CUMBERLAND G. WHITE, Plaintiff and Respondent, v. ALGERNON S. BAXTER, Defendant and Appellant.
I. DAMAGES.
1. Agreement for their measurement Toy profits ea/rned during a specified period.
(a). Profits fob a shorter period only having been
PROVED, IS NOT CAUSE FOB REVERSAL.
1. When such proof was received without objection.
(a) The argument, that for the part of the period not covered by the proof, the losses might have exceeded the profits proved, is not of much force when the jury were instructed to disregard a certain line of profits, earned in the shorter period, and no questions were asked in regard to the period not covered by the direct evidence.
II. PRIMO IP AL AND AGENT.
1. Brolcer belonging to open Board.
3. Appearing before arbitration committee.
(a) It is no part of his duty to his principals to refuse to appear before such committee, when summoned so to do in reference to an alleged demand claimed to have arisen out of a contract, entered into by him in behalf of his principal.
(Í) Validity or non-mlidity of the claim does not affect or control such right.
IH. OONTRACT.
1. Duress—what does not constitute.
A and B being members of a body which had certain rules and regulations for the government of its members, and the settlement of differences arising out pf contracts between them, A as agent of 0, but in his own name, entered into a contract with B. 0 knew of the rules and regulations of the body, and that A and B were members of it. Thereafter B made an unlawful demand upon A, claiming a right so to do under the contract. A communicated the demand to 0, and reminded him of the consequences to him, A, in case of refusal; thereupon 0 agreed with A, that if A would not comply with the demand, and would not comply with a certain rule of the *359body (the duty to non-com ply with which was not imposed on A by his agreement or relations with C), he would compensate him for any loss he might sustain according to a certain designated rule of compensation.
Held, there was no duress either as being made under pressure of an unlawful demand, or to induce A to perform, his legal obligation.
2. Mutuality.
(a) Express acceptance of proposition not necessary.
(b) Performance of the acts or conditions embraced in the proposition is sufficient.
3. Consideration.
(a) Performance of a service by acts of either omission or commission, is sufficient consideration for a promise to pay therefor. '
1. Obligation to make the promise.
2. Benefit from the service.
The absence of either or both of these elements, does not affect the validity of the promise.
IY. APPLICATION OF ABOVE PRINCIPLES.—BROKERS.
W and C, being stock-brokers, and members of the open board of brokers, W, as agent of B, but in his own name, entered into a contract with C, for the sale by A and the purchase by C of certain stock, a certain margin to be deposited by both, and either party to have a right, in certain specified contingencies, to call for further deposits. B knew the rules regulating the board., Thereafter 0 called on W for a further deposit. W, notified B, reminding him that he (W) would be liable to suspension if he did comply. Thereupon B requested W not to comply, and not to appear before the board of arbitration of the open board of brokers, if summoned by C to appear in reference to said contract, or any matter growing therefrom, and promised W that if, by reason of complying with such requests, he should be suspended, he (B) would compensate him for the loss he might sustain, according to a certain measure of compensation. W did not, in express terms, assent to the proposition, but he complied with the request, and was in consequence suspended, and suffered loss.
Held,
That B’s agreement was valid ; W was under no obligation to B to refrain from appearing before the arbitration committee ; the contract was not made under duress; there was sufficient mutuality and consideration.
*360Before Curtis and Van Vorst, JJ.
Decided October 23, 1876.
Appeal by the defendant from a judgment entered upon the verdict of a jury for six thousand six hundred and one dollars and fifty-five cents.
In February, 186?, the plaintiff was a stock-broker and a member of the open Board of Brokers in the city of Hew York. As a condition of admission into that Board and into the rooms occupied by it, the plaintiff had agreed to be bound by certain rules. Unless the plaintiff had such admission to the open Board, he could only carry on his business by employing other brokers who had such admission, and to great disadvantage to himself.
On February 18, 1867, the defendant employed the plaintiff as a broker to sell in his own name one thousand shares of the Hudson River Railroad Company’s stock to Currie, Martin and Co., at one hundred and twenty-eight dollars per share, payable and deliverable any time during the year at the seller’s option, with interest at six per cent, either party to have the right to call, from time to time, for deposits to meet the fluctuations of the market.
The rules of the open Board provided that either party was at liberty to call upon the other for margins to meet such fluctuations, and in case of any breach of the contract, or refusal to comply with a demand for a deposit, or any other matter of difference arising between the parties, that the same should be determined by an arbitration committee appointed by the president of the Board, who should take cognizance of, and exercise jurisdiction over all claims and matters of difference between the members of the Board.
The rules further provided, that in case of any *361breach of contract, the member in default should be suspended from the Board.
On April 8, 1867, the Hudson River Railroad Company doubled its capital stock, agreeing to give every stockholder, on April 10th, 1867, an amount of new stock equal to that held by him, upon the payment of only fifty per cent of its par value.
Currie, Martin <& Co., on April 10, 1867, notified the plaintiff that they elected to take this additional stock. The plaintiff showed the defendant this notice, who said that Currie, Martin & Co. were not entitled to the stock, and neither offered the plaintiff money to make the subscription, nor instructed him to subscribe.
This issue of new stock was called a dividend in the open board of brokers, and thereafter the stock of the company was sold ex-dividend. The stock thus increased sold, at first, for a much lower price than the old stock had done, but it advanced steadily, and Sept. 5, 186?, its price was about one hundred and twenty-seven dollars per share. On that day Currie, Martin & Co., who had previously called for margins which had been deposited on each side to the extent of fifty-five thousand dollars, called for a further deposit of ten thousand dollars. The plaintiff notified the defendant of this call, and the defendant refused to make any further deposit. Upon this the plaintiff objected that he was liable to be suspended by the Board, and to be deprived of all his business as a stock-broker. The defendant then said to the plaintiff, that if plaintiff would not put up any margin, nor appear before the arbitration committee of the open Board, when summoned to do so by Currie, Martin & Co., under the contract, he, defendant, would protect plaintiff against all loss which should ensue to him from such refusal, and if he was suspended, would pay him, during the time of his suspension from the Board, at a rate equal to the plaintiff’s average business for the *362previous year, with ten per cent, added thereto. This was repeated two or three times. The plaintiff thereupon refused to put up any margin upon the contract, and refused to appear before the arbitration committee when summoned by Currie, Martin & Co. Upon plaintiff’s refusal to put up the additional margin, the president of the Board, at the request of Currie, Martin & Co. bought two thousand shares of the stock, they claiming that it was for plaintiff’s account. The plaintiff was suspended 'from the Board, and summoned to appear before the arbitration committee, which, acting under the instructions of the defendant, lie refused to do. The arbitration committee made an award of sixty-six thousand dollars against the plaintiff upon the contract, and when he attempted to enter the open Board, he was excluded.
The plaintiff continued suspended from the Board, from September, 1867, until May, 1869, to the great injury of his business. His earnings in the open Board during the eight months preceding his suspension were thirteen thousand one hundred and forty-five dollars from commissions on regular business, and thirteen thousand four hundred and fifty-four dollars in profits on speculations in the course of his ordinary stock business. During the period of his suspension his earnings did not exceed one thousand five hundred dollars. After his suspension, the defendant advanced to the plaintiff about six thousand six hundred dollars, which the defendant, by his answer, claimed was a loan, and pleaded it as a counter claim; the defendant also, by counter-claim, sought to recover one thousand dollars damages by reason of expenses he incurred in an injunction suit against the Trust Company, to prevent the payment over cf money which had been deposited by Currie, Martin and Company on the contract, and which suit he claimed was rendered necessary, by the want of fidelity on the part of his agent, the defendant.
*363It was shown by the defendant’s testimony, that it was a. general custom in the market, for brokers to make contracts in their own name, when they had orders to buy or sell stock; that contracts between brokers for the purchase or sales of stocks were subject to the rules of the stock board; and that when this contract was made, he knew that the Board could expel a man if he did not live up to his contract, and that he supposed the plaintiff, if he broke his contract, would be expelled.
The defendant denied having made the agreement of September 5, 1867, for compensation and indemnification, to which the plaintiff testified.
When the plaintiff rested, the defendant moved to dismiss the complaint, which was denied, and the defendant excepted. At the close of the testimony this motion was renewed and denied, and the court was requested to direct a verdict for defendant, which was denied, and to these rulings the defendant also excepted.
The court charged the jury that it was for them to determine whether the contract of September 5, 1867, testified to by the plaintiff, and denied by the defendant, was in fact made; and also to determine whether there was a loan made by the defendant to the plaintiff, as set up by counter-claim and denied by the plaintiff, and also whether there was such negligence and omission of duty on the plaintiff’s part as was in like manner alleged by the defendant and denied by the plaintiff.
The court also excluded from the consideration of the jury, as a basis for any recovery, such portion of the plaintiff’s earnings as arose from profits on speculations in the coarse of bis ordinary stock-business.
There were numerous exceptions at the trial to the rulings of the court, and to the charge to the jury.
The jury rendered a verdict in favor of the plaintiff for six thousand and sixteen dollars.
*364
Redfield & Hill attorneys, and John G. Hill, of counsel, for appellant.
Shearman & Sterling, attorneys, and Thomas G. Shearman, of counsel, for respondent.
The briefs of the respective counsel (especially that of the appellant) are so elaborate and exhaustive on every point that they cannot well be epitomized, and they are too lengthy to report in full.
The members of the profession are referred for these points to the bound volumes of cases heard at the General Term, kept in the libraries of the Superior Court and of the Bar Association.
By the Court.—Curtis, J.
The jury found that there was such an agreement made September 5, 1.867, between the parties, as was testified to by the plaintiff, and by which he was to be compensated by the defendant for the loss of earnings, in case he should be suspended by the Board. The measure of his compensation was to be an amount, equal to his average business for the preceding year, with ten per cent added.
The jury did not allow the plaintiff as much as he would have been entitled to under the agreement, even if his earnings from commissions for the eight months ($13,145) had been all that he had earned during the previous year. They appear to have considered that during the other four months of the previous year the plaintiff earned nothing. As the plaintiff’s profits on speculations in his stock-business during the eight months was excluded from the consideration of the jury as forming any basis for the measurement of damages, and their attention in that respect limited to the amount of earnings from commissions on regular business, there is not much force in the objection, that for aught that appeared, the plaintiff’s previous *365four months more than exhausted profits by losses. No questions were asked the plaintiff on cross-examination, in regard to his business during the preceding four months, and his evidence as to his earnings during eight months was received without objection.
The defendant claims that his promise was involuntary, and was made under a species of duress. That is, that it was made under the pressure of a wrongful demand, and to induce the plaintiff to perform his legal obligation. The testimony shows, that when the plaintiff reminded the defendant of what he knew, as-, to the plaintiff’s liability to suspension in case a further deposit was not made, the defendant, of his own, accord, made to the plaintiff a new proposition,, not merely in reference to not putting up the margin, b.ut that he should not appear before the arbitration com-, mittee of the Board, when summoned to do- so, by Currie, Martin & Co., and that upon plaintiff’s thus acting, he would not only protect him from loss, but if he was suspended from the Board, would pay him¡ at a certain rate for his time during the period of such, suspension. To this proposition the plaintiff acceded,, and fulfilled the new contract thus created,.
It is argued that this promise of the defendant was; involuntary, and was made under a species of duress* for two reasons. First, that it was- made under the pressure of a wrongful demand, and secondly, to induce the plaintiff to perform his legal obligation. The evidence fails to show that the plaintiff made any demand whatever upon the defendant, but simply that an additional or supplemental agreement was entered into between the defendant as principal and the plaintiff as his agent. Neither does the testimony show that it was made to induce the plaintiff to perform Ms legal obligation. The non-appearing of the plaintiff before the arbitration committee, when summoned by Currie, Martin & Co., was not a legal obligation on *366the part of the plaintiff that he owed the defendant. The right of the plaintiff to appear there, was not affected or controlled by the validity or non-validity of the claim of that firm. His appearance and explanation might have satisfied the arbitration committee that the defendant was not in default. • The defendant, as the plaintiff’s employer, and from motives or for reasons with which the plaintiff’ had nothing to do, and which were not embraced in the scope of his employment, instructed him, as the jury found, not to appear, and promised him compensation in case he sustained a loss from such service. Nothing involuntary or in the nature of duress appears in the transaction. An objection is presented, that the contract is 4 ‘ void for want of mutuality,” that is, for want of express proof, that when the defendant made his proposition to the plaintiff, the latter in express terms accepted and agreed to it. It is abundantly proved that the plaintiff performed what the defendant proposed to him that he should do, and that the defendant knew of such performance, and availed himself of its results. The defendant’s offer was upon the condition of this performance by plaintiff, and when the latter performed the acts which were made its condition, the offer was accepted and became a binding contract (L’ Amoureux v. Gould, 7 N. Y. 349; Willetts v. Sun Ins. Co. 45 Ib. 45 ; Train v. Gold, 5 Pick. 380).
It is insisted that the defendant’s final promise of September 5, 1867, was for simple indemnity, unmixed with any service or other benefit to the defendant, and unsupported by any consideration and void.
The plaintiff acted as agent for the defendant, under the rules of the open Board, which were known to the defendant, and recognized by him up to September 5, 1867. These rules, by the nature and acts of the employment, conferred certain legal rights and privileges in the -transaction of his business upon the plaintiff, as *367was known to the defendant. At this date the defendant promised to indemnify the plaintiff against a pecuniary loss, if he would comply with his request to perform certain services for him in the course of his employ ment, and which involved a non-compliance by the plaintiff with those rules. It was believed by both parties that such compliance would render the plaintiff liable to expulsion from the open Board, and cause loss and injury to him in his business, for which, if it occurred, the defendant promised in advance compensation. This promise was not a wager, nor the result of an effort to obtain indemnity based upon a wrongful claim. It was notin hostility to the reasoning in Converse v. Kellogg (7 Barb. 598). It was conditioned upon a service to be performed by the plaintiff.
An ingenious and elaborate argument has been presented on the part of the defendant, to establish that the defendant was under no obligation to the plaintiff which could serve as a basis for the defendant’s promise. The transactions and accounts relating to them, with Currie, Martin & Co., and the results of the litigations growing out of them, are considered and reported in 45 N. Y. 842, and 2 Daly, 329, which are referred to. Whether the defendant was under any obligation to make the promise to the plaintiff or not, is immaterial. Neither is it material whether the defendant received benefit or not from the plaintiff’s performance. Where an employer requests a specific service, and promises indemnity and compensation therefor, the rights and remedy of the employee are not prejudiced by the failure of the service rendered to be of benefit to the employer, and the law presumes that the rendering of such service was the basis of the promise of indemnity.
An employment may be for acts of omission as well as of commission, and the distinction sought to be made in the present case between the two, as respects a remedy upon a promise of indemnity, is not well founded.
*368It is stated, on the part of the defendant, that the plaintiff was under a legal obligation to do the very thing which he claims to have done at the defendant’s . request; that is, that he had no legal right to submit this claim of Currie, Martin & Co. to arbitration. What the defendant employed the plaintiff to do in this behalf, was simply “not to appear before the arbitration committee of the open Board when summoned to do so by Currie, Martin & Co., under the contract.” The question whether the plaintiff had the legal right or not to submit this claim to arbitration does not arise. It is immaterial. But the non-appearance of the plaintiff before the committee was in compliance with the defendant’s request, and upon his promise of indemnity, and in accordance with the new agreement of Sept, ñ, 1867, and irrespective of all questions of antecedent legq,l obligations in reference To such service, if any such obligation had ever existed.
In the performance of the last contract, the plaintiff' sustained losses incident to it, and such as were contemplated as probable by the parties, when they entered into it. There was such an assumption of liability and performance of acts detrimental to the plaintiff, as constituted a good consideration for the defendant’s promise (L’Amoureux v. Gould, 7 N. Y. 349 ; Milton v. Somhurst, 17 Maine, 303 ; Kempton v. Coffin, 12 Pick 129; Howe v. Buffalo, N. Y. and Erie R. Co., 37 N. Y. 297). The construction which the defendant put upon the contract, and the way it was understood at the time by the parties, are shown by the plaintiff’s performance, and the advances by the defendant to the plaintiff which were found to have been made in part compensation therefor.
The extent to which the agreement in question was executed, and the facts established at the trial are such, that no sufficient reasons appear for disturbing its validity.
*369None of the exceptions seem to be of a character to call for a new trial.
The judgment appealed from should be affirmed with costs.
Van Vorst, J., concurred.