
    Ida Small, Appellant, v. Clarence J. Housman and Sailing W. Baruch, Respondents.
    First Department,
    February 3, 1911.
    Principal and agent — purchase and sale of stock — facts showing agency — notice to agent demand for margins — reasonable time — notice of time and place of sale — waiver of further notice.
    Where a woman gave orders to stockbrokers for the purchase and sale of securities through her sou, who was employed by them'to obtain customers, the' court is justifie'd in holding that the son was authorized to represent his mother as her agent, where neither denied the authority and the defendants dealt with her through her son for a period of two and a half years with her knowledge and acquiescence.
    Moreover, when the mother went to Europe leaving a large speculative account in the management of her son, who had theretofore given all orders for the purchase and sale of the securities to the brokers, she constituted him her agent to receive demands for margins and notices of sale.
    Where the son, being in the employ of the brokers, knew the condition of his mother’s account,- the state of the market, and that further sums would be required to keep the margin up to the amount agreed upon, a demand upon the son by the brokers for additional margin was sufficient although it did not specify the amount required. '
    A reasonable time was allowed for furnishing additional margin where the brokers did not sell the securities until two days after the demand for additional margin. -
    
      Where the reports o£ the stockbrokers to the son contained the words'“subject in all respects to the rules and regulations of the New York Stock Exchange,” of which the brokers were members, and where the securities were bought and sold, a notice that the brokers would proceed forthwith to sell on the exchange sufficient of the securities to relieve the account if additional margins were not * furnished, sufficiently stated the timé and place of sale.
    Where the son, after delivering to the brokers securities left in his custody by his mother on her departure for Europe, in response to calls for additional margin stated that he had delivered the last of his mother’s securities, there was notice to the brokers that he could not put up further margin and a waiver of further calls therefor.
    In the absence of a waiver a stockbroker must give his customer reasonable opportunity to furnish additional security when called for, and must give notice of ' time and place of sale; but the reasonableness of the demand and the sufficiency of the notice must be determined by the surrounding circumstances.
    Appeal by the. plaintiff, Ida Small, from a' judgment of the Supreme Court in favor of the defendants, entered in the office of the clerk of the county of New York on the 3d day of December, 1909, upon the verdict of a jury rendered by direction of the court. ■
    
      Eugene Treadwell, for the appellant.
    
      George Zabriskie, for the respondents.
   Miller, J.:

This is an action by a customer against stockbrokers for conversion. The complaint is that, between the 24th day of October, 1907, and the 29th day of. October, 1907, both inclusive, without any notice to the plaintiff of the amount due, without any demand upon her for the payment thereof, and without notice to her of an intention on the part of the defendants to sell any of her securities, or of the time and place of any proposed sale, the defendants wrongfully sold and converted her securities. The plaintiff’s account was opened in January, 1905. Shortly prior thereto, her son entered the defendants’ employ, his principal duty being to obtain customers and information. The plaintiff transacted all her business with the defendants through her son. On the 19th of July, 1907, she went abroad without making any provision to meet a demand for margin in case one should be made. She had a quantity of securities in a safe deposit box, one key of which she took with her, leaving the other with a friend, who from time to time during the month of August took securities from'the box and delivered them to said son to be deposited with the defendants in response to calls for further margin. The said friend went to Europe in September, leaving certain securities with the son. On October twenty-second the last of those securities, 100 shares of Southern Pacific, was delivered by the,son to the defendants in response to a call for margins, and at that time the defendants were informed by the son' that that was the last he had of his, mother’s securities. It is undisputed that, when the last 100 shares of stock were delivered by the-son, the defendants demanded more margins, and that the son undertook to communicate with the plaintiff by cable but did not-succeed in doing so. One of the defendants testified that, on the morning of . October twenty-fourth, and again at ono o’clock' of that day, he notified the plaintiff's son that he Avas going on the Stock Exchange to sell securities to protect himself, to sell Avhatever marketable securities there Avere in the account; ” that he again informed him on the morning of October twenty-fifth that he Avas going to continue the sale of securities, and about two or two- thirty on the tAventy-nintli of October he notified the son that he was going to sell Interborough-Metropolitan bonds. The son denied having any conversation with said defendant on the morning of October twenty-fifth, but admitted that he was notified „at íavo o’clock on October twenty-fourth that the defendants Avere then going to sell the Union Pacific stock; that he Avas also notified on the afternoon of October twenty-ninth. that the defendants Avere about to sell $30,000 Interborough-Metropolitan bonds, and that the said defendant .told him -a number of times that he would sell. The defendant sold at two-ten o’clock on October twenty- . fourth 1,800 shares of Union Pacific common; on October twenty-fifth, 200 shares of Missouri, Kansas and Texas common, 400 shares of American Smelting and Refining Company common, 400 shares of Southern Pacific preferred, and $25,000 Interborougli-Metropolitan bonds, and on the 29tli of October, 1907, $30,000 Interbor- • ough-Metropolitan bonds. There is no question but that the condition of the market justified the demand for'additional margins, and that insistent demands for more margins Avere made upon the son during the time in question commencing at least two days before the first sale complained of Avas made. The appellant contends that the son was not authorized-to receive the demand for margin and notice of sale on behalf of the plaintiff, and that, in any event, sufficient notices were not given.

As the learned trial court-dismissed the complaint the case has to be considered upon the most favorable view of the evidence to the plaintiff. But we think the court was justified, upon the conceded facts, in holding that the son was authorized to represent his mother in the transactions with the defendants. Although both were sworn as witnesses, neither denied that the son had such authority. The defendants liaddealt.withthe mother through the son, and, although he was in their general employment, they had the right from tire course of business to treat him as the representative of his mother. While it is asserted that he gave orders on behalf of his mother, precisely ás he did for other customers, it is quite apparent from the course of business that they dealt with him as the representative of his mother with her knowledge- and acquiescence. Moreover, when she went -to Europe, leaving a large speculative account with no one but her son, who had theretofore given all the orders for purchase or sale, to look after it, she in effect constituted him her agent to receive demands for margin and notices of sale. At -any rate, under such circumstances, the defendants had the right to deal with the only personAvhom they had been-accustomed to deal with in transactions covering a period of more than two and a half years. ^/"

The demands for additional margins did not specify the amount required. /However, they must be considered in view of the situation of the parties. The plaintiff’s son knew the condition of the accomyi and the state of the market. He knew what further sum was /Required to keep the account margined up to the amount required-or agreed upon, and the demand for more margin implied a^/deinand for such amount. Certainly, a reasonable time was allowed because at least two days elapsed after the first demand, not complied with, before a sale was made.

I The question, then, is whether there was sufficient notice of the / time and place of sale. The securities were dealt in on the Hew | York Stock Exchange. The defendants were members of the Stock Exchange. The reports of transactions made by the defendants to ; their customers contained the words “ subject in all respects to the rules and regulations of the New York Stock Exchange,” and, of course, it was understood by the plaintiff’s son that the sales would be made on the exchange.

Was the time sufficiently stated 1 The notices in effect were that the defendants would proceed forthwith to sell on the exchange sufficient securities to relieve the account. That meant that sales would be made from time to time as the market afforded an opportunity. Of course, the fact was that the plaintiff’s son did everything he could to protect the account. lie succeeded in getting his uncle to take over a,part of it. ' All the securities left with him had been exhausted. In getting his uncle to take over a part of the account he exhausted all the resources he had, aiid lie could have done nothing more, no matter what notice had been given him. But if he had been in a position to supply more margin or to protect the interests of his mother by'purchasing on the exchange when the sales were made, he had sufficient demand for margin and sufficient notice of the time and place of sale to have enabled him to do both, .and certainly that ought to be the.te.st. His statement on delivering the last 100 shares of collateral, thalftb.pf was the last he had of his mother’s, was .obviously intended by him as notice to the defendants that he could not put up further margin; and it was a waiver of . further call .for margins, if it be assumed that such further call ■ would otherwise have been necessary. In that situation,; and in the condition of the market, the defendants were not obliged to face-disaster by undertaking to carry the account. All of the surrounding circumstances have to be considered in determining the reason-’ ableness of the demand and the sufficiency of the notice, of time and place of sale. Although in the absence of agreement or waiver, the broker in speculative transactions must give the customer, reasonable opportunity to . furnish additional margin when called'* for and must give notice of time and place of sale (Content v. Banner, 184 N. Y. 121), the reasonableness of the demand and the sumcienoy of the notice must, like all other transactions, be judgech by the surrounding circumstances. In the case cited no. time or| place was specified and the sale was “ on the curb.” In this case it ! was plainlyunderstood that the place of sale was the Stock Exchange | and that the time was forthwith or whenever the market afforded j an opportunity to make a sale., Moreover, the complaint is not of ) the sufficiency of the demand .and • notice, - but of no demand or notice;

The conclusion which we have reached renders it unnecessary to consider the exceptions to rulings Upon evidence which could not in any event affect the- decision.

The judgment should be affirmed, with costs.

Ingraham, P. J., McLaughlin and Clarke, JJ., concurred.

Judgment affirmed, with costs.  