author: Mercur,, J.

text:
    Holt versus Green.
    1. A commercial broker cannot recover commissions unless he has taken out a license under the 71st sect, of the Act of Congress of June 30th 1864.
    2. An action cannot be maintained in Pennsylvania founded on a violation of an United States law.
    3. Although a contract may not be declared by the statute void; and a penalty may be imposed for its violation; an action cannot be maintained on a contract in violation of a statute.
    4. There is no difference whether the contract is malum prohibitum or malum, in se.

    5. The test is whether the plaintiff requires the illegal transaction to establish his case.
    6. Public policy will not allow courts to aid one grounding his action on an illegal or criminal act.
    7. Maybin v. Coulon, 4 Dall. 298, followed.
    February 24th 1873.
    Before Read, C. J., Agnew, Sharswood, Williams and Mercur, JJ.
    Error to the District Court of Philadelphia: No. 78, to January Term 1871.
    This was an action of assumpsit, brought January 18th 1869, by Frederick F. Holt, against Joseph Green.
    The plaintiff’s bill of particulars was as follows:—
    “ The plaintiff’s demand is founded on his claim to commissions as a broker or salesman on commission for the sale of certain cards, and spinning and other machinery of a cotton or woollen mill put in his hands for sale by the defendant above named, on or about May 1866.”
    The case was tried May 5th 1869, before Stroud, J.
    The plaintiff testified that he was employed by the defendant Joseph Green,- to sell for him certain machinery, and that he advertised the same for sale; upon cross-examination he testified that his business was buying and selling machinery for other parties, and being asked whether he had ever obtained a United States license, or paid a United States license tax, answered that he had not done so, never having been asked to do so.
    The defendant then moved the court to enter a nonsuit against the plaintiff, on the ground that he could not maintain his action for commissions for the sale of machinery, without having paid the United States license tax as a commercial broker or commission merchant; the court entered the nonsuit, which the court in banc refused to take off.
    This was assigned for error by the plaintiff on the removal of the record to the Supreme court.
    The Act of Congress of June 30th 1864, 2 Brightly’s U. S. Dig. 227, 230, pi. 77, 79, 99, which was the ground of the non-suit, provides as follows:—
    “ Sect. 71. That no person, firm, company or corporation shall be engaged in, prosecute or carry on any trade, business or profession hereinafter mentioned and described, until he or they shall have obtained a license therefor in the manner hereinafter provided.
    “ Sect. 73. That any person carrying on business, &c., without a license, shall be liable for each offence to certain fine and imprisonment as therein set out.
    “ Sect. 79. That commercial brokers shall pay twenty dollars for each license. Any person or firm whose business it is, as a broker, to negotiate sales or purchases of goods, wares, products or merchandise * * * shall be regarded a commercial broker under this act.”

      W. W. Montgomery and R. L. Ashhurst, for plaintiff in error.—
    The Act of Congress must be construed as affecting only the rigfyt to sue in the United States courts, since it would be unconstitutional if considered as affecting the right of action of a citizen of a state in the state courts. The Congress of the United States cannot prescribe rules of evidence in state courts, nor can it make the courts of a state the machinery for enforcing national laws: Prigg v. The Commonwealth of Pennsylvania, 16 Peters 539; Latham v. Scott, 45 Ill. 27; Heister v. Cobb, 1 Bush 239 ; Carpenter v. Snelling, 97 Mass. 452 ; Lynch v. Moore, Id. 458; People v. Gates, 43 N. Y. 40; Clemens v. Conrad, 19 Mich. 190; Griffin v. Ramsey, 35 Conn. 239.

      L. O. Oleemann and Gf. Sergeant, for defendant in error. —
    Courts of justice will not assist a plaintiff in recovering under a contract made in violation of the law: Maybin v. Coulon, 4 Yeates 34; Mitchell v. Smith, 1 Binney 118; Seidenbender v. Charles, 4 S. & R. 159; Columbia Bank v. Haldeman, 7 W. & S. 235; Biddis v. James, 6 Binney 329; Evans v. Hall, 9 Wright 236; Bowman v. Coffroth, 9 P. F. Smith 19; Smith v. Mahood, 14 M. & W. 452; Marshall v. Railroad Co., 16 Howard 334; Tripp v. Bishop, 6 P. F. Smith 430.
   The opinion of the court was delivered, March 17th 1873, by

Mercur,, J.

The plaintiff brought this suit to recover commissions for the sale of eei'tain machinery sold by him for defendant. It appeared upon the trial of the cause, that the plaintiff was carrying on the business of a commercial broker, and as such broker rendered the services for which the commissions were claimed. He also testified that he had not taken out a license nor paid a special tax, under the Act of Congress. Upon this the learned judge nonsuited the plaintiff and judgment was entered thereon. This is assigned for error.

The question thus presented is, did the plaintiff’s omission to pay the tax and obtain the license as a commercial broker, bar his recovery of commissions for services rendered as such broker.

The Act of Congress of June 30th 1864, sect. 71, provides, that no person * * * shall be engaged in prosecuting or carrying on any trade, business or profession hereafter mentioned and described until he * * shall have obtained a license therefor, in the manner, hereinafter provided. Section 73 provides, that any person carrying on the business without a license, shall be liable for each offence to a certain fine and imprisonment therein specified.

Sect. 79 provides that commercial brokers shall pay twenty dollars for each license. Any person whose business it is as a broker to negotiate sales or purchases of goods, wares, products or merchandise shall be regarded a commercial broker under this act.

An action founded upon a violation of the laws of the United States or of this state, cannot be maintained in the courts of this state: Maybin v. Coulon, 4 Dall. 298; s. c. 4 Yeates 24.

It is not necessary that the statute should expressly declare the contract to be void. An action founded upon a transaction prohibited by a statute, cannot be maintained, although a penalty be imposed for violating the law: Seidenbender et al. v. Charles’s Admrs., 4 S. & R. 159. Hence where a contract is made about a contract .or thing which is prohibited and made unlawful by statute, it is void, though the statute itself does not declare it shall be so, but only inflicts a penalty on the offender: Columbia Bridge Co. v. Halderman, 7 W. & S. 233. Nor is there any distinction in this state, whether the contract is malum prohibitum or malum in se: Id. 235.

The test whether a demand connected with an illegal transaction is capable of being enforced by law, is whether the plaintiff requires the aid of the illegal transaction to establish his case: Swan v. Scot, 11 S. & R. 164; Thomas v. Brady, 10 Barr 170; Scott v. Duffy, 2 Harris 20. If a plaintiff cannot open his case without showing that he has broken the law, a court will not assist him; Thomas v. Brady, supra. It has been well said that the objection may often sound very ill in the mouth of a defendant, but it is not for his sake the objection is allowed, it is founded on general principles of policy which he shall have the advantage of, contrary to the real justice between the parties. That principle of public policy is that no court will lend its aid to a party who grounds his action upon an immoral or upon an illegal act: Mitchell v. Smith, 1 Binn. 118; Seidenbender v. Charles’s Admrs., supra. The principle to be extracted from all the cases is, that the law will not lend its support to a claim founded on its own violation: Coppell v. Hall, 7 Wallace 558.

Apply these principles to this case. The bill of particulars served on the defendant avers, “ the plaintiff’s demand is founded on his claim to commissions as a broker or salesman on commission, for the sale of certain cards and other spinning and their machinery of a cotton or woollen mill, put in his hands for sale by the defendant, on or about May 1866.” Upon the trial he testified that his business was buying and selling machinery for other parties. The moment he opened his case, he showed that he was engaged in a business directly contrary to a clear and express Act of Congress. That for so doing, he was liable to a fine and imprisonment. The intent with which he did it, cannot be inquired into in this action. His right to commissions as shown rested upon his illegal acts. His right to recover in law, must depend upon his legal right to perform the services. The facts to which he testified, showed he had no such right.

Without the aid of his illegal transactions, he could not, and did not, show any services performed. His case as he exhibits it is based upon a clear violation of the statute. He grounds his action upon that violation. Thus resting his case, he cannot successfully invoke the aid' of a court.

We are aware there are some English authorities, as well as decisions in some of our sister states', that make a distinction in cases of contracts predicated of a violation of the revenue laws, and especially that class of them which does not expressly declare the contract to be void. The case of Aiken v. Blaisdell, 41 Vermont 655, is a strong case, going to sustain a contract of sale contrary to law. We prefer, however, to stand by our own decisions. The case of Maybin v. Coulon, supra, was based upon a violation of the revenue laws of the United States, and the unbroken current of authorities in this state, is to hold a contract void which is grounded upon a clear violation of a statute, although it may not be expressly so declared by its terms.

Judgment affirmed.

Sharswood and Williams, JJ., dissented.


source: Caselaw Access Project

author: Williams, J.

license: Public Domain

text:
    Robinson versus Hodgson.
    1. The owner of negotiable securities which have been stolen may follow them and reclaim them in whose hands soever they may be found, and when shown that the securities had been stolen from the owner, the burden is upon the holder to show that he took them in the usual course of business and for value.
    2. In trover for such securities, merely showing that they were in possession of another from whom defendant or his immediate bailor received them is not a defence.
    3. A holder’.s possession in primS, facie evidence of ownership, because the presumption is that it was honestly acquired.
    February 25tb 1878.
    Before Read, C. J., Agnew, Sharswood, Williams and Mercur, JJ.
    Error to the District Court of Philadelphia: No. 112, to January Term 1872.
    On the 22d of September 1870, Henry D. Hodgson, executor, &c., of Mark A. Hodgson, deceased, brought an action of trover against Robert E. Robinson for certain bonds of the Philadelphia and Baltimore Central Railroad Company, which had been stolen from the decedent.
    The case was tried June 13th 1871, before Thayer, J.
    The plaintiif gave evidence, by James M. Ramsey, the treasurer of the company, that decedent had been the owner of six bonds of $100 each, and one bond of $200, issued by the Philadelphia and Baltimore Central Railroad Company; the bonds were coupon bonds, were payable to bearer, and were worth about par or slightly more.
    He also gave evidence that these bonds, with a number more of the same kind belonging to other persons, were stolen September 24th 1864. All the bonds had been in a safe of Robert & George D. Hodgson in their warehouse in the borough of Oxford, Chester county; the door of the safe had been drilled and blown off, and the bonds taken. The whole amount of bonds taken was $4100. An advertisement by police officers of Philadelphia, and also one by Robert Hodgson were published, announcing the robbery and describing the bonds (except three) of all the owners; with a request to brokers and others to examine the lists, and give information at the mayor’s office.
    James A. Strawbridge (who was administrator, &c., of G. A. Hodgson, deceased, one of those whose bonds had been stolen) testified that in February 1870, he met the defendant at the office of the treasurer of the railroad company; the defendant said that he had come there to inquire about the stolen bonds; “ I told him I represented most of the bonds, and asked him where they were; he said in New York ; I asked him to give me all the information he had; he said he had seen them, and had had them in his hands ; he said they were sent by his (defendant’s) brother, in Now York, through Drexel, Winthrop & Co., in New York, to Drexel’s in Philadelphia; that his brother had received them from a diamond broker in New York;” at witness’s request defendant, witness and Mr. Hodgson went to Drexel’s office; the clerk there gave him the package, which was opened, and compared with a list of the stolen bonds which witness had; after the examination the defendant said, “ I am satisfied these are the Hodgson stolen bonds.” It was then agreed to leave them in charge of Mr. Drexel, but he refused to receive them; the defendant then took the bonds ; they stopped before De Haven’s ; defendant went in there, and proposed to meet the others at the depot before the train started; witness then got a search-warrant from the recorder, and went with it to the depot “ to attach the bonds on defendant’s person.” Defendant was at depot according to appointment, and on being asked said he had left the bonds at De Haven’s; he and the officer went there, and he came to the recorder’s office with the bonds, which were deposited with the recorder to remain till a hearing in the next week. Six days after witness, with his counsel, met defendant and Mr. Harrington, defendant’s counsel, at the recorder’s office, when the bonds were given to the defendant under a mutual agreement that he would hold them until a trial should be had in Philadelphia to determine their ownership; the defendant said he would be responsible for their forthcoming; he agreed to accept service, and try the right to the bonds.
    On cross-examination witness testified that the defendant said he believed the bonds had been stolen, and that he would do all he could to get their owner; the defendant lived in Wilmington, Delaware.
    James Given, Esq., the recorder, testified, that all the bonds alleged to have been stolen, including the three not mentioned in the advertisement, were before him and in his custody under a search-warrant ; that they had gone out of his possession in pursuance of an agreement of the counsel of the parties, in their presence, that the right should be tried in court. De Haven, who was defendant’s brother-in-law, was to hold the bonds for him; that before witness, the defendant said that he knew the bonds had been stolen from Hodgson.
    Joseph Huddell, the secretary of the railroad company, testified, that in February 1870, the defendant came to him at the company’s office and asked if there were not some stolen bonds of the company; to a question by witness, he said he knew it by information from Mr. Quigley, of Wilmington; defendant said he knew of bonds being offered for sale, and had a list of them; witness compared a list he had of the stolen bonds, with' the list of defendant.
    H. D. Hodgson, plaintiff, testified as Mr. Strawbridge as to most of the facts stated by him; and also that defendant said the bonds had been sent to Mm by Ms brother, who was in Drexel’s house, New York; defendant at the recorder’s office agreed to accept service in a suit to be tried in Philadelphia to determine the ownership of the bonds.
    A. De Haven testified, that he was a member of the firm of De Haven & Brother, brokers in Philadelphia, and recollected the bonds; the firm had sent the bonds to New York, by direction of the defendant or Mr. Harrington his counsel; the bonds had been received by their firm March 1st 1870, subject to defendant’s order ; and on March 6th 1870 they sent them to New York, to J. N. Robinson, care of Drexel, Winthrop & Co.
    J. N. Robinson is a member of that firm and brother of defendant.
    Plaintiff gave in evidence a letter from Mr. Harrington to Mr. McVeagh, one of plaintiff’s counsel, written shortly before April 9th 1870, in which Mr. Harrington said that it had been his purpose when he received the bonds to hold them till the title to them should be settled in the suits to be brought without reference to time; that they were deposited with De Haven & Brother, subject to his order alone; and he had been surprised to learn three weeks afterwards that the defendant without his authority obtained possession of the bonds and returned them to Drexel, Winthrop & Co. After learning this he had insisted to defendant that he should inform plaintiff’s counsel and tell them the exact state of the case, disclose the name of the party pretending to be the owner, who was then under arrest in New York, for receiving other stolen bonds and goods. Mr. Harrington enclosed in the letter slips from New York papers showing “the name, place of business and offences of the party who claimed to own the bonds.”
    The banking-house of Drexel & Co., Philadelphia, and Drexel, Winthrop & Co., New York, are one establishment, composed of the same partners.
    The plaintiff rested.
    The defendant testified that he had been in the banking business in Wilmington for about twenty years, that his brother, J. N. Robinson, lived in New York, and that the business he had with the New York house was transacted through his brother; he had received from his brother a letter dated,
    “ Banking House of Drexel, Winthrop & Co.
    New York, February 9th 1870.”
    The writer said that a party had called on that day to sell 3100 Baltimoré Central first mortgage bonds; he did not know much about the person offering them ; he gave his name as William C. Brandon, 702 Broadway; the letter proceeded: “I am thus particular about giving you where they came from, as we don’t want to take any responsibility in selling them, though I am told if you pay the value of bonds, and have no reason to suspect anything wrong, that the holder of coupon bonds, even if stolen, can keep them. I want you to inquire of the Philadelphia, Wilmington and Baltimore folks, and also of Bowen & Fox, who are the trustees, if any bonds have been stolen; if you find everything correct make us a bid for them, * * * his limit is 70 * * * If you can’t pay 70 I think the fellow will take a little less. I enclose you the number of the bonds; part are for $100 ; part for $200 each.”
    Defendant further testified: “ I went to Mr. Huddell (secretary of the company), and asked him if there had been any bonds stolen; he declined to answer; I told him if he did not tell me I would hold him responsible if I bought any stolen bonds; he said there were persons in the country who had lost some bonds, and wanted me to call again, and he would write to them. I called again, and he sent me to the office of the Philadelphia, Wilmington and Baltimore Railroad to see Mr. Ramsey, who was not there. I started out, and was called back by Hodgson and Strawbridge; they asked me what I would take to get the bonds; I said nothing ; but would do all I could to get the bonds for the rightful owner; I told them the bonds were at Drexel’s office.”
    He further testified as plaintiff’s witnesses, as to the delivery of the bonds at Drexel’s, and his arrest at the depot, and to giving him the bonds at the recorder’s office; and that he afterwards, in company with Mr. Harrington, left them with Mr. De Haven; he afterwards got an order for the bonds, which was sent by his brother from New York; the order was as follows:—
    “New York, March 3d 1870.
    Messrs. Drexel, Winthrop & Co.,
    Gentlemen:—
    I hereby demand from you and each of you the return to me of the bonds given to you by me in the month of February 1870, to sell, amounting in all to the sum of three thousand one hundred dollars, and I demand that they be returned to me within a reasonable time.
    Wm. C. Brandon,
    702 Broadway.”
    In consequence of this order defendant sent the bonds to New York about the 4th or 5th of March. He had nothing to do with Brandon; did not receive the bonds from him or send them back to him.
    A. H. De Haven testified that the bonds in the package and those on the slip of paper agreed. The agreement at the recorder’s was that the bonds were to be surrendered to defendant, and to be put into the hands of De Haven & Brother, so as to remain in the jurisdiction of Pennsylvania, that they might be attached and test the question of ownership; they were taken away March 6.
    Mr. Harrington, defendant’s counsel, testified that on his own account, defendant not agreeing to it, he said that plaintiff should have the opportunity to get a legal hold on the bonds, so that if the owner in New York demanded them, defendant would have a legal excuse; witness told plaintiff’s counsel that they must get a legal hold on them at once or they would be ordered back; the understanding was that they should get a legal hold on them at once; it was no part of the understanding that the bonds were to be held in the jurisdiction of- Pennsylvania until the title was determined ; the bonds were sent back in violation of the order of witness as attorney for defendant to De Haven; the violation of the order was by the defendant.
    Robert Winthrop, in his deposition taken under a commission, said that he was a member of the firm of Drexel, Winthrop & Co.; that the bonds in question were delivered to his firm February 9th 1870,. by William C. Brandon, to be sold on his acqount; they were forwarded by Drexel, Winthrop & Co. to R. R. Robinson & Co., Wilmington,, to be sold in accordance with Brandon’s instructions ; the bonds were returned to witness’s firm, and delivered by them to Brandon March 10th 1870; the bonds were received by the firm that they might be sold in Wilmington on Brandon’s account.
    Defendant gave in evidence the receipt of Brandon to Drexel, Winthrop & Co., dated March 10th 1870, for bonds of the Philadelphia and Baltimore Central Railroad Company, amounting in all to $3100, amongst which were five, the bonds claimed by plaintiff.
    A number of exceptions were taken to the rulings of the court on questions of evidence not necessary to notice here.
    The defendant submitted these points, all which the court declined to affirm:—
    1. To maintain this action it must appear that the defendant did a positively wrongful act. If the jury find that in all that he did from the time when the bonds came to his possession down to the time when he returned them to the party from whom he had received them, he acted in good faith and with an honest purpose to preserve them in his custody so that the rightful owner might with due diligence recover them, the defendant is not liable in this action.
    2. If, at the time the bonds were delivered up to the defendant or his counsel at the recorder’s office, the plaintiff’s counsel was notified to proceed immediately while they were in the jurisdiction and that they would have to be returned, if an order to that effect was received from the' party in New York who sent them, the delay of proceedings on the part of the plaintiff was a sufficient justification for defendant in returning the bonds when the order was received. The defendant, in the absence of any legal proceedings being taken to hold the bonds or prevent him from disposing of them, was bound to comply strictly with the order of his principal to return them, and no action would lie against him for complying with the orders of his principal, received under such, circumstances.
    3. The return by the defendant of the bonds to the person from whom he had received them, in compliance with the order of that person, was not in itself a wrongful conversion of the bonds on the part of the defendant.
    4. If the plaintiff delayed commencing his proceedings or making any formal demand for the delivery of the bonds until after they had been returned by defendant under the order of his principal, it was such laches on the part of the plaintiff as would bar his right of recovery in this action.
    5. In order to make defendant responsible for the wrongful conversion of personal property on the ground of a demand and refusal, it must appear that the goods were in the possession of the defendant at the time the demand was made, or that at the time of the demand he had it in his power to give up the goods; hence, if the jury find that at the time the plaintiff demanded the bonds from the defendant, they were not in defendant’s possession or control, but had previously been sent back to his principal in New York, the plaintiff cannot recover in this form of action.
    6. If the jury find that Drexel, Winthrop & Co. were the agents employed by Brandon to sell the bonds, that they sent them to defendant for sale, and defendant returned the bonds to them between the 6th and 10th days of March, A. D. 1870, in complianee'with their peremptory order, the verdict should be for the defendant.
    7. If the plaintiff, at the time of giving up the bonds at the recorder’s office, agreed with the defendant that the title should be tested by a legal process under which the bonds were to be seized immediately, and the plaintiff did not take any steps to seize and hold them by process of law until after they had been returned to Drexel, Winthrop & Co., off New York, the plaintiff cannot recover in this action.
    The court charged:—
    “ [If the bonds were really the property of the plaintiff, and if the defendant had reason to suppose-that the bonds had been stolen, and that they were the property of the plaintiff, and if he was notified of these facts, and after that did, notwithstanding such notice, and notwithstanding the claim made upon him for the bonds by the plaintiff, send them back to New York without the consent and against the will of the plaintiff, that was a wrongful conversion of the bonds for which the defendant is responsible.]

      “ [The law is, that a bailee who comes into possession of property that has been stolen or which bailor has no title to at all, is not excused for delivering it up to bailor after notice of that fact from the real owner, and if he does do so, it is at his own peril. If he finds himself in such a position as that, he must at any rate stand Still until the right is determined. When he has notice that bailor has no title to the property, he has no right to deliver it to him; he must keep it.] And one reason of that is, that it was the duty of the man who delivered the property to have acquainted the broker with the truth. If he has not done that, then he has no right to complain if bailee withholds the property from him, for the real owner. If he has withheld the truth from the bailee, he has no right to demand that the bailee shall restore the property to him. The bailee who receives property for which bailor has no title, cannot, after notice of the real owner’s title, return it to bailor without being responsible for it.
    “ Therefore, if these bonds were really the property of plaintiff, and defendant had reason to suppose they were stolen, and after notice of that fact from the plaintiff, returned them to New York, without consent of plaintiff, he is liable.
    “Now with regard to the ownership of the bonds. You are to consider the evidence, and to determine whether the plaintiff has made out his ownership. If you are satisfied that he has, then it was incumbent upon the defendant, if he alleges ownership in another, to show it.
    “ [The least a man can do, if he comes into possession of stolen property, is to show how his bailor obtained the possession. Therefore, if the defendant rests his defence upon an alleged ownership of Brandon, then it was his duty to show how he acquired that ownership, how Brandon got it, and where he got it. Mere possession after robbery is no evidence of title. And if a man gets such bonds as these, which • pass by delivery alone, after they have been stolen, he must show from whom he got them, whether in good faith and for what consideration. It was for defendant to show all that, if he relies on the title of Brandon.] [Mr. Ramsey, the treasurer, says the bonds were issued to Mark Hodgson, and identifies them by the numbers, and it has been shown that they were subsequently stolen. No evidence whatever has been given as to how Brandon got possession of these bonds.]”
    The verdict was for the plaintiff for $824.
    The defendant removed the record to the Supreme Court.
    He assigned seventeen errors, of ■ which
    4-7. Were the parts of the charge in brackets.
    8-14. Declining to affirm his points.

      A. M. Burton and fr. W. Biddle, for plaintiff in error.
    The property in bonds payable to bearer passes by delivery: Beaver Co. v. Armstrong, 8 Wright 65. A purchaser in good faith is not affected by his vendor’s want of title, the burden of proof is on him who asserts his title: Murray v. Lardner, 2 Wallace 110; Goodman v. Simonds, 20 How. 343.
    The plaintiff must prove a positive tortious or wrongful act on the part of the defendant: Bromley v. Coxwell, 2 Bos. & Pul. 438. Where the defendant refuses to deliver up the goods claimed, until some ownership is shown on the part of the claimant, it is no evidence of a conversion: Solomons v. Dawes, 1 Esp. 83; Green v. Dixen, 3 Campb. 215, n.; Jacoby v. Laussat, 6 S. & R. 305; 1 Bacon’s Abr. “Bailment,” 618; Edwards on Bailments 83, 84. Defendant is not liable for the acts of his agent in delivering the bonds: Shotwell v. Few, 7 Johns. R 302; Alexander v. Southey 5 Barn. & Ald. 247. By the return of the bonds to the defendant, plaintiff recognised the title of Brandon to the property. He never produced any evidence to defendant that Brandon had no title; nor allege that Brandon had obtained the property wrongfully: Shelford v. Scotsford, Yelv. 23. Upon the doctrine of “ Respondeat superior,” the defendant incurred no liability: Mires v. Solebay, 2 Mod. 242; Berry v. Vantries, 12 S. & R. 92. An agent cannot dispute his principal’s title : Dixon v. Hamond, 2 Barn. & Ald. 310; Shotwell v. Few, 7 Johns. 302; Woodward v. Webb, 15 P. F. Smith 254 ; Carey v. Bright, 8 Id. 83.

      J. Groforth and W. Mae Veagh, for defendant in error.
    If a bailor has no title, the real owner is entitled to recover the property in whose hands soever it may be found: Story on Bailments, §§ 52,102 ; 2 Kent’s Com. 767 ; King v. Richards, 6 Whart. 418.
    Where negotiable paper has been stolen or lost, or obtained by duress, or procured or put in circulation by fraud, on proof of these circumstances it is incumbent on the holder to show himself to be a holder bond, fide and for a valuable consideration; otherwise, he is considered as standing in no better situation than the former holder in whose hands the instrument received the taint: Beltzhoover v. Blackstock, 3 Watts 26; Knight v. Pugh, 4 W. & S. 448; Brown v. Street, 6 Id. 221; Gray v. Bank of Kentucky, 5 Casey 365.
    The onus of proof of Brandon’s title rests on the plaintiff in error: County of Beaver v. Armstrong, 8 Wright 63; Mercer County v. Hacket, 1 Wallace 83; Murray v. Lardner, 2 Id. 110; Grant v. Vaughan, 3 Burrows 1516 ; Lawson v. Weston, 4 Espinasse 56; Duncan v. Scott, 1 Campbell 100; Rees v. Marquis of Headford, 2 Id. 574; Douglass 611; Norris’ Peake 342; Byles on Bills 394; Beltzhoover v. Blackstock, 3 Watts 26; Knight v. Pugh, 4 W. & S. 445; Brown v. Street, 6 Id. 221; Albrecht v. Strimpler, 7 Barr 477; Hutchinson v. Boggs, 4 Casey 294; Kuhns v. Gettysburg Nat. Bank, 18 P. F. Smith 448.

      Where a person is in the possession of stolen property, and has been notified by the rightful owner that such property is his, he becomes a bailee for such owner, and his refusal to deliver the property to such owner, is evidence of conversion, no matter upon what trust, or in what capacity he received the stolen property: Shelbury v. Scotsford, Yelv. 23; Yorke v. Grenaugh, 2 Ld. Ray. 866; Ogle v. Atkinson, 5 Taunton 759; Hardman v. Willcock, note to 9 Bing. 382; Wilson v. Anderton, 1 Barn. & Ad. 450.
   The opinion of the court was delivered, May 17th 1873, by

Williams, J.

The main question in this case is, whether the plaintiff below gave such evidence of ownership as entitled him to recover the bonds alleged to have been wrongfully converted by the defendant ? The evidence showing that the bonds were the property of the plaintiff’s testator, and that they were stolen from him, was undisputed. The defendant did not claim to be the owner of them, but set up title in Wm. C. Brandon, who left them with Drexel, Winthrop & Co., of New York, the defendant’s bailors, for sale. The court charged the jury in substance, that if the bonds were really the property of the plaintiff’s testator, and were stolen from him, then it was incumbent on the defendant, if he alleged ownership in another, to show how he obtained the possession ; and if he rested his defence upon Brandon’s alleged ownership, it was his duty to show how he acquired that ownership ; that mere possession after the robbery was no evidence of title. It is contended by the plaintiff in error that this instruction was erroneous, because the presumption is that Brandon obtained the bonds honestly, and, being negotiable, his possession of them was evidence of ownership. But the owner of negotiable securities, which have been stolen, has the right to follow them wherever he can find them, and to reclaim them in whose hands soever they may be found; and it is no defence to an action for their wrongful conversion, in refusing to deliver them up on the owner’s demand, for the bailee merely to show that they were in the possession of another, from whom he or his immediate bailor received them. If the defendant’s possession would not be a defence, how can his bailor’s be ? Why ■should the bailor’s possession be higher evidence of title than his own ? Undoubtedly the holder’s possession is primfi facie evidence of ownership, because the presumption is that it was honestly acquired. But when it is shown that the securities were stolen from the owner, the burden of proof is on the holder, and he rnnst show affirmatively that he took them in the usual course of business for value. The rightful owner may assert his title to stolen property whenever he can find it, and if he could recover it from the bailor he can recover it from the bailee. The bailee can never be in a better situation than the bailor. If the bailor has no title he can give none, for he can give no better title (than he has. The owner of stolen securities has the same right to recover them from the holder, unless he has taken them in the usual course of business for value, that he has to recover a chattel or other movable property that may have been stolen. There is this difference, however, the owner’s right to the chattel is not divested if it has been bought by the holder in good faith without notice of the theft; but his right to negotiable securities that have been stolen is divested if they have been received by the holder in the usual course of business for value. But the burden of proof, of showing that they were thus taken, is on the holder. These are familiar and well settled principles, and require the citation of no authorities for their support. There was, therefore, no error in instructing the jury that if the defendant relied on Brandon’s ownership of the bonds it was incumbent on him to show how he obtained it.

The other assignments of error need not be specially noticed. There is nothing in them that calls for a reversal of judgment, and no practical benefit would result from their discussion. There was no error in entering judgment on the verdict, and the discharge of the rule to amend the record of the verdict and judgment, with respect to the amount of damages, was a matter wholly within the discretion of the court below, and is not assignable for error here.

Judgment affirmed.


author: Mercur, J.

text:
    Philadelphia versus Lockhardt, to the use of Pyle & Hansell.
    1. A contract for building a school-bouse in Philadelphia was made in the name of The Controllers of Schools, signed by the Mayor, under the corporate seal; it, with the sureties for its performance, was approved by ordinance of councils, and payments made on account of it. Reíd, that the city was estopped from denying that she was a party to the contract.
    2. The contractor assigned the contract. Reid, that the assignment was not within the Act of May 28th 1715, relating to assignment of bonds, &e.
    3. An executory contract may be assigned before performance has been begun, or anything be due on it, and although the debtor be a municipal corporation.
    4. Notice of the assignment given to the Board of School Controllers was notice to the city.
    5. Notice to an agent, bound, in the discharge of his duty, to act upon it and to communicate it to his principal, is notice to the principal.
    6. Danville Bridge v. Pomroy, 3 Harris 151, recognised.
    February — 1873.
    Before Read,’ C. J., Sharswood, Williams and Mercur, JJ. Agnew, J., at Nisi Prius.
    Error to the District Court of Philadelphia: No. 433, to January Term 1871.
    This was an action of debt, brought February 5th 1870, by George W. Lockhardt to the use of Pyle & Hansell against the City of Philadelphia. The claim was for a balance due for building a public school-house under a contract of Lockhardt with the controllers of public schools, in the First District of Pennsylvania, the claim having been assigned to Pyle & Hansell before anything was done.
    The case was tried February 23d 1871, before Thayer, J.
    The plaintiff offered in evidence an agreement dated October 8th 1867, between the controllers of public schools of the first district, &e., and Lockhardt, by which Lockhardt agreed to build a school-house according to certain specifications, on Wood street above Eleventh street, in consideration of which the controllers agreed to pay him $>13,700 in six payments; the last being $4566.70 to be paid when the house should be finished, possession given and the contract fully complied with. The agreement was signed by “Morton McMichael, Mayor of Philadelphia,” and sealed with the corporate seal of the city.
    The defendant objected to the offer on the ground that the contract was not in the name of the city. The offer was admitted and a bill of exceptions sealed.
    The plaintiff also offered in evidence the following assignment:
    “ Know all men ly these presents, That I, George W. Lockhardt, of the city of Philadelphia, builder, do hereby authorize and empower Edw. H. Pyle and Edmund M. Hansell, trading under the firm of Pyle & Hansell, of the same place, as my true and lawful attorney, for me and in my name to receive from the proper officer of the Board of School Controllers, all moneys or warrants that are due, or shall become due to me upon any contract for the erection of the school building on the north side of Wood street, west of Eleventh street, in the Fourteenth Section, and I do hereby agree that this writing shall operate as an assignment of said warrants to said Pyle & Hansell, so that it cannot be revoked or recalled without their consent, the same being made and executed upon good and valuable consideration received by me of them.
    “Witness my hand and seal, October 12th 1867.
    George W. Lockhardt.” .
    This was objected to, admitted and a bill of exceptions sealed.
    The plaintiff gave evidence that the building was finished in the early part of 1868; it was accepted by the city, and occupied by it ever since.
    Hansell, one of the plaintiffs, testified that he had furnished all the lumber for the school-house on the faith of the assignment; he accepted orders, and acted as trustee for all the mechanics and material-men; he got the money on five instalments; they were paid by Mr. Halliwell, secretary of the board of school control; Halliwell signed the warrants; he had notice of the assignment ; knew all about it, and that others were doing work on the school-house on the strength of it; witness informed the board of control at a meeting that plaintiffs had the assignment; Halliwell said they had a full release of liens; witness saw Mr. Green, chairman of the committee on city property, and explained the whole thing to them; plaintiffs received city warrants on orders from Lockhardt, who generally met plaintiffs at the school controllers’ office when they went for the warrants.
    W. B. Robbins, Esq., the attorney for the plaintiffs, testified that on the 22d of March 1869, he gave notice of the assignment to the city solicitor, and on the 9th of April 1869, he sent to the board of school controllers a copy of the assignment; Halliwell afterwards gave the warrants to Lockhardt; two warrants amounting to $4566.70 were given July 10th 1869; the warrants were signed by the officers of the controllers of public schools ; also by the city controller.
    For the defendant, Halliwell testified that he had never seen the assignment which plaintiffs said they had; the warrants had all been given to Lockhardt.
    The defendant gave in evidence Lockhardt’s receipt dated July 6th 1869, for the last warrant for $4592.30.
    On the 1st of December 1864, the Councils of Philadelphia passed an ordinance entitled, “ An ordinance to authorize a loan for school purposes ;” the amount authorized was $1,000,000, to provide for the erection of school buildings in the First School District; specific amounts were appropriated to different sections.
    Also, an ordinance passed November 1867, as follows, viz.:—

      “ That the following contracts for the erection of school buildings in the Fourteenth ward, both of which said contracts have been duly executed by the mayor of the one part, and the several and respective contractors of the other part, be and the same are hereby also approved, and the several and respective sureties therefor are hereby also approved, to wit: * * * No. 2, contract dated October 8th 1867, for the erection of school building on the north side of Wood street above Eleventh, for the sum of $13,700, by George W. Lockhardt, contractor, and John E. Whiteman and George W. Rankin, sureties therefor.”
    The defendant submitted 9 points.
    The 1st, 4th, 7th, 8th, which were as follows, were unqualifiedly refused:—
    1. In the form in which this action is brought a payment to George W. Lockhardt, the nominal plaintiff, before suit, is a satisfaction of the debt.
    4. Notice of the assignment given to the board of school controllers is not such notice as would affect the city of Philadelphia under the Act of 1715.
    7. If the jury believe from the evidence that the city of Philadelphia did not promise to pay to Pyle & Hansell the debt in said suit and have paid said debt to Lockhardt, or order, the plaintiff cannot recover.
    8. If the jury believe from the evidence that Pyle & Hansell, knowing that Lockhardt claimed this money notwithstanding the alleged assignment, and that he had sued for it, took no legal steps to enforce their claim to it, from July, to 1869, when it was paid to Lockhardt, then their laches estops them from recovering in this action.
    The 2d, 3d, 5th, the court refused, but reserved the questions presented by them; they are as follows:—
    2. A valid assignment cannot be made of a right not yet acquired, of a sum of money not yet earned, nor of a warrant or other evidence of indebtedness before the instrument is made or the right to it acquired.
    3. A building contract is not such a specialty as passes by assignment under the Act of 1715, so as to make a payment to original contractor, after notice of assignment, no satisfaction of the debt.
    5. The board of school controllers cannot by their acceptance of an order, or by their assent to an assignment, make the city of Philadelphia liable to the new debtor or assignee.
    The 6th point, which was unqualifiedly affirmed, was as follows:—
    6. If the jury believe from the evidence that the city of Philadelphia, before they received notice of this assignment, paid the money for which this suit is brought to Geo. W. Lockhardt or his order, the plaintiff cannot recover.
    The 9th point and its answer were as follows:—
    9. That notice to the secretary of the board of controllers is not notice to the board.
    “ Affirmed; if he did not communicate the notice to controllers, but a notice to him, communicated to the controllers, would be notice to the city.”
    The court left it to the jury to determine whether, upon the evidence, the city had notice of the assignment of October 12th 1867, and instructed them, if they were satisfied the city had such notice, to find a verdict for the plaintiff; subject to the opinion of the court on the reserved point.
    And also charged, that if notice was given to the board of controllers of public schools and the councils thereof, and the city solicitor, there was notice to the city.
    The verdict was for the plaintiff for $4566.70, on which judgment was afterwards entered for the plaintiff on the reserved points.
    The defendant sued out a writ of error, and assigned thirteen errors:—
    1-2. Admitting the plaintiff’s offers of evidence.
    3-10. The answers to defendant’s points.

      íll-12. The portions of the charge above stated.
    13. Entering judgment for the plaintiff on the reserved points.

      It. IF. Willson and O. H. T. Qollis (with whom was G. D. Budd,) for plaintiff in error.
    The contract was not in accordance with Acts of April 21st 1855, § 11, Pamph. L. 267, providing that contracts shall be in the name of the city of Philadelphia, and April 21st 1858, § 5, Pamph. L. 386, providing that no contract shall be binding on the city unless authorized by law, or an ordinance of councils, and sufficient appropriation be previously made by councils. The assignment was the grant of a thing not in existence and therefore invalid : Perkins, tit. Grant, pl. 65; Bacon’s Maxims, Reg. 14; Lunn v. Thornton, 1 Manning, G. & S. 380. The assignment was not within the Act- of May 28th 1715: 1 Smith’s Laws 90, enabling an assignee to sue in his own name. There was nothing in existence that could be assigned: Fairlie v. Denton, 4 Barn. & Cress. 395 ; Crowfoot v. Gurney, 2 Moore & Scott 473; s. c. 9 Bing. 372. The reservation was of the whole evidence, and therefore bad: Winchester v. Bennett, 4 P. F. Smith 510.

      J. G. Johnson for defendant in error.
    The contract was for the benefit of the city, and being in the name -of the controllers will not vitiate it: Angell & Ames on Corp., pl. 185 ; Dillon on Municipal Corp., pl. 121, 123, 131; Robinson v. St. Louis, 28 Missouri 488. The assignment was not governed by the Act of May 28th 1715. Lockhardt was the legal plaintiff with the equitable ownership in Pyle & Hansell, and the assignment being in good faith no act of Loekhardt’s could defeat it: 1 Parsons on Contracts 227, and cases cited in note ; Rodick v. Gendell, 1 De. G., M. & G. 763; Jones v. Farrell, Id. 208; Stocks v. Dobson, 4 Id. 11; Phillips v. Bank, 6 Harris 394; Jones v. Witter, 13 Mass. 304; Anderson v. Van Alen, 12 Johns. 342; Dawson v. Coles, 16 Id. 50. Knowledge acquired by the agent of a corporation in the performance of official duties is notice to the corporation : Bank v. Schaumberg, 38 Missouri 228 ; Trenton Bank v. Woodruff, 1 Green’s Ch. 117; Bridge Co. v. Phœnix Bank, 3 N. York 156; Black v. C. & A. R. R. 45 Barb. 40; Trenton Bank v. Canal Co., 4 Paige 127 ; Danville Bridge v. Pomroy, 3 Harris 151. A contract may be assigned so as to give the assignee the title to the proceeds: Morrell v. Wootten, 16 Beav. 197; Leslie v. Guthrie, 1 Bing. N. C. 697; Lott v. Morris, 4 Simon 607; Bell v. London & N. W. Railway, 15 Beav. 548. That the debtor is a municipal corporation makes no difference : Bracket v. Blake, 7 Metc. 335; Crocker v. Whitney, 10 Mass. 319; Field v. New York, 6 N. York 179.
   The opinion of the court was delivered, March 17th 1873, by

Mercur, J.

The admission in evidence of the written contract under which the school-house was built is assigned as error. The objection to its admission is predicated of the fact that the instrument in its commencement purports to be an agreement between “ The Controllers of the Public Schools of the First District of Pennsylvania,” of the first part. It is, however, signed and attested on the part of the first party, by the mayor of the city, and duly sealed with its corporate seal. A short time after its execution the contract was duly approved by ordinance of councils. The sureties given by Lockhardt for his performance of the contract, were at the same time and in like manner approved. From time to time during the progress of the work, the city paid the instalments as they severally became due, according to the terms of the contract. After its completion the city took possession of the house, and have continued in the possession and enjoyment thereof.- After all these recognitions and ratifications on the part of the city, it is too late for her successfully to deny that she was a party to the contract.

The fifth, sixth, seventh and eighth assignments are based upon the Act of 28th of May 1715, which provides for the assignment of bonds, specialties and notes in writing. The form of the suit in this case, however, does not admit of the application of that act. That act provides a mode of assignment by which a suit may be brought in the name of the assignee only. This action is brought in the name of the original party to the contract for the use of the assignee. This assignment is not made according to the Act of 1715. This suit is not brought under it. The plaintiff is unaffected by its provisions. The claim to recover is not put upon an alleged agreement made with the equitable plaintiffs, but upon the one made with Lockhardt, from whom they have an equitable assignment.

The remaining alleged errors that were pressed relate to the assignment made by Lockhardt to Pyle & Hansell, and notice thereof to the city. It is contended by the plaintiff in error that when Lockhardt made said assignment he had no interest to assign; that it was made four days only after the execution of the contract, and before he had done anything under it. We think this position is not sound. It is well settled that a contract may be assigned so as to vest in the assignee the equitable right to the proceeds, although the money may not have been due or earned at the time of the assignment. It is often done by builders and other contractors to enable them to procure the materials necessary to fulfil their contracts. This was the case in Scott v. Morris, 4 Simons 607, in which the assignment was held good. Nor does it make any difference, if, instead of a debt now due, the assignment is of money, which is expected to become due at a future day to the assignor: Crocker et ux. v. Whitney, 10 Mass. 316. In Patton v. Wilson, 10 Casey 299, it was held, that* an equitable assignment of unliquidated damages arising from a tort, and for the recovery of which an action was pending, was binding between the parties. Nor does the fact that the debtor is a municipal corporation change the right to assign money not yet earned: Brackett v. Blake, 7 Metc. 335; Field v. The Mayor of New York, 6 N. Y. 179.

The only remaining question is, that of notice to the city. Did she have such notice of the assignment and letter of attorney from Lockhardt to Pyle & Hansell, and their claim under it, as to prevent the subsequent payment by the city to Lockhardt, from being interposed against a recovery in this action. No objection is taken to the form of the notice given, but to the official upon whom it was served. It was urged upon the argument that the assignee should have given notice to the city controller or to the city treasurer. There is much force in the suggestion that if the assignees had given written notice of their rights to the city controller he would have retained the warrant, subject to the order of the assignees. It would be well if the law designated that officer as the person to whom it should be given, in such cases. In the absence, however, of any such law, we think notice to other officials equally valid. The jury found that notice had been given to the board of controllers of public schools, to the councils, and to the city solicitor. This the learned judge held upon the point reserved, was notice to the city.

By the Act of March 3d 1818, § 7, Smith’s Laws 65, it is made the duty of the controllers to examine all accounts of moneys disbursed in erecting, establishing and maintaining the several schools within the district. The Act of the 15th of February 1832, 1 Pamph. L. 80, makes five members of the controllers a quorum for the making of orders, for the payment of money, and the transaction of business generally. There would then seem to be great propriety in giving notice to this board, which was most directly interested in looking after the subject-matter for which the money was to be paid. In Danville Bridge Company v. Pomeroy et al., 3 Harris 151, it was held, that notice to the engineer of a company appointed to supervise and direct the work of an alteration in the structure by the builder, was notice to his principals.

In Trenton Bank v. Canal Co., 4 Paige 127, it was ruled, that notice to the agent, when it is the duty of the agent to act upon such notice, or communicate it to his principal in the proper discharge of his duty as agent, is notice to the principal, and applies to the agents of corporations as well as of others. In this case three official branches of the city having been notified, we must hold the notice sufficient to charge the city therewith. The court committed no error in entering judgment in favor of the plaintiff below upon the points reserved.

Judgment affirmed.