Opinion
Argued May 10, 1881
Decided May 31, 1881
Samuel Hand for appellant.
Nathaniel C. Moak for respondent.
By the receipt given by the defendant to Sheldons Wood, the plaintiff's assignors, the original owners of the telegraph stock, which is the subject of controversy in this action, the defendant agreed to do the best he could with the stock, and was to have one-half of the proceeds thereof. At the time it is evident that the stock was not considered as of any market value, and the intention of the parties clearly was to confer upon the defendant, who was then about removing to the west, authority to manage or to sell and dispose of it to the best advantage, and as a reward for his skill and attention in making it valuable, or in disposing of the same, he was to receive one-half of the proceeds when sold or disposed of. He was not restricted as to the time of sale, the price or the manner in which he was to operate in reference to the stock, but he was vested with an unlimited discretion in the management and disposition of the same. He would have been justified in selling it soon after he received it, and would then have been entitled to divide the avails with the owners. If, in his judgment, a more advantageous and profitable result could be attained by watching the market and by waiting or by inquiry, correspondence and attention, all of these means were also within the line of his duty, as well as his right, and the use of any of these could not deprive him of the one-half of the proceeds which belonged to him by the terms of the contract.
There is no ground for claiming that the defendant's management in the disposition of the stock was not the very best which could have been employed under the circumstances, as it had advanced greatly in value, and at the time of the commencement of the action, was worth more than at any previous period. The delay, therefore, was to the interest and advantage of all the parties interested, and the plaintiff or his assignor had no just ground of complaint on that account. No loss had thus been sustained by the conduct of the defendant, and it seems to have been dictated by a sound judgment and discretion.
In view of the facts, with no improper management on the part of the defendant, no needless delay, and no act which was injurious to the interest of the owner, the question arises whether upon demand the plaintiff was entitled to the entire stock without dividing the same with the defendant or at least furnishing him an opportunity to sell or dispose thereof for the mutual benefit of the parties in interest? The defendant had done the best he could under the circumstances, and that he had not sold the stock when demanded of him did not deprive him of his interest in the same according to the terms of the contract. The right to sell existed up to the time of the demand; the plaintiff did not request that the stock be sold, made no complaint that a sale had not been made, and by an offer to allow compensation and expenses for the defendant's services virtually prohibited a sale. Had a sale taken place at that time the defendant would have been entitled to one-half of the proceeds of such sale. Had the defendant refused to sell when requested then there would be ground for claiming that he had forfeited his right. As no request was made to sell, and no injury accrued to the plaintiff by the delay, and inasmuch as the defendant has not failed to fulfill the contract, a just and reasonable interpretation of its terms demands that he should receive one-half of the avails of the stock, as well as the dividends actually paid to him. By this construction the defendant would receive no more than if he had sold the stock and divided the proceeds; the contract would be fully carried into effect and equity done between all the parties. It follows that the judge erred upon the trial in directing a verdict that the plaintiff was the owner of the stock and entitled to a transfer of the same, and for the amount of dividends received and interest thereon. The General Term modified the judgment in respect to the dividends, and in conformity with the previous decision of that court held, that the plaintiff was entitled to the whole of the stock.
In the last respect the General Term was wrong, and for the error stated the judgment should be reversed and a new trial granted, with costs to abide the event.
All concur, except FOLGER, Ch. J., absent.
Judgment reversed.