Hopkins v. O'Kane

Opinion By Mr. Justice Mitchell, There is nothing in this case which would justify disturbing the judgment. It ought not to be necessary to say again after Peters v. Grim, 149 Pa. 163, and other cases, that a purchase of stocks on margin is not necessarily a gambling transaction. [480] Stocks may be bought on credit, just as flour or sugar or anything else, and the credit may be for the whole price or for a part of it, and with security or without it. “ Margin ” is security, nothing more, and the only difference between stocks and other commodities is that as stocks are more commonly made the vehicle of gambling speculation than some other things, courts are disposed to look more closely into stock transactions to ascertain their true character. If they are real purchases and sales, they are not gambling though they are done partly or wholly on credit. The appellant himself testified that the first transaction involved in this case was his purchase of two hundred shares of Reading. “I bought them outright,” and paid for them. Shortly afterwards he sold them, and on his order the brokers bought Traction stock, and retained the proceeds of the Reading as part payment for it. The subsequent transactions were of the same character, actual purchases and sales in which the stocks bought were received by the brokers for defendant, and those sold delivered by them for him to the purchasers. There was all the time on the broker’s book a standing credit to appellant of the monejr received on his account from the sale of the Reading stock, and the subsequent debits and credits for the later purchases and sales. The account closed unfortunatety for appellant with a balance against him, but there is no allegation, certainly no evidence, that it was not correct. Judgment affirmed.