only a lien. (Wilson v. Little, 2 Coms. (N. Y.) 447; Morton v. Preston, 18 Mich. 69.)

The sixteenth assignment of error is as follows: "The Court erred in charging the jury, as it did, that the defendant could not recover of the plaintiff, for the conversion of his stock, if he was always ready, able, and willing to replace such as he may have converted, if any, without at the same time informing the jury, as it did not, that to be ready and able in law to replace such stock, was to have as many shares of his own, free and unincumbered, on hand, and under his instant control, as he had so converted, and that to have had shares of third par ties in his hands, was not sufficient as a defense as against such conversion."

The instruction is but a repetition of the cardinal error which runs through the case. What has already been said in preceding points sufficiently explains our views in regard to it. It would permit a party who could buy stock in the market to sell his pledge whenever he saw fit, and thus to speculate on his pledgor-which he may not do. The principle of Atkins v. Gamble (42 Cal. 86) is, that shares of stock are intellectual entities unsusceptible of identification, and may therefore be treated as coins not in a bag; but the operation of that principle is carefully guarded by the proviso, that a pledgee shal! not speculate upon his pledgor. The proviso, he shall have as many shares of his own on hand when he disposes of his pledgor's as he so disposes of, means nothing else.

"The

The twenty-ninth assignment of error is as follows: Court erred in saying to the jury what it did about notice suffi cient to put the parties upon inquiry, and omission to make inquiry." The Court instructed the jury on the point of notice as follows: "Actual notice of these facts is not always necessary: Notice is, first, actual, which consists in express information of a fact; second, constructive, which is implied by law.'"

"This is the section to which I call your attention now: 'Every person who has actual notice of a circumstance sufficient to put a prudent man upon inquiry as to a particular fact, and omits to make such inquiry with reasonable diligence, has constructive notice of the fact itself." "

However good law this may be, it was inapplicable, and calculated to mislead the jury. The case was one in which constructive notice could have no effect. The relation of principal and agent existed, and the principal was not required to pursue any inquiry. He reposed on his agent's fidelity. Before he could be held to have knowledge of the alleged fraud, it should have been proved he had actual knowledge of the facts constituting the fraud. What the Court said relieved the plaintiff of that onus as to proof, when it belonged to the plaintiff and threw it on the defendant. (Pence v. Langdon. 99 U. S. S. C. Rep., 9 Otto, 578; Sears v. Shafer, 2 Seld. 268; Civil Code of Procedure, § 1869; Shannon v. White, 6 Richards Eq. R., S. C., 96; Basset v. Nosworthy, 2 Leading Cases in Equity, 1; Boone v. Chiles, 10 Pet. 210; McLure v. Ashley, 7 Richards Eq. R. 439; 23 Iowa, 66; 30 id. 375; 4 Strobh. 155; Pease v. Barbiers, 10 Cal. 436.)

The judgment must be reversed because it calls for $305,050.95, with interest thereon, and $422.50 costs, when the verdict it recites was $295,345.38.

Estee & Boalt, for Respondent.

There was no fraud even if plaintiff, as the agent, pledgee, or trustee of defendant, had sold the stock of the latter without his consent, if he was at all times ready, able, and willing to turn over on demand an equal quantity of similar stock. The Court below held that the relations of piedgor and pledgee existed between these parties, and upon that opinion was compelled to declare the law as laid down by this Court in Atkins v. Gamble, 42 Cal. 86.

That decision goes to the merits of this case, and is the law of this case upon the assumed proposition that Hayward, this plaintiff, was the pledgee of the stock in controversy, and the charge of the Court to the jury upon the law of the case, was practically an extract from that decision. So that practically the errors assigned by the defendant to the Court below are errors of this Court, and a favorable consideration thereof would result in overruling that case. The case at bar is much stronger than Atkins v. Gamble.

It was conceded in that case that the plaintiff was the owner of the stock and had himself deposited it with the defendant,

who thereupon became the pledgee thereof. And the Court held that although the owner of personal property which has been wrongfully converted is ordinarily entitled to recover his specific property, or its value, and can not be compelled to accept other property of the same kind and equal value in lieu of that which was converted, yet shares of stock in a corporation stand upon a different footing, and if all the shares are of equal value, there can be no reason for preferring one share to another.

Indeed, as the Court remarked, the stockholders in a corporation are the joint owners of the franchise and property of the corporation. Each holder is entitled to an undivided share in the assets and business of the corporation. All stand upon the same footing. This same view was entertained by the Supreme Court in two other cases, viz.: Hawley v. Brumagim, 33 Cal. 394; Hardenbergh v. Bacon, id. 365. Chancellor Kent in the case of Nourse v. Prime, 7 Johns. Ch. 87, was of the same opinion as this Court in Atkins v. Gamble.

The plaintiff in this case was the owner of certain shares of U. S. Bank stock, which he deposited with defendant as collateral for the payment of his note; and if the note was not paid the stock was to be sold, the note paid out of the proceeds, and the balance turned over to the plaintiff. The stock was sold afterwards at a depreciated price, and the sale did not realize enough to pay the debt; so the pledgee brought suit to recover the deficiency.

The pledgor however, filed his bill in equity to enjoin the action at law, on the ground that the pledgees were large operators in stocks, and had mingled his stock with their own and other stocks which they held in trust, in such a manner that they could not be distinguished, and that it was the duty of the defendants to have set apart the pledgor's share in such a manner that they could be identified; and not having done so, they were liable for the highest price at which the stock could have been sold.

The opinion of the Court was adverse to the plaintiff in the equity suit, on the ground that under the contract all that plaintiff could demand was a return of 430 shares of the bank stock; that if he desired to have any specific 430 shares he

The learned Chan

should have so provided in the contract. cellor approves the opinion of Lord Chancellor Parker in Le Croy v. Eastman, 10 Mod. 499, in a similar case, to the effect that the defendant was accountable only for the stock and dividends, and not for the price at which the stock was held. (See also Horton v. Morgan, 6 Duer, 56; Gilpin v. Howell, 5 Penn. St. 42; Allen v. Dykers, 3 Hill, 593.)

SHARPSTEIN, J.:

The principal contention on behalf of Rogers is, that Hayward held a certain number of shares of mining stock as security for money advanced by him to Rogers, and that Hayward, without the knowledge of Rogers, sold said shares of stock, and that afterwards, and while Rogers was uninformed and ignorant of said sale, Hayward procured a power from Rogers to sell said stock, and then sold of the stock of the same mining company the same number of shares that he, Hayward, had held prior to said first sale as security for his said advances to Rogers, and that Hayward accounted to Rogers for the sum realized on the sale of the stock last sold only, which was much less than the sum realized on the sale of the stock first sold, which Rogers contends was the stock which Hayward held as security for his said advances.

On the other side, it is claimed that Hayward constantly held the identical stock certificates which he took as such security from the time when he received them up to the time when he admits that he sold them, or that if he did not, during all of such time, have said identical stock certificates in his possession, that he did, during all of such time, have other stock certificates of the same mining company for the same number of shares, which, during all of such time, he was able, ready, and willing to deliver to Rogers, upon his paying the sum for which said certificates were held as security.

It is to the admission and rejection of evidence, and to the giving and refusing of instructions upon this issue, that most of the exceptions are directed.

The transaction out of which this litigation arose, as narrated by Rogers in his testimony, was as follows:

"I went to Mr. Hayward, and found him alone in his front

CAL REPS. LXII-24

office. I said to Mr. Hayward that I had two hundred and ten shares of Savage coming in on Monday; that is, it was due Monday we speak of it as coming in, and I was afraid I would not be able to take care of it, and would sell the stock. * * of I told him that I thought that perhaps, rather than to see that amount of stock thrown on the market, he might assist me in taking care of it. He asked me at what prices the stock was coming in. I told him; and he said: 'Send it to me.' That is, the two hundred and seventy shares.

*

*

*

Then, upon his saying, 'Send it to me,' he says: 'By the way, what has become of that two hundred shares Burling was carrying for you?' I says: 'Burling is still carrying it.' He says: Order that up and send it to me.' I told him I would do so. That was the end of the conversation. There may have been something said about interest - probably

was.

Q.-Was anything said as to Mr. Hayward's power or authority to sell it? A.-Not a word.

"Q.-What was done in consequence of that arrangement, if anything? A.-The stock was delivered to Mr. Hayward and he paid the money that was spoken of, about $186,000, that he advanced to these different parties for this stock."

In considering the exceptions upon which the appellant relies, we shall assume, as indeed we must, that this is the correct version of that transaction. And in view of that, and the further fact that it is not charged in the cross-complaint of Rogers that he was induced to do what he did by reason of any representations of Hayward as to the condition of the mine, or the then present or prospective value of the stock, or in regard to the quantity of it which Woods & Freeborn, or any other person or persons, were selling, we do not think that the Court erred in sustaining the objections of respondent to the introduction of evidence of what Hayward said to Rogers in regard to those subjects.

Nor do we think that the Court erred in allowing the witness Peart to be asked how much stock Hayward carried for Rogers from April 22, 1872, to November, 1872. According to the testimony of a majority of the witnesses, Peart was better qualified to answer that question than any other witness, including Hayward himself. When this question was