Shattuck v. American Cement Co.

Citations

• 205 Pa. 197
• 54 A. 785
• 1903 Pa. LEXIS 547

Syllabus

<p>Corporations — Stock certificates — Power of attorney to transfer title.</p> <p>A certificate of stock with a power of attorney to transfer, duly executed but in blank as to date and name of transferee, is in the position of merchandise prepared for market. That is the way sales and transfers of stock are usually made, and the presumable intent of executing the power to transfer, is to put the holder in position to complete a sale by delivery of the certificate and transfer of the stock. Such transfer carries prima facie good title. The business of a stockbroker is to buy and sell stock, and when a certificate and power to transfer are put into a broker’s hands, the situation is exactly analogous to that of goods or merchandise of any kind, prepared for market, and put into the hands of a dealer in that particular article. The presumption which would arise in the case of an ordinary agent or holder is reinforced by the nature of this particular agent’s business.</p> <p>The rights of a bona fide holder, as against the true owner of the stock, to whom the apparent owner has either sold or pledged, do not depend on a negotiable character in the certificates, but rest on another principle ; namely, that one who has conferred upon another by a written transfer all the indicia of ownership of property, is estopped to assert title to it as against a third person, who has in good faith purchased it for value from the apparent owner.</p> <p>If an owner of stock voluntarily gives to his brokers certificates of stock owned by him, but standing in the name of other parties with blank assignments, and power to make transfers endorsed by the registered owners, and the brokers betray the confidence reposed in them, the owner of the certificates must suffer the loss rather than innocent strangers whose money the brokers were thereby enabled to obtain. The principle applies to pledges of stock, and one who purchases from the pledgee may hold against the pledgor ; and if the pledg