the vessel, and Metcalf, and that he exercised some authority over her. a surrender by the owner of all authority and control. His dividend from her earnings was increased by the The case was one of collision, and largely affected by very saving of expenses which the master effected at the terms and language of the act of Congress of 1851. the risk and to the injury of the mate; and I am unIn Kenzel v. Kirk, 37 Barb. 113, where the vessel was able to resist the conclusion, in spite of the very let to the master on shares, he to provide supplies, it learned and interesting argument for the appellaut, was ruled that there was not a "positive chartering,". that the judgment was correctly given against both and the owners were liable for supplies to a vendor the owners. ignorant of the arrangement. In Macy v. Wheeler, 30 The judgment should be affirmed. N. Y. 241, it was said that the liability for supplies All concur. depends not on legal ownership, but possession and control. In Vose v. Cockroft, 45 Barb. 60, there was a written agreement that the master should sail the CORPORATIONS – PLEDGED STOCK - WHO vessel on shares in the customary way, he to man and
MAY VOTE ON. provision her, pay one-half of port charges and expenses and of extra labor, and have “as wages" one.
OREGON SUPREME COURT, JUNE 14, 1887. half of the gross freight. This was held not to be a chartering of the vessel, and great force was given to
STATE, EX REL. REED, V. SMITH.* the stipulation describing the master's share as
Where shares of stock are pledged as collateral, the pledgee " wages." In McCeady v. Thorne, 49 Barb. 438, there
reserving the right to sell in case of default, and the was a letting on shares, the master to victual, man
pledgee causes a transfer to himself to be recorded on the and sail the ship at his own expense, pay port charges
books of the corporation, until the pledgor's rights shall out of earnings, and divide the balance equally with
have been foreclosed by a sale, etc., the pledgor, and not the owners. It was ruled that the master was not
the pledgee, is entitled to vote on the stock in the absence owner pro hac vice, and that the general owners were liable for unpaid port charges. A comparatively re
of a statute providing otherwise. cent case in the English courts discusses the liability
RDER for rehearing. For original opinion, see 14 of the owner for the negligence of the master, where
V Pac. Rep. 814. the relations between them were much like those in THAYER, J. I have examined with some care the the case at bar. Steel y. Lester, L. R., 3 C. P. 121. ably prepared petition for rehearing filed herein by Lester was owner and Lilee captain. It wils agreed
the counsel for the respondent, and have endeavored between them that Lilee should sail the ship whenever
to give it that consideration which the importance of he chose, be at liberty to take or refuse any cargo, en
the questions involved therein demands. The coungage and pay the men, and furnish all requisite sup sol inquire with considerable earnestness whether plies, and give Lester one-third of the net profits.
any oue can imagine any reason for the giving of the While the vessel was unloading at its port of destina
written power of attoruey by Seeley to Reed, at the tion, under a charter party made by the master, the
time the stock was transferred by the former to the wharf was damaged by the sloop through the negli
latter, excepting that it was uuderstood and intended gence of Lilee, and Lester was sued for the damages.
that Reed should transfer the stock as provided for The court decided that the arrangement did not
in the power of attorney. Anotber inquiry might be amount to a demise of the vessel, and was not such an
made that would be as difficult to answer, and that is, absolute parting with it as would sever the control.
why Seeley executed to Reed an absolute transfer These authorities indicate a distinction, which I am
and assignment of the stock when it was understood content to recognize, between an actual demise of the
and intended by them that no title to the stock was vessel, which transfers its possession and all authority
to pass from the former to the latter beyond a right and control over it, and a mere arrangement for the
to sell it in case of a default in the payment of the sailing of the ship which does not amount to a demise,
* 15 Pac. Rep. 386.
$50,000, and an application of the proceeds to such shares of stock. No authority was given him in the payment. The assignment and delivery of the 361 agreement to surrender them to the company and reshares of stock, and execution of the power of attor ceive other certificates in his own name. He could ney by Seeley to Reed, no more express their inten not become the owner of the stock by a transfer to tion in the transaction than an absolute deed to real himself, and no more, in my opinion, had he the right property from the former to the latter would, where a th clothe himself with the apparent ownership of it. defeasance was given back. The deed by itself would He had authority to sell it, in case the note and interconstitute a complete con veyance of the property, but hst were not paid when due, and make a transfer to the in connection with the defeasance, would be no con purchaser upon the books of the company. The veyance at all; would be no more than a charge or power to make such transfer, it seems to me, was only lien upon the property. So the assignment and power to complete the sale, in case the event transpired auof attorney, considered by themselves, would consti- thorizing him to make the sale. tute a sale of the stock, with an immediate right upon | Counsel however claim that it was necessary in order the part of the purchaser to have a transfer made, to protect his security, that the trausfer upon the from the vendor to himself, on the books of the com- | books be made to him at once; that otherwise Seeley's pany; but considered in connection with the agree creditors might come forward and attach the stock, ment made and entered into, by and between the and cut off the security. They do not explain how parties at the same time, might have an entirely dif Seeley was to be protected against Reed's creditors in ferent character.
case the stock is registered in the latter's name. I do It is in that the assignment was not intended not see how Seeley, especially under the view of counto have any effect except as a pledge of the stock, sel that the registry of the stock passes the legal title, coupled with a right to sell it in case the note was not could not have any protection. Reed would have the paid at its maturity; and I concluded, when the case title, and his creditors, if he had any, could sequester was heard, that the power of attorney could have no it with impunity. It would not be necessary for them operation until such sale was made; that it was only to prove that they trusted him upon the faith that executed for the purpose of enforcing the security in he was the owner of tbe stock, as he would be owner case Reed was compelled to resort to it in order to ob. in fact. But I do not think that “unless Reed had tain payment of the note; and I therefore character- the right to transfer the stock to himself upon the ized Reed's act in having the transfer made to him- | books of the company under said power of attorney, self upon the books of the company, by surrendering | his collateral security would be of no more value to up the stock, and having new certificates issued to
him than a chattel mortgage unrecorded and conhimself before the note became payable, as a wrong. cealed in his pocket;” or that “prior to the time Whether that conclusion was correct or not must be when the transfer was made upon the books of the determined by au ascertainment of the intention of company, any creditor of Seeley might have attached the parties to the transaction, and that must be gatb the stock, or have seized it upon execution, or Seeley ered from the assignment and transfer of the stock, might have sold it to a bona fide purchaser." the power of attorney, and agreement entered into There have been, I confess, a number of decisions between them at the time. The said agreement con- | to that effect, but the weight of authority is the other tains a recital that Reed was about to advance to the way. Mr. Cook, of the New York bar, in a late work “Oregon Iron & Steel Company" an amount of on the law of stock and stockbolders, says (sec. 487): money, so that the total amount of his advances “The decided weight of authority holds that he who would aggregate $150,000; that Seeley was willing to purchases, for a valuable consideration, a certificate take an interest of $50,000 in the total advances made of stock, is protected in his ownership of the stock, by Reed, aud had given his note, of even date with the , and is not affected by a subsequent attachment or ex' agreement, to Reed for said sum, payable two years ecution levied on such stock, for the debts of the regfrom date, with interest, etc., and had delivered as istered stockholder, even though such purchaser has collateral security, for said note and interest, 361 neglected to have his transfer registered on tbe corshares of the capital stock, full paid, of said company. porate books, thereby allowing his transferer to apTherefore Reed undertook, upon the full payment of pear to be the owner of the stock upou which the at. the note and interest, to redeliver to Seeley said tachment or execution is levied." And this author shares of stock, together with one-third of such bonds, cites a large number of authorities in support of that eto., as he should receive from said company, in con rule. sideration of his said advances; and Seeley, in con) - The decision upon the question in the different sideration thereof, authorized and empowered Reed States, and in many of the States themselves, have upon default of the payment of said note, at the ma not been in harmony. The language of Chief Justice turity thereof, together with the accumulated inter Shaw in Fisher v. Bank, 5 Gray, 373, quoted in the est thereon, to sell or dispose of, at public or private counsel's petition, “that shares in a bank whose charsale, and in such manner and on such terms as to the ter provides that they shall be transferable only at said Reed should seem best, the said 361 shares of its banking house, and on its books, cannot be effectstock. Any one having any kuowledge whatever of ually transferred as agaiust a creditor of the vendor business affairs would know at once that this agree who attacbes them without notice of the transfer, by ment was the substratum of the transaction between a delivery of the certificates, together with an assignthe parties, and that the assigument and transfer of ment and blank power of attorney from the vendor to the stock, and execution of the power of attorney, the vendee, even if notice of the transfer be given to which it appears was signed it blank, were for the the bank before the attachment," instead of being sole purpose of carrying out the provisions of the authority in favor of the counsel's position upon the agreement; and it seems to me that to term this as point, is considered, in the light of the other decisions sigument and transfer of the stock any thing other or in that State, directly against it. different than a pledge would be a niisnomer.
In Sibley v. Bank, 133 Mass. 515, it was shown that It is well understood that property of such charac- Judge Shaw's decision in Fisher v. Bank was conter is capable of being pledged as well as sold, and trolled by the statutes of that State expressly applicathat the general law relating to that subject applies to ble to bauk shares. Judge Allen, who delivered the such a pledge. Reed's duty in the matter, under the opinion of the court in Sibley v. Bank, 521, says: “In law and under the agreement, was, upon full payment Fisher v. Bank the question was, what was the intenof the note and interest, to redeliver to Seeley the 361 tion of the Legislature of this State in using similar words [referring to the provisions of the Federal rect opposite of the holding set out in the petition; Bauking Act, that the stock shall be transferable ou that under the statutes of this State upon the subject the books of the bank in such a manuer as may be it may reasonably be supposed he would have decided prescribed by its by-lawe), and the court found in the the same way the court did in Music Hall v. Cory, general spirit and scope of the legislation of this Com- | supra. Such has been the current of decisions of the monwealtb, as to the attachment of shares in corpo- || Federal courts. And I am of the opinion that in the rations, and in the particular legislation as to the at best considered cases the same result has been tachment of bank shares, evidence that the Legisla-1 reached. In support of that opinion I cite with great ture intended by the words, the stock of said bauk confidence Smith v. Crescent City, etc., Co., 30 La. Ann. shall be transferable only at its bauking-house and on 1378, and Cornick v. Richards, 3 Lea, 1. Judge Davis, its books,' to enact that an assignment not so re in Bank v. Lanier, 11 Wall. 377, 378, stated explicitly corded should not be valid against attaching creditors what kind of security Reed bad when Seeley deposof the assignor. * * * " Those statutes not only ited said certificates of stock with him, when he said, made the shares of any stockholder liable to attach that “although neither in form nor character negoment, but made it the duty of the officers of any cor tiable paper, they approximate to it as nearly as pracporation keeping its records to give a certificate of the ticable. If we assume that the certificates in question shares or interest of any stockholder, on request of are not different from those in general use by corpoany officer having a writ of attachment or execution rations, and the assumption is a safe one, it is easy to agaiust such such stockholder. But he says: “The see why investments of this character are sought after statute under consideration for construction is a stat and relied upon. No better form could be adopted to ute of the United States, in whose legislation no such assure the purchaser that he can buy with safety. He policy existed, and whose legislative acts contained is told, under the seal of the corporation, that the no provisions such as were referred to from the legis shareholder is entitled to so much stock, which can lation of Massachusetts."
be transferred on the books of the corporation, iu perAud in Music Hall v.Corey, 129 Mass. 436, 437,Judge son or by attorney, when the certificates are surrenColt, in delivering the opinion of the court, says: “In dered, but not otherwise. This is a notification to all the next place, it is strenuously urged, that by force of persons interested to kuow that whoever in good faith the various statutes of this Commonwealth relating to buys the stock, and produces to the corporation the the ownership and transfer of stock in corporations, certificates, regularly assigned, with power to trangauthorizing the attachment of shares, requiring re fer, is entitled to have the stock transferred to him. turns to the secretary of the Commonwealth, and in And the notification goes further, for it assures the posing a personal liability on stockholders for the holder that the corporation will not transfer the stock debts of the corporation, there can be no transfer of to any one not in possession of the certificates. In stock, valid against the claims of an attaching cred. | this state of the case Lanier and Handy made their itor, unless such transfer be recorded in the books of purchase of Culver. They bought for value, without the corporation;" citing the statutes. “The inten kuowledge of any adverse claim, in full faith that the tion of the Legislature, it is said, must have been to bank would observe its engagements, and pursued in provide for the owners of stock a convenient and uni all respects the directions given in the certificates. form method of transferring title on the books of the They were not told to give notice to the bank of their corporation, which should be the only valid transfer purchase, nor was there any necessity for notice, beas to creditors and others interested; and although cause by the rules of the bauk, Culver could not transthe statutes have not provided in express terms, that fer the stock in the absence of the certificates, and as to creditory, transfers shall not be valid till they these they had in their possession." Reed being a are so recorded, yet such, it is contended, is the nec pledgee instead of a purchaser of the stock, did not essary implication, for otherwise the design of the render it more necessary that it should be registered statutes, requiring registration and making the shares in his name in order that his rights in the transaction liable to be taken for debts, would be defeated. But should be protected. Holding the certificate without the consideration is not sufficient to control the law, such registry would be more consistent, and less liaas long since settled by the decisions of this court. It ble to the imputation of fraud, in the case of a pledge requires clear provisions of the charter itself, or of than of a sale. But I am satisfied that in neither case some statute, to take from the owner of such property could his rights be affected by any act done or sufthe right to transfer it in rccordance with known rules fered by Seeley subsequent to the delivery over to him of the common law. And by those rules the delivery of the stock, although po transfer were made upon of a stock certificate, with a written transfer of the the books of the company. Reed cannot therefore same, to a bona fide purchaser, is a surficient delivery claim that it was necessary to his protection against to transfer the title as against a subsequent attaching the creditors of Seeley, or against the acts of Seeley creditor;" citing several cases, including Fisher v. himself in selling the stock to a purchaser without noEssex Bank. The learned judge further adds that "it tice, that such transfer be made. The former had a would not be in accordance with sound rules of con- | right to have a transfer made upon the books of the struction to infer from the provisions of several differ company, but it seems to me that it was only a conent statutes, passed for the purpose of obtaining in ditional right; that the parties did not intend that it formation needed to secure the taxation of such prop should be exercised except in the event of non-payerty, or for the purpose of subjecting stockholders to ment of the note. They seem to have acted in accorda liability for the debts of a corporation, or for pro ance with such intention. Reed did not have the tecting the corporation itself in its dealings with its transfer made for more that a year and a half after own stockholders, that the Legislature intended the execution of the assignment, and in the meantime thereby to take from the stockholder his power to Seeley voted the stock. The transfer upon the books transfer bis stock in any recognized and lawful mode. would put it out of the power of the latter to receive If a change in the mode of transfer be desirable for the dividends that might accrue thereon, and at the protection of creditors, or for any other reason, it is same time he had obligated himself to pay the interest for the Legislature to make it by clear provisions en upon the note semi-annually, at the rate of seven per acted for that purpose.''
cent per annum. It is evident from these cases that Judge Shaw, in I can see no justice in the right which Mr. Reed sets the absence of the peculiar provision of the Massa | up. Counsel have cited a number of authorities to chusetts statutes referred to, would have held the di- show that he had a right, as pledgee of the stock, to fill the blank in the assignment and have it trans | the other securities received therewith, was $15.219.81, ferred to himself. I have eximined the most of these and the question for the court to determine was authorities, and do not think them decisive of the whether defendant was entitled to hold the 134 shares question under consideration, or as having much to for the payment of this balance. The Court of Apdo with it.
peals held that it was; that the plaintiff, by executDay v. Holmes, 103 Mass. 310, one of the cases cited, ing the blank assigument and power, was as against was an action for the wrongful conversion of certain the defendant estopped from asserting his ownership mining stock, delivered by the defendant to plaintiffs to the stock, where the latter bad made advances unas collateral security for his indebtedness to them, der the circumstances mentioned; that the signing of with an assignment in blank which the plaintiffs the blank assignment and power, and delivering the filled by inserting their own names, and obtained stock, was the common practice of passing tbe title of new certificates to be issued to themselves. This, the stock, aud that it conferred upon Goodyear Bros. & court said, was in no sense a sale of the stock to them Durant the apparent title thereto. The question was selves; that the delivery of the assignment in blank not as to the rights of the immediate parties to the asnecessarily implied the right to insert their own signment and power of attorney, but as to the rights pames, and the doing so, and taking out new certifi of third persons who had advanced money upon the cates, was in accordance with the implied contract of faith of them. the parties, and a lawful and reasonable measure to If Reed had sold the 361 shares in controversy to an protect their security, and could upon no principle be innocent purchaser, there is no doubt but that such deemed an nulawful conversion. The gist of the de- purchaser would have acquired a valid title to them. cision is that the plaintiffs were not chargeable with But a pledgee of the stock, as between him and the a wrongful conversion of the stock in consequence of pledgor, would have no such right. the filling the blank assignment, and having the new Chancellor Walworth, in Bunk v. Kortright, 22 certificates issued to themselves; that it was in ac- Wend. 349, used the following language: “The stock cordance with the implied contract of the parties. It was not sold to Barton, but was merely pledged for will be observed that the court also said iu that case the security of $10,000. He therefore had no legal “What it was obviously not the intention of the plain right to fill up the blank with an absolute sale to himtiffs to exercise any dominion over the stock incon sell, and a power to transfer it on the books of the sistent with the rights of the defendant;" that “bis bank absolutely. If the debt was not paid, he had a rights were not in fact violated or injuriously af right to sell the pledge to a third person, after due fected." If it had appeared to the court that the | notice thereof to the banker, and then bave been auplaintiffs were largely interested in the corporation thorized to fill up the blank with an absolute sale to that issued said stock; that their apparent object and such purchaser, and a power to transfer the stock to purpose in filling the blank assignments with their such purchaser on the corporation books, as that owu names, and having the new certificates issued to would be according to the agreement inferred from themselves, was to enable them to represent the stock | the pledge of the certificate with such blauk iudorseat stockholders' meetings, vote it in opposition to the
ment." wishes of the defendant, and in order to secure the In that case the rights of a bona fide transferee were election of themselves and frienda to the directorship involved, who had sued the bank for refusing to perof the corporations, and thereby control the manage- / mit a transfer of the stock upon its books, and the dement of their affairs-it would not certainly have com cision was placed on similar grounds to that im McNeil mended the act, nor in my opinion, have determlned v. Bank, supra; but the view enunciated by the chanthat they could rightfully use the defendant's stock cellor upon the point referred to was not questioned to further any such design.
as a logical sequence; and there was nothing, as I can McNeil v. Bank,46 N.Y.330, another of the cases cited see, in the way of its application to the case under by counsel, was an action to compel the surrender of consideration. The question here is between pledgeor 134 shares of stock in the First National Bank of St. and pledgee. The obligations of each are fully set out Johnsville. The plaintiff owned the stock, and deliv. in a written agreement. The object of the formal asered it to, and left it with Goodyear Bros. & Durant, signment and power of attorney relating to the shares stock brokers, as collateral security for any balances of stock was evidently to effectuate and carry out the that might be found due them on account of other purposes of the agreement; and the evident and unstock they had purchased, and were carrying for him. mistakable aim of the relator was to gain control and A blank assigument and power of attorney to transfer dominion over the shares of stock pledged, in order the 134 sbares was indorsed thereon, and signed by to enable him to retain the management of the affairs tbe plaintiff at the time of its delivery. Afterward of the company, and without regard to the maintenthe defendant, at the request of Good vear Bros. & ance and protection of his security. That he had a Durant, paid to Fred. Butterfield, Jacobs & Co. the right to have the shares transferred upon the books of bum of $45,135, and received from the former certain the corporation, for the better protection of his sesecurities, including the 134 shares of stock, as secur curity, except as before suggested, is very questionity for the advances. Goodyear Bros. & Durant, at able to my mind; but that he had such right, for the the time of the advances to Fred. Butterfield, Jacobs purposes of advancing his general interest, I do not & Co., were insolvent, and indebted to the defendant. believe. I cannot think that the trausaction between In pledging the plaintiff's shares of stock, they acted him and Seeley, in view of all the facts, indicates any without actual authority from him, and without his such intention on the part of the parties, a
les, and I must knowledge. He was indebted to them in the sun of | still adhere to my former bluntly expressed opinion $3,000, but the account had not been rendered, or any | upon that point. demand made. The defendant at the time of receip I do not mean to be understood as holding that a ing the shares had no knowledge of the plaintiff's in- pledgee of capital stock in & corporation has not a terest therein. The defendaut filled in the blank in right to have it transferred to him upon the books of the assignment and power with the name “I. H. the corporation. Many authorities, in referring to Stout," its cashier, and attempted to have the shares the matter in a general way, accord the right unqualitransferred to his name on the books of the said First Redly, and I have met with others that deny it. National Bank of St. Johnsville, but was prevented by In Smith v. Crescent City, etc., Co., 30 La. Ann., injunction in the action. The balance of the advances supra, the court, at page 1383, in referring to the conmade thereon by the defendant, less the proceeds of venience and value of such stock as a basis of credit,