1 Chicago Legal News, Oct. 15th, 1881, p. 37. 2 Pickering v. Cease, 79 111. 328; from selling or buying grain for future delivery; such was not the purpose of the statute; nor can it make any difference, as to the legality of the contract, whether the person who sells for future delivery, at the time the sale was made, has on hand the grain; a party may sell to-day a certain quantity of grain for delivery in a week or a month hence, and then go upon the market and buy the grain to fill the contract."1 "Option," therefore, as a statutory term in Illinois, means a contingent bargain for differences of price, as distinguished from a bargain for the thing itself, and as such is illegal.2 But in New York, there is nothing in itself illegal in an "optional contract for the sale of any marketable commodity, when, for a consideration paid, one of the parties binds himself to sell or receive the property at a future time, at a specified price, at the election of the other. Mercantile contracts of this character are not infrequent, and with a bona fide intention on the part of both parties to perform them. The vendor of goods may expect to produce or acquire them in time for a future delivery, and, while wishing to make a market for them, is unwilling to enter into an absolute obligation to deliver, and, therefore, bargains for an option which, while it relieves him from liability, assures him of a sale, in case he is able to deliver; and.

Wolcott v. Heath, 78 111. 433; Pixley v. Boynton, 79 111. 351. 3 Logan v. Brown, 81 111. 415.

1 A contract of this class was held valid, the court relying on Pixley v. Boynton, 79 111. 351; Pickering v. Cease, 79 111. 328; Sawyer v. Taggart, 14 Bush, 727. And see Cole v. Milmine, 88 111. 349.

2 Under this statute a sale "where the seller had only an option as to the time of delivery" is valid. Blodgett, J., Jackson v. Foote, 12 Fed. R. 41; citing Pixley v. Boynton, 79 111. 351; Cole v. Milmine, 88 111. 349. It was afterwards held in the same state, that a contract for the sale of wheat by which "neither party expected the delivery of any wheat, but in case of default in keeping margins good, or even at the time of delivery, they only expected to settle this contract on the basis of difference, without either performing or offering to perform his part of the agreement," "was only gambling in the price of wheat. . . .If the one party is not to deliver, or the other to receive the grain, it is in all but name a gambling on the price of the commodity, and the change of name never changes the quality or nature of things. It has never been the policy of the law to encourage, or even sanction, gaming transactions, or such as are injurious to trade or are immoral in their tendency; and the old maxim that courts will always suppress new and subtile inventions in derogation of the common law would be applicable to such contracts." Lyon v. Culbert-son, 83 111. 33.

1 Andrews, J., Bigelow v. Benedict, 70 N. Y. 202; see Chicago R. R. v. Dane, 43 N. Y. 240; Cooke v. Davis, 53 N. Y. 318; Story v. Salomon, 71 N. Y. 420; Kirkpatrick v. Bonsall, 72 Penn. St. 155; discussed in Biddle on Stockbrokers, 311 et seq.

2 Cole v. Milmine, 88 111. 349; see supra, sec 453.

In a case in the New York court of appeals in 1880, Harris v. Tumbridge, 83 N. Y. 92, the plaintiff, Mrs. H., bought through the defendant, a New York stock broker, a stock option or privilege known as a "straddle," which secured to her the right to demand of the seller, at a price stated, a certain number of shares of a specified stock, or to require him to take said stock at the same price within sixty days. It was in evidence that the plaintiff was induced to make the purchase by printed circulars issued by defendant, explaining the nature of a "straddle," offering to purchase one of his selection upon payment of a specified sum, and guaranteeing that fluctuation in the stock during the pendency of the contract would amount to eight per cent., and in case it did not, agreeing to refund the amount paid less commissions. The plaintiff sent $400 to the defendants to invest in a sixty day "straddle." Under this supposed guaranty, on the next day after the purchase, the defendant sold the stock " short," which resulted in a loss. In an action to recover damages, it was ruled that defendant had no authority to make the sale, that in the absence of any directions from plaintiff, it was the defendant's duty to have closed the contract by exercising the option at the most favorable time, and to have acted for her in that respect with reasonable care. It was further held the question of negligence and want of skill and care in the performance of his duty as agent, was properly submitted to the jury, and authorized a recovery.

The defendant claimed on appeal that this was a gambling transaction, and as such prohibited by statute. It was held that the contract was not of necessity a wager contract and void under the statute.

"The plaintiff," said Finch, J., "bought, through the agency of the defendant, a stock option, or privilege, known in the language of brokers as a 'straddle.' The word, if not elegant, is at least expressive. It means the double privilege of a ' put' and ' call;' and secures to the holder the right to demand of the seller at a certain price within a certain time a certain number of shares of specified stock, or to require him to take, at the same price within the same time, the same shares of stock. The continuance of the option is fixed by the agreement, and in this case was for sixty days. The value of a 'straddle,' it is proven, depends upon the fluctuation of the stock selected. The wider the range of these fluctuations, whether up or down, the greater the amount which may be realized; and of course the longer the option continues, the greater the chance of such fluctuations during the period." . . . "It is next argued that this the party securing a contract for the future delivery of some commodity at his option, and then, by engrossing the stock of such commodity in the market, making it impossible for the other party to complete his contract, but by purchasing of his adversary at his own price, or paying in cash the difference fixed by such adversary. As was said of another great wrong, if this is not wrong then nothing is wrong."1