BAGAB S. TOWNSEND.
HAGAR T. TOWNSEND et at. (Circuit Court, E. D. New York. Aprll 4, 1895.)
PLJuDING DURE. MONEY HAD AND RECEIVED NEW YORE CODE OF CIVIL PROOB-
Plaintiff's complaint alleged that he let one E., a partner of one of the defendants, and since deceased, have certain bonds with which to raise $3,000; that E. and his partner, T., one of the defendants, afterwards increased the loan on the bonds to $4,000, and used the additional $1,000 in the firm business; that D., the other defendant, afterwards became a partner; that the bonds were sold for $1,460 more than the loan, and that this balance was received and used by the defendants. Upon these facts, plaintiff demanded judgment for the return of the bonds, or, on inablUty or failure, for payment of damages tor their los8. Held, under the New York Code ot Civil Procedure, that the allegations of the complaint were sufficient to support a recovery for money had and received to the amount of the plaintitI's remaining interest in the bonds, and that the demand of judgment tor a return of the property would not control the right to damages, where there was no judgment for a return.
This was an action by James M. Hagar against James A. Townsend and Wallace Downey to recover the value of certain bonds. The jury gave a verdict for the plaintiff. Defendants moved for a new trial. E. N. Taft and T. M. Taft, for plaintiff. Peter S. Oarier, for defendants. WHEELER, District Judge. The defendant Townsend and one Edgett, now dead, were partners. The plaintiff let Edgett have some railroad bonds to raise $3,000 upon, which he did by pledging them on a firm note of that amount to a bank. Without the plaintiff's knowledge, a note of $4,000 was substituted. The defendant Downey became a member of the firm. The bonds were sold by the bank for more than the note, and the excess, $1,460.88, by direction of the firm, was placed to its credit These latter' two sums were credited to Edgett on a balance against him in his firm account The complaint set forth the facts, with conclusion that the defendants had converted the bonds to their own use to the damage of the plaintiff, and demand of judgment for the return of the bonds, or, on inability or failure, for the payment of damages suffered from the loss of them. The evidence tended to show that Townsend knew the bonds were the plaintiff's before the note was enlarged, and that the additional $1,000 went to the use of the firm. The court refused to direct a verdict for the defendants requested because of the form of action; and, against exception, a verdict for the $1,460.88 excess was directed, and one for the $1,000 "Was found, under directions that the plaintuf was entitled to recover it if it went to the use of the firm. On this motion for a new trial the counsel for the defendants insists that a verdict for the defendants should have been dh"ected; and that, it not, 8.8 damages were demanded only upon inability or failure to return, Done but those for not returning them at the time of trial were recoverable. If one of these causes of action was intended v.67F.no.4-28
for a replevin, as argued, it was not used as such, and could ap· parently be joined with the other without affecting it. Code N. Y. § 1689.1;'heallegation of conversion is like that in trover, which perhlips could not be maintained because the plaintiff had not the right to immediate possession. As either of these could be with other causes of (ld. § 484), the defendants would not be (;!irtitIed to a verdict because not supported by proof, it what would constitute any other was alleged.. The complaint wellaUeged,and the evidence showed, 11Jl interest remaining to the plaintiff in the bonds which the firms of which the defendants are the ,suryivorsconverted into money, to the damage of the plaintiff.This is a good cause of action in assumpsit for money had and received, which always concludes in the same way, and the -damages recoverable is the amount received. The demand of judgment for damages upon failure on a judgment return would not control the right todama,ges when there was no judgment of return. And a tort:Jleasor may be held liable for the avails as a measure of damages. This is well shown in patent cases, where an infringer may always, a$ is elementary, be held liable for the profits, at least, as damages.. So here the defendants would be liable, at least, for the avails received from the wrongful con· version of the plaintiff's interest in the bonds. Although Edgett was given apparent control of the bonds by the plaintiff, they were not left to stand upon that,'but' further control was assumed by the defendants, which, as the jury has found, resulted in the appropriation of $1,000, of these avails by 'the firm of which Townsend, was a member, after notice to him, and of, $1,460.88 by the,firm of which both were members. The credit of the avails to Edgett the balance, of firm accounts against him would not -deprive t1l.e ,defendants of their benefit, nor affect the plaintiff's right tot1),em. OIl this review, no reason for disturbing the verdict becomes apparent. MQtiondenied.
ROOD v. WHORTON. 1.
D. Wisconsin. April 29, 1895.)
CORPORATION8:-LIABILITY OF ,STOCXllOL:DERS-EOIUFJDE PURCHASER.
One w:ho purchases In good faith,ln the open market, stock ot a corporation which purports, on the taceot the certificates, to be full paid and nonassessable, Is not, liable for assessments' on 'such stock,though In fact It had ij,Ot been fully paid.
The A.. Cpo ,was, orga.n!.zed" under the Michigan 8tatutes, with ll. capi'tal ot$l,Ooo,OOO, In sharesot $25 each., all of w)llch 1V4s subscrlbed,and on which $220,000 was paid· In. In, order to ratite money for the purposes otthe corporation, the original Bubscribel:s' contributed two-fifths stock to a ppok to be $old: at $8 per share, as full paid, nonas. a,ble stock" the... ,p.']roceed.s:. to .be divide.d.. between, the. corpo.1'8.tion .. .. anll the through one W., an agent of the cprpbration, '. not a stocIth9ider, bought SOo shares, which were represented by W. to be full: paid. and unassessable. Defendant had· no knowledge -of the real, facta., 'J.'he wrporation tailed, and a receiver, under the