A TRANSACTION IN SHARES

Dominion, Volume 9, Issue 2784, 31 May 1916, Page 6

A TRANSACTION IN SHARES

RESERVED JUDGMENT. In the Supreme Court yesterday His Honour Mr. Justice Hosking delivered judgment in the case of Albert Sanderson Collins, clerk, of Wellington, and J. Martyn Hume, sharebroker, Wellington, and Rossmoro C. Wilson, shcop fanner, Cheviot.

The case was that Hume had 600 preference shares in the Westport-Stockton Coal Company placwl in his- hands for sale. The plaintiff Collins knew nothing of preference shares, but authorised his broker to buy the shares. Hume 6ent a sold note for preference shares to plaintiff's broker, who sent a bought note' to Humo without specialising the shares, and the evidence was that ordinary shares were meant. Plaintiff's broker sent a bought note without specialising .the shares either. All that was before t?ie Court as constituting a contract was the bought and sold note. In His Honour's opinion these differed from each other in substance as to the subject of sale, and were insufficient to show that the parties wore ad idem. Plaintiff never saw defendant's sold note till after the transaction was completed, but on the morning of the receipt of the notes which passed between plaintiff's broker and Hume he was informed that it was preference, and not ordinary, shares Hume had to sell. The plaintiff treated this as a substitution of the contract for preference, instead of ordinary, shares. Ii plaintiff's broker had authority to purchase either class of sliares, the parties then became ad idem, and a contract was then formed which justified Hume in tendering ordinary or preference shares in performance, and Hume tendered a transfer of ordinary shares to plaintiff's broker. The shares paid for and signed for were ordinary shares, although the clerk who presented tho transfer to plaintiff for signature said they were preference. Discovering that they were ordinary shaies, plaintiff claimed preference shares, and relied on the sold note signed by defendant. But His Honour held that there was no contract constituted by that and the . bought note. Plaintiff's broker had authority to make the contract either for ordinary or preference shares. If tho agent hud no authority to that effect, tliore was no contract, and the tender of the transfer was an offer of tho shares therein mentioned, which were ordinary shares. The plaintiff accepted this offer by signing the transfer and. eoriipleting the purchase. It was true that his evidence n-as that he did so \ nftor being assured by his broker's c.'erlc that the shares were preference, but Hume was not responsible for such representation. The plaintiff could not succeed. The contract was for either ordinary or preference shares, and the plaintiff got ordinary shares. There waa an previously stated no ease against Wilson. The appeal was dismissed, and plaintiff was ordered to pay to each defendant as costs .£lO, with each defendant's incidental disbursements. Mr. A. W. Blair appeared for Blointiff. Mr. T. Young for Hume, and Mr. Robert Kennedy for TOJrnw*.