not liberal construction, to the end the legislative intention may be accomplished, to prohibit all dealings in options in grains or other commodities. Nothing is productive of more mischievous results. Considerable fortunes secured by a life of honest industry have been lost in a single venture in options. The evil is all the more dangerous from the fact it seemingly has the sanction of honorable commercial usage in its support. It is a vice that has in recent years grown to enormous proportions. Legitimate transactions on the board of trade are of the utmost importance in comSuch contracts, whether for immediate or future delivery, are valid in law, and recieve its sanction and all merce. templated, but the parties expect to settle upon the difference in the market. When so limited by judicial interpretation, the statute is not inconsistent with public policy. It forbids and punishes wagering contracts; that is, contracts in which they stipulate that they shall gain or lose upon the happening of an uncertain event, in which they have no interest except that arising from the possibility of such gain or loss. Fariera v. Campbell, 89 Pa. St. 89; Thompson v. Cummings, 68 Ga. 124: Flagg v. Baldwin, 38 N. J. Eq. 219." Fortenbury v. State, 47 Ark. 188. The evidence fully proves that the appellant. Pearce, was operating what is commonly denominated a bucket shop,'-in fact, this is established by his own admission on his cross-examination. He was engaged in conducting the illegal business of selling futures' or options. The products which he pretended to sell to his customers he did not have at the time, and it was mutually understood and intended by both parties, that the wheat or corn which was claimed to be sold and purchased was not to be delivered. but when the time fixed for its delivery arrived, the market value at Chicago of such cereals should constitute the basis upon which the settlements would be made. As the market would rise or fall there would be a loss or gain to the purchaser. The deals or transactions were understood to be a speculation solely on chances, and were in contravention of, and hostile to, public policy, and therefore illegal. Such transactions are of a like character and akin to bets made on a game of poker or faro, and are equally as uncertain and hazardous. The business or operations of the bucket shop' have been the source of much evil. Embezzlements and other crimes on the part of public officers, and bank officials, having the custody of money belonging to others, have been in the past some of the evil fruits directly traceable to dealings in futures in these institutions, and the question of prohibiting such transactions or business as it is generally conducted merits the consideration of the legislation." Jordan, J., in Pearce v. Dill (Ind.), decided Dec. 14. 1897. the support that can be given to them. It is only against unlawful gambling contracts' the penalties of the law are denounced, and no subtle finesse of construction ought to be adopted to defeat the end it is to be hoped may be ultimately accomplished."1 § 91. The Nature of an “Option.”—The term “option,' as employed in board of trade transactions, is defined by the court, in Pearce v. Foote, as follows: "As was said by this court in Pixley v. Boynton," the true idea of an option is what are called, in the peculiar language of the dealers, 'puts' and 'calls.' A 'put' is defined to be the 'privilege of delivering or not delivering' the thing sold, and a 'call' is defined to be the privilege of calling for or not calling for' the thing bought. Optional contracts' in this sense are usually settled by adjusting market values, as the party having the 'option' may elect. It is simply a mode adopted for speculating in differences in market values of grain or other commodities. It must have been in this sense the term 'option' is used in the statute. Such a contract is obviously fictitious, having none of the elements of good faith, as in a contract where both parties are bound, and is defined by statute as a gambling contract.' Fictitious purchases or sales, such as were in the contemplation of the parties, were as nothing, and it is a matter of no consequence where it is pretended they were made, whether on the board of trade or elsewhere." In Ex parte Young, the 1 Pearce v. Foote, 113 Ill. 228, Case. 79 Ill. 398; Rudolf v. Win239. Pixley v. Boyd. 79 III. 351. Pearce v. Foote, 113 Ill. 228. 234; s. C.. 55 Am. Rep. 414. See also as to meaning of terms: Maxton v. Gheen, 75 Pa. St. 166: Knowlton v. Fitch, 52 N. Y. 288: Kirkpatrick v. Bonsall, 72 Pa. St. 155: Er parte Young, 6 Biss. C. C. 53; Story v. Solomon, 6 Daly, 531; Union Bank v. Carr, 15 Fed. Rep. 438; Third Nat. Bank v. Harrison, 10 Fed. Rep. 243: Pickering v. ters, 7 Neb. 125; Bigelow v. Benediet, 70 N. Y. 202; s. c.. 26 Am. Rep. 537. The plaintiff bought, through the agency of defendant. a stock option or privilege, known in the language of brokers as a straddle. The word. if not elegant, is at least expressive. It means the double privilege of a 'put' and 'call;' and secures to the holder the right to demand of the seller at a certain price, within a certain time, a certain number of following definition and statement of the rule were included in the finding of the court: "Puts" or the privilege for a nominal consideration of delivering a large quantity of shares of specified stock, or to require him to take at the same price, within the same time, the same shares of stock. The continuance of the option is fixed by the agreement, and in this case was for sixty days. The value of a straddle', it is proven, depends upon the fluctuations of the stock selected. The wider the range of these fluctuations, whether up or down, the greater the amount which may be realized; and, of course, the longer the option continues, the greater the chance of such fluctuations during the period. The plaintiff swears that she was led into the purchase of the 'straddle' in question by certain printed circulars of the defendant which she produced. Of course, they point out an easy and rapid road to wealth for any one who is careful in his choice of a broker, but the material point in them is that they describe a straddle,' explain its dependence for success upon the fluctuations of the selected stock, and offer to any one who will purchase a sixty day straddle' of the defendant's selection, paying therefor $400, and $25 more for commission, a guaranty that the aggregate fluctuation in the stock, during the pendency of the contract will amount to eight per cent.; and, further, promise that if the stock does not move to that extent, the cost of the contract, less commissions. shall be refunded." Harris v. Tumbridge, 83 N. Y. 92, 95. By the evidence offered on the part of the plaintiff. it was shown that a sale of gold short, according to established usage, means a sale of that which the seller has not, but what he expects to buy in at a lower price than that for which he sells. The seller can order the gold to be bought in at any time, and the buyer can call for the delivery of it when he pleases. That the buyer or seller is entitled to a margin for his security, as the gold may rise or fall in the market. This margin must be in money, or its equivalent in securities, and equal to from five to ten per cent. on the price at which the gold is sold, over and above its market price at any time, and such margin must be kept up as the value of gold fluctuates in the market, so that the buyer shall have in hand on a rise in price, an amount in money, or its equivalent, sufficient to cover the loss to the seller caused by such rise in gold above the price at which it was sold short, with from five to ten per cent. on the contract price, added to the amount of such loss. If this margin be not kept up as gold advances, the buyer has the right to buy in the gold for account of the seller, and charge him with the loss." Appleman v. Fisher, 34 Md. 540, 549. "As to the validity of these contracts. From what has been said concerning them, it appears that there is no essential difference between them and the numerous contracts. of the same kind which have been before the courts in England and in this country, and which have been almost uniformly upheld as valid contracts. All these decisions unite upon the proposition that these contracts are presumptively grain within a certain time at a specified price, when taken of parties notoriously running a "corner," are wager contracts, and void as against public policy. Where no delivery of the grain was contemplated by the parties, but they expected simply to settle the differences as established by future prices, the contract is simply a wager, and, therefore, void.1 § 92. Modification of the Common Law Doctrine.— To some extent the common law doctrine in regard to covenants in restraint of trade, as established in England and followed by the courts of this country, has been modified by statute and by the more recent decisions. Where the earlier rule has been found to conflict with modern business methods beyond what is essential to the adequate protection of the parties concerned, it has either been abrogated by statute or materially modified by the courts. Certain transactions which, under the law against engrossing or forestalling, were indictable as misdemeanors, have become simply void, leaving the parties without the means of redress where the contract is violated. In some of the States, as in New York, the late statutes have substituted for the requirements of the earlier certain restraints on combinations, but imposing none on the individual, In England all valid. but that, though valid on their face. they may be shown by extrinsic evidence to have been intended by the contracting parties, not as commercial transactions, but as mere wagers on the future state of the market; that the one thing which makes them wagers and renders them invalid is an agreement between the contracting parties, made at the time of the contract, and understood as part thereof, that the contract may be discharged by the seller, not by the delivery of the commodity sold, but by paying to the purchaser the difference between the market price on the last day of the performance of the contract and the price at which the sale was made; or, on the other hand, that the purchaser, if the market goes the other way, shall not be bound to receive the commodity purchased, but may settle by the payment of a difference; and that such an agreement will not, if made subsequently to the making of the contract itself, taint the contract and render it invalid in law." Kent v. Miltenberger, 13 Mo. App. 503, 507. See also Sawyer v. Taggart, 14 Bush, 727, 734; Williams v. Tiedeman, 6 Mo. App. 269. 1 Er parte Young. Biss. 53. of the earlier statutes relating to this subject have been repealed, but it seems to have been held that the common law is still to such an extent in force as to render combinations to enhance the price of provisions punishable. In the lead 1 Rex v. Waddington, 1 East, 143; s. c., 1 East, 167. There is no doubt that modern ideas of trade have practically abrogated some common law doctrines which are supposed to unduly hamper commerce. At the common law there is no doubt such transactions as were here contemplated, although confined to a single person, were indictable misdemeanors under the law applicable to forestalling and engrossing. Some of our States have abolished the old statutes which were adopted on this subject, and which were sometimes regarded as embodying the whole law of such cases. Where this has been done, as in New York, the statutes have replaced them by restraints or combinations for that purpose, leaving individual action free. In England, there have been several statutes narrowing or repealing all of the ancient statutes, and more recently covering the whole ground. But so long as the early statutes only were repealed, it was considered that enough remained of the common law to punish combinations to enhance values of commodities. And when this doctrine became narrowed, it seems to have been considered that such combinations to enhance the price of provisions remained under the ban. In Rex v. Waddington, 1 East, 143, and s. c.. 1 East, 167, it was held, the common law was still in force to punish engrossing the necessaries of life or provisions by single persons. The chief difficulty was in determining whether hops came within that rule, and it was held they did, and that the legislature only could change the law. The defendant was heavily fined. That case has been sharply criticised as not in harmony with modern political economy, and it, no doubt, goes beyond what would be considered proper among us. It has never, so far as the researches of Mr. Bishop have gone, and he seldom overlooks important cases,-been judicially disapproved, although statutes have been made to change the rule. See Bishop, Criminal Law, §§ 527, 528, and notes to 6th edition. And he intimates that conspiracies for such purposes may, perhaps, be punished, even where the individual offense has been abolished. See also Vol. 2. §§ 202, 206, 216, 220, 230, 231, and notes. In Rex v. Hilbers, 2 Chitty, 163, it was held that there must be a combination of more than one person before an information will be granted for enhancing the price of necessaries. Mr. Russell gives it as his opinion, that in our day, single offenders would not be regarded as punishable unless their offense relates to provisions. 1 Russ. 170. But where there is a conspiracy the law has been given a much wider application, and the case of Rex v. De Berenger, 3 M. & S. 67, has obtained celebrity from the high rank of the offenders who were convicted-(and one of them at least. Lord Cochrane, unjustly)—of conspiring to raise the price of stocks by false rumors.“ Raymond v. Leavitt, 46 Mich. 447, 450. |