Smith v. Baker , 4 N.Y. St. Rep. 520 ( 1886 )

Daniels, J.

The object of the action was the recovery of a debt against the defendant, James H. Redfield, amounting to the sum of $2,000 and interest upon a promissory note made by him on the 24th of May, 1878, and the sale of sixteen shares of stock of the National Broadway Bank and the appropriation of the proceeds towards the payment of the debt. The fact that the debt was contracted and the plaintiff was entitled to recover the amount of it were proved beyond dispute upon the trial. But the shares of stock assigned as collateral security for the loan were not the property of Redfield, the debtor, but they belonged to the defendant, Alice R. Baker, for whom Redfield acted as guardian during her minority. She was under his charge after the decease of her mother, and from the time she was about nine years of age until she attained the age of twenty-one years, in October, 1877. These shares of stock were part of her estate, and while she was under the age of twenty-one years, and in or about the year 1872, at his request she appears to have written her name upon the back of the certificate. This was done under no arrangement that the shares should be transferred to him, or that he should be at liberty to sell or dispose of them, and she was not given to understand what his purpose was in desiring her signature or that it was to be placed, or was in fact, placed upon the certificate of these shares. There was accordingly no intention on her part to supply him with the evidence of ownership of these shares, "without which in no event could he have used or disposed of the shares themselves. Weaver v. Barden, 49 N. Y., 286; McNeill v. Tenth National Bank, 46 id., 325. And it is quite evident that the assignor of the plaintiff received the shares upon no such understanding, for under her own name, as she had written it, her name was again written by the defendant Redfield as attorney, and upon that signature the shares were probably transferred as security for this loan.

But even if the shares had been received by the assignor of the plaintiff, or the plaintiff himself, in reliance upon the signature of the ward, as she was an infant at the time, she would not legally be bound by this as her act. The law would still permit her, as long as she made no actual representations concerning her signature or her age, to avoid its effect on the ground of her infancy. This is a general legal principle too well settled to require any support by way of citing authorities, and being an infant she could not be estopped by the simple circumstance of her name being placed upon the certificate of these shares of stock. Ackley v. Dygert, 33 Barb., 176; Brown v. McCune, 5 Sandf., 224.

These cases proceed upon the legal principle that a person under the age of twenty-one years will not be estopped from asserting the truth, by the mere circumstance appearing to have transpired,in this case. And the latter authority has not otherwise been disapproved of, except so far as it has a tendency to exonerate an infant from liabihty to arrest on account of fraudulent representations actually made by such person. Schunemann v. Paradise, 46 How., 426; Eckstein v. Frank, 1 Daly, 334; Wallace v. Morss, 5 Hill, 391.

The dealings through which the right is insisted upon, of appropriating these shares of stock to the payment of this indebtedness, took place exclusively between the plaintiff’s assignor and the acting guardian of this infant, and in no manner precluded her from asserting her right to the shares, and repudiating the act and conduct of the person under whose charge she had been during the greater period of her minority. No act upon her part either before or after she attained her majority, in any manner approved, confirmed, or ratified, this illegal disposition of her property, but she herself continued to receive the dividends upon it near to the time when this suit was commenced. Upon the facts as they were proven the judgment denying the right of the plaintiff to appropriate this stock to the payment of this indebtedness was legal and proper. To that extent the case seems to be free from substantial ground for doubt. But in determining the action without any proof as to the actual value of the shares, the court made an allowance in favor of this defendant amounting to the sum of eighty dollars. The shares themselves were for the sum of twenty-five dollars each, and as there was no evidence that they exceeded in value the amount for which they were issued, this allowance was unauthorized. It may probably in the absence of any proof, be presumed that the shares were of their face value, for they would ordinarily represent that amount of the capital stock of the bank issuing them, which, if it complied with the law, as it is to be presumed it had, would give them this extent of value. But the court could not presume them to be worth more than that sum. In making the allowance such a presumption seems to have been indulged, in favor of this defendant, and upon the strength and effect of it, at least sixty dollars more was allowed to her by way of additional costs, than was permitted by subd. 2 of sec. 3253 of the Code Civil Procedure. This allowance should be reduced to the sum of twenty dollars and with that modification the judgment should be affirmed, without costs to either party.

Davis, P. J., and Brady, J., concur.