Page:Harvard Law Review Volume 8.djvu/459

PURCHASE AND SALE. 443 of his customer, a requisite of his engagement is a provision for his being supplied with the money or the securities. This usually takes either the form of a deposit at the time the stockbroker is engaged, or, as the making of the contract or contracts is always uncertain, of an offer to supply the money or the securities on the making of the contract or contracts. 3. Since the stockbroker must be paid a commission, on terms and in amount as are fixed by the rules of his Stock Exchange, a requisite of his engagement is a provision for the payment by the customer of. this commission according to the requirements of these rules. Subject to these requisites the stockbroker may be engaged in any way he and the customer may agree upon, and all kinds of promises, provisos, and conditions may be made part of his engage- ment. There has been established, however, a convenient, brief, and customary way of engaging a stockbroker to carry out a simple purchase and sale of securities. This way is almost always used except where a customer is ignorant of it or peculiar circumstances exist which force the adoption of some other form of engagement. It is proposed to describe what this way is, how the transaction is carried out under its terms, and what rights it gives to the cus- tomer and to the stockbroker. It is as folloys. The Order, The first step is for the customer to give the stockbroker an " order" in the regular form.-^ This form is, " Buy or sell for my account and risk," followed by a statement, which is usually briefly and customarily worded, of the securities which the customer wishes to buy or to sell, and the price at which he wishes them to be bought or sold. To illustrate, a typical order in the regular form would be, " Buy for my account and risk 100 C. B. & Q. at 71." There are a number of established customs ^ according to which orders in the regular form are interpreted.^ ^ The word " order " will be used throughout this artic'e as signitying only an order in the regular form. The word " order " is commonly used by stockbrokers as signify- ing any kind of a proposition relating to the purchase or sale of securities. Evidence is admissible to show a written order was changed by a subsequent verbal understanding. Clarke v Meigs, 10 Bosw. (N. Y.) 337 ; Bickett v. Taylor, 55 How. Pr. (N. Y.) 188. 2 These customs apply to other things besides orders in the regular form, for instance the notices (?,&& posl, p. 453) given by stockbrokers to their customers; but for the pur- poses of this article the exact scope of these customs need not be considered. 3 While the adjudications of courts of law on the question of how far the engige-