Marx v. Elsworth
Marx v. Elsworth
Opinion of the Court
Opinión.— The charge of the court rendered both prominent and obnoxious the subject of gambling contracts as applied to the facts of this case; the charge defines also in what consists a gambling contract, as has been, seen from the reading of the general charge. If such contracts as the court defines to be gambling contracts be in fact illegal
The only testimony in the case to establish the contract as it was made was that of the plaintiff himself, which emphatically disclaims the making of any such contract as that which is thus denounced by the charge of the court; nor is there in the nature of the contract, as alleged by the petition, nor as developed by evidence, the elements of a gambling contract according to the definition of such as given in the charge; and the charge given'to the subject would be otherwise inapplicable to the evidence, unless, notwithstanding the testimony given in relation thereto, it is to be left to construction by the jury to'- determine whether, notwithstanding the forms of words and terms, that one or both of the parties to the contract meant that there should be, in fact, neither actual sale nor resale. Whether it was proper, under the evidence, to give a charge at all on such a hypothesis need not, at this time, be discussed, but it is sufficient to say that if it was, nevertheless, in view of the emphatic allegation in pleading and evidence to the contrary by the plaintiff, so far as such illegal intent related to his participation in the making the contract, he was entitled to have the whole law applicable to the supposed illegal contract fully given so as to afford him, dis
The general charge of the court does not present, unless inferentially, this material point of mutuality of minds of both parties as essential elements of its invalidity as a gambling contract. The propositions contained in the charge asked for and refused are maintained by abundant authority. Clark v. Foss, 7 Biss., 540; Lehman v. Strasberger, 2 Wood (U. S. C. C.), 562; Gilbert v. Gangar, U. S. Ct. Ill., Cent. L. J., vol. 7, p. 41; Walcott v. Heath, 78 Ill., 433; Logan v. Brown, 81 Ill., 415; Hibblewhite v. McMorine, 5
The intent that a transaction should be a mere betting on the market, without any expectation of actual performance, must be mutual and constitute an integral part of the contract in order to render it invalid. The secret intention of one of the parties not to fulfill his contract, uncommunicated to the other, is not enough to make the transaction illegal, nor that it wras contemplated by him thereby to adjust the difference resulting from the fluctuations in the market price in case of a rise or fall, by making good, in money, by way of compensation, a guaranty to save the other party harmless against loss, or in like manner to make good the premium on profit to accrue to the other in case of advance in prices, under such a contract as the one sued on is alleged to have been, the other party not agreeing, at the time of its formation, to such an interpretation of a contract requiring actual sale and resale of the property embraced in its terms. The giving of the ninth charge asked was essential, under the evidence before the jury, to a full statement of the law applicable to the plaintiff's case; the more so because the general charge gave very great prominence to the defense set up of a gambling contract, by the use of trenchant language, denouncing such contracts as standing beyond the pale of the law’s protection, asserting that the usual habit of parties to them was to cloak them with disguises, and invoking the exercise, by the jury, in conjunction with the court, of their mutual powers to unmask all species of coverings used by parties to conceal their subterfuges. In the case of Powell v. Messer, 18 Tex., 405, the court commended the refusal of the district judge to give an instruction asked, which ivas abstractly correct law, where the law of the case had been properly given by the court, Chief Justice Wheeler remarking." “ Where the judge has embodied in his charge rules of law applicable to the case, in such form and connection as to give to each no more than its due relative
The first assignment of errors is to the effect “ that the court erred in charging the jury that the circular advertisement of defendant, announcing a new line of business, nd the employment of J. E. Villavassa as agent and manager, did not authorize said agent to make the contract .sued on, in that plaintiff had introduced seven wholesale grocers of G-alveston to prove the agency of "Villavassa by showing that the business of Elsworth & Co., as brokers and commission merchants in western produce and bacon, was all done by and through said agent. Plaintiff then rested, and the defendant testified in his own behalf that the agency was special. On cross-examination the advertisement was shown to him, and put in evidence as explanatory and in rebuttal.'’’
The second and third assignments of error "were as follows, relating to the same subject, and all of them may be considered together; they are substantially as follows:
Second proposition. The court erred in charging that the written circular advertisement would not authorize Villavassa to make the contract sued on, in that the legal import of said circular is that it is only an advertisement of Elsworth & Co. of their having opened a new branch of business, and the management of Villavassa as manager thereof is not by way of a power of attorney to him, nor intended to be the evidence of his authority, but a statement to induce business by showing the competency of the manager. The charge of the court, on this circular, laid such stress on this circular that it was calculated to mislead the jury into thinking that the question whether Villavassa was defendant’s authorized agent for the making of the contract sued on turned on the legal import of authority under said circular.
Third proposition. The court erred in charging the jury that the written circular advertisement would not authorize Villavassa to bind the defendant by the contract sued on,
Fourth proposition. The court erred in charging the jury that the circular advertisement did not authorize the agent, Villavassa, to bind the defendant by the contract sued on, in this: The contract is alleged in petition to have been made by Elsworth through said agent as broker. The advertisement does not even state that Elsworth does a brokerage business, and has no further connection with the case than to show that Villavassa had full charge of certain lines of business to which the brokerage business of defendant is germain.
And in the same connection may be considered the tenth assignment of error, as follows:
Tenth proposition. The court erred in refusing to give the charge asked by plaintiff to the effect that if Elsworth authorized Villavassa to do business in such a way as to authorize the making of the contract sued on, or, if Elsworth justified Marx in believing that Villavassa was authorized to make such a contract, then, if the jury find that the contract was made by Villavassa as agent of Elsworth, it binds Elsworth.
Because the general charge does not instruct the jury as . to responsibility, as between principal- and third party, that springs from the principal so acting as to justify the third party in believing that the agent had requisite authority.
The most usual mode of appointment of agents is by an unwritten request, or bjr implication from the recognition of the principal, or from his acquiescence in the acts of the agent. Agencies of this class, as remarked by Judge Story (Story on Agency, § 55), “ are very familiar in all the common business of life and the common departments of trade. . . . And the nature and extent of the authority of the 6 servant or agent are often wholly deduced from the nature
The elementary rule, however, on this subject is, of course, not questioned by the district judge, nor by counsel, that the p.mcipal should be held bound by the acts of the agent within the scope of his general authority; whatever questions arise grow out of the application of the maxims of law to facts. To ascertain not merely the actual authority conferred by express delegation of trust by the defendant, but to determine how far third persons might fairly imply the existence of authority deducible nnot only from the nature of the business or agencj7 in which Villavassa was employed, but from transactions and dealings had with the business world by Villavassa in behalf of defendant, acquiesced in or approved by the latter, whereby he was thus held out to the public as competent to do such acts, were all proper subjects to submit by evidence to the jury. And it was only proper to have allowed the jury, under instructions, to determine, from all the evidence before them, as to what was the extent of Villavassa’s authority to bind the defendant, either from the nature of his employment of from the acts and dealings of defendant through his agent, Villavassa, with the business or commercial world. The circular letter constituted one of such facts; and the evidence respecting dealings and transactions with others, acquiesced in, and the current business affairs of the defendant in certain lines of business, constituted other facts; and it was from all of these that the jury should have been allowed to draw the inference concerning the competency of Villavassa to bind the defendant by such a contract. It was not an incorrect proposition, as stated in the charge, “ that the written circular in evidence would not authorize
The subject of the charge asked and refused, set out in the tenth assignment of errors, ought to have been submitted in some shape by the judge in view of all the evidence in the case, as the plaintiff asked an instruction on the subject. We are not prepared to approve of the charge in the shape in which it is presented. The court, we think, properly declined to give it. A<- ¿ame time, the subject being called to the attention 01 tne court, it should have been given with appropriate changes adapted to the statement of the legal propositions involved in the suggestions contained in the charge. The charge asked was too indefinite and too hypothetical as applied to the evidence.
The fifth, sixth and seventh assignments of error may be considered together. They are as follows:
Fifth proposition. There was no evidence to justify the charge on gambling contracts, and the prominence and length of such charge was calculated to mislead and confuse the jury, in that the lengthy exceptions and answer of defendant as to its being a gambling contract, and the argument of defendant’s counsel, made it the duty of the court
Sixth proposition. The court erred in charging the jury as to gambling contracts, in that there was no evidence showing that the plaintiff, Marx, did not intend to buy actual bacon, or even that he had any reason to think that Elsworfch & Co., acting as brokers, did not intend to deliver the bacon constructively to plaintiff by holding the same for'resale on the day they contracted for delivery.
There was no evidence to show that any one ever gambled in bacon, by any such contract as is set out in the charge as constituting a gambling contract. There was no evidence that bacon is one of the articles of commerce, the market fluctuations of which are or can be the basis of gambling contracts. There is no witness that either plaintiff or defendant ever made a gambling contract as to any article.
Seventh proposition. The charge of the court was, as a whole, calculated to mislead the jury, in that, as a whole, the prominence given to gambling contracts and the effect of the circular advertisement was calculated to mislead the jury, and invades the province of the jury just as much as if there had been a direct charge for the defendant on the weight of the evidence, and especially so when the charge is put in the form of abstract propositions.
We have already sufficiently indicated our views on the seventh proposition. The defense of gambling contracts was in issue, and if the charge of the court had been sufficiently explicit in respect to matters hereinbefore adverted to, or had given the instructions asked, notwithstanding the prominence given to the subject of defense and the animadversions against that class of contracts, this court would not necessarily reverse the judgment, even though we might consider the charge subject to criticism, unless there was reason to conclude that the jury were unduly influenced thereby and the plaintiff injured thereby.
Eighth proposition. The court erred in refusing the charge asked by plaintiff, to the effect that subsequent ratification is equivalent to previous authority, and that if the principal retains money paid to agent by third party after he is advised of the terms of the contract on which it was paid, this would constitute ratification, even though the agent, when he paid the money to his principal, falsety represented that he had received it on another and different contract.
The evidence being that defendant’s agent received $1,500 from plaintiff, Marx, on the contract sued on, and about the same time paid $1,000 to defendant without informing defendant of the real contract, but stating that the $1,000 was paid by the plaintiff on another and different
We do not think that the court erred in refusing to give this charge. The evidence did not warrant the assumption that the defendant was advised of the terms of the contract on which it was paid, the assignment itself admits, in the proposition that the defendant was otherwise advised in respect to the money and the account on which it was received. Such evidence would be too remote to base on it the existence of the fact of such knowdedge as would, in its effect, operate as an estoppel in £>ais. The evidence of ratification, to bind a party, should be as clear as that required for an original authority. ... It may be stated, as a general rule, says Judge Parsons, “that no act operates a ratification, unless, with a full knowledge of the circumstances, it was intended so to operate, or unless it was such an act as justifies third parties, who are interested in the question, in believing it was a ratification. And the ignorance of the principal, although it arose from his own negligence, will invalidate the ratification.”
The last remaining proposition under the assignment of errors is the eleventh, as follows:
Eleventh proposition. The court erred in refusing the charge asked for plaintiff, to the effect that if Elsw.orth authorized the making of the contract, and it was made by him as a broker, there can be no question or defense in this suit on the ground that plaintiff did not expect the actual article to be delivered.
It is not clear to our minds that the evidence in the case warranted the application of the principle which it invoked by the instruction asked and refused. As the judgment will be reversed and the cause remanded for further proceedings, and in view of the fact that the principle of law involved is well settled, and the only differences which might occur in legal minds would arise from the construe
There is no assignment of error requiring us to remark upon the merits of the defense set up against contracts commonly designated as dealings in “futures;” the defense characterizes and assumes that such contracts under our laws are gambling contracts and void as against public policy. In passing upon the questions presented to us in the assignment of errors, we do not mean to be understood as expressing any opinion as to the alleged illegality of the class of contracts referred to.
We are of the opinion that the judgment of the district court ought to be reversed and shall award accordingly.
Case-law data current through December 31, 2025. Source: CourtListener bulk data.