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Reports of cases adjudged in the Supreme court of Pennsylvania, in the Eastern district [Dec. term, 1835 - Mar. term, 1841] (Volume 6) online

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him Sharpe was safe enough. I told Mr. Parker I would go
Sharpe's security for him, and that if Sharpe did not make up the
stock to him I would ; I would go security for him."

The counsel for the plaintiffs thereupon asked the court to strike
out all of the testimony of the witness.

The counsel for the defendant then proposed to ask the witness
as to the sale of stock by Parker, and as to the amount Parker got
for the stock ; to which question the plaintiffs' counsel objected ;
but the court overruled the objection, and admitted the testimony,
to which the plaintiffs' counsel excepted.

127 SUPREME COURT [Dec. Term,

[Commonwealth v. Watmough.J

The witness then stated in answer to questions by defendant's

"Mr. Parker sold the stock for about $123 or $124 per share,
or something in that neighborhood. It was for more than enough
to pay this claim. He sold it a short time after the transfer to him ;
he told me so. He never asked me for any instrument of writing ;
never made any claim against me."

On the cross-examination being resumed by the plaintiffs' counsel,
the witness stated :

"I don't know to whom Mr. Parker sold this stock. I bought
goods from him for my brother. No part of the proceeds of the
*1281 * stoc k went to pay for those goods. I believe Sharpe has
J got part of the money for this stock. Mr. Parker settled
it all. He gave him a receipt for the stock, that whenever this suit
was settled, he would pay it over. Mr. Sharpe has got the money
for the stock, Mr. Parker paid it over to him in my presence. Mr.
Parker paid the money to me for Sharpe. Sharpe gave me a receipt
to get the money. I gave that receipt to Mr. Parker. I brought
the receipt up and got the money and took it down to Wilmington.
I paid the whole of the money over to Sharpe. The note which
Sharpe had given me for this stock was not in my possession when
the money was paid by Parker."

In answer to a question by the court, the witness said : Mr.
Parker has now nothing in his hands but Sharpe's security, and I
to back him."

The counsel for defendants then drew up a release at bar from
Mr. Parker to the witness, dated February 4th 1839, which was
duly executed, and the evidence previously given was agreed to be
considered as if given after the release.

The counsel for the plaintiffs again objected to the competency
of the witness, but the court overruled the objection, and the coun-
sel for the plaintiffs again excepted.

The witness proceeded : " I took down Mr. Parker's notes to
Sharpe for the stock. My father or brother gave me the money
for those notes, and I gave it to Sharpe. There were one or two
notes; I am not certain which. I don't recollect in whose favor
the notes were drawn, nor whether I put my name on them or not.
The note was not over thirty or sixty days. I took the notes
directly to my father or brother and got the money. I did not
take the notes to Sharpe. Sharpe never saw the notes till I handed
him the money. If they were to my order, I endorsed them. My
brother is two years younger than myself. He was born it 1805;
is in the flour business. I knew of this judgment against me when
I transferred this stock to Shrape. I don't know that he knew of
it. I never paid the expenses of his coming up. In April 1833,
I went into business for my brother in Wilmington. The store


[Commonwealth v. Watmough.]

belongs to my father. I get a salary. I have a power of attorney
to sign checks for my brother. I can't say whether I drew the
money for Parker's note on this power of attorney or not. I sign
his checks. I deposit all money to the credit of my brother. The
proceeds of Sharpe's note I deposited to the credit of my brother.
I kept but one bank account; it was in the bank of Wilmington
and Brandy wine; my father is president of it. Sometimes ray
father discounts paper for me and gives me the money, an<i some-
times he gives me a check. I drew the money out of the
bank to discount Parker's notes *with. My brother first
came into the store in 1836. He lived in Philadelphia till ^
that year; went down in September 1836. The store is carried
on by me up to this day under that power of attorney. The sale
to Mr. Sharpe was a bona fide sale no cover of any kind what-
ever. The money with which the fifteen shares were bought in ray
name was taken out of my brother's stock, and the proceeds returned.
I never had any interest in that stock whatever although it was in
my name."

The counsel for the defendants then called the subscribing wit-
nesses, to the power of attorney, which was read in evidence, as

" Know all men by these presents, that I, the undersigned, for
value received, do hereby irrevocably constitute and appoint Jesse
Sharpe, to be my true and lawful attorney, for me, and in my name
and behalf to sell, assign and transfer unto Samuel Parker, or any
other person or persons, fifteen shares in the capital stock of the
Bank of the United States, and further one or more persons under
him to substitute, with like power.

In witness whereof, I have hereunto set my hand and seal, this
22d day of April 1836."

The counsel for the defendants further gave in evidence a notice,
dated the 13th of May 1836, to the president and directors of the
Bank of the United States, by the attorneys of Mr. Sharpe, that the
stock attached as the property of Mr. Seal was actually the property
of Mr. Sharpe.

The counsel for the defendants further gave in evidence the fol-
lowing order :

" Mr. Samuel Parker,


You will please to pay Joshua T. Seal, the proceeds of the fifteen
shares of the United States Bank stock you sold of mine, and much

Obli 8 e ' Yours,

Wilmington, May 22d 1837."

129 SUPREME COURT [Dec. Term,

[Commonwealth v. Watmough.]

The evidence having been gone through, and the jury having
been addressed by counsel on both sides, as the judge was about to
charge the jury, the plaintiffs counsel handed him the following
points in writing :

1. That if the brother of Joshua T. Seal entrusted him with
money to conduct and carry on a store with, and gave him the
absolute control of funds for a number of years, and he (Joshua T.
Seal) purchased stock in his own name, and dealt with it as his
*13fn * own ' sucn stock in the possession of Joshua T. Seal would

' be liable to his creditors.

2. That if the jury believe that these fifteen shares of stock
never were transferred to Jesse Sharpe, but were in the name of
Joshua T. Seal till they were transferred into the name of Samuel
Parker, then and in that case they were liable to this execution.

3. That if this stock never was in the name of Jesse Sharpe, and
he never had the possession of it, except for the purpose of trans-
ferring it to Samuel Parker, but it continued in the name and pos-
session of Joshua T. Seal, at the time of the levy, that then and in
that case it was liable to this execution.

4. That the sheriff was bound to proceed and sell this stock
standing in the name of Joshua T. Seal especially as an indemnity
was offered to him by the plaintiffs.

The learned judge charged the jury, in substance, as follows:
" The plaintiff alleges that there was property of J. T. Seal suf-
ficient to make the money, on which the sheriff actually levied, and
that by his subsequent return of nulla bona, he made himself and
his sureties liable for the debt. It is conceded that if there was
such property, the defendants are liable ; and the question is, was
there such property or not ? The defendants say, that after the
levy and before the return, the sheriff was satisfied that the pro-
perty levied on, did not belong to J. T. Seal. On the 18th of
April 1836, fifteen shares of the United States bank stock were
transferred on the books of the bank to Joshua T. Seal. At that
time the present plaintiffs had the judgment against Seal. The
second section of the act of the 29th of March 1819, relative to
taking stock in execution, authorized a levy on the stock in the
name of J. T. Seal, if it were owned by him. The distinction
between ownership and holding for another, is plainly and unequi-
vocally recognised in the preamble to the third section of the act,
and in the third section, and provision is made to enable a creditor
of a person owning stock held in another's name, to reach it for the
debt of the real owner. On the 6th of May, execution being issued,
a levy on this stock was made, it still standing on the books in the
name of J. T. Seal. So far the plaintiff has a prima facie case.
Until explained the name of J. T. Seal on the books of the bank


[Commonwealth r. Watmough.]

might be deemed sufficient evidence of his ownership. The defend-
ants, however, make a two-fold defence.

1. They allege that though the stock was in the name of Joshua
T. Seal, yet in fact it was owned by bis brother Joseph ; that
Joshua never had any interest in it. If this be made out in point
of fact, it finishes the controversy. The sheriff was then, right in
returning nulla bona, and any judgment creditor of Joseph Seal,
if such existed, *could have made it liable to execution, for r*-ioi
debts due by him. The defendants rely on the testimony '
of Joshua T. Seal, who certainly swears unequivocally to the fact
that he had no interest ; that the stock was bought with his
brother's money, and was owned entirely by him. The defendants
say that Joshua was a man of no property, merely an agent for his
brother, and that the brother was a man of substance. All this
depends on the evidence of Joshua himself. The plaintiffs ask you
to reject the testimony as that of a man unworthy of belief. The
plaintiffs produce no witnesses to contradict, but argue on the facts
and papers in evidence, that there is enough to show him not
entitled to be believed. The plaintiffs say that the story is improb-
able in itself, that no adequate reason is given for using the wit-
ness's name for his brother, but the reverse, and that the manner
in which the witness testified, shows his disregard of truth. The
defendants deny these inferences, and contend that as an unim-
peached witness he is entitled to full credit ; that there is
nothing in his statement improbable or inconsistent, but on the
contrary every thing is natural and obvious, and that there
is nothing in his manner to bring discredit on him. The jury
will judge. If the jury are with the defendants on this part
of the case, there is nothing left. But the defendants say further,
that even if Joshua was the owner, yet there was such a dives-
ting of his ownership before the levy, as to prevent the execu-
tion from attaching. A certain paper is produced. The defendants
allege that on the 22d day of April 1836, some days before the
levy or before the execution was handed to the sheriff, J. T. Seal
sold the stock to Jesse Sharpe, took full value for it in Mr. Sharpe's
note at sixty days (which was paid at maturity), and handed him
over the certificate, with a power of attorney irrevocable to transfer
the stock on the books of the bank. All this he did, it is said, for
his brother, though his name was necessarily used. If Mr. Sharpe
had immediately made the transfer (supposing the 22d of April
1836, to be the date of the transaction), it would have prevented
all dispute ; but he retained the certificate and power of attorney
until the levy was actually made, and then, for the first time
informed the bank of his claim. In the case of goods and chattels,
the rule is clear, that where there is a judgment against any one, a
transfer of the property, unaccompanied by actual possession, is

131 SUPREME COURT [Dec. Term,

[Commonwealth v. Watmough.J

void against the creditor ; and even where possession does accom-
pany the transfer, the party is required to show, as against a
creditor, beyond doubt, that there was a sufficient consideration.
The peculiar character of bank stock, however, renders it necessary
to guard against being misled by this general rule of law. In
reference to a transfer of interest, it is more analogous perhaps to a
chose in action than to goods and chattels. The discrimination is
marked in the very section of the act of 1819, on which the plaintiff
relies, to sustain his levy. That section declares that " Stock,
&c., shall be liable to be taken into execution and sold in the same
^ on-i manner *that goods and chattels are liable in law to be so
-" taken and sold," not in the same manner that other goods
and chattels are liable, &c., but goods and chattels. The subject
was considered by the Supreme Court, in the case of the United
States v. Vaughan, 3 Binn. 394, in reference to stock situated as
this is. There by the charter of the bank, as here by an act of
assembly, transfers are directed to be made in the presence of an
officer of the bank. It was held that stock, assigned bona fide, for
full value, on the certificate, and handed over with a power of attor-
ney to transfer, conveyed such an interest that the stock was not
liable afterwards to attachment as the property of the vendor,
although the transfer was not made on the books of the bank at the
time of attachment. Judge Breckenridge intimates that the
principle must go the whole length of protecting the stock from
levy under an execution of the vendor. In the United States v.
Cutts, 1 Sumn. 132, the principle of the above decision is approved
and enforced by Mr. Justice Story. Whether in case of a second
sale of the same stock to an innocent purchaser, for full considera-
tion, and an actual transfer on the books of the bank, the first
vendee would not be made to suffer for his own omission to consum-
mate his title, is not the question here. As he left it in the power
of the vendor to commit such a fraud upon him, he would hardly
be allowed to complain, except against the vendor. I hold it then
to be the law, that if on the 22d of April 1836, Mr. Sharpe actually
gave value for the stock, in good faith, and took an assignment and
power to transfer, it authorizes him to make defence in this suit.
The handing over the certificate with an irrevocable power of attor-
ney to transfer, was a sufficient assignment to pass all Mr. Joshua
T. Seal's interest in the stock. This being the law, the plaintiffs
again meet the case in point of fact. They say the transaction did
not occur on the 22d of April 1836, but after the levy, and that
the whole of it was a fraudulent effort to convey stock really owned
by J. T. Seal. To make good their position, they must here also,
deny that Mr. Seal speaks the truth, and indeed must charge him
with a series of unequivocal falsehoods. The plaintiffs give their
reasons for the allegations. The defendants deny that there is the


[Commonwealth v. Watmough.]

slightest ground for these accusations. The jury must determine.
Both grounds of defence are made out if J. T. Seal speaks the
truth. If he is false in regard to the one ground, it is not unlikely
that he is in regard to the other. So that the whole case seems
to be resolved into a question, whether the jury believe him to
have spoken the truth, or to have uttered gross and palpable false-

The jury found for the defendants ; and the plaintiffs' counsel
having excepted to the charge, a writ of error was taken, and the
following errors assigned :

*1, The court erred in admitting Joshua T. Seal as r*-ioo
a witness, as mentioned in the plaintiffs' same bill of ex- "-

2. The court erred in refusing to strike out the testimony of
Joshua T. Seal, when his interest was disclosed ; and in admit-
ting his testimony, as mentioned in the plaintiffs' first bill of ex-

3. The court erred in admitting the testimony of Joshua T. Seal,
as mentioned in the third bill of exceptions.

4. The court erred in not instructing the jury as requested in the
plaintiffs' first point ; but on the contrary, instructing them, that if
Joshua T. Seal purchased the stock with the money of his brother,
that then it was not his, nor liable to his creditors.

5. The court erred in not instructing the jury as requested in
the plaintiffs' second and third propositions ; but on the contrary,
instructing them that if the stock was sold by Joshua T. Seal to
Jesse Sharp, on the 22d April 1836, and the certificate delivered to
him, with an irrevocable power of attorney, although never trans-
ferred to Sharpe on the books of the bank, yet that it was his
(Sharpe's), and not liable to be levied upon by an execution against
Joshua T. Seal.

6. The court erred in not instructing the jury as requested in
the plaintiffs' fourth proposition ; but on the contrary, instructing
them, if they believed that the stock in question was purchased by
Joshua T. Seal with the money of his brother, or that it was sold
to Sharpe, although never transferred into his name, the sheriff
was justified in returning the fi. fa. " nulla bona," though the
plaintiffs offered to indemnify him.

Mr. Perkins, for the plaintiffs in error.

The three first errors assigned all relate to the admission of
Joshua T. Seal as a witness, to prove that the stock levied on was
the property of Jesse Sharpe ; thai he had sold it to Sharpe.

A sale of personal property implies a warranty of title on the
part of the vendor. Ritchie v. Summers, 3 Yeates 534 ; Boyd v.
Bopst, 2 Dall. 91 ; Shields v. Buchanan, 2 Yeates 219. Seal, the

133 SUPREME COURT \Lec. Term,

[Commonwealth v. Watmough.]

vendor, was offered to support the title to the stock, in Sharpe, his
vendee. If Sharpe, the vendee of Seal, lost the stock from defect
of title in Seal, he would have a right of action against Seal, his
vendor. In such Action the verdict in this case would be evidence.
Witmer et al. v. Schlatter, 2 Rawle 365-6 ; Leather v. Poultney,
4 Binn. 356 ; Clarke's Executors v. Carrington, 7 Cranch 322 ;
Waldo v. Long, 7 Johns. 173. Blasdale v. Babcock, 1 Id. 517,
was an action on the case on an implied warranty of title in the
sale of a horse, which the plaintiff had purchased of the defendant,
and which one Snow had recovered from him in an action of trover;
and the record of the recovery by Snow was held to be evidence.
^-.04-1 Barney *v. Dervey, 13 Johns. 224. In an action by Sharpe
-" against Seal, the averment that Seal was examined as a
witness in this case, would be tantamount to an averment that he
had notice : and all the cases show, that if Seal had notice, the
verdict and judgment in this case would be conclusive against him,
in an action by Sharpe, on an implied warranty of title to the stock.
Kip v. Bringham, 6 Johns. 158 ; Pinney v. Gleason, 5 Wend. 535 ;
Tarlton v. Tarlton, 4 M. & Selw. 20. A vendor of goods is not a
competent witness for the vendee in an action by a third person for
the goods. Heermance v. Vernoy, 6 Johns. 5 ; Chapman v. An-
drews, 3 Wend. 240; Baxter v. Graham, 5 Watts 418. If this
verdict could be given in evidence in an action by Sharpe against
Seal, the witness, he was incompetent. Conrad et al. v. Keyser, 5
S. & R. 371 ; Hilhouse v. Smith, 5 Day 432 ; Benjamin v. Smith,
12 Wend. 404, 406, 7. It is not even necessary in order to ren-
der a witness incompetent, that the record in the pending cause
should be evidence, for or against him in a subsequent suit. It is
enough that a decision of the cause in favor of the party calling
him, will prevent the witness's liability to a subsequent suit : 6
Page's Ch. Rep. 81, and cases there cited. By the verdict and
judgment in this case, Sharpe keeps the stock ; and this judgment
prevents a suit by him against Seal, the witness, on an implied
warranty of title. The release by Parker to Seal did not restore
his competency. He was liable to Sharpe, not to Parker; and
Sharpe never released. The delivery of the certificate of the stock
by Seal to Sharpe, accompanied with an irrevocable power of
attorney, did not exempt it from being levied on and sold as Seal's
property, if Sharpe suffered it to stand in Seal's name, on the
books of the bank. The law is well settled in Pennsylvania, that
possession must accompany the sale of personal property. Clow v.
Wood, 5 S. & R. 275 ; Cunningham v. Neville, 10 Id. 201 ; Shaw
v. Levy, 17 Id. 99 ; Pritchett v. Jones, 4 Rawle 260 ; Jenkins v.
Eichelberger, 4 Watts 121. In this case the stock had been stand-
ing on the books of the bank, in the name of Joshua T. Seal, from
the 18th of April 1836. It was levied on as his property on the


[Commonwealth v. Watmough.j

6th of May 1836 ; and was not transferred on the books of the
bank till the 1st of June 1836 ; and then not to Sharpe, the alleged
purchaser, but to Mr. Parker. The stock never was in the name
of Jesse Sharpe, the claimant. Is there anything in the character
of bank stock that should exempt it from the wholesome rule
established in regard to other personal property ? It is as suscepti-
ble of delivery, and much more, than many descriptions of property
to which this rule has been held to apply. The act of assembly
treats it as personal property. Purd. Dig., edit. 1830, p. 167, sec.
2. Act 29th March 1819. And the act of 18th June 1836, sec.
22 (Purd. Dig., 5th edit. 370), says, that it shall be liable to execu-
tion like other goods ; and section 34 of the same act (Purd. Dig.
371) points out *the course for a claimant of stock, stand- r*ioc
ing in the name of the defendant, to pursue to try his rights. *
The transfer of stock is not good till made according to law, on the
books of the company. Marlborough Manufacturing Co. v. Smith,
2 Conn. 579 ; Newton v. Bridgeport Turnpike Co., 3 Id. 544 ;
Northrop v. Curtis, 5 Id. 246 ; Oxford Turnpike Co. v. Bonnel, 6
Id. 522. The act of 1st April 1836, sec. 3, requires the stock of
banks to be assigned and transferred in the presence of the presi-
dent, cashier or other officer appointed by the directors. The sheriff
was bound to execute the writ and sell the stock when a satisfac-
tory indemnity was offered. Baily v. Bates, 8 Johns. 143 ; Vau-
cleef v. Fleet, 15 Id. 167 ; Curtis v. Patterson, 8 Cowen 66 ;
Mayne u. Seymour, 5 Wend. 309.

Mr. Me Call, for the defendant in error, having cited The U. S.
v. Vaughan, 3 Binn. 394 ; The U. S. v. Cutts, 1 Sumner 133 ;
Bank of Utica v. Smalley, 2 Cowen 770; Quiner v. Marblehead,
10 Mass. 476; Plymouth Bank v. Bank of Norfolk, 10 Pick.
454, was stopped by the court ; whose opinion was delivered by

KENNEDY, J. The only question involved in the first three
errors assigned, which seems to be worthy of notice, is the compe-
tency of Joshua T. Seal as a witness for the defendants. If the
competency of the evidence, or any portion thereof, was intended to
be excepted to, I think it was not made a question of, and pressed on
the argument of the cause here ; nor can I perceive any tenable
ground upon which such an exception could have been sustained.

The objection to the competency of Joshua T. Seal, as a witness
for the defendants, is made upon two grounds ; First, that of inter-
est in the event of the suit ; and second, that of the verdict in this
case, if it had been in favor of the plaintiff, being evidence in an
action brought hereafter by Jesse Sharpe against Seal, to recover
back the price of the stock, upon a breach of the implied warranty
of title, on the part of Seal, that attended the sale thereof by him

135 SUPREME COURT [Dec. Term,

[Commonwealth . Watmough.]

to Sharpe. Sharpe, it would seem, must be considered the real
defendant in this suit, though Seal undoubtedly was interested in
it, according to his own statement, until he was released by Parker,
which was on the trial of the cause : because he induced Parker to
go into a bond with Sharpe to the sheriff, engaging to save the
latter harmless, if he would forbear to proceed in the execution
which he had in his hands at the suit of the plaintiffs against Seal,
to sell the stock. But Seal could only be looked on as interested
in the event of the suit, on account of his undertaking to Parker,
to be back security to him, for the sufficiency of Sharpe to keep
him indemnified, for becoming Sharpe's security in the bond given by
them to the sheriff. But it is alleged that Seal, in selling the
*1 3fi1 s * oc ^' as * ne wner thereof, to * Sharpe, impliedly warranted
' the title of it; that a recovery by the plaintiffs in this action,
would be evidence, at least, of a breach of such warranty ; and
Seal, by means thereof might be rendered liable to return the price
of the stock to Sharpe ; hence it is contended that he was interested

Online LibraryPennsylvania. Supreme CourtReports of cases adjudged in the Supreme court of Pennsylvania, in the Eastern district [Dec. term, 1835 - Mar. term, 1841] (Volume 6) → online text (page 15 of 75)