Statement of case. receiving from them certain securities, including the certificate and power for the 134 shares in question, which had been previously pledged by Goodyear Brothers & Durant to Fred. Butterfield, Jacobs & Co. Goodyear Brothers & Co. were at that time insolvent, and indebted to the appellant. In pledging the plaintiff's shares, they had acted without actual authority from him, and without his knowledge. He was indebted to them, on the account for which the shares were pledged to them, in the sum of $3,000, with interest from December 1, 1866; but the account had not been rendered, or any demand made. The appellant, at the time of receiving the shares, had no knowledge of the plaintiff's interest therein. The cashier of the appellant, within a few days after receiving the certificate, assignment and power, filled in the blank in the assignment and power with "I. H. Stout, cashier, Tenth National Bank, New York, one hundred and thirty-four," and dated the same the 19th day of June, 1868, and sent the scrip to the First National Bank of St. Johnsville, for the purpose of having the shares transferred on the books accordingly; but such transfer was prevented by an order of injunction in this action. The plaintiff demanded of the appellant a surrender of the scrip, on payment of the balance due by him to Goodyear Brothers & Durant; which demand was refused. The value of the shares was $17,420. The balance of the advance made by the appellant thereon ($45,135, less the proceeds of the other securities received therewith, $29,915.19), was $15,219.81, besides interest. When the certificate and power came to the possession of the appellant, they bore the proper revenue stamp, duly canceled with the stamp of Goodyear Brothers & Durant, and the name of Ch. Goodyear as subscribing witness to the power. The referee found, that when the plaintiff delivered them, they were not stamped or witnessed, and that the plaintiff had never authorized those acts. The referee found in favor of the plaintiff, and in con Statement of case. formity with his report, a judgment was entered, requiring a surrender of the scrip to the plaintiff, on payment by him of the $3,000 and interest due by him to Goodyear Brothers & Durant. This judgment was affirmed at General Term, and an appeal taken to the late Court of Appeals, where, after argument, that court was divided and a re-argument ordered. The case now comes up on the re-argument. E. L. Fancher, for appellant. Plaintiff constituted Goodyear Bro.'s & Durant his agents, with power to sell; and if the agents deviated from instructions, still plaintiff is bound. (Story on Agency, § 127, 131; Com. Bank of Buffalo v. Kortright, 22 Wend., 361; Sargent v. Franklin Ins. Co., 8 Pick., 90.) Defendant as bona fide holder had the right to fill up the blanks, and to require a transfer of the shares on the books of the bank. (Com. Bank of Buffalo v. Kortright, 22 Wend., 348; S. C., 20 Wend., 92; Fatman v. Lobach, 1 Duer, 534; Bank of Utica v. Smalley, 2 Cow., 770; Little v. Barker, 1 Hoff. Ch. Rep., 487; Boyson v. Coles, 6 Maule & Selw., 14; Crocker v. Crocker, 31 N. Y., Rep., 507; Bank of Buffalo v. Kortright, 22 Wend., 361; N. Y. and N. H. R. R. Co. v. Schuyler, 34 N. Y., 80.) S. Hand, for respondent. Defendant is not a bona fide holder without notice. (15 N. Y., 360; 27 How., 1; 49 Bar., 364; 20 Wend., 277.) The court will not disturb the referee's finding. (5 Duer R., 216; 3 Comstock, 168; 7 Bosworth, 394; 35 How. P. R., 286; 3 E. D. Smith's Reports, 98; 36 N. Y., 342.) The certificate is not negotiable, and a bona fide assignee takes subject to equities. (13 N. Y., 600; 6 Duer, 574; 28 N. Y., 604; 34 N. Y., 80; 22 N. Y., 535.) G. B and D. could not sell without first demanding payment and giving plaintiff notice of time and place of sale. (4 Denio, 227; 7 Hill, 501; 2 Comstock, 443; 25 Howard, 261; 16 N. Y., 392; 25 How., 284; 40 Barb., 648; Markham v. Jaudon, 2 Hand, 235.) The legal title remained in plaintiff Opinion of the Court, per RAPALLO, J. until actual transfer on the books of the bank. (13 N. Y., 625; 2 Wheaton, 393; 34 N. Y., 80.) Until then the prior equities will prevail. (3 Paige, 361; 6 Duer, 574.) RAPALLO, J. The pledge of the plaintiff's shares by his brokers, for a larger sum than the amount of their lien thereon, was a clear violation of their duty, and excess of their actual power. And if the effect of the transaction was merely to transfer to the appellant, through Fred. Butterfield, Jacobs & Co., the title or interest of Goodyear Brother and Durant in the shares, the judgment appealed from was right. It must be conceded, that as a general rule, applicable to property other than negotiable securities, the vendor or pledgor can convey no greater right or title than he has. But this is a truism, predicable of a simple transfer from one party to another where no other element intervenes. It does not interfere with the well-established principle, that where the true owner holds out another, or allows him to appear, as the owner of, or as having full power of disposition over the property, and innocent third parties are thus led into dealing with such apparent owner, they will be protected. Their rights in such cases do not depend upon the actual title or authority of the party with whom they deal directly, but are derived from the act of the real owner, which precludes him from disputing, as against them, the existence of the title or power which, through negligence or mistaken confidence he caused or allowed to appear to be vested in the party making the conveyance (Pickering v. Busk, 15 East, 38; Gregg v. Wells, 10 Adol. & El., 90; Saltus v. Everett, 20 Wend., 268, 284; Mowrey v. Walsh, 8 Cow., 238; Root v. French, 13 Wend., 570.) The true point of inquiry in this case is, whether the plaintiff did confer upon his brokers such an apparent title to, or power of disposition over the shares in question, as will thus estop him from asserting his own title, as against parties who took bona fide through the brokers. Simply intrusting the possession of a chattel to another as SICK ELS-VOL. I. 42 Opinion of the Court, per RAPALLO, J. depositary, pledgee or other bailee, or even under a conditional executory contract of sale, is clearly insufficient to preclude the real owner from reclaiming his property, in case of an unauthorized disposition of it by the person so intrusted. (Ballard v. Burgett, 40 N. Y. R., 314.) "The mere possession of chattels, by whatever means acquired, if there be no other evidence of property or authority to sell from the true owner, will not enable the possessor to give a good title." Per DENIO, J. in Covill v. Hill (4 Den., 323). But if the owner intrusts to another, not merely the possession of the property, but also written evidence, over his own signature, of title thereto, and of an unconditional power of disposition over it, the case is vastly different. There can be no occasion for the delivery of such documents, unless it is intended that they shall be used, either at the pleasure of the depositary, or under contingencies to arise. If the conditions upon which this apparent right of control is to be exercised, are not expressed on the face of the instrument, but remain in confidence between the owner and the depositary, the case cannot be distinguished in principle, from that of an agent who receives secret instructions qualifying or restricting an apparently absolute power. In the present case, the plaintiff delivered to and left with his brokers, the certificate of the shares, having indorsed thereon the form of an assignment, expressed to be made "for value received," and an irrevocable power to make all necessary transfers. The name of the transferee and attorney, and the date, were left blank. This document was signed by the plaintiff, and its effect must be now considered. It is said in some English cases, that blank assignments of shares in corporations are irregular and invalid; but that opinion is expressed in cases where the shares could only be transferred by deed under seal, duly attested, and is placed upon the ground that a deed cannot be executed in blank. Without referring to the American doctrine on that subject, it is sufficient to say that no such formality was requisite in this case. It was only necessary to a valid transfer as Opinion of the Court, per RAPALLO, J. between the parties, that the assignment and power should be in writing. The common practice of passing the title to stock by delivery of the certificate with blank assignment and power, has been repeatedly shown and sanctioned in cases which have come before our courts., Such was established to be the common practice in the city of New York, in the case of The New York and New Haven Railroad Company v. Schuyler (34 N. Y., 41), and the rights of parties claiming under such instruments were fully recognized in that case. And in the case of Kortright v. The Commercial Bank of Buffalo (20 Wend., 91, and 22 Wend., 348), the same usage was established as existing in New York and other States, and it was expressly held that even in the absence of such usage, a blank transfer on the back of the certificate, to which the holder has affixed his name, is a good assignment; and that a party to whom it is delivered is authorized to fill it up, by writing a transfer and power of attorney over the signature. It has also been settled, by repeated adjudications, that, as between the parties, the delivery of the certificate, with assignment and power indorsed, passes the entire title, legal and equitable, in the shares, notwithstanding that, by the terms of the charter or by-laws of the corporation, the stock is declared to be transferable only on its books; that such provisions are intended solely for the protection of the corporation, and can be waived or asserted at its pleasure, and that no effect is given to them except for the protection of the corporation; that they do not incapacitate the shareholder from parting with his interest, and that his assignment, not on the books, passes the entire legal title to the stock, subject only to such liens or claims as the corporation may have upon it, and excepting the right of voting at elections, etc. (Angell and Ames on Corporations, 8th ed., § 354; Bank of Utica v. Smalley, 2 Cow., 770; Gilbert v. Manchester Co., 11 Wend., 627; Kortright v. Com. Bank of Buffalo, 22 Wend., 362 N. Y. and N. H. R. R. Co. v. Schuyler, 34 N. Y., 80.) In the case of Kortright v. Com. Bank, Chancellor WAL |