Appeal by the defendant from the judgment of the District Court of the Nineteenth Judicial District of the State of California in and for the City and County of. San Francisco. Wheeler, J.

Action on promissory note, and on account of moneys laid out and advanced for benefit of defendant. The complaint was filed February 25, 1876. An amended complaint was filed September 8, 1876, and prays judgment against defendant for the sum of $30,000, and interest thereon at one per cent, per month, compounded monthly, from June 4,1872, to December 2, 1872; and from that date on $20,278.44, alleged to be due on a promissory note of defendant to plaintiff, executed June 4, 1872; and for the sum of $179,201.56, and interest thereon at the rate of ten per cent, per annum from April 14,1874, for moneys paid out and advanced by plaintiff for benefit of defendant, and costs of suit. The defendant, on the twentieth day of July, A. D. 1876, filed his original answer and cross-complaint, which pleadings of the defendant were twice amended. The defendant set up payment of the indebtedness and the stock transactions between himself and the plaintiff, referred to in the opinion of the Court and also in the instructions given and refused, hereinafter set forth. The plaintiff answered and denied the cross-complaint. On the trial of the action, the Court instructed the jury as follows:

“ Gentlemen of the Jury: This case, which is about now drawing to a close, as you have observed, is one involving a large amount, not only when viewed from the standpoint of the plaintiff’s claim, but also when we consider the cross-bill or cross-complaint that the defendant makes. This, the magnitude of the case, at first almost startles the jury and the Court; but that should simply amount to this, to insure upon the part of the jury a very careful consideration of the evidence, and also a careful attention to what the Court may declare to you to be the law of the case; for with the law the jury have nothing to do, nor has the Court. We take .it from writers upon the subjects and also from the declaration and interpretation of the law as laid down by the higher Courts .of the land; and where our own Supreme Court has laid down the'law in a given case, that becomes binding upon this Court, and it follows that it is the duty of this Court, in administering the law in cases where it has been settled in the Supreme Court, to state it to you as that Court has declared; and it is your duty, without any regard to any affections or sympathy or any other motives that may control you, to pay a strict attention to that law, and to shape your verdict accordingly.

“ This case briefly stated, is an action on the part of Hayward, the plaintiff, to recover from the defendant a balance alleged to be due for moneys laid out and advanced for the benefit of the defendant, and at his request; the sum that it is shown that he advanced, is $267,667.25; this includes the assessments that were paid by him from time to time upon the stock that he held for Mr. Rogers; concerning this gross amount there seems to be no difference of opinion; there seems to be no contest here in the case; Hayward then gave Rogers credit for the amount of $68,000, and odd dollars, which grew out of the sales which he alleges he made, in November, 1872, of something about $55,000, and also the sale of April 14, 1874, for $12,000. Those two sums added together making an aggregate of $68,000, which the plaintiff deducts from his $267,000, which he had advanced, leaving a balance of $199,591.87. Upon that sum the plaintiff claims interest according to various rates, as expressed in different promissory notes and so forth, and claims that now there is a grand total of $295,349.38.

“ The computation of the interest has been made in your presence, and I do not understand that there is any controversy upon that subject—relying, I suppose, upon the familiar rule that figures do not lie; and I believe the respective attorneys for the parties do not disagree upon that computation. Then it stands thus, gentlemen, that if the defense that is set up in this case, if you should determine that it amounts to nothing under the law and the evidence, then your verdict would necessarily be for the plaintiff in that sum, two hundred and ninety-eight thousand dollars, or thereabouts, and if there were no counter-claim set up by the defendant, the case would be made plain, and that would be the result, and that would necessarily be your verdict, for when facts are testified

to by witnesses who are not impeached, and there is no inherent improbability in the statement, the jury are bound to take that evidence as proving the particular fact; and the jury have no right capriciously to disregard evidence where it is not controverted and the character of the witnesses is good and the story is probable.

“ But under this case thus made out the defendant claims that between April 21 and May 14, 1872, the plaintiff sold of his stock five hundred and seventy shares, for the aggregate sum of three hundred and eighty-seven thousand six hundred dollars; that between July 6th and July 13th; and July 13th is a point in the case, that being the day on which the power of attorney was executed; he claims that between July 6th and July 13th the plaintiff sold one hundred and twenty shares more, for which he realized twenty-four thousand dollars, and that on April 14, 1874, he sold one hundred and ninety shares more, that is what is called the Hall stock, for the sum of twelve thousand and odd dollars, thus making an aggregate of receipts of four hundred and twenty-three thousand seven hundred and seventy-six dollars. Of course, if this claim should prevail, it would result in a verdict in favor of the defendant; after deducting or making the proper allowances for interest and so forth, I believe the attorney for the defendant claims it would aggregate now about two hundred thousand dollars. Those are the figures in round numbers, so far as the claims of the different parties are concerned.

“How, as to the transaction itself, it appears from the evidence, that in the spring of 1872, about April 22d, that Hayward took up for Rogers a large amount of stock and ‘carried it’ for him, as the phrase runs among brokers and business men. The evidence of Rogers is, that there was nothing said about the terms upon which he was to carry it; there was nothing said about the rate of interest, nor about the time when he was to pay Hayward, nor, he says, did he give Hayward any power of sale; on the other hand, Hayward testifies that he made this advance upon the sole and express condition that he was at liberty to deal with the stock as his own, to sell it when and where and as he pleased.

“ The evidence upon that point, then, of course, is contradictory; but it is not a material matter, for the reason that if Hayward is chargeable with the sale of the stocks made at high figures in April and May, then Eogers would be entitled to that credit, and Eogers does not repudiate that sale, but in substance ratifies it, and seeks the benefit of the sale for the very plain reason that the stock has never reached so high a figure since. If Hayward had no authority to sell the stock, and he had sold it at low figures at that time, and the stock had since that risen to a higher figure, as a general rule, the pledgor, which is Eogers, could have recovered from the wrong-doer the highest market price of the stock between the day of the sale and the day of trial.

“I charge you, then, that the relation of Hayward and Eogers was that of pledgor and pledgee, and if you find that there was no agreement between them at the time the stock passed into Hayward’s hands, authorizing Hayward to sell the stock, then he had no right to sell it without first demanding payment of Eogers and giving him due notice of the sale.

“ Now comes the question, gentlemen, as to whether the sale by Hayward of the identical certificates that Eogers left with him was a breach of Eogers’ rights. In other words, whether Eogers has the right to claim the high price at which Hayward is alleged to have sold those particular certificates during April and May. The Supreme Court of this State, in a case which arose some years ago, after very elaborate consideration, and in which all of the Judges agreed, and upon a petition for rehearing having been granted and the case heard again, they all agreed again in the first decision, held that one certificate of stock is as good as another; that all shares of stock are alike; and that if the pledgee of the stock, that is Hayward, holds himself at all times ready and able and willing to deliver to the pledgor, upon demand, an equal number of similar shares in the same company, he has the right to do that, and the pledgor is not injured by the fact that the pledgee sold the particular certificates.

" I, therefore, charge you that if you find that Hayward did sell and deliver the identical 690 shares before July 13, 1872, without authority from Eogers, he would not thefeby become liable to Eogers beyond nominal damages, if he was at all times ready, able, and willing to transfer to Eogers an equivalent number of similar shares in the same company by a proper and valid certificate. I hope the jury understands this proposition, because it is the leading and important point in this case; and this decision of the Supreme Court, while it did not meet the approbation of the entire profession, is still not a new decision; the same doctrine, precisely, was laid down by Chancellor Kent, more than fifty years ago, in the case where bank stock, of the old United States Bank, had been pledged with a broker of the city of Hew York; and it stands precisely as if one of you had stored with a warehouseman a hundred bushels of wheat, and he had placed it in with a thousand bushels more of his own, in bulk, not sacked or in barrels, but had been emptied into one vast bin; now, the warehouseman would have the right to go on selling the wheat from that amount in bulk; and, although he might happen to sell the identical hundred bushels you had deposited, it would not be any wrong to you, providing he always kept on hand a hundred bushels of wheat of the quality and character, which he was ready to deliver to you on demand. Probably that is all that is necessary to say on that point; but I wish you to clearly understand it,' as the case must necessarily turn upon that question.

“I instruct you further, that inasmuch as Eogers never made any demand on the plaintiff for his stock before July 13th, and never directed him to sell any, the plaintiff was at liberty, as he sold stock from time to time from the mass of shares on hand, to credit such sales to such particular account as he pleased; and that doctrine finds analogy in the case where a man is owing you upon two accounts, or upon a note and account, and he meets you and says: ‘Here is a hundred dollars towards what I owe you.’ You are at liberty to apply it upon the note, or to apply upon the account, as you see fit; if he gives no directions to the contrary, or rather, if he does not specify upon which particular account or indebtedness he intends the money to apply, you can place it to whichever you choose. So in this case, if you find that Hayward had a large amount of Savage stock on hand, and he sold from time to time, he had the right, until a demand was made by some pledgor, or a direction from some pledgor for him to sell, he had the right to credit to such accounts as he pleased during his sales from time to time. Of course, gentlemen, it is for you to determine if these credits were made in good faith, and if they were made about the time of the sales. You will remember that the books were given in evidence, and there were various sales made between April and July 13th, and the balance was made at the end of each month, showing that the 690 shares were always to the credit of Rogers in those statements; it is for you to determine, of course, whether that was a truthful and fair statement of the transaction. If you find that Hayward had sold the 690 shares before the execution of the power, and that at all times from April 22d to July 13th, he had been ready, able, and willing to transfer to Rogers an equivalent number of similar shares in the same company by a proper and valid certificate, then and in that case it was not material that these facts should be imparted to Rogers at the time he executed the power of attorney and the power was a valid and binding one.

“Now upon that point the rule is, that when a man in his senses, in the possesion of his faculties, deliberately executes a written agreement, he is presumed to have understood the agreement and is bound by its terms unless there was fraud, or mistake, or surprise, or something of that kind, that unfairly prevented him from knowing what he was doing; as for instance, if a man who is unable to read, signs a document, and it is read to him, but falsely read, a portion is suppressed or something is put in that is not there, in reading, and signs it, he is not bound, because he was imposed upon; or if a man is blind and an instrument is misread to him and he executes it, he is not bound by it. So if there is any suppression or misstatement of a material fact, and through which a party is led innocently to sign an agreement, that amounts to what the law calls a fraud, and he is not bound by it.

“ I therefore have charged you that if Hayward—and will read this again now, that you may better understand it: If you find that Hayward had sold the 690 shares. before the execution of the power; that, you remember, was July 13th, and had been ready, able, and willing to transfer to Rogers an equivalent number of similar shares in the same company by a proper and valid certificate, then and in that case it was not material that these facts should be imparted to Rogers at the time he executed the power of attorney, and the power was a valid and binding one. It was not material to tell him that, for the reason that that was a thing that Hayward had a right to do anyway, and the law says, that he was selling his own stock, and not Rogers’ stock, provided he was all the time able, ready, and willing to respond to Rogers, in case he should come and demand his stock. And if you find that Hayward had sold the identical 690 shares, and that he was not at the time of such sales able, willing, and ready to deliver to Rogers a similar number of shares, then, and in that case, the suppression of those facts operated as a fraud' upon Rogers and destroyed the force and effect of the power of attorney, there being nothing for the power to operate upon.

“As to the other defense; the defense that is made to Rogers’ cross-bill, namely, the Statute of Limitations. I will simply state that it is conceded that if Rogers knew all of these circumstances more than three years before he filed his cross-bill, then this defense of his is barred by the statute: ‘An action must be brought within three years, if it relies on the ground of fraud or mistake; the cause of action in such case is not to be deemed to be accrued until the discovery by the aggrieved party of the facts constituting the fraud or mistake.’ Now, if Rogers discovered this fraud that he alleges Hayward perpetrated on him more than three years before he filed his cross-complaint in this case, then his action is barred, and you must pay no attention to the defense.

“Actual notice of these facts is not always necessary: ‘Notice is, first, actual, which consists in express information of a fact; second, constructive, which .is implied by law.’ This is the section to which I call your attention now: ‘Every person who has actual notice of a circumstance sufficient to put a prudent man upon inquiry as to a particular fact, and omits to make such inquiry with reasonable diligence; has constructive notice of the fact itself.’

“ I have been asked to charge you, that the rendition of 'the account by Hayward, in August, 1873, showing all these sales,, was a circumstance that should be taken into consideration in determining the question as to whether Rogers did have notice of those frauds more than three years before the filing of his cross-bill; and I instruct you, of course, that that is a circumstance that you are at liberty to take into consideration; the evidence being that Hayward rendered him an account of sales in August, 1873, and by that account it appeared that the whole 690 shares was sold after the power of attorney, and in the month of November, 1872, realizing some 55,000 and odd dollars.

“ Here are two instructions that I give you at the request of defendant’s counsel: ‘That when an agent is dealing with the principal, or a trustee with the beneficiary of his trust, it is his bounden duty to see that everything is fair, and that the principal or beneficiary has all the information as to the matters of fact necessary, to show him his precise situation in relation to the business on hand.’ Second. ‘ It is no defense or excuse to the plaintiff, that stockholders have a custom amongst themselves, in the delivery of shares of stock to persons with whom they deal, to deliver any certificate they see fit.’ This, of course, was not a transaction between two brokers, and it is clear that Mr. Rogers’ rights are not to be determined, nor Mr. Hayward’s either, by the rules that this limited and private association,known as the Board of Brokers, have among themselves.

“ Now, gentlemen, I have endeavored to state to you plainly the principles upon which this case is to be decided, and you will observe that the case pretty much turns, indeed it does turn, upon the main question: that is, if you find that Hayward sold those shares before July 13th; as to whether he was during all of those times, able, ready, and willing to deliver Mr. Rogers his 690 shares at any time that he might call for them, if he should call and pay Hayward the money he had advanced, if he was ready to respond, then Hayward did precisely what the law says he may do; he sold the stock, and he had a right to sell it, for his own account or for any account that he pleased, so long as he retained the proper number for Rogers, to give him upon demand.

“ Now, gentlemen, the law makes you the judges, the exclusive judges, of all matters of fact; and it is for you to determine, wherever there has been a conflict, upon which side the truth lies; and you are to judge from the appearance of men, and you have a right to take into consideration their demeanor upon the witness stand, their interest in the event of the suit, the probabilities of their statements and all of the surrounding circumstances, and to give such verdict, under that evidence, as your consciences and judgments may dictate. The fact that the case is large, should make you careful; but should not deter you from rendering such a verdict as you think the evidence, as given before you, and the law as given you by the Court, will justify.

“ Gentlemen, the case is now with you for your consideration.”

Among others refused, the following instructions were asked by the defendant, and refused by the Court:

“ If the jury believe from the evidence that the plaintiff sold certificates of Savage stock received by him for the defendant, at any time prior to his procurement of the power of attorney produced here, without the authority of the defendant, it makes no difference how much Savage stock the plaintiff had on hand belonging to persons other than himself, or belonging to Hayward & Jones.”

“ If the jury believe from the evidence, that at the time when the plaintiff procured the power of attorney produced here, he did not communicate, or cause to be communicated to the defendant, that he had sold or otherwise disposed of any of the certificates of Savage stock he had received for the defendant, and that the defendant was then ignorant of the fact that the plaintiff had so sold any of the said certificates, they will not take the said power of attorney further into consideration.”

“ If it appears from the evidence that the plaintiff, at any time prior to the procurement of the power of attorney produced herb, sold without the defendant’s consent any certificates of Savage stock received by him for the defendant as security for money loaned the defendant, and that that power was prepared by the plaintiff, or his agent or agents, without any suggestion as to the numbers of and upon the certificates therein described and identifying the same, and that the defendant did not then know that the plaintiff had so sold any of the said certificates, then that power is void.”

“ If the defendant, when he executed the power of attorney produced on this trial, did not know that the plaintiff had sold any of his certificates of Savage stock, then that power is void.”

“ It makes no difference as to the validity of the power of attorney produced on this trial, whether the plaintiff or his manager, Peart, knew that the plaintiff had sold any of the certificates of Savage stock belonging to the defendant or not, at the time when that power was procured.”

“It makes no difference whether the plaintiff placed as many shares of Savage stock as he had sold of the defendant’s in an envelope, or otherwise segregated such a number for the defendant or not, unless- the shares so replaced, belonged to the plaintiff.”

“If the jury believe from the evidence, that nothing was said as to the plaintiff having power to sell the stock to be delivered him for defendant at the time when the plaintiff agreed to advance him moneys upon the same in April, 1872, and that before the power of attorney produced on this trial was executed, the plaintiff sold any of the certificates of Savage stock received by him for the defendant, and that the defendant did not, at the time he executed said power, know that the plaintiff had sold any of the said certificates, and that, thereafter, there ever was a time when the plaintiff did not have as many shares of Savage stock on hand of his own, then the defendant is entitled to recover of the plaintiff the highest market value of Savage stock at the time or times when the plaintiff so sold the said certificates, or any of them, for as many shares as the plaintiff did not always have and keep-on hand.”

“If the defendant delivered shares of stock to the plaintiff as collateral security for money loaned, and no further stipulation was made between them, the plaintiff had no right to sell the same or any part of the same, without first demanding the money due him, or, in case of default in payment, without giving notice when and where he would sell the said shares at public auction.”

“It is not enough for one who has sold certificates of stock belonging to another, without his consent, to produce and offer the owner an equal number of shares of the same stock, but the party who so sold must have always had on hand of his own that number of shares.”

“It is no defense for the plaintiff that his books bore the right number of shares of stock to the credit of the defendant during the time he was responsible to the defendant for that number of shares, but it must appear that the plaintiff had in his possession, or under his absolute control, that number of shares of his own all that time.”

The verdict and judgment were for the plaintiff. The defendant took this appeal and brought up -the evidence in a bill of exceptions. After the decision in bank a petition for rehearing was presented by the appellant and denied by the Court.