Chandler v. Prince

217 Mass. 451

• Court: Massachusetts Supreme Judicial Court
• Decided: May 19, 1914
• Status: Published

Opinion

Rugg, C. J.

This is an action to recover from the defendant, a stockbroker, the value of securities and money lost by the plaintiff’s testatrix through the kind of stock gambling prohibited by R. L. c. 99.

The defendant contends that a verdict should have been directed in his favor on the ground that the plaintiff’s case rested wholly upon the prima facie evidence that there was an intention on the part of the customer that there should be no actual sales and that there was reasonable cause on the part of the broker to believe that no such intention existed, established by R. L. c. 99, § 6, from the fact that orders were given to sell stocks which the customer did not own: and that this prima fade case was met by the auditor’s report in his favor, which of itself was prima facie evidence by R. L. c. 165, §§ 55, 56; and thus that, as the prima facie evidence of the statute was neutralized by the prima facie evidence of the auditor’s report, the burden of proof resting upon the plaintiff was not sustained.

This contention is not sound. Prima facie evidence means evidence “which standing alone and unexplained” maintains the proposition and warrants “the conclusion to support which it is introduced.” Emmons v. Westfield Bank, 97 Mass. 230, 243. Wilder v. Cowles, 100 Mass. 487, 488. Carroll v. Boston Elevated Railway, 200 Mass. 527, 536. Many statutes have been enacted from time to time establishing certain facts as prima facie evidence. The effect of these statutes is that where such fact is proved and there is no other evidence and no foundation for contrary inferences, the conclusion it supports must follow. Wakefield v. American Surety Co. 209 Mass. 173,176. But the law does not put all prima facie evidence on the same footing, nor declare that it is all of equal probative force. The effect of prima facie evidence, when not met or controlled, is established by the law, but its weight is not fixed when it is met or controlled. Then it'is to be analyzed and treated according to its worth. When two pieces of evidence conflict, each declared by law to be of prima facie force, then the case is thrown open and is to be considered at large upon all the evidence. The tribunal charged with the ascertainment of the facts is bound to determine the inherent evidential value of each piece of evidence and weigh it with the inferences and probabilities arising from all the circumstances, and thus reach a decision. It becomes a question to be decided according to the sound judgment of the jury, which evidence in fact is the more credible. To illustrate: By R. L. c. 29, § 20, it is provided that the record of a city or town clerk as to birth shall be prima facie evidence of the fact, while by c. 106, § 25, a certificate of age of a minor, signed and sworn to by the minor and his parent, was made prima facie evidence. These two instruments, one under each of these statutes and each made prima facie evidence, well might conflict as to the same fact. It is not difficult to determine which of these two instances of prima fade evidence commonly would have higher probative value. The uncertainty of the latter has been emphasized by the repeal of that statutory provision and the substitution of the certificate of the city or town clerk wherever available. St. 1909, c. 514, §§ 59, 145. Conflicting evidence, prima fade in character, is analogous to conflicting presumptions. It cannot be said as matter of law that one kind is stronger or weaker or equal to another kind. It is a question of fact. The evidence is to be considered as a whole and the truth ascertained as in other cases of contradictory evidence. Turner v. Williams, 202 Mass. 500, 505.

The facts in the case at bar, however, did not support this contention of the defendant. There was oral testimony at the trial directly contradicting the statement in the auditor’s report that all purchases and sales of securities charged in the account were made “upon written orders signed either by Mrs. Colburn or her agent.” This testimony may have been believed and found to be material, and, if so, the force of the auditor’s report and of his general conclusion was shaken. In other words, there was material evidence outside of that made prima facie evidence. Manifestly then the whole question was for the jury. Lonergan v. Peck, 136 Mass. 361, 365. Wyman v. Whicher, 179 Mass. 276. Cohasset v. Moors, 204 Mass. 173. It follows that the defendant’s requests for instructions numbered 1 and 7 were denied rightly.

The defendant has saved his right to object to the rule of damages laid down in the charge. He seasonably presented requests setting forth his view of the law in this regard, which were refused subject to his exception. At the close of the part of the charge respecting liability, attention was called specifically to one of these requests and then the judge suggested that as the parties had agreed upon the amount of damages, he would not lay down the rule of damages. Whereupon the counsel for the defendant, referring again to his request, said, “that just goes to the fundamentals. It has nothing to do with our agreement, and calls for the application of an entirely different rule of law.” The judge again said he would not give the defendant’s requests. Whereupon the defendant’s counsel announced the amount of damages agreed upon, if the plaintiff was entitled to recover anything. This was no waiver of the defendant’s contention as to the correct rule of damages. In substance it meant that after the judge had refused the defendant’s requests, and exception had been saved, he agreed upon the amount, if anything, which must be recovered upon the only rule of damages left open under the ruling of the judge.

The unusual circumstances of this case required the application of the rule of damages contended for by the defendant. The transactions between the plaintiff’s testatrix and the defendant began by the transfer to the latter of the qualified title to certain securities held by others upon valid pledges made by her to secure just demands against her. She did not and could not deliver the securities themselves. When the defendant paid the amount for which these securities were pledged, he succeeded to a valid lien for a like amount in his own interest. There was nothing illegal in that transaction, whatever were the later dealings between the parties. Subsequently she gave to the defendant orders from time to time to sell these securities, and the proceeds were used toward discharging this lien. The defendant was entitled to enforce his lien by legal process, but the same result could be and was accomplished by agreement between the parties. When these sales were made by the defendant upon order of the plaintiff’s testatrix, her qualified title was extinguished and transferred to the balance of proceeds left after satisfying the pledge. Wiggin v. Heywood, 118 Mass. 514, 516. This would have been the situation if there had been no gambling transactions between the parties. . But their relations touching the valid pledge was not affected by those subsequent illegal transactions. They were not so connected with the legal relation as to taint the whole. The substance of the affair was that when the securities were sold and the proceeds were applied toward the extinguishment of the lien, this was not illegal and thereupon the cash took the place of the qualified title to the securities and was contributed to the illegal gaming operation. The latter was all which she devoted to that unlawful purpose, and is all which her representative is entitled to recover.

It follows that the substance of the defendant’s requests 15, 16, 17 and 18 should have been given, to the effect that the plaintiff was not entitled to recover the value of the securities, but only the net money received by the defendant from their sales made on the express orders of the plaintiff’s intestate. This decision does not go beyond the peculiar facts here presented. It does not extend to nor affect a case where the initial deposit with the broker is not subject to a valid pledge or lien.

There is nothing at variance with this result in the earlier opinion in this case. The point now decided was not then necessary to be determined: Nor is it within the principles established in the numerous other cases decided under R. L. c. 99.

The plaintiff gave notice to the defendant to produce at the trial his books touching the transactions in question. The defendant did not produce them, but when the plaintiff’s counsel during the trial called for the notice, his counsel replied in substance that copies of all accounts had been furnished long before, with opportunity to verify them. It was said by the judge and the counsel for the plaintiff in the colloquy which followed, that the failure to produce the books gave the plaintiff an opportunity to use the copies as evidence, and they were so used. The defendant then, for the purpose of meeting such inferences as the plaintiff might seek to draw from the fact that the books were not produced in response to the notice, offered to show in substance that at the hearing before the auditor it was agreed by the parties that transcripts of the material portions of the books should be used after ample opportunity for verification from the books by the plaintiff, and that this course was followed in that hearing. It appears from the charge of the judge that an argument in behalf of the plaintiff was addressed to the jury based on the failure to produce the books, and instructions were given the jury touching the effect of such suppression of evidence. Hence it cannot be said that the defendant suffered no harm, if there was error. Unexplained failure to produce evidence, called for by notice or otherwise and within the control of a party, which naturally would be produced if helpful, is foundation for the drawing of adverse inferences by the jury. Howe v. Howe, 199 Mass. 598. Buckley v. Boston Elevated Railway, 215 Mass. 50, 56. Fairness demands that under such circumstances a party who fails to proffer such evidence be given opportunity to make explanation. Commonwealth v. Costello, 119 Mass. 214. Rumrill v. Ash, 169 Mass. 341. Commonwealth v. Goldberg, 212 Mass. 88, 91. Callahan v. Boston Elevated Railway, 215 Mass. 171, 174. The evidence offered by the defendant had a tendency to explain rationally his failure to produce a large number of books of account and should have been received. Where the parties by agreement had gone through one hearing without the original books by using copies of their material parts, it well might have been thought reasonable by the jury for the defendant to assume that the notice to produce the books was intended only to lay the foundation for the use of copies and was not based on a desire to use the books themselves in evidence. At least it was a subject for argument. See also 214 Mass. 180, 182.

The defendant’s exceptions to the exclusion of questions asked on the cross-examination of the plaintiff as to his knowledge of the amount of the losses of his testatrix and of the profits to the defendant arising out of the transactions must be overruled. These detached facts were of no consequence, and the right to recover did not depend upon them. Greene v. Corey, 210 Mass. 536, 547. Corey v. Griffin, 181 Mass. 229, 232. The account of all these transactions was before the jury rightly. It was permissible for one familiar with the account to analyze it and to show its details with reference to the ultimate facts whether the transactions were genuine or merely wagering contracts within the statute, whether the customer’s intent was that there should be no actual purchases or sales, and whether the defendant had reasonable cause to believe that such was the customer’s intent. This is the extent of the decision when the case was here before. 214 Mass. 180,181. But the evidence to the exclusion of which the defendant excepted was not directed to this end. It was a bald attempt to show who had lost or gained by the transactions and how much.

Considerable latitude in the introduction of evidence must be allowed in this respect, and something left to the discretion of the trial judge. The proportion of broker’s commissions received by the defendant does not appear to have beén material, nor within the rule of evidence declared in the earlier decision of the case.

The testimony of the plaintiff, excepted to by the defendant, that his testatrix told him that “she had lost all her property, all her money and securities, in stock speculation” was incompetent. A material issue was whether the plaintiff’s testatrix had any of the stocks which were the ostensible subject of these transactions or whether they all were that kind of gambling prohibited by the statute. The extent of her financial resources and the stocks actually owned by her bore upon this issue. Carpenter v. Leonard, 3 Allen, 32. Bliss v. Johnson, 162 Mass. 323. To this end it was competent to show that at the beginning of her relations with the defendant, she deposited with him all the securities she had, and at the end of those relations she had no securities. But the evidence of her statement to the plaintiff went beyond this. This exception should not be sustained, because the same evidence in substance was earlier admitted without exception. Morrison v. Lawrence, 186 Mass. 456,458. But the evidence was not admissible and the point is decided as it may arise on a new trial.

Exceptions sustained.