Page:Federal Reporter, 1st Series, Volume 10.djvu/262

 250 J-EDEfiAIi EEPOETER. �"In this country the same doctrine has been held substantially in the fol- lowing cases: Lehman v. Strasslerger, 2 Woods, 554; Warren v. Hcivitt, 45 Ga. 501 ; ClarTc v. Foss, 10 Chicago Leg. N. 213. �"In the case oi Marshall v. Thurston the court says. ' We umiei-stand the charge of the lower court to be, in substance, that if the broker knovv- ingly assisted the defendant by an advance of money and active agency, though net as principal, to gamble in the rise and fall of bonds, no recovery can be had; but if the broker merely acted as his,agent in effecting contraets between him and third parties for the purchase or sale of bonds on time, the defendant and third parties intending to speculate in the rise and fall of priees, and defendant suliered losses which were paid by the broker at defend- ant's request, or were paid and the payments subsequently ratifled by the defendant by executing notes therefor, a recovery can be had. In this view the charge is supported by the authorities.' �"The rule which bas the support of the great weight of authority (what- ever may be thought of the policy and morality of the rule) seeins to be as follows: If a factor, broker, or commission raerchant be employed by his principal to buy or sell commodities for the purpose of speculating on the rise and fall of priees merely, and the agent buys or sells in his own nanie, but on his principars account, and subsequently, after losses ]iave oecurred in such transactions, the agent advances money at his principal's request lo pay such losses; or if the agent pay such losses and the principal aftetwards executes notes in the agent's favor to cover the aipounts so advanced, the agent may recover against his principal the advances so made at his request, or upon the notes so executed, notwithstanding the illegal character of the original ven- tiire. ihe promise implied in the one instance and expressed in the other is nelther void for want of consideration nor tainted with illegality. It was even held in the case of the Planters' Bank v. Union Bank that where the de- fendant, in violation of law, had sold bonds for the plaintiff and received the proceeds, the plaintiff might recover the amount from the defendant, and that the illegal character of the transaction out of which the f und arose was no defence. �"But, on the other hand, if a broker or factor supply his principal with funds for the express purpose of enabling him to engage in illegal transac. tions, and if he (the agent) conducts the illegal venture in his ovvn name, it seems clear that he becomes a particeps criminis, and the law will not aid him to recover moneys advanced for such purpose, nor will it enforce secivrities taken therefor. �"The facts proven in the case at bar seem to bring the case within the principle last stated. The original notes involved in this controversy, of which those in suit were mere renewals, were not given after the varions contraets had been settled, to cover losses which the agent had paid for his principal. The notes see«i to have been drawn by the principal in favor of his agent at the inception of the alleged illegal ventures, or within a few days thereafter, while the transactions were still pending and the resuit undeter- mined. They were either given to secure moneys advanced by the broker to his principal, to enable the latter to prosecute the ventures, or they were given as an indemnity to the broker, to shield him from losses that lie nilght ��� �