Page:Harvard Law Review Volume 8.djvu/463

447 PURCHASE AND SALE. AA7 ity, the customer will supply ^ him with the means to perform it or them, and will reimburse and indemnify ^ him for all outlays,'* expenses,^ and losses* necessarily or unavoidably incurred through the carrying out of the order. This offer remains unaffected ^ by anything the stockbroker may do until he has actually contracted to buy or to sell the securities, when it ripens into a promise and the customer becomes contractually bound. The ground for im- plying this offer is {a) because it is the purpose of the transaction that the customer should furnish the means to perform, and {b) because the stockbroker acts only on behalf o{ .q customer. 4, An order in the regular form says nothing about the stock- broker's commission. Yet a provision for its payment in accord- ance with the rules of the Stock Exchange, to which the stockbroker belongs, is a requisite of his engagement. This is, however, se- cured by the following custom. An order in the regular form is understood to contain an implied offer by the customer to pay the stockbroker a commission in accordance with the requirements of the rules of the Stock Exchange.^ These requirements have been shown to be that the stockbroker shall be paid a fixed commission for every contract he makes. Hence the customer's implied offer is to pay the stockbroker the usual commission on and in consideration of the making of the contract or contracts he makes to carry out the order. This offer 1 See authorities cited in note 2 to page 446, and in note 2 below. The offer to supply the means to perform is really a deduction from the offer to indemnify, and where the means are supplied at the time the order is given, it does not exist. 2 Dos Passos, 129-135 ; Duncan v. Hili, L. R. 8 Ex. 242, revg. L. R. 6 Ex. 255; Mechem on Agency, § 977. This offer protects the stockbroker in case he volunteers or is compelled to perform with his own money or securities. See ante, page 446, note 2. 8 Dos Passos, 159; Marye z/. Strouse, 5 Fed. Rep. 483; Mechem on Agency, § 977. selling spurious securities. Maitland v. Marvin, 86 Pa. St. 120; Young v. Cole, 3 Bing. N. .C. 724; Mechem on Agency, § 977. ^ The stockbroker's efforts to execute his authority to contract are of no concern to the customer, and he is not responsible for any expenses incurred in relation thereto, Mechem on Agency, § 978 ; cf. Sibbald v. The IJethlehem Iron Co., 83 N. Y. 378. s Dos Passos, etc., 231, 232. Cf. " Where there is no express agreement as to the compensation of an agent, usage if any will determine what he should receive." United States V. Duval, Gilp. 356; Morgan v. Mason, 4 E. D. Smith (N. Y.) 636 ; Mechem on Agency, § 963. Thus the question of whether the stockbroker has earned his commis- sion is easy of determination, and the difficulties which arise with it in the case of real estate brokers do not exist. Mechem, § 965.
 * The customer must indemnify the stockbroker for any losses incurred through