Robinson v. Norris

Van Brunt, J.

—There is no dispute about the facts of this case and the questions which I am called upon to decide are merely those of law. The first question which presents itself is as to the right of the plaintiffs to charge the commissions which they did in the account of the defendant for obtaining money.

*448At the commencement of their dealings, in a letter of the 10th of October, 1872, the plaintiffs informed the defendant that their custom was in ease of a stringent money market to charge such commissions as they were required to pay in raising money, and in the case of the first account rendered, and which the defendant acknowledged to be correct, there was a charge for money paid out in this way, and it is to be noticed that the defendant was duly informed every day when any such charge was made against him, and he made no objection to the same until August at least, although they were made in February, March and April. It seems to me very clear that the defendant was in duty bound, if he intended to dispute these charges, to notify "the plaintiffs at once as soon as he was made aware of the fact, and not let them make day by day these expenditures for his benefit, and not wait until he is called upon to pay to dispute them. If he did not desire them to raise money to carry his stocks at such high rates, he should have said so, and then the plaintiffs could have protected themselves.

The defendant, in his points, urges that the plaintiffs were merely his agents to borrow the money, and that he owed the lenders of the money, and not the plaintiffs. This position is entirely untenable, because no rule is better established than that if an agent pays out money for his principal that he may sue and recover the sum so paid from the principal. Mr. Atkins swears that they actually paid these sums for commissions to obtain money to carry the defendant’s stocks, and hence if done by his authority, and we must assume that it was so done, in" view of the letter of October tenth and the daily notification of such expenditures without any objection being made by defendant, they have a clear right to claim their payment of the defendant.

The next question is as to the sale of the Lake Shore stock. If the agreement of October eighteenth was still in force, there can be no question upon the subject, as it gives the plaintiffs the right to sell, whenever and wherever they *449please. The defendant claims that this agreement applies only to the purchase of bonds, which account was closed on or about the 18th of November, 1872, arid did not cover subsequent transactions. In discussing this question it will be necessary to consider, briefly, the circumstances under which the agreement of October eighteenth was signed. TJpon the receipt of the first order from the defendant the plaintiffs at once inclose to him this agreement for signature, saying: “We herewith inclose our usual customer’s agreement for your signature,” and he signs and returns the same to them. It has been settled by our court of appeals, that no custom among brokers can deprive parties of rights which the law gives them, but they have not decided that those rights may not be waived by agreement.

I think it perfectly clear that if the broker informs his customer of the terms upon which he will act for him as his broker, and in view of that notice the customer gives an order, he is bound by the terms on which the broker proposed to act for him.

So in this case, if the plaintiffs had written to the defendant that the terms upon which they accepted orders from customers were as stated in the printed contract and he had then given an order, he would have been bound by its terms even though he had never signed it, or given any express assent to it. As well might a customer of a merchant say, after buying goods, that he had not promised to pay cash, because he said nothing when the merchant, before dealing with him, had told him he only sold for cash.

It seems to me immaterial, therefore, whether the agreement, as signed, was intended to apply to any other transactions than the bonds or not; it was a notice to him of the terms upon which the plaintiffs would deal with him, and when he gave his orders he assented to its conditions.

But I do not think that there is any thing in this case to show that it was only intended to apply to the purchase of the bonds.

*450The .defendant became a customer of the plaintiffs for the first time when he gave the first order, he signs what the plaintiffs notify him is their “ usual customer’s agreement,” and he goes on dealing with them almost continuously thereafter. The mere fact that for one day or two the account was balanced does not alter the question, because the defendant still continued to be the plaintiffs’ customer — there had never been a sufficiently long cessation of dealings for him to lose that relation. In fact there was no formal closing of the account, and the defendant never, by any act of his, showed that he intended to close his account. The mere payment of all the money which he owed upon the bonds did not show any such intention, because if he had intended so to do he would have taken up his bonds and not have allowed them to remain in plaintiffs’ hands and be used at a margin for his future purchases. The fact that the stock was not sold at the Stock Exchange does not invalidate the sale, because the contract gives them the right to sell wherever they please; neither were the plaintiffs bound to sell as soon as margin was exhausted, as long as they acted in good faith.

The plaintiffs must have judgment, with costs.