the defendant, as a storage-ticket holder, did not have any constructive possession of the grain in question, or of any specific grain. Under such circumstances it is entirely clear that an action would not lie against the defendant for the value of the grain covered by plaintiff's mortgage.

(77 N. W. Rep. 95.)

WILLIAM H. BEST vs. L. C. BARRETT, et al.

Opinion filed June 2, 1898.

1

Conversion-Elevator Storage Tickets-Identification of Mortgaged Property.

Appeal from District Court, Cass County; McConnell, J.

Action by William H. Best against L. C. Barrett and others. Judgment for defendant, and plaintiff appeals.

Affirmed.

Seth Newman and Newman & Stambaugh, for appellant.
Pollock & Scott, for respondents.

CORLISS, C. J. This case is controlled by our decision in Best v. Muir, 8 N. D. 44. The judgment of the District Court is affirmed.

All concur.

(77 N. W. Rep. 1117.)

N. D. R.-4

THE SECOND NATIONAL BANK OF GRAND FORKS VS. THE FIRST

NATIONAL BANK OF ST. THOMAS.

Opinion filed June 4th, 1898.

Opinion filed on rehearing October 7th, 1898.

Attachment of Pledged Property.

The interest of a pledgor in certain bank stock that he had pledged as collateral security for certain indebtedness was subject to seizure in attachment proceedings and sale on execution against such pledgor under the provisions of sections 5363, 5366, Rev. Codes.

Transfer of Pledged Stock Upon the Books.

Certain bank stock was pledged by the owner as collateral security to a debt owing by him to the pledgee, and an absolute assignment of the certificate given. Three years thereafter the pledgee presented the certificate to the bank, and demanded a transfer of the stock on the books, which was refused. Thereupon the pledgee brought an action against the bank, asking that the bank be required to make such transfer, or, on failure, that plaintiff have judgment for the value thereof. Held, that plaintiff's money recovery must be limited to its special interest in the property, not exceeding the value of the property, and that before any money judgment could be entered in its favor it was incumbent upon it to establish such special interest.

Rights of Pledgee-Burden of Proof.

And held, further, that the pledgee was not entitled as against the bank, which was the owner of the pledgor's interest in the stock, to have the same transferred to it on the books of the bank until it established some beneficial interest in the stock. Wallin, J., dissenting. Appeal from District Court, Pembina County; Sauter, J.

Action by the Second National Bank of Grand Forks against the First National Bank of St. Thomas. Judgment for plaintiff. Defendant appeals.

Reversed.

Bosard & Bosard, for appellant.

Burke Corbet, for respondent.

BARTHOLOMEW, J. These parties plaintiff and defendant are national banks. The controversy is over ten shares of the stock of the defendant bank. This stock was originally issued to one Clarke in one certificate. Plaintiff, claiming to be the owner of the stock by virtue of an assignment to it by Clarke of the said certificate presented the certificate, so assigned, to the defendant bank, and demanded that the said stock be transferred to it on the books of the defendant bank, and a new certificate of stock issued and delivered to it. This the defendant bank refused, claiming to be the owner of said stock by virtue of a purchase upon an execution sale against the said Clarke. It is undisputed that Clarke was indebted to the defendant in the sum of about $2,500, and that defendant

brought an action against Clarke on such indebtedness, and caused a writ of attachment to issue against his property, under which his interest in the stock was seized, and subsequently sold, on an execution issued upon the judgment obtained in such action, and defendant purchased the same. No objection is made to the regularity of these proceedings, but it is claimed that Clarke had no attachable interest in the stock by reason of the fact that it appears that in June, 1893, said Clarke pledged said stock to plaintiff as collateral security for an indebtedness due from Clarke to it, and executed to plaintiff an absolute assignment of the certificate of stock. But section 5363, Rev. Codes, declares: "When property is pledged or mortgaged for the payment of money or the performance of any contract or agreement, the right and interest in such property of the person pledging or mortgaging the same may be attached and sold on execution, and the purchaser at such sale shall acquire all the right and interest of the defendant therein." It follows that under said section Clarke's interest in the stock, whatever it may have been, was subject to seizure and sale, and that such interest became vested in the defendant. In other words, whenever the indebtedness to which the stock was collateral in plaintiff's hands was extinguished, the defendant would be entitled to the stock.

By reason of defendant's refusal to transfer the stock as requested by plaintiff, this action was brought, wherein plaintiff asked that defendant be compelled to transfer the stock and issue the certificate as required, and, in case of failure so to do, that plaintiff have judgment for the value of the stock. The facts render this case peculiar. We find many cases in the books where the pledgor has brought an action against the pledgee for conversion of the pledged property. But, as the pledgee is always in possession of the pledged property, it is ordinarily impossible that the pledgor, or one standing in place of the pledgor, should convert the property to the damage of the pledgee. But, as the wrongful refusal of a corporation to transfer its stock on demand renders such corpor ation liable for the value thereof (Doty v. Bank, 3 N. D. 9, 53 N. W. Rep. 77, and cases cited), it follows that in this case that which is ordinarily an impossibility becomes possible.

The trial resulted in a judgment for plaintiff for the value of the stock. There has been much diversity of procedure in cases where a transfer of corporate stock on the books of the corporation has been refused. Mandamus has sometimes been applied for and granted to compel such transfer. People v. Crockett, 9 Cal. 112; Turnpike Co. v. Bulla, 45 Ind. 1; State v. First Nat. Bank of Jeffersonville, 89 Ind. 312; People v. Goss & P. Mfg. Co., 99 Ill. 355. We are clear, however, that the weight of authority is against the issuance of the writ, except under special circumstances. Shipley v. Bank, 10 Johns. 484; Murray v. Stevens, 110 Mass. 95; Stackpole v. Seymour, 127 Mass. 104; Birmingham Fire Ins. Co. v.

Com., 92 Pa. St. 72; State v. People's Building & Loan Ass'n, 43 N. J. Law, 389; Freon v. Carriage Co., 42 Ohio St. 30; Tobey v. Hakes, 54 Conn. 274, 7 Atl. Rep. 551. All of these cases are placed expressly upon the ground that the party seeking the remedy has an adequate remedy at law in an action for damages. In many cases, however, a suit in equity to enforce a transfer has been sustained. Iasigi v. Railroad Co., 129 Mass. 46; Cushman v. Jewelry Co., 76 N. Y. 365; Walker v. Railroad Co., 47 Mich. 338, 11 N. W. Rep. 187; Johnson v. Brooks, 93 N. Y. 337. While these cases announced the principle that a court of equity will entertain an action to enforce the transfer, yet they place it upon the ground of the inadequacy of the commonlaw remedy in those particular cases. Other cases, however, affix no such limitation upon the equitable jurisdiction to enforce performance. Bank v. Roden (Ala.) 11 South. Rep. 883; Railroad Co. v. Fink, 41 Ohio St. 321; In re Reading Iron Works (Pa. Sup. 24 Atl. Rep. 202. And in the Bank v. Roden and Reading Iron Works cases it was held that the prayer might be in the alternative, as in this case. But no question of practice was made in this action. But an action at law for damages is an old and well established remedy of a stockholder in cases of this kind. Cook, Stocks & S. § 392, and cases cited. In such an action the damages are measured by the value of the stock at the time of the demand of the transfer and the refusal. All the cases treat the wrongful refusal to transfer as a conversion, where the stockholder elects to sue for damages. In this case plaintiff has recovered a judgment, according to the findings and the evidence, for the full market value of the stock. But the Court also finds, and such finding is well supported by the evidence, that the stock in controversy was delivered by Clarke to plaintiff on January 5, 1893, as collateral security to an indebtedness then due and owing from said Clarke to the plaintiff. But it will be remembered that plaintiff brought its action as owner, and it proved the execution of the assignment of the certificate to it by Clarke, introduced such assignment, and rested. The fact that plaintiff held the stock as collateral to Clarke's indebtedness to it was shown by the undisputed testimony introduced by defendant. As to whether or not such debt, or any part of it, existed at the time of the trial of this action, in January, 1897, the record is entirely silent. All that we know about the debt comes from the testimony of defendant's cashier relative to a statement made to him by plaintiff's cashier. He testified: "He told me or gave me to understand that they held this as collateral security; that Clarke was owing the bank about six thousand dollars, and this stuff, with some other, was collateral security." As to what has been done with the other security, and as to the present condition of the debt, if any there be, we know nothing. But as plaintiff had not the absolute, but only a special, interest in the stock, its measure of damages was not, necessarily, the value of

the stock, but the value of its special interest therein, which would be measured (speaking without reference to the other security) by the indebtedness to which it was collateral, but not exceeding the value of the property. Kasper v. Walla, 49 Neb. 288, 68 N. W. Rep. 476; Seibold v. Rogers, 110 Ala. 438, 18 South. Rep. 312; Sheehan v. Levy, I Wash. St. 149, 23 Pac. Rep. 802; Sherman v. Finch, 71. Cal. 68, 11 Pac. Rep. 847; Ganong v. Green, 71 Mich. 1, 38 N. W. Rep. 661; Rev. Codes N. D. § 5002. It is true there is some general language in the books indicating that a pledgee may recover the full value of the stock. See Coleb. Collat. Sec. § 272. But the authorities that sustained that proposition as to a pledgee are cases where the debt exceeded the value of the stock, or where the measure of damages was in no manner raised. We do not believe that the authorities ever intended to make this class of cases exceptional or to depart from the broad general rule of compensation; and certainly this must be true where, as in this case, the party against whom the damages are sought is the party who would be entitled to the surplus over the amount of the indebtedness secured. Of course, we are not speaking of the damages in conversion by a stranger.

Regarding this action, as we must, as an action to recover damages for the wrongful conversion of property in which plaintiff had only a special interest, if anything, as a pledgee, it was incumbent upon plaintiff to establish the amount of such special interest. We think it failed to do this. If it has complied with this requirement, it must be found in the single fact that the proof that it held the stock as collateral came from an admission of the cashier, and coupled with that admission, and as a part of it, was the statement that Clarke owed the plaintiff bank about $6,000, and the bank held this stock and other property as collateral thereto. It will be conceded that this admission must be taken as a whole, and that it establishes, prima facie, that at one time Clarke owed plaintiff bank about $6,000. But this stock was transferred by Clarke in January, 1893, the admission was made in December, 1894; and the case was tried in January, 1897. Does the admission establish an indebtedness from Clarke to plaintiff at the time of the trial? We think not. We recognize the rule that in actions upon contract for the recovery of money, where the making of the contract is admitted and the defendant relies upon payment as a defense, such defense must be specially pleaded. It is also true that the burden of proving payment always rests upon the party pleading it. But these principles are not applicable here. This plaintiff is not suing on contract, but in tort. The burden is upon it to establish, affirmatively, every proposition necessary to sustain a judgment in its favor. And whatever might be the presumption of payment or nonpayment as between Clarke and plaintiff, as against this defendant, who had no connection with the contracts between those parties, no presumption of nonpayment, after the