Sowles v. Welden National Bank

The opinion of the court was delivered by Royce, Olí. J. This suit was brought to recover money which it is claimed was paid to the defendant upon a wagering contract between the Public Grain and Stock Exchange, in the city of New York, and its customers. The Public Grain and Stock Exchange were dealers in stocks, and jin 1886 they made an arrangement with the plaintiff by which he was to act for them in the sale of stocks, and was to have a certain commission upon what he might sell. They at the same time opened an account with the defendant, and it was a part of the arrangement made with the plaintiff, that upon the receipt of every order for ten shares of stock he should deposit in the defendant bank to the credit of said exchange ten dollars. In pursuance of that arrangement the plaintiff procured large orders for stock, forwarded them to the exchange and made the deposits as required by said arrangement in the defendant bank, and it is found that the bank stood for said company, and that the deposits by the plaintiff were as payments to the company. That of the amount so paid to the plaintiff- $467.50 was on trades or orders of his own, and the rest was on orders of customers. The bank opened and kept the account with the company the same as with any other depositor, and knew in a general way that the plaintiff and said company were engaged in stock transactions, but did not know their nature or character. Many other facts appear in the record descriptive of the way and manner in which the business was carried on, and from them it is claimed by the plaintiff that the court should find that it was illegal, and by the defendant that it was legal. But we do not feel called upon to decide [377] 'that question. The bank, as we have seen, stood for the company, and the deposits made by the plaintiff were as payments to the company. They were in legal effect payments to the company, and having been so made, upon the facts found, cannot be recovered back. It lias been claimed that the bank was a mere stake-holder, but there are no facts found to justify such a •claim. The money held by it was not payable upon any contingency, but absolutely tp the company. Conceding that the transactions between the company and its customers were of the character claimed by the plaintiff, betting on the rise and fall of •stocks, and so, wagering contracts, and illegal, was the plaintiff’s relation to such transactions of such a character that he can in a •court of law enforce any claim, in his own favor which grew out •of and was the result of such transactions ? It is found that he was an active participant in, and interested in the business. He was made the agent of the company to procure orders for them, •and his compensation was made dependent upon his success in .luring people to engage in what he knew to be an illegal business. It was said by Lord Mansfield, in Holman v. Johnson, Cowper 343, “ No court will lend its aid to a man who founds his cause of action upon an immoral or illegal act. If from the plaintiff’s own statement, or otherwise, the cause of action appears to arise ex turpi causa, or by the transgression of the positive law of the country, then the court says he has no right to •be assisted. It is upon that ground the court goes, not for the •sake of the defendant, but because they will not lend their aid to such a plaintiff.”- In Petrie v. Hanny, 3 Term Rep. 422, Ch. J. Kenyon said, It is a rule that those who come into a court of justice to seek redress must come with clean hands, ^nd must disclose a transaction warranted by law.” Those rules have ever since been regarded as sound law, and, applying them to the facts shown by the record, the plaintiff would have no legal right to the money which he seeks to recover in this action. The judgment is affirmed.