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says: “The holder who does not wish to sell may party beneficially interested in the shares, and for pledge bis certificates for loans and discounts to an that reason the cases are inapplicable to the present amount approximating their market value, with rea controversy ; for here it has been shown that the desonable margin for possible depreciation. The pledgee fendant, in whose name the sbares had been regisdoes not desire to become the owner of the stock, and tered as trustee bas no greater or other right iban he would not think it necessary, nor would he have that of a pledgee, whicb under the authorities deterthe right to surrender the pledged certificates, and

mining the effect of that relation, will not permit him have the stock transferred to him on the books of the

to vote upon them against the objection of the plaintiff, corporation." The court here evidently meant that who is still to that extent entitled to dictate and disuch right did not arise out of the mere act of pledg. | rect the use which may be made of them." ing, and I thing that would be correct, except where

The opinion of the court in the case from which the transfer was necessary to the completion of the

this rather extensive quotation is made was delivered pledge. A pledgee cannot be the purchaser of the

by Judge Daniels, whu for nearly twenty-five years thing pledged, when sold to satisfy the debt (Bryan v.

past has been upon the bench of the Supreme Court and Baldwin, 52 N. Y. 232), and he could certainly bave

the Court of Appeals of New York, and whose knowlno right to have a transfer made to himself upon the

edge of the various decisions of the courts of that books of the corporation, unless specially granted by

State, and ability to discriminate between analogous the pledgeor. Pledging the shares of stock would not

ones, are not excelled by any jurist. Said opinion was of itself confer the right.

concurred in by Judges Davis and Brady, the former McHenry v. Jewett, 90 N. Y. 58, is decisive of that of whom delivered the opinion in Railroad Co. v. point. In that case shares of the capital stock of the

Schuyler, 34 N. Y. 41, to which the counsel bare reCleveland, Columbus, Cincinnati & Indianapolis Rail ferred in their petition apparently with great confi. way Company were pledged by the plaintiff, their | dence. * owner, to the Erie Railway Company, to secure a loan

A distinction is made in McHenry v. Jewett, which of money, and by means of certain foreclosure pro.

| in the examination of the question under consideraceedings against that company, they were transferred

tion, is liable to be overlooked; and that is the differBubject to the plaintiff's right of redemption, to the ence in principle between a case where parties claim a New York, Lake Erie & Western Railroad Company. right to represent stock, and it is challenged by the The sale under this foreclosure was made in 1878, and

corporation, and one where the contention is between since that time the defendaut had held the shares

parties beneficially interested in stock as to which is nominally as trustee for the last-named company. By

entitled to represent it. The corporation might not what authority they were registered in his name as

have any right to refuse to allow a party to be regis. trustee had not been made to appear. It was not

tered as a stockholder in the company, and to particishown to have been done under the authority of the

pate in the affairs of its business, while another party plaintiff in the action. “For that reason,” the court

might very properly object to it as the exercise of unsaid, “the defendant must be regarded as holding the

warranted authority, and a fraud upon its legal rights. sbares solely under the authority as created by the A corporation is no such sacred sanctuary as is able pledge; and having no greater right to make use of or

to shield those gaining admission to it from the react upon them than the relation of a mere pledge

| sponsibility imposed by law. Getting shares of stock would confer. As between himself and the plaintité transferred to a person upon the books of the corpoin the action, that continued to be the sole measure ration does not preclude the courts from inquiring, of his rights. * * * As the defeudant had the when the matter is properly before them, by what shares simply by way of pledge or security for the

right the transfer was made, and what immunities it repayment of money which had been loaned upon confers. The records of corporation proceedings are them, he could hold them only for that purpose. As not absolute verity, or conclusive of the right of parlong as the rights of the plaintiff to redeem them by the

ties under the law. They may show that a person is payment of the debt was not extinguished by a lawful

a stockholder in the company, and entitled to vote Bale (Lawrence v. Maxuell, 53 N. Y. 19), they are arti

shares of stock when the courts, upon an investigation cles of property, which under such an arrangement,

of the facts, would adjudge the contrary. The ques. could not be otherwise lawfully used, and under the

tion as to who has the right to vote shares of stock authorities the defendant had no legal right to vote

must ultimately be determined by law, and as between upon them without the express or implied assent of

pledgeor and pledgee, it has been long since estabthe plaintiff, the pledgeor. This point was consid lished that the right belongs to the former, unless acered in Scholfield v. Bank, 2 Cranch. C. C. 115; l'owell

corded by him to the latter. A stipulation to tbat v. Thompson, 3 id. 248; Ex parte Willcocks, 7 Cow. 402. effect upon the part of the latter, or from which it Iu the last case it was held, that that until the pledge

would necessarily be implied, would doubtless confer was enforced, and the title made absolute in the

the right; but as said in Mcllenry V. Jewett, it is a pledgee, and the name was changed on the books, the

question between the two parties with which the cor

question pledgeor should be received to vote; that it was a

poration has uothing to do. question between him and the pledgee with wbich the

(Minor points omitted.] corporation had nothing to do. Id. 411. These cases are direct and decided authorities against the right of the defendant to vote upon the shares, and the princi NEW YORK COURT OF APPEALS ABSTRACT. ple sustained by them has in no respect been impaired by In re Barker, 6 Wend. 509, or In re Railroad Co., APPEAL — WHEN LIES — INTERLOCUTORY DECREE 19 id. 135; for the disputes which wore there made WHAT REVIEWABLE.-- (1) The Special Term entered the subject of adjudication did not arise between the an interlocutory judgment against the defendant. It parties sustaining the relation existing between the determined certain matters in controversy, and plaintiff and the defendant to this action. It was ordered an accounting. Defendant appealed to the simply made a question between a person offering to General Term, and asked for a new trial. The motion vote, who was registered as trustee of the shares in was denied, and the judgment modified, but it still the first case, and ascribed as cashier in the second, and

* An error here. The extract referred to is not from the the corporation, whether such registry of stock au

opinion of the Court of Appeals in 90 N. Y., but from that of thorized the person in whose name it had been made to the Supreme Court, 26 Hun, 453, wbich was reversed in 90 vote upon it. No point was made in behalf of the | N. Y.-ED.

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provided for the accounting. Hell, that it was an in- of debtor and creditor, and the bank holds the funds terlocutory judgment, from which an appeal was not subject to be paid out upon the direction of the crediauthorized. (2) Code Civil Pro. N. Y., $723, provides tor according to the terms and conditions imposed by that the court, in its discretion, may permit amend him. Bank v. Bank, 46 N. Y. 82; Crawford v. Bauk, ments to the pleadings which do not substantially 100 id. 56. The bank's protectiou in the payment of change the claim or defense. The General Term, on checks consists in the fact that is has followed strictly appeal from an order refusing leave, allowed plaintiffs the depositor's directions in disbursing his funds. to amend their complaiut. Held, that it was in the Where a depositor has imposed the conditions that his discretion of the court, and not appealable. (3) The check shall not be paid unless it bears his indorseGeneral Term reversed an order granting a stay of ment, the depository, if it pays it to a holder without proceedings pending an appeal. Held, that the graut such indorsement, runs the risk of the transaction, ing of the order was in the discretion of the court, and and takes the burden of showing that such holder has is not reviewable. Oct. 25, 1887. King v. Barnes. acquired in some way the lawful title to receive the Opinion by Earl, J.

funds. It may successfully defend such a payment, if

it can show that it made it to a person who, as against BANK-UNINDORSED CHECK-LIABILITY OF BANK.

the drawer, was legally entitled to receive it, for in Plaintiff received a check from the drawer, payable to

that event the drawer would suffer uo damage thereby. the maker or order, but not iudorsed by him. The check

It was held in Risley V. Baik, 83 N. Y. 318, that & had been certified by defendaut bank at the request of

parol contract by a depositor for the transfer of the the drawer and while in his possession. Held, tbat as

whole or any part of his deposit is valid in law, and there was no evider.ce that the maker of the check in

invests the transferee with the right to sue for and retended to part with any portion of his deposit to the

cover the amount of such deposit, or such part thereof plaintiff, the defendant was not liable. It is clear that

as was intended to be transferred. It was also held there was no contract made between Wilder and the

in the same case that a depositor might, concurrently plaintiff whereby any transfer of the deposit in the

with the delivery of a check to a third person, enter bank was intended to be made beyond that which

into such a contract by parol as would transfer the would follow the mere delivery of the check. The

fund represented by the check to the person named action can be supported only by prool that all of the

therein. In such a case the liability of the depository conditions, upon which the authority of the bank to

is not predicated upon the check, but that is used in pay the check was made to depend by the drawer have

connection with the parol agreement as evidence of been performed. Freund v. Bank, 76 N. Y. 357. It

the contract transferring the debt. Bank v. Bank, 21 therefore seems to us that the only question in the

N. Y. 490; Risley v. Bank, supra. The action arises case is whether the bank could be made liable to pay

upon the contract of assignment, and not upon the to third persons Wilder's funds by any transfer of this

check. Oct. 18, 1887. Lynch v. First Nat. Bank of check, except one evidenced by the indorsement of

Jersey City. Opinion by Rapallo, J. his name thereon. It is well settled by authority that the mere drawing and delivery of a bauk check to a

CRIMINAL LAW-INDICTMENT-SUFFICIENCY-MATthird person by a depositor does not constitute an as

TERS OF FORM.- Code Crim. Pro. N. Y., $ 285, prosignment to the payee therein named of the fund held

vides that “no indictment is insufficient, nor can the by such bauk. Bank v. Bank, 46 N. Y. 82; Bank v. trial, judgment or other proceeding thereon be affecHughes, 17 Wend. 94. A check is analogous to a bill of ted, by reason of an imperfection in a matter of form excbange, aud a bank cannot be made liable thereon, which does not teud to the prejudice of the substanexcept by its acceptance indorsed upon it in writing. I tial rights of the defendant upon the merits." DeRisley v. Bank, 83 N. Y. 318. An acceptance of the fendant was charged with perjury in swearing to a check however was made by the bank, we think, when statement of the condition of a bank of which he was through its agent, it indorsed thereon a certificate of cashier. The iudictment set out the statement and geuuineness, and directed its payment by the Ameri verification in full; specified portions of the report; can Exchange National Bank. That operated as a and charged that defeudant knew they were not true; promise to pay it upon presentation at the American but nowhere in direct terms, alleged that the stateExchauge National Bank, beariug Wilder's indorse. ments in connection with which perjury was charged ment. The obligation of the bank as shown thereby were untrue. Held, that the indictment negatived, amounts to a representation that the drawer has funds in substance, the facts which the defendant swore to, in the bank with which to pay the check, and that it and that it was error to discharge him. Oct, 18, 1887. will retain and pay them to the holder by its agency People v. Clements. Opinion by Rapallo, J. in New York upon its presentation there bearing the DURESS — MORTGAGE-THREAT OF CRIMINAL PROSEindorsement of the drawer. Bank v. Bank, 14 N. Y.

CUTION-STATUTE OF LIMITATIONS-ACTION TO QUIET 623; 16 id. 125; 28 id. 425; Bauk v. Bank, 67 id. 458,

TITLE-CODE N. Y., S 382.- (1) A mortgage was given 460; Clews v. Bauk, 89 id. 418. Such a contract the

to certain persons by reason of the threats of the bank had a right to make, limiting its liability to an

latter, that unless it were given, they would send the order properly indorsed by the depositor, or his payor,

son of the mortgagor to prison for a crime which he and the depositor had the right to impose upon the

had committed. After the giving of the mortgage, the bank the condition that his money should be paid out

prosecution previouely instituted against the son was by it only upon a check indorsed by himself or its

dismissed. Held, that the mortgage was in ralid, and payee. If the bank should disregard such a require

should be canceled, as a cloud on the title. (2) Au ment, it would do so at its own risk; but the holder

action to remove a cloud from the title to real property has no legal right to impose such a liability upon it

created by au invalid mortgage is not barred by (ode against its consent. It would certainly add much to

N. Y., $ 382, subd. 5, which applies a six-years' limitathe hazard of the transmission of funds by check,

tion to "actions to procure a judgment other than for draft or otherwise, through the mail or express, if the

a sum of money on the ground of fraud, in a case bauks or agencies upon which they were drawn should

which on the 31st day of December, 1846, was cognibe compelled to pay them to the holder by an action

zable by the court of chancery." Oot. 11, 1887. Schoeat law, where they do not bear upon the face the evi.

ner v. Lessauer. Opinion by Rapallo, J. dence of the performance of the condition upon which the drawer has authorized their payment. The rela- EXECUTORS AND ADMINISTRATORS — LIABILITY – tion existing between a bank and its depositors is that COSTS. - (1) Where an action is brought in the name of the executor, for a conversion of his testatrix's | thereon, which was done. This petition was filed in personal property, and other interests besides his owu | November, 1884, asking that the last order be set aside, personal interests are involved, and his duty requires and that the receiver be ordered to pay the amount of the executor to bring such action in his official capacity the judgment obtained by petitioners against the mortas executor, and no mismanagement or bad faith ap- | gagor. Held, that the judgment in the action be. pears on the part of the executor, the estate which he tween the receiver and petitioners in 1883, for the represents, and not he personally, is chargeable with possession of the plates, was res adjudicata as to the costs, if the action is unsuccessful. (2) Wheu'in such an | point involved, and that the petitioners were guilty action the costs are charged by the trial court against of laches by their long delay. Oct. 4. 1887. Sullivan the plaintiff as executor of the last will and testa- v. Miller; In re Petition of Little v. Ames. Opinion ment of” his testatrix, it is an adjudication that they by Ruger, C. J. are not to be charged against the executor personally,

MARRIAGE – CONTRACT BETWEEN HUSBAND AND but only in bis representative capacity; and no col

WIFE - CONTINGENCY OF SURVIVORSHIP – ESCHEAT,lateral attack thereon can be made. Oct. 4, 1887.

CONSTITUTIONAL LAW - TITLE OF STATUTE. - (1) A Hone v. De Peyster. Opinion by Ruger, C. J.

contract was made between a man and woman preJUDGMENT - REVIVOR AGAINST DECEDENT'S ESTATE vious to their marriage, that if the man died first -- LIMITATION OF ACTIONS - PRESUMPTION OF PAY without issue by the marriage, the woman should have MENT — DEATH OF JUDGMENT DEBTOR - ACKNOWL | all of his property, and if the woman died first withEDGMENT OF INDEBTEDNESS. - (1) A judgment re out issue by the marriage the man should have all of covered against an intestate, and upon which no pay- her property. The husband died without issue of the ment has been made or acknowledgment of a contipu. marriage, but leaving a number of legal heirs, aud ing indebtedness given, cannot on presentation to the soon after the wife died, leaving no heirs whatever. administrator at a period of more than twenty years Held, that the contract was valid, and upon the death after ite rendition, be revived by him against the of the husband, the wife took an equitable interest creditors or next of kin of the intestate. (2) A judg in his property, and upon her death without heirs the meut recovered on May 29, 1863, against one who died equitable interest and a right to a conveyance of the January 9, 1883, was presented to his administrator for property reverted to the State. (2). The property of a payment on March 27, 1884. No acknowledgment or person dying intestate and without heirs, in the State payment had been made by the intestate. Code Civil of New York, reverts to the State as ultimus hæres. Proc. N. Y., $ 403, provides that “the term of eighteen (3) Laws N. Y. 1885, chap. 377, entitled "An act to months after the death, within the State, of a person release the interest of the people of the State of New against whom a cause of action exists, is not a part of York in certain real estate to Henry Spicer, Catharine the time limited for the commencement of an action Valentine, Georgiana Farrington, Sarab F. Chapman against his executor or administrator.Held, that and Charles Spicer, and for other purposes," is invalid this section does not extend the time after which a as in violation of Const. N. Y., art. 3, § 16, providing judgment is presumed to be paid under section 376, that “no private or local bill which may be passed by which declares that such presumption sball arise, and the Legislature shall embrace more than one subject, be conclusive, in the absence of a part payment or and that shall be expressed in the title." Oct. 18, 1887. acknowledgment, at the expiration of twenty years Johnston v. Spicer. Opinion by Ruger, C. J. from the time when the party recovering it was first

MORTGAGE — COVENANT TO PAY TAXES — BREACH.entitled to a mandate to enforce it. (3) Executors

A mortgage contained a clause that the mortgagor petitioned tbat a judgment recovered by their testator

should pay all taxes, charges and assessments which against an intestate be decreed to be paid, and the

may be imposed by law, upon the said mortgaged administrator in his answer set up that another judg

premises, and in default thereof that it sbould be lawment was entitled to priority over the petitioner's

ful for the mortgagee to pay the amount of any such judgment. Held, not to be such an acknowledgment

charge, with any expenses attending the same. Any that such other judgment was a subsisting claim

amount so paid, the mortgagor covenanted to repay. against the estate as to rebut the presumption of pay

Held, that under the clause, this mortgagee could rement arising under the statute of limitations. (4) The

cover an amount paid by him to an expert tax examipetitiou for the judicial settlement of an administra

ner, who had examined and obtained a reduction of tor's account set forth, as required by Code Civ. Proc.

the taxes imposed on the premises which the mortN. Y., $ 2729, the names of the persons interested in

gagor had failed to pay, and that a tender by the the estate of the deceased, as creditors, etc., and

mortgagor of the amount dne on the mortgage, less named “W., a judgment creditor of the deceased,"

the sum so paid to the expert, was not sufficieut as a without specifying the amount of the judgment, the

defense to a foreclosure suit. Oct. 25, 1887. Equitable date of its recovery, or that any amount was due

Life Assur. Soc. of the United States v. Von Glahn. thereon. Held, not to be such an acknowledgment

Opinion by Earl J.; Danforth, J., concurs in result; tbat the W., judgment was a subsisting claim against

Ruger, C. J., not voting. the estate as to rebut the presumption of payment

MUNICIPAL BONDS — FOR RAILROAD AID – INVALarising under the statute of limitations. Oct. 11, 1887.

IDITY – COMPLIANCE WITH STATUTE – EXTENSION OF In re Kendrick. Opinion by Rapallo, J.

TIME – LIABILITY FOR PUTTING ON MARKET – CON- EFFECT — RES ADJUDICATA.— Certain stereo STITUTIONALITY.-(1) Defendant and others pretended type plates were mortgaged in July, 1882, but this to form a railroad corporation under the general railmortgage was not filed until January 4, 1883, upon road law, and procured bonds from plaintiff village to which date the mortgagor made an assignment. In aid in the construction of their line of road. DefendMarch, 1883, petitioners obtained a judgment against ant procured possession of such bonds as acting presithe mortgagor for an indebtedness incurred after the dent of such pretended corporation. The pretended mortgage was given, and levied upon these plates, railroad company never began the construction of its which were already in their possession. The receiver proposed line of road. Held, that under act of who succeeded the assignee brought action for the 1867, chap. 775, which provides that it any corporation possession of the plates, and obtained them from formed under the general railroad law shall not within petitioners in July, 1883. On March 15, 1884, the court five years after its articles of association are filed and ordered the receiver to sell the plates for not less than recorded in the office of the secretary of State, begin a specified sum, and pay off the original mortgage the construction of its road, and expend thereon ten

per cent of the amount of its capital, its corporate exis. received by the passenger on shipboard, no evidence tence shall cease, such corporation ceased to exist at appeared that defendant was careless or negligent in the end of five years from the time of filing and re. the selection of a surgeon, but rather the coutrary, cording its articles of association, and at that time the and the evidence of experts as to the propriety of the bouds of plaintiff village became void in the hands of surgeon's treatment was contradictory, held, that no such corporation or its agents. (2) An alleged rail negligence was shown on defendant's part, and the road corporation never began the construction of its dismissal of the action was justified. Oct. 18, 1887. line of road, and its corporate existence ceased by Laubheim v. Netherland S.S. Co. Opinion by Fiucb, J. operation of law in February, 1875. Held, that the act of 1875 (Laws 1875, chap. 598), passed June 18, 1875,

RAILROAD CORPORATIONS — DISSOLUTION – LEASE which provides that a railroad corporation that had

- ULTRA VIRES - MORTGAGE OF ROAD - INCOME not completed its line of road in the time limited by

MORTGAGE BONDS – RIGHTS OF HOLDERS. - (1) Where law might have two years more in which to finish the

a statute creating a corporation, and authorizing it to construction of its line, did not apply to a corporation

build a railroad, provides that if the corporation shall which had not begun the construction of its line, nor

not begin construction within a certain time, the cordid it revive defunct corporations. (3) After the cor

poration shall be dissolved, such failure does not ipso porate existence of an alleged railroad corporation has

facto dissolve the corporation. (2) Defendant, a rail. ceased by failure to comply with the law regulating

road corporation, organized under the New York act such corporations, defendant, an officer of such de

of 1858, chap. 140, § 5, had power under Laws 1839, funct corporation, and knowing its condition, and

chap. 218, “to contract with any other railroad corhaving in its hands bonds given by plaintiff village to

poratiou for the use of its road," and operate a road such corporation, and knowing that such bonds were

in New York running to the borders of Vermont. void, and could not be enforced by such corporation,

Another corporation had been created by a law of fraudulently sold them to innocent parties, represent

Vermout, with power to build a road in Vermont, and ing them to be bona fide securities, and valid bonds of

to lease its road. The Vermout corporation, before plaintiff village. Held, that defendant, by his fraud,

building its road, entered into an agreement with debecame liable to plaintiff for the value of the bonds

feudant and others by which, after reciting, that with negotiated by him. (4) Defendant and others pre

a view to establish all rail routes between the west and tended to organize a railroad corporatiou, but did not

northern New England, and to form necessary con

nections fer that purpose, a new road must be built in comply with any law governing the formation of such

Vermont, it agreed to issue bonds to build the new corporations, but by the perjury of defendant and two others, a seeming compliance with law was had.

road, the others agreed to buy them for that purpose, Bonds were issued by plaiutiff village to such supposed

and the New York corporation agreed, on the comcorporation, and defendant came in possession of them

pletion of the new road, to take a perpetual lease of it as an officer of such alleged corporation, and sold them

in form prescribed by the agreement. The agreement to innocent parties,'representing them to be valid and

was performed, and a new agreement, purporting to binding upon plaintiff, and thereby became liable to

be a lease and in the prescribed form, was executed, plaintiff for the value of the bonds so negotiated.

covering the new road, and all rights and taugible Held, that the fact that defendant accounted to the

property of the Vermont corporation. Under the

lease defendant was to equip, maintain and operate alleged corporation for the proceeds of the bonds did not release him from his liability to plaintiff. (5) |

the new road, and to pay the bouds in fifty years. Laws 1880, chap. 577, passed June 22, 1880, provides for

Held, that the new agreement was a valid lease, and

not ultra vires, as to the New York corporation, and the release of the Attica & Arcade Railroad Company

was not a lease of an incomplete road. (3) Defendant, from the forfeiture of its charter by reason of its failure to begin the constructiou of its road, and expeud

a railroad corporation, executed a mortgage reciting its thereon ten per cent of its capital within five years

determination to issue two classes of bonds, viz., after its articles of association were filed and recorded

“first consolidated mortgage bonds,'' and “income in the office of the secretary of State, and also by

mortgage bonds," payable forty years from April 1, reason of its failure to finish said road and put it in

1880, with interest payable semi-annually on the first operation within ten years from so filing and record

mortgage bonds, and annually on the income bonds, ing its articles of association. It also provides that

but only the principal of the income bouds was to be said company shall possess all the powers and rights

secured by the mortgage. The interest on the income it would have possessed if its acts and proceedings

bonds was payable out of defendant's "pet earnings,'' bad been in conformity with law, and authorizes said

and both the income bonds and the accompanying in

terest coupons provided that the term “net earnings" company to construct its road with a three-foot gauge. Held, that said act is unconstitutional, being

signifies the amount remaining of defendant's income in conflict with § 18, art. 3, of the Constitution of

during each annual interest period after discharging 1875, wbich prohibits the Legislature from passing any

certain specified expenditures, and that defendant's

directors should determine the amount of the opet local or private bill granting any corporation, association, or individual the right to lay down railroad

earnings" in each period. The mortgage showed that tracks. Oct. 18, 1887. Farnham v. Benedict. Opinion

the promise for interest on the income bonds was by Rapallo, J.; Earl, Danforth and Peckham, JJ.,

subject to a condition that defendant's net earnings concur; Ruger, C. J., Andrews and Finch, JJ., not

for each period after satisfying the aforesaid expendivoting.

tures, should suffice to pay the interest on all of this

class outstanding at the specified dates following each NEGLIGENCE - EMPLOYMENT OF SHIP SURGEON.- of said periods, or such less interest as such pet earn(1) Where a surgeon is selected for duty on shipboard, ings during such periods should be sufficient to pay on the ship-owners are bound only to the exercise of all said bonds then outstanding. The mortgage conreasonable care and diligence in the selection of a tained other provisions further evincing defendant's competent person for the position, and are liable, not intent not to secure the interest on the income bonds for the negligence of the surgeon, but only for their by the mortgage, and covered defendant's income and owu negligence in making the selection. (2) Where, profits. After executing the mortgage, defendant in an action by a passenger against a steam-ship com leased a road from a Vermont corporation, agreeing pany for damages caused by the alleged improper and in the lease to pay certain bonds issued by the latter, negligent treatment by the ship surgeon of an injury and has been paying these latter bouds, but not the interest on the income bonds. Plaintiffs are holders of was bought by the purchasing committee for its princoupons for interest on the income bonds. Held, that cipal, the purchasers of the road. Held, that the purplaintiffs have no lien under the mortgage, and that chasers of the road were not purchasers for value withdefendant's directors have the right to determine the out notice, and that they took the property subject to amount of the net earnings, and plaintiffs are bound plaintiff's lien. (8) The purchasers of a railroad who by such determination, and cannot maintain an action had notice of plaintiff's lien on the road organized a to restrain defendant from using its income to pay the railroad company, and transferred their title to the Vermont corporation's bonds or operating expenses. road to the company in exchange for its stock. Held, Oct. 11, 1887. Day v. Ogdensburg & L. C. R. Co. that the railroad company having paid no value for Opiuion by Danforth, J.

the property, and representing simply the purchasers

who had notice of plaintiff's lien, took the property RECEIVER - OF RAILROAD COMPANY - POWER TO

subject to that lien. (9) The purchasers of the first CONTRACT DEBTS — EQUITY JURISDICTION — SALE –

mortgage bonds of a railroad agreed with the sellers CONSOLIDATION OF CORPORATIONS.- (1) A railroad

that they would form a corporation which should accompany executed first and second mortgages on its

quire the title to the rolling stock, etc., and all the property. Afterward it was put into the hands of 8

property belonging to the railroad which might be receiver, who petitioned the court for power to buy

subject to the claim of one V.; and further that “the some necessary rolling stock on credit. Held, that in

purchasers are to assume the prosecution of that suit, order to secure the successful operation of a railroad

(the V. branch), and to abide its results and judgin its possession, a court of equity has jurisdiction to

ment; and if there shall be any recovery in V.'s favor, authorize its receiver to create debts, and to charge

the purchasers agree to iudemnify said parties of the them as a first lien on the property. (2) A receiver's

first part, and said Platt, as receiver against the same." expenditures, before they can be charged on the prop

Held, that this was a contract strictly of indemnity, erty, must be authorized by the court; and while ex

which contained to promise to pay V., and was not penses for preserving the property incurred by a re

made for his benefit; and that he was not entitled to ceiver without the prior sanction of the court may be

a personal judgment against the purchasers. (10) allowed by the court to be charged upon the fund, it is

Plaintiff released certain rolling stock to a receiver nevertheless the order of the court, and not the act of under an agreement that in case it chould be finally the receiver, wbich creates the charge. (3) The court

determined that he had an absolute and beneficial title issued an order authorizing the receiver to buy the

to the property, he should paid $18,000 and interest, necessary rolling stock for a railroad, provided that he and that the money and interest should be charged as could do so upou a credit of not less than six montbs. a first lien on the whole property. In an actiou to The order further provided that “the amount which

ter provided that the amount which foreclose two mortgages on the property. the Court of said receiver may so contract to pay for the said rol- | Appeals decided that plaintiff had a legal title to the ling stock, together with all interest that may accrue

said rolling stock, and awarded costs in his favor. thereon, is hereby made a first lien on said mortgaged

Held, that the costs adjudged in plaintiff's favor, in premises, and all proceeds thereof." Held, that the

the foreclosure suit, were not included in his agreeeffect of the order was to charge both the property

ment with the receiver, and could not be charged as a and the proceeds from its sale with the lien. (4) In

lien on the property. (11) Under Laws N. Y. 1869, February, 1857, a receiver was appointed to take charge

chap. 917, § 5, authorizing the consolidation of certain of a railroad. In the following September it was sold

railroad companies, and providing that the rights of under a decree of the court, but the purchasing com

creditors and liens were not to be impaired by the conmittee who bought it did not complete their purcbase

solidation, a railroad company which had notice of until 1868. Held, that until the sale was completed,

plaintiff's lien on the road consolidated with another the court was not divested of its power of managing

company. The property of the consolidated compauy the property. (5) A director of railroad had bought,

was leased to a canal company. Held, that neither at an execution sale, the rolling stock of the road. I the new company which was formed by the consolidaSubsequently he released the stock to a receiver of the tion, nor its lessee, the canal company, was as regards road, and made an agreement with the receiver, which

said lien, a purchaser for value without notice. Vot. provided that in case it should be determined by this 4. 1887. Vilas v. Page. Opinion by Andrews, J. or in any other action or proceeding that the said property belonged absolutely and beneficially to him,

SCHOOLS – CONTRACTS OF TRUSTEES – LIABILITY he should be paid for the foregoing release $18,000.

OF SCHOOL FUNDS.- Under Code Civil Proc. N. Y., Held, that this agreement fixed the price of the rolling

S$ 19:27, 1929, 1931, providing that trustees of schoolstock at $18,000. (6) Plaintiff, a director of a railroad,

districts shall be individually liable for judgments repurchased its rolling stock at an execution sale, and covered against then

covered against them on contracts made by them in afterward released it to a receiver who has been ap

their official capacity, a judgment so recovered may be pointed to take charge of the road. It was agreed be

collected from their individual property, and a writ tween them that plaintiff was to be paid $18.000 and of mandamus will not be granted to enforce the payinterest, when it was finally determined that he had ment of such a judgment out of funds belonging to a an absolute and beneficial title to the rolling stock.

| school-district in the hands of its trustees. Oct. 18, Subsequently an actiou was begun to foreclose two

vo 1887. People, ex rel. Wallace, V. Abbott. Opinion by mortgages on the property of the railroad, and in that | Andrews, J. proceeding it was determined that plaintiff by his purchase secured a legal title to the rolling stock. Held,

ABSTRACTS OF VARIOUS RECENT DEthat the judgment of the Court of Appeals satisfied the condition of the contract in respect to plaintiff's

CISIONS. title to the rolling stock. (7) An agreement was made between plaintiff and a receiver of a railroad, whereby BAILMENT-DEPOSIT-ORDINARY DILIGENCE - USE under certain conditions, plaintiff was to have a lieu | BY BAILEE. - Where a bailee for hire allows money to on the road. This agreement was consented to by the be deposited in his safe for safe-keeping, and without ropresentatives of a purchasing committe appointed to i his fault to safe is robbed, the owner must bear the buy the road. The purchasing committee had notice | 1089. In such a case, if the bailor consents to the use of this fact. The conditions were fulfilled, and plaiu- of the money by the bailee, if such robbery occurs betiff's lien established. At a foreclosure sale the road fore there has been such use of the money the bailor

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