Wotkyns v. Wm. R. Staats Co.

YORK, J. A judgment was rendered on a complaint which alleged that the plaintiffs became customers of defendant on or about February 1, 1930, and placed numerous orders for the purchase of corporate stocks and bonds and numerous orders for the sale of same; that all of said orders were given orally by plaintiffs and accepted orally by - defendant and were executed by said defendant, as set forth in the said com[547]plaint; that all of the corporate stocks and bonds so purchased by plaintiffs through the defendant as broker of plaintiffs were paid for in cash, and plaintiffs during said period of time never had any margin account with said defendant.

The complaint specifically alleged that on or about February 15, 1931, plaintiffs orally instructed and requested defendant to sell for their account 200 shares of Massachusetts Investors Trust at $35 per share and 50 shares of the corporate stock of Texas Gulf & Sulphur Co., at $52.50 per share; that the defendant orally promised and agreed at said time to sell said shares, and each of them, at said prices if the market equalled or exceeded said prices at which plaintiffs directed said shares to be sold; that the plaintiffs agreed with defendant that defendant should charge and plaintiffs should pay defendant’s regular commission for the sale of said shares of stock in said transactions. It is further alleged that thereafter, during the two months following the giving of such instructions, the market prices of said shares on many days during which the New York Stock Exchange was open and during which the said defendant was engaged in the business of selling said stocks, exceeded the respective prices at which plaintiffs instructed and directed said shares to be sold, but notwithstanding said fact, defendant failed to sell said shares pursuant to its agreement, which was set forth in said complaint.

It is further alleged that during the period of time from April, 1931, immediately following the above-mentioned transactions, and down to and including the month of April, 1932, the market prices of said stocks fell far below the prices at which defendant agreed to sell the same, and during said period of time the defendant constantly advised plaintiffs not to sell, upon the representation by defendant that the losses sustained in the foregoing transactions would be retrieved in a rising market. However, on or about a year and a month after said original instructions were given, the defendant sold 25 shares of Texas Gulf & Sulphur Co. for the sum of $419.81, and some weeks later defendant sold a further 25 shares of said Texas stock for the sum of $448.50 and 200 shares of Massachusetts Investors Trust for the sum of $2,517, making the net proceeds to the plaintiffs for the sale of said stocks $3,385.31; and that by reason thereof plaintiffs allege they have suffered a loss, as a direct and proximate consequence of