Sprague v. Hosie

Ostrander, J.

(after stating the facts). 1. There was no continuing offer to sell the stock at the price of 1154 a share. Defendant’s letter of November ?th, if it can be said to contain an offer to then sell the stock, was not a continuing offer. Moreover, whether it be treated as a present or a continuing offer to sell, it was refused and was not thereafter renewed. The bargain, if one was made, rests in parol.

2. Whether stock in an incorporated company, the shares of which have been actually issued, is goods, wares, or merchandise, within the meaning of the statute of frauds (3 Comp. Laws, § 9516), is a question which has been answered differently in different jurisdictions. In essentials our statute is a copy of the seventeenth section of the statute of Charles II, and was adopted in this jurisdiction in 1819 from the laws of the State of New York. The English courts, to a period as late as 1839, had not apparently determined conclusively, that such shares were or were not within the statute. Mussell v. Cooke, Pre. Ch. 533; Crull v. Dodson, Sel. Cas. in Ch. 41. Lord Denman in Humble v. Mitchell, 11 Ad. & El. 205, a case decided in 1839, held with the concurrence of his associates that “shares in a joint stock company like this [a bank] are mere choses in action, incapable of delivery, and not within the scope of the seventeenth section. A contract in writing was therefore unnecessary.” It is stated in the opinion that no case had been found directly in point. Humble v. Mitchell has apparently been since followed in England. See 29 Am. & Eng. Enc. Law (2d Ed.) p. 961; 20 Cyc. p. 244; 1 Beach on Modern Law of Contracts, § 558. See, also, note to Weightman v. Caldwell, 4 Wheat. (U. S.) 85-89. In 1838, in Tisdale v. Harris, 20 Pick. (Mass.) 9, the precise converse of the modern English rule was laid down; it being decided that the words “goods” and “merchandise,” are broad enough in meaning to include stocks or shares in incorporated companies. The rule is affirmed in Boardman v. Cutter, *34 128 Mass. 388 . To the same effect are North v. Forest, 15 Conn. 400 ; Pray v. Mitchell, 60 Me. 430 ; Spear v. Bach, 82 Wis. 192 ; Johnson v. Mulvy, 51 N. Y. 634 . It must be admitted that at the common law shares of an incorporated company occupied much the same position as promissory notes and other mere choses in action. Indeed, it is held in Massachusetts that a promissory note is within the statute. Baldwin v. Williams, 3 Metc. (Mass.) 365. To the contrary is Vawter v. Griffin, 40 Ind. 593 , which approves the rule of Humble v. Mitchell . Such shares have, however, come to be subjects of common barter and sale, are usually evidenced by certificates which, in the absence of statute provisions, operate by assignment and delivery to transfer title to the shares as between the parties. They are in this State by statute subject to levy and sale on execution. In many other respects they are treated as something more than mere choses in action. It was said by this court in Weston v. McDowell, 20 Mich. 353, 357 , in considering the meaning to be given the words “goods, wares and merchandise,” as employed in the common counts in assumpsit, that it has always been considered that the phrase as employed in' the statute of frauds embraced animate as well as inanimate property, and that the word “ goods ” may well include oxen. The case is not in point here except as indicating that a broad rather than a narrow meaning should be given to the word “ goods.” That contracts for the sale and delivery of shares of stock are subject to the mischief aimed at by the statute, must be admitted. We are of opinion that reason and the weight of authority favor the conclusion that shares of stock in an incorporated company, the shares having been issued, are goods within the meaning of the statute of frauds. It follows that the parol contract for their sale was invalid.

3. The declaration alleged no facts to show whether the contract sued upon was or was not obnoxious to the statute.' It was nevertheless a good pleading. Dayton v. Williams, 2 Doug. (Mich.) 31; Harris Photographic *35 Supply Co. v. Fisher, 81 Mich. 136 ; Stearns v. Railway Co., 112 Mich. 651 ; Kroll v. Diamond Match Co., 106 Mich. 127 . See, also, 9 Enc. Pl. & Prac. p. 700; Seaman v. O’Hara, 29 Mich. 66, 67 . The language of the statute in question here is:

“No contract for the sale of any goods, wares or merchandise, for the price of fifty dollars or more, shall be valid, unless,” etc.

It is clear that such a contract may be valid and enforceable, although no note or memorandum in writing of the bargain be made and signed by the party to be charged therewith. The plaintiff in his declaration asserts the existence of a valid contract and upon the motion or objection of the defendant must prove such an one. The scope of the plea of the general issue is as a general rule a denial of every material averment of fact in the declaration. The precise question presented was answered adversely to plaintiff’s contention in Third Nat. Bank of New York v. Steel, 129 Mich. 434 (64 L. R. A. 119).

It follows that the judgment must be, and it is, affirmed.

Montgomery, Hooker, Moore, and McAlvay, JJ., concurred.