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Baron v. Peoples National Bank of Secaucus

Decided: April 7, 1952.

M. BENJAMIN BARON, PLAINTIFF-RESPONDENT,
v.
PEOPLES NATIONAL BANK OF SECAUCUS, A NATIONAL BANKING ASSOCIATION, ORGANIZED UNDER THE LAWS OF THE UNITED STATES OF AMERICA, DEFENDANT-APPELLANT



On appeal from the Hudson County Court, Law Division.

For affirmance and dismissal -- Chief Justice Vanderbilt, and Justices Heher, Oliphant, Wachenfeld and Burling. For reversal -- None. The opinion of the court was delivered by Oliphant, J. Heher, J., concurring in dismissal.

Oliphant

This is an appeal from an interlocutory order entered in the Law Division of the Hudson County Court in an action in replevin. The order denied a motion for a summary judgment under Rule 3:56-3. The motion was originally made before answer and denied and was renewed at the pretrial on notice.

The grounds of the motion were: (1) that replevin would not lie where the defendant had neither actual nor constructive possession of the property at the time of the issuance of the writ; (2) that the plaintiff had waived his right to bring suit in replevin since he had previously consented to a dismissal without prejudice of an action in conversion based upon the same set of facts, and (3) estoppel.

An appeal was taken from this interlocutory order to the Appellate Division under Rule 4:2-2(a) (3) on the theory that the order denying the motion for summary judgment involves a question of the jurisdiction of the subject matter of the suit. The appeal is before this court on our own motion.

For reasons that will appear hereafter we are of the opinion that this appeal does not lie under Rule 4:2-2(a) (3). However, we deem it necessary to discuss the pleading and practice question involved. The following facts establish the situation that is the gist of the alleged cause of action for replevin.

On May 9, 1949, the respondent borrowed the sum of $12,000 from the appellant and executed and delivered to the appellant his promissory note secured by collateral consisting

of stock certificates representing shares of stock in various companies. There was the usual pledgor-pledgee agreement under which the certificates representing the shares of stock were deposited with the appellant as pledgee and in all probability were endorsed in blank in view of their subsequent disposition by the pledgee. There was a decline in the market value of these stocks and on June 7, 1949, the appellant believing the margin was unsatisfactory sold the stock through a brokerage house and tendered the proceeds to the respondent after deducting the amount due on the note. It appears from the pleadings and pretrial order and the opinion of the court below that there is a sharp dispute of fact as to whether the appellant notified the respondent of its position with respect to the collateral and its intention to sell in view of the depreciation thereof.

The pledge agreement contained, inter alia, the following condition:

"Upon failure of the undersigned either to pay the above sum or any indebtedness to said Bank when becoming or made due, or to keep up required margin of collateral securities, then and in either event said Bank may immediately without advertisement, and without notice to the undersigned sell any of the securities held by it as against any or all of the liabilities of the undersigned, at public or private sale, or at any Broker's Board in New Jersey or the City of New York or elsewhere, and apply the proceeds of such sale as far as needed toward the payment of the above sum and towards any or all of such liabilities together with interest and expenses of sale, * * *."

The net proceeds of the sale of the securities was $14,232.79, from which the appellant deducted the amount due on the loan and remitted the balance to the respondent. On June 10, 1949, the respondent alleges he demanded that the appellant restore the stock to him and repeated the demand on June 17, 1949, and on October 16, 1950 tendered the amount due on the note. The note was the note of May 9, 1949, in the sum of $12,000, and was due three months after date.

On August 15, 1949, the respondent instituted an action in conversion against the appellant ...


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