Case ID: miss_14/html/0647-01.html
Source: Caselaw Access Project
Author: {"author": "Mr. Chief Justice Sharkey Mr. Justice Thacher.", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

William Petrie’s Executors et al. vs. Daniel W. Wright et al.
    P. entered into a contract with the Jackson and Brandon Railroad and Bridge Company, by which he agreed to build a bridge over Pearl River, and to construct a turnpike road from the eastern end of the bridge to the termination of the swamp in an eastwardly direction ; and the company agreed to pay him $ 37,500 for the bridge over the river, forty-four cents per cubic yard for making the embankment for the turnpike, and ten dollars per lineal foot for building all necessary bridges between the bridge over the river and the end of the turnpike at the termination of the swamp. Sometime thereafter, P. entered into a contract with the Mississippi and Alabama Railroad Company, to which the Bridge Company were also parties, by which he agreed to construct a railroad, furnish materials, &c. from Jackson to Brandon, and the Railroad Company agreed to pay him therefor $ 204,000, and an extra sum for excavating rock. In the last contract, there was a clause declaring that the Bridge Company had abandoned their scheme, and that .they thereby assigned to the Railroad Company all their rights and privileges under their first contract with P.; but in the last contract it was expressly stipulated, that the building of a bridge over Pearl River should not be included in P.’s obligations to the Railroad Company. Held, that the two contracts must be construed together, and that P. was entitled to receive from the Railroad Company the $37,500, forty-four cents per cubic yard for making the embankment, and ten dollars per lineal foot for building bridges, in addition to the $204,000, and the extra sum for excavating rock.
    Corporations may contract under their corporate seal, by a vote of the directory entered on the books of the corporation, or by their agents acting within the scope of their authority ; and binding contracts may be implied from their-corporate acts, without either a vote, deed or writing.
    W. P. contracted with the Mississippi and Alabama Railroad Company to build a failroad, furnish materials, an engine, &c., for which the company were to pay him a stipulated sum, a portion of which was to be advanced to enable him to purchase slaves to work on the road ; and he was to execute to the company a mortgage on the slaves so purchased, as a security for the diligent and faithful performance of his duties on the road. They advanced the money, and he purchased the slaves and executed the mortgage. The company afterwards, to wit, on the 21st day of December, 1839, and before the road was completed, adopted several resolutions, by the first of which they released W. P. from his obligation to furnish an engine ; by the second they directed his mortgage to be cancelled; and by the third, after admitting in a preamble that they had failed to supply him with par funds, they requested that he should proceed to finish the road at his own expense, and retain it until he should be repaid by the profits. They subsequently agreed that F. H. P. should be substituted as a contractor in the place of W. P., and that they would give him $ 15,000 to complete the road ; W. P. at the same time gave to the company his verbal promise, that F. H. P. should finish the road. F. H. P. then, with the knowledge of the company, proceeded to work on the road, and continued to work on it for some time, though he never finished it. Held, that the resolutions, by substituting new terms and conditions inconsistent with the original agreement, amounted to an abandonment of the contract with W. P., and when taken in connection with the other circumstances and facts of the case, must be considered as a settlement of the balances between W. P. and themselves ; and as a legal consequence, to a discharge of him from all obligations or liability to them, on account of his contract or mortgage.
    Fraud may sometimes be established by strong circumstantial evidence, even against positive proof denying it.
    A voluntary release of securities held by a corporation, is void as to creditors; yet if, in the settlement of mutual and conflicting claims, a corporation allow a debtor more than he is strictly entitled to, that is not of itself a fraud ; there must be some device to injure others, or the act must be so grossly extravagant and wasteful, as to amount to fraud in law.
    P. contracted with the Mississippi and Alabama Railroad Company to build a railroad from Jackson to Brandon, for which he was to receive about $281,000 ; the money to be paid from time to time, as P. in the construction of the road might, in his own opinion, require it. The company failed to keep him supplied with par funds, and after paying him $298,026, most of which was in depreciated bank paper, they released him from the further prosecution of the road, and cancelled the mortgage he had given them for the diligent and faithful performance of the work on the road. When this release was given and the mortgage cancelled, P. claimed large damages against the company for their failure to comply with their contract; they refused to allow him the whole amount claimed, but they allowed him a part of it, and a final settlement took place between them. P., in his answer, stated, and several witnesses proved, that the settlement was fair, and made in good faith. Held, that even though P. may have received more than he was strictly entitled to, the settlement was not only binding on the company, but was legal and valid as against their creditors.
    Where a complainant, in addition to the general allegations in his bill, propounds special interrogatories to the defendant, the direct answers of the defendant to such interrogatories, are evidence for as well as against him, and will be conclusive unless shown to be false ; nor will any presumption be indulged against such evidence on account of its being furnished by a party interested.
    Where a party agrees to make a security in future, that is construed in equity as an equitable mortgage; but the equitable mortgage becomes merged whenever a mortgage is executed according to the agreement of the parties.
    P. gave a mortgage to a railroad company, as a security for the performance of certain work, and the chancellor rendered a decree of foreclosure of the mortgage for a balance found to be due by P. to the company, on an account stated between them : Held, that the mortgage being a mere security for the performance of work, and not for the payment of a debt, the decree was erroneous.
    On appeal, from the superior court of chancery; Hon. Robert H. Buckner, chancellor.
    Daniel W. Wright and others, who were partners, doing business under the name and firm of the “ Real Estate and Banking Company of Columbus, Mississippi,” and Richard T. Hoskins, filed their bill in the superior court of chancery, alleging that the said partners, under their partnership name, at the November term, 1839, of the circuit court of Rankin county, recovered .two judgments against the “ Mississippi and Alabama Railroad Company,” the one for the sum of $130,446 73, besides costs, and the other for the sum of f19,943 90, on which numerous executions have been issued. Certified transcripts of the judgments and executions are exhibited with the bill; that in the month of November, 1839, the said firm assigned all their effects, including said judgments, to the said Richard T. Hos-kins, by deed duly acknowledged and recorded in the county of Lowndes, a certified copy of which is also exhibited with the bill. In June, 1840, executions were issued on said judgments, and placed in the hands of the sheriffs of Rankin and Hinds county ; the former levied on thirty-eight, and the latter on forty-one negroes, as the property of the “ Mississippi and Alabama Railroad Company,” all of which were claimed by William Petrie, who made oath and gave bonds to try the right of property according to the statute. The bill charges that the claim of Petrie is without foundation in equity or justice, but is founded in fraud, complex in its nature, well contrived to defeat the ends of justice in a trial at law, and too artfully framed and guarded to be successfully sifted and exposed, except in a court of chancery ; that William H. Shelton, Samuel M. Puckett, Robert G. Crozier, Richard M. Hobson, John Wr. King, Henry K. Moss, and Thomas J. Coffee, were stockholders in, and the acting managers and directors of, the said railroad company, and by them alone could the interests and property of the company be protected and secured to answer the trusts growing out of the law of its incorporation ; that the said directors were faithless to the charge confided to them, and used the said corporation as an instrument of amassing large amounts of property, of which the negroes levied on as above stated, form a part, and were colleagued with divers persons, of whom William Petrie was one, for the purpose of creating false claims, titles and ownerships to and of the property thus amassed, that they might abstract the same from the said company, defraud the creditors thereof out of it, and appropriate it to their own use ; that said directors, instead of being interested in behalf of said company, to have justice done in a trial at law of the issue sought to be made up by said Petrie as aforesaid, are colluding with Petrie to defeat the title of the company ; that they have caused some of the books of the company to be taken out of the state of Mississippi, and have so mutilated and altered others, as to destroy the evidence they contained of the numerous frauds practised by themselves, said Petrie, and their other confederates, and make them sustain the fraudulent claim of Petrie to the negroes above-mentioned; that Shelton and Petrie have used their influence over several of the most important witnesses in behalf of complainants on the trial of the right of property, to leave the state, so that their testimony could not be procured in time, if at all, for the circuit court of Rankin county, then in session. The bill further charges, that it was the settled policy of the directors of said company, from its commencement, to use the company as the means of'getting into their possession large amounts of property, and hold the same in their own and in the names of their confederates, and in that manner protect it from the just claims of the creditors of the company, and finally divide it amongst themselves and their confederates; that the said directors, out of the means of the company, had provided themselves with large estates in lands, negroes and other property, and had besides taken eighty or ninety thousand dollars, and deposited it in some bank in the city of Philadelphia, in the name of one of themselves, and then transferred the same to the credit of the Bank of Lexington, for the purpose of evading the claims of attaching creditors of the said railroad company, and ultimately of dividing it amongst themselves; and that they have been for some time in said city to effect that object. The bill further charges, that about one hundred and forty negroes, including those levied on as above stated, which cost $159,000; a large number of horses and oxen, which cost $12,400; a large number of wagons, carts and tools, which cost $25,000; a steam sawmill, which cost $25,000 ; and a large quantity of railroad iron, which cost $25,000 or $30,000, were all purchased with the funds of the said company, and were by the fraudulent contrivances of the said directors and Petrie, subjected to the claim of Petrie, that they might through him and his claims, defraud the company and their creditors out of the whole of said property, and eventually divide it between Petrie and themselves; that Petrie bases his claim to said negroes and other property on certain articles of agreement entered into between said company and himself, a copy of which is exhibited with the bill, and is in the following words, to wit:
    
      “ Articles of agreement made and concluded this 23d day of February, A. D. 1837, between the Mississippi and Alabama Railroad Company, by William H. Shelton, the president thereof, and the Jackson and Brandon Railroad and Bridge Company, by Henry K. Moss, the president thereof, of the first part, and William Petrie, of the county of Rankin, state of Mississippi, of the second part, witnesseth : That the said William Petrie, for himself, his heirs and assigns, agrees to perform all the grubbing, clearing and chopping, making excavations, embankments, bridging drains and culverts, necessary to complete the graduation of the Mississippi and Alabama Railroad from the depot lot in the town of Jackson, donated by the legislature to the Jackson and Brandon Railroad and Bridge Company, to the western bank of Pearl river, contracted to be built by the Jackson and Brandon Railroad and Bridge Company, by articles bearing date herewith, to the ravine in the western part of the town of Brandon ; also, to furnish all materials, including iron plate, spikes, and connecting plates, and put down the whole of the superstructure^ with the necessary turnouts, turning platforms, side roads at the depots, water stations, road crossings, and all other incidental work that may be necessary to render the Railroad complete in every respect; to build a warehouse at the termination in Brandon, the dimensions to be 35 by 60 feet, and an engine house ; also, to furnish a locomotive engine and tender of the most approved construction, and eight cars, one of which shall be a forty-passenger car, and put the railroad in full operation. Provided, however, that this instrument, nor any part of it shall be so construed or understood as including the building of the bridge over Pearl river; and provided also, if there should be rock encountered in excavating through the ridge near the depot place in Brandon, that the party of the second part shall be paid for any such rock at an extra price not exceeding two dollars per cubic yard. It is the understanding of said parties that the railroad way shall be graduated twelve feet wide where embankments occur, and fourteen feet wide in excavations, so as to allow a sufficient width for drains on the sides, excepting at the depots and turnouts, where the width will be increased as much as necessary. The superstructure to be composed of ties of oak, to rest on plank at each end, with grooves cut out four and a half inches deep to receive the wood rails, which will be firmly keyed to its place with white oak wedges, the whole to be surmounted by an iron plate rail two inches wide by a half inch in thickness secured to the under rail by five inch wrought spikes, ragged at the points, and underlaid at the joints with connecting plates of zinc or iron. And whereas the president and directors of the Jackson and Brandon Railroad and Bridge Company, having abandoned the scheme of connecting that portion of the railroad extending from the depot at Jackson to the ravine aforesaid, in consideration whereof, the said president and directors do hereby covenant to and with the president and directors of the Mississippi and Alabama Railroad Company, that they will and do hereby release and convey trato the said president and directors of the Mississippi and Alabama Railroad Company for the time being and their successors in office, to the entire use and benefit of said company, all claim which the said president and directors of the Jackson and Brandon Railroad and Bridge Company have or may hereafter have unto the lands, lumber, stone, dirt, &c., on the tract heretofore allotted for said road of said Company, and to every right and privilege extended to them by the original owners of the lands. And the said president and directors of the said Mississippi and Alabama Railroad Company, do hereby contract with the said Petrie, to construct the railroad aforesaid from the points aforesaid, and in the manner and form aforesaid; in consideration of which said covenants and agreements on the part of the said William Petrie, the said Mississippi and Alabama Railroad Company, parties of the firdt part, hereby promise and agree to pay to the party of the second part, the sum of two hundred and four thousand dollars, the first payment of twenty thousand dollars to be made within one month of the commencement of the work, and then payments to be made at intervals of about thirty days, as the money may be required for the prosecution of the contract, and for the purchase of the iron and the engine, of which the party of the second part shall determine. It is the understanding of both parties, that besides the above mentioned terms of payment, the parties of the first part shall, at the expiration of thirty days from the date hereof, invest the party of the second part with authority to draw bills of exchange on the Bank of Mississippi and Alabama Railroad Company at Brandon, to the amount of one hundred thousand dollars, in the following manner, to wit: Twenty thousand dollars at four months after date, twenty thousand dollars at six months, twenty thousand dollars at eight months, twenty thousand dollars at ten months, and twenty thousand dollars at twelve months after date. It is further understood by the parties, that the party of the second part shall apply the above mentioned one hundred thousand dollars, .(or letters of credit to that amount,) to the purchase of slaves to work on the railroad, which slaves with all other property in possession of the party of the second part, shall be mortgaged to the parties of the first part as security for the faithful performance of this contract. It is further understood by said parties, that this contract shall be commenced within one month, and completed in two years from the date thereof, and if the party of the second part complete it before the expiration of said two years, he shall have the right to retain it in possession with its appurtenances, and derive the profits arising from the transportation of passengers and freight during such time till this contract expires; the party of the second part shall also have the right to all timber that it may become necessary to clear off for the roadway, and - he shall keep the railroad and machinery in repair, and deliver them to the party of the first part in full and complete operation at the expiration of the contract. It is further understood by the parties, that if the party of the second part shall prove negligent, and fail to use due diligence and energy in the prosecution of this contract, or for any other reason shall not perform the same in a manner to give assurance that it will be accomplished by the lime specified, the president of said company shall have power to declare this contract abandoned, and that such declaration shall exonerate the parties of the first part from every obligation thence arising, and they may immediately thereafter proceed to re-let the work as freely and fully as if this contract had never existed; and the party of the second part shall be liable to pay to the parties of the first part, such damages as may be sustained by reason of such failure or non performance. It is agreed by the parties, that if any dispute or misunderstanding shall arise as to the meaning or execution of the provisions of this instrument, then it shall be referred to some competent persons to be selected jointly by the parties, and that his or their decision shall be final and binding on both parties. In testimony whereof, the said parties have hereunto affixed their hands and seals, the day and year first above written.
    William H. Shelton, [l. s.]
    
      Pres. Miss, and Ala. R. R. Co.
    
    H. K. Moss, [l. s.]
    
      Pres. Jackson and Brandon R. R. and B. Co.
    
    Wm. Petríe.” [l. s.]
    The bill then charges that at the time Petrie entered into said contract, he was in a state of absolute poverty, and yet in three months from that time he claimed to be the owner of negroes which cost $159,000, instead of $100,000, the amount to be invested in negroes according to the agreement, and various horses, oxen, wagons, carts, tools, saw mills, railroad iron, &c., which with the negroes, cost at least $226,000, all of which were purchased with the funds of the company ; that Petrie had not paid out a dollar of his own money in the purchase of the negroes and other property, nor did he owe a dollar on account of them to the said company, nor any one else. It is further charged that the said company paid Petrie at least four hundred and forty-two thousand seven hundred and fifty-five dollars on account of said railroad, or the sum of two hundred and thirty-eight thousand seven hundred and fifty-five dollars more than they stipulated to give him; that notwithstanding said Petrie had received, more than double as much as he was entitled to, he has not completed any part of the railroad; the superstructure is under wooden rails only put down in part, no iron plate rails have been laid, no turnouts, turning platforms, side roads at the depots, water stations, road crossings have been made, no depots nor warehouse built, no locomotive engine nor tender, nor cars procured ; but that Petrie, after superintending the road for about two years, during which time he received a salary of $4500 per year in addition to the sums above mentioned, abandoned it not half finished, in a ruinous and worthless condition, and removed said negroes and other property to cotton farms, and has since been engaged in raising cotton instead of building said road. _The bill further charges that in the fall of 1838, when the bank commissioners of the State of Mississippi were about to examine the said Mississippi and Alabama Railroad Company, said Petrie addressed a written communication to William H. Shelton, the president of said company, which is exhibited’with the bill, and is in the following words, to wit:
    “ Railroad Office, August 2d, 18.38.
    Col. W. H. Shelton, Fres. fyc.
    
    Sir : In accordance with your request of yesterday I make the following statement of the amount of money expended in the construction of the railroad between Jackson and Brandon, the bridge over Pearl river, and the turnpike road and bridges through the swamp, to wit:
    For slaves purchased, ..... #159,000
    Horses and oxen,...... 12,400
    Wagons, carts and tools, .’ . . . . 5,000
    Erecting a saw mill and fixtures for sawing lumber for constructing the bridge and road superstructure, ........ 25,000
    Wages of managers and physicians, . ■ . 9,000
    Do. of masons for work on abutments, . . • 1,660
    Do. of laborers on turnpike road, .■ . 2,975
    Subsistence, ....... 23,500
    #239,035
    The principal items of work done consist in grubbing and clearing twelve miles of the road, and in grading six and a half miles ready to receive the superstructure. Also, in hewing ten thousand cubic feet of lumber for railroad bridges, and preparing a portion of the superstructure of the road. The materials prepared and labor done on the bridge over Pearl river, and the turnpike and bridges through the swamp amount to #56,000.
    Respectfully submitted,
    W. Petrie.”
    
      “ Memorandum. Mr. Petrie received from Rankin county ail appropriation towards the turnpike, which makes the expenditures larger than the bank advances.”
    The bill further charges that, when said company apprehended no danger from creditors, and wished to increase its credit, impose upon the community, and extend its operations, the said negroes and other property were rightfully declared to be the property of the company; but when creditors beset them, and there was danger of the negroes being seized on to pay debts, then the claim of Petrie would be set up, as the claim of the Bank of Lexington had been set up to the said fund in Philadelphia, to defraud the creditors of the company. That by the terms of said agreement Petrie was to execute a mortgage on said negroes and other property, to secure the diligent and faithful performance on his par.t of said contract; that he never executed said mortgage, but that equity will consider as done. that which ought to have been done ; and that, by the conditions of the mortgage which thus exists in equity, the' title to said negroes and property has become absolute in said company, by said Petrie failing to comply with the terms of said .contract; that Petrie and the company ought to be made to account together, under the superintendence of the court of chancery; the amount due hy Petrie to the company ascertained ; the mortgage foreclosed, and the negroes and other property sold for the payment of the judgments in favor of complainants. The bill also charges that, notwithstanding Petrie has failed to comply with his contract, and has abandoned said road, in an unfinished and worthless condition, the company fraudulently refuse to declare said contract cancelled, or to re-let said road. It therefore charges that said contract should be rescinded, and the negroes and property remain with the company for the payment of its debts; that besides the negroes above levied on, there are others which ought also to be embraced in said equitable mortgage, and sold for the payment of the judgments due the complainants. The bill charges that William H. Washington is a stockholder, and was at one time a director in said company, and that he possessed important information relative to the actings and doings of the above-named directors and Petrie, and prays that he may be made a defendant; that Frederick H. Petrie claims some interest in some of said negroes, under a conveyance made by William Petrie, in 1840, and that he has, as agent of William Petrie, some of the negroes and other property in possession; that complainants are afraid and believe that William Petrie, Frederick H. Petrie, or some of the said directors, will sell, remove, or otherwise dispose of said negroes, &e., so as to put them beyond the jurisdiction and reach of the chancery court. The said directors, William Petrie, Frederick H. Petrie, William R. Crane, and John T.'Blow, (the two last named persons having been appointed by the governor of Mississippi commissioners to take charge of the effects and settle up the affairs of said company,) and William H. Washington, are made defendants.
    In addition to the foregoing general allegations there are thirty-one special interrogatories propounded to the defendants, all of which they are required to answer fully. They were called on to state whether they had ever been connected with the Mississippi and Alabama Railroad Company, as president, director, stockholder, agent, engineer, or in any other capacity; when their connection commenced and ended; whether the company was ever engaged in building a railroad from Jackson to Brandon; at what time it was begun, how long it was worked on, and what progress was made towards the completion of it; whether William Petrie was ever employed by said company as engineer, overseer, or in any other character on said road; when he commenced, and when he ceased to work on it; whether the company abandoned the road, and why; have they discharged William Petrie, and when; have they had a final settlement with him; when it took place, how much he owed them on such settlement; have they released him, and when and why; how much they paid him; whether the said negroes and other, property were purchased with the funds of the company; and were they, at the time they were purchased, considered the property of the company, or of Petrie; does Petrie now owe the company anything, and how much. And numerous other questions, all pertaining to the nature of the contract between the company and Petrie; the understanding of the parties at the time it was entered into; the manner in which it had been executed, and the final settlement with, and release of Petrie, &c.
    On the 15th day of September, 1841, William Petrie filed his answer, in which he admits that the Real Estate Banking Company of Columbus recovered judgments against the Mississippi and Alabama Railroad Company, as charged in the bill, stales that he knows nothing of the assignment of such judgments to the said Hoskins, and without either admitting or denying it, requires proof, if the fact be deemed material; he admits the issuance and levy of the executions, the giving bond to try the right of property, and that the property was left in his possession, as stated by the complainants; he denies that his claim is founded in fraud, either simple or complex; insists that it is legal and equitable, and he is willing to test the justice of it in any court legal or equitable, in the state ; says that when the negroes were first levied on he filed his bill in the superior court of chancery, for an injunction, and thereby evinced his willingness to submit his claim to the scrutiny and test of that court; and it was only after the chancellor had decided that he could not order the negroes levied on to be delivered up, that he gave the bond to try the right of property, and that was the only course, as he believed, by which he got possession of the negroes. He admits that Shelton, Puckett, Crozier, King, Hobson, Moss, and Coffee, were for some time directors of the Mississippi and Alabama Railroad Company. He does not know whether said directors colleagued with' others to obtain large amounts of property fraudulently, by using the company for their own purposes, or not; and, if material, he requires proof. He denies that he ever colleagued with said directors for any of the fraudulent purposes charged in the bill. He also denies that his claim to said negroes was got up for the purpose of defeating the claims of the creditors of said complainant, or that his claim is of the fraudulent character set out in the bill. He denies that said directors have any title to the negroes claimed by him. Says they are his property, not subject to the control of said directors, nor to the claim of said directors, or the company, or of any other person, in law or equity. He says it is untrue that said directors had colluded with him in any manner to defeat the claim of the Mississippi and Alabama Railroad Company, or to sustain his claim to the property, on the trial of the issue at law. He does not know whether the directors have removed, or destroyed, or mutilated the books of said company, or whether, by .such means, they have destroyed any evidence of their actings and doings. If such things have been done, it was without his approbation ; and, if material, he requires proof. Though, if any such thing was done, it was not done with the view to secrete, or hide, or remove, or destroy the evidence of the dealings of the company with him. The books never did contain any evidence of any fraudulent dealings with him, for the purpose mentioned in the bill, or any other purpose. Nor have said books ever been altered or changed for him, or at his request or with his knowledge, in order to make them evidence for or against said company; the books never were under his control or direction, and he denies that they were ever removed, ,or destroyed, or mutilated, with his knowledge, at his suggestion, or for his interest. Whatever frauds or misdeeds said, directors may have committed, he leaves to them to answer for; he has never been and never expects to be benefited by any of them. He says it is untrue that he ever used any influence over any witness, or in any way procured the absence of any witness, so as to defeat any testimony which they could give at law ; and if Shelton ever did, it was not within his knowledge. He does not know what motives or policy influenced the directors in the management of said corporation, nor does he know whether they have acquired large estates from said corporation. He knows nothing of the $90,000 said to be deposited in Philadelphia. He had no interest in that or any other appropriation by said directors, and had no participation in it, if any such there was. He neither admits or denies any fraudulent conduct or management of said directors, except so far as such frauds are charged to have been done with his connivance, at his instance or for his benefit, and in-relation to his business with said company, and all such he denies. It is not true that the negroes levied upon, or any other species of property, of any of the different kinds mentioned in the bill, have, by any fraudulent contrivance, been subjected to the claim of the respondent, for the purpose of defrauding the Mississippi and Alabama Railroad Company, or her creditors, in order that the same might be divided between respondent and said directors. It is true, that he bases his claim to said slaves upon means and facilities afforded him by said company by virtue of the agreement referred to in the bill. The agreement or contract was made under these circumstances: Prior to the incorporation of the Mississippi and Alabama Railroad Company, there was another corporation in existence called the Jackson and Brandon Railroad and Bridge Company, established to erect a bridge over Pearl river and a railroad from Jackson to Brandon, and of which he had for some time acted as the agent and engineer; and they were indebted to him in the sum of about six thousand dollars for his services; which sum the Mississippi and Alabama Railroad Company agreed to pay him in addition to the sums mentioned in his agreement with the Railroad and Bridge Company, which agreement was in the following words, to wit:
    11 Articles of agreement made and concluded the 23d day of February, 1837, by and between the Jackson and Brandon Railroad and Bridge Company, by H. K. Moss, the president thereof, of the one part, and W. Petrie, now of the county of Rankin and state. of Mississippi, of the other or second part;Witnesseth, for himself, his heirs and assigns, agrees to furnish all materials and construct a bridge over Pearl river, and extend the same over the slough and low ground near said river, as far as it will be necessary to accommodate the travel of the country ; and in consideration of which the party of the first part hereby promises and agrees to pay to the parly of the second part the sum of f>37,500. The first payment to be made within one month from the commencement of the work, the others at intervals of about thirty days, in sums proportioned to the whole amount agreed upon, to enable the party of the second part to progress with the job; and when the bridge shall be finished, he shall receive, the balance due him on a final settlement. The said party of the second part also agrees to construct a road from the termination of the bridge in an eastward-l.y direction to the edge of the swamp, and build any bridges that may be considered necessary between those two points, by the party of the first part. And in consideration of which the party of the first part hereby promises and agrees to pay to the party of the second part as soon as said road is done, at the following rates, viz.: for embanking the road, forty-four cents per cubic yard; for bridging, if any be required, ten dollars per foot lineal of the bridges. It is the understanding of said parties, that the bridge over Pearl river shall be sufficiently elevated so as not to interrupt the free navigation of said river. The pier and abutments to be of hard burnt bricks, laid in lime mortar and covered with hydraulic cement. The superstructure shall be built on Town’s patent lattice plan, with two tracts, one to accommodate the common travel of the country, the other for the railroad, to be covered in and painted, and the whole structure shall be finished in the most substantial and workmanlike manner. The extension over the slough to the county road, shall be of piling or trestle-work, so managed as to render it substantial* and firm; the road-way to be of 2^-inch plank, and finished with a neat’, railing on the sides. It is also understood by said parties that this contract shall be commenced in thirty days from date, and finished by the first day of May, 1838; but that the party of the second part shall have the right to retain the road and bridge in possession, and receive the profits arising from the tolls, till the 23d day of February, 1839, during which time he shall keep them in repair; and at the expiration, deliver them to the party of the first part in a perfect condition. It is further understood by said parties, that if the party of the second part shall prove negligent, fail to use due diligence and energy in the prosecution of said contract, or for any other reason shall not perform the same in a manner to give assurance that it will be accomplished by the time specified, that the president of said company shall have power to declare said contract abandoned, and that such declaration shall exonerate the party of the first part from every obligation thence arising, and that they may immediately thereafter proceed to re-let this work as freely and fully as if this contract had never existed ; and the party of the second part shall be liable to pay to the party of the first part any damages that may be sustained by reason of such failure or non-performance. It is agreed by said parties, if any dispute or misunderstanding should arise as to the meaning or execution of this instrument, it shall be referred to some competent person or persons selected by the parties, and his or their decision shall be final and binding upon both. In testimony whereof, the said parties have hereunto set their hands and affixed their seals the day an d year first above written.
    “H. K. Moss, (l. s.)
    
      Pres. Jackson and Brandon R. and B. Co.
    
    “ W. Petrie.” (l. s.)
    After the incorporation of the Mississippi and Alabama Railroad Company, the stockholders in the other company agreed to surrender to them, the Mississippi and Alabama Railroad Company, all their privileges of constructing a railroad, and upon making this agreement the Mississippi and Alabama Railroad Company wished to employ respondent as an engineer in the construction of the road, but he refused to be employed in any other capacity than that of independent builder and contractor, in which capacity he was willing to undertake the completion of the work by a particular time for a given sum. Whereupon the agreement was entered into which is exhibited with the complainant’s bill. By that agreement it will be seen that he was to receive $204,000, with the additional sum of two dollars per cubic foot for excavating rock. The number of yards of rock excavated was 2292, which at the price agreed upon amounted to $ 1,584. By the contract with the Bridge Company, he was to receive $37,500 for building the bridge over Pearl river, forty-four cents per cubic yard for making the embankment for the turnpike from the end of the bridge to the highlands, and ten dollars per lineal foot for building the bridges on the turnpike. He made 39,567 cubic yards of embankment, which was worth $17,409 48; and 1203 lineal feet of bridging, which was worth $12,030, making together the sum of $66,939 48; all of which the Mississippi and Alabama Railroad Company, having taken the place of the Jackson and Brandon Railroad and Bridge Company, assumed to pay, which amount added to the $204,000 and $1,584 above mentioned, made the. sum of $275,000, which the Mississippi and Alabama Railroad Company were to pay respondent on the two contracts, besides the sum of six thousand dollars which they had assumed to pay for his services as engineer, as above mentioned.
    The stipulation in the agreement relative to the in vestment of $100,000 in negroes was made because he thought tli'af with the negroes purchased he could do the work, make them pay for themselves, and have them as his own property at the completion of the contract, when if he had hired laborers lie would have been compelled to pay them high prices, and he would have had but a few thousand dollars left at the completion of the contract, as profit. The sum of $100,000 dollars was advanced to him, and he purchased negroes with it, and placed them on the road according to the agreement. The further sum of thirty-six thousand dollars, or thereabouts was furnished him and invested in slaves, which, by agreement with the company, he also placed as laborers on the road. This last sfihi of $36,000 was paid on his contract, for work which he had done and was willing to do. None of the slaves were purchased for the company or any of the directors, nor did the company or any of the directors have any interest or title in them; further than a mortgage on those bought with the $100,000, to secure the faithful performance of his contract, but subject to the right ■to bar said mortgage, the slaves were his. He did not fail to comply with the agreement to give said mortgage. But soon after the purchase of the slaves, he did execute a mortgage on eighty-one slaves which had cost $95,000. The mortgages so executed were never by said company recorded, though that was not through or by the agency of respondent, but he supposes by the negligence of the company. The mortgages were cancelled at the settlement hereafter stated. He was always ready to execute any mortgage, or give any pledge required by the agreement to secure the performance of his contract. He files with his answer bills of sale, which will show the negroes purchased, their description, the time when purchased, &c. It is not true that he erected a saw-mill with the funds of said company, for which they paid $25,000. He did erect a saw-mill, however, which cost him about $7,000 in cash, besides the labor of his hands; in estimating this labor he put down the labor of negroes at $40 per month, and in this manner the estimate of the saw-mill of $25,000 was obtained. The $7,000 was paid by said company under the contract, but neither the company nor the directors have any right or control over the said mill, the same being the sole property of respondent, built by him to facilitate him in procuring lumber for the road, &c. The oxen, horses and mules purchased to work on the road cost him $12,000 or $13,000; when bought they were his sole property. The money with which they were purchased he received from the company on the contract, which they were bound to pay him. He also purchased tools, perhaps to the amount of $5,000 to be used on said railroad. These were purchased in the same way as the other property, and were his. The horses, &c., have been mostly worn out or destroyed on the road. The railroad iron did not cost $30,000 or $35,000, but with the freight cost about $15,000 or $20,000, and is now attached by the creditors of the company in New Orleans. Respondent claimed it as his property, because the company were to have furnished him the money with which to buy it, which they could not do, and having funds in Liverpool, they ordered said iron to be bought and shipped-to respondent, and respondent was advised that he had a right to the iron, and to its, control, in order to perform his contract, but he never claimed it in any other manner. His claim he still urges for the purpose of laying the iron on the road, which the brother of respondent has agreed to finish. Respondent files with his answer an account current, showing that he had received of the company $298,02181, the greater part of which, was in the notes of the company, and at a discount at the time he received it, and lie had often to use it at a great loss, by which his expenses on the road were much increased. At the time respondent received the $ 125,000, in Brandon money, mentioned in his account, the company were considerably in arrear, and had no other means with which to pay than in that manner, and for the purpose of finishing the road he agreed to receive it. So far from said company having overpaid him, on the 21st day of December. 1839, when a settlement took place, they were considerably in his debt. From the first the company did not comply with their engagements, and they thereby considerably enhanced the cost of making the road, for which he believed in equity he was entitled to remuneration. When the settlement took place he claimed this remuneration, but the directors were unwilling to allow it, and at last a compromise was effected, by which respondent was discharged from any further connection with the road, the agreement rescinded and the mortgages cancelled : the road, so far as done, was received in satisfaction of his part of the contract, and the company discharged from further payments to him. This settlement was made after some delay and difficulty, in the presence and by the advice of counsel employed by the company ; it was fairly made, without anydesign to deceive or defraud any one, and without any claim or pretence of claim by the company, or any one, to the property aforesaid. He files with his answer an account of the additional expense claimed, which is in the following words, to wit:
    “ An approximate estimate of the enhanced cost of constructing the Jackson and Brandon Railroad, Turnpike and Bridge, on account of the failure of the company to comply with their engagements.” “Had funds been furnished in July, 1837, as requested, for the purchase of iron, engine and cars, the railroad and bridge could have been finished at least one year ago, and the stock for sawing lumber could have been conveyed on the railroad by the aid of the engine; also, all the materials for constructing the railroad and bridge could have been conveyed in the same manner, which would have saved the expense of eighty-five horses and oxen, which estimated at 75 cents per day, say 300 days, amounts to . . . . $19, L25 00
    And twelve drivers to attend to same, at $45 per mouth, 12 months, is..... 6,480 00
    Also, extra time of three managers one year, at $1500 each, . ...... 4,500 00
    Loss by being obliged to anticipate the par funds that were voted me by the directory, which were not furnished at the time specified, thereby obliging me to purchase on a credit, at advanced prices, the necessaries for prosecuting the work, say 10 per cent, on $40,000, . 4,000 00
    Loss on $260,000 Brandon money, depreciated 15 per cent........ 39,000 00
    Had I received the iron the bridge could have been built eiglr| months before my contract expired, and I should probably have received in tolls on the bridge and turnpike road . . 5,000 00
    Detriment to myself by detention here, say one year at least, and consequent prevention from entering into any profitable “ engagement that might have offered, say” . , . '• . . 7,500 00
    “ $85,605 00”
    He denies that he was destitute and in poverty when he made said contract; he thinks his property was worth $20,000; he possessed character in his profession of civil engineer, and had never given any one cause to complain of his want of punctuality. He denies that he failed to comply with his contract; he has always been, and still is willing to perform his part of it whenever the company places it in his power to do so. He commenced work on the road soon after the 23d day of February, 1837, and continued to work on it until the 21st day of December, 1839, and during the whole time he was continually hindered by the inability of the company to furnish him funds according to their contract; that by their failure to furnish him money to buy iron, &c., and by the iron purchased for him being attached in New Orleans, and particularly by the inability of the company to procure the right of way, respondent could not finish the road. Respondent has a suit now pending against him for damages in constructing the road over the land of Gardner, and for cutting down timber for that purpose. If the company had complied with their contract, lie would have easily finished the road within the time specified. When respondent ceased to work on the road on the 21st December, 1839, his brother employed respondent’s force on it from that time tilt the 28th April, 1840, when he had to quit for the want of the right of way and of the iron. At the time his brother, F. H. Petrie, withdrew the force from the road, he could have had it in operation in six or eight weeks, if the right of way could have been procured, and the iron could have been had ; and it was not till it was manifest that these obstacles could not be removed, that the hands were withdrawn from the road. It is not true that he abandoned the road not half finished, in a ruinous and worthless condition; on the contrary, the whole of the work is nearly completed, none of it except the grading however, is actually finished. The wood rails are laid except about three-fourths of a mile. The iron is not laid for the reason before stated. The turnouts, turning platforms, side roads, crossings, water stations, &c. are the last work usually done on such roads, and the expense for making them would be very small. The materials are all ready for the ware and engine houses, and they are not erected because the principal cost of them would be the transportation of the materials from the swamp of Pearl river; whereas, if the road was done, the cost would be light; nor is there any necessity for such houses until the road is done. A locomotive and tender were built for the road in Philadelphia, but were not sent on because the company did not furnish the par funds to pay for them ; and the same is true as to the cars. Such was the situation of the road at the time of his settlement with the company. He brought them considerably in debt by his account for damages. The directors, however, were unwilling to allow all his charges, and proposed a compromise, which was finally acceded to as stated above, and respondent’s brother then agreed to finish the road for $15,OCO. The estimate of $226,000 placed upon the property of respondent, is fur more titan it is worth. At the time the executions were levied, the whole of his property was not worth more than $80,000, though it cost more than that sum. The whole of said property, except what was owned by respondent at the time of his contract with the company, was not paid for with money advanced by the company, but a part of it was paid for with money borrowed from his brother, and other parts with money otherwise made. It is not true that he never paid the company anything for the money advanced to him. He made a contract with the company to do certain work, for which he was to be paid a specific price. He has performed his part of the contract as far as he could, and the company have failed to perform theirs, and he has thereby sustained a great loss. Thai the road has not been completed is no fault of his, but is the fault of the company, as they well knew and admitted at the time of the settlement aforesaid. But he is advised, if he had failed to perform his part of the contract,,it was competent for the company tore-lease him, and no one else had a right to complain. He files as an exhibit to his answer, resolutions passed by the directors of said company on the 21st day of December, 1839; by which they directed his mortgages to be cancelled, and admitted their inability to furnish the funds they were bound to furnish for the completion of the road, which resolutions are in these words, to wit:
    “ Resolved, That William Petrie be, and he is hereby released from that portion of his contract, for the construction of the railroad, in which he has obligated himself to furnish a locomotive engine for the same, and that seven thousand dollars, the estimated price, be passed to his credit.
    “ Be it further resolved, That the cashier be required to cancel the mortgage given by said Petrie to this company, now remaining on record on the books of this bank.
    “ Whereas, this company are under obligation to furnish William Petrie, contractor of the railroad, a certain amount of par funds, to enable him to complete the road, and this bank being unable to furnish said funds, therefore
    
      “ Resolved, That the said Petrie be, and he is hereby requested to prosecute said road to completion at his own expense, and that he retain the use of it until the profits arising therefrom shall be sufficient to pay him such balance as this company may owe him after the completion of said road.”
    “ The above is a true copy from the minutes.
    “ R. G. Crozier, Cashier
    
    Respondent admits he wrote the letter exhibited with the complainant’s bill, but denies that he represented the property to belong to the company; he made the estimate to enable the company to show the general manner in which they had laid out their funds, and the extent to which the same had beeu applied on the road. That was a rough estimate, and not precisely cotrect; the amount laid out by him in negroes was only about $136,000, instead of $159,000, as stated in that letter; he not only never admitted that said slaves belonged to the company, but he uniformly claimed them as his own. After the settlement and compromise with the company, he obtained possession of his mortgages by letter from the cashier, and he exhibits with his answer the letter and mortgages. He avers that all the slaves he ever purchased with the money advanced to him by the company, were levied on by said executions in favor of complainants. At any rate, he files with his answer a list of all that were ever so purchased by him. He admits he received other sums of money from the company, which he invested in slaves; he also often borrowed of his brother, P. H. Petrie, considerable sums of money, which he still owes, and invested it in slaves or applied it to the road ; and he also made other sums of money by trading, &c., with which he bought slaves or used it on the road. And he files with his answer a list of all the slaves he ever bought, all of which, except, such as have died, ran away, or been sold, are still in his possession. He repeats that before his final settlement with the company,.he was at all limes ready and willing to mortgage any or all of his property to secure the performance of his contract. His contract had never been declared forfeited by the company, nor the work re-let, because the company, and not he, were in default. He admits that Blow and Crane were appointed commissioners to take charge of and settle up the affairs of said company; that William H. Washington was once a director of the company, and that his brother, F. H. Petrie, has a mortgage on about sixty of said slaves to secure $29,000, which respondent owes him. He denies all fraud, and denies that the complainants have any good cause to believe that any of said slaves will be removed out of this state. Hé then answers each of the thirty-one special interrogatories contained in the bill, but as all of the answers are substantially set out in his answer in chief, it is not deemed necessary to repeat them.
    The answer of F. H. Petrie denies all fraud, and refers to and adopts the answer of William Petrie. He further states, that in December, 1839, William Petrie was indebted to him in the sum of $29,176 81|, for money before that time loaned to him, and to secure the payment of that sum of money, William Petrie, on the 20th day of December, 1S39, executed a mortgage on sixty-eight slaves, which mortgage was duly recorded, and was exhibited with his answer. He avers that at the time he received the mortgage, he was entirely ignorant that the Mississippi and Alabama Railroad Company, or any one for them claimed, or pretended to have any right, title, claim or interest of any kind whatever, in, to, or upon said slaves, either in law or equity; respondent believed them then to be, and he now believes them to be the property of William Petrie. These slaves are a part of the number levied on by complainants ; and respondent claims the protection of the court, to secure him the benefit of his mortgage aforesaid, under any circumstances, inasmuch as he is an innocent purchaser, ignorant of any frauds, trusts, combinations, or contrivances, if any such existed, which respondent does not believe, between William Petrie and the said company or its directors, or any of them. Claiming the benefit of his mortgage, and in nowise or under any circumstances waiving the same, ho proceeds to answer the special interrogatories, &c.
    Robert G. Crozier answered, and denied all fraud. He states that he was a stockholder and director in the Mississippi and Alabama Railroad Company, in the years 1837, 1838 and 1839; that there was a full and final settlement between Petrie and the Company, in December, 1839, which he is satisfied was made fairly and in good faith ; denies that the directors of said company, so far as his knowledge extends, ever used the company to amass large fortunes for themselves, or committed any of the frauds charged in the bill. Some of the directors are in possession of large amounts of property, but he believes they all owe more than their property is worth. The said company, to his knowledge, never bought or owned a negro. Petrie bought a great many negroes to work on the railroad from Jackson to Brandon, and he believes some of them are the same levied on by the complainants. He has no doubt Petrie’s claim to them is founded in justice and equity. And he substantially sustains the answer of William Petrie throughout.
    Henry K. Moss also answered ; denied all fraud, and sustained the answer of William Petrie.
    Neither of the other defendants answered, and the bill was taken for confessed as against them.
    On the 28th day of February, 1842, the complainants filed an amended bill, stating the death of William Petrie, and that he had made a will, by which he appointed Lemuel W. Petrie and Frederick H. Petrie his executors, and conferred on them full power and authority to sell and dispose of all or any portion of his property, either real or personal, they pleased ; that the executors had qualified and given bond in the small sum of $501)0 oidy, an amount entirely inadequate to secure the negroes and other property which they alleged ought to be sold for the payment of their judgments ; that the answers of William Petrie and Frederick H. Petrie to the original bill contained abundant evidence of fraud to justify the decree asked for by the complainants. Charges that the company was utterly insolvent, had been divested of all its officers and dissolved, and that there was no one to take of effects except the creditors. And concluded with a prayer for the appointment of a receiver and for process to take the property out of the possession of the executors, unless they gave another bond in sufficient penalty, and with sufficient security for the safe keeping and delivery of the negroes, &c.
    Process was issued, and the executors gave the further bond prayed for in the amended bill, and retained the possession of the negroes, &c.
    'The answer of the executors to the amended bill admits the death of William Petrie; that he made a will and appointed them executors, and they qualified and gave bond as charged by complainants. They say they gave the bond in the penalty fixed by the probate court, and whether it be too large or small they deny the right of the complainants to object to it, as they are neither heirs, legatees or creditors of William Petrie.' The answer denies all the material allegations of the amended bill.
    The depositions of Samuel M. Puckett, John W. King, Wright Ford, Charles Lynch, and George Adams, were taken and read on the part of the complainants.
    Samuel M. Puckett proved that he was twice elected a director of the Mississippi and Alabama Railroad Company, and served in that capacity until Governor Lynch was elected in 1839; that he was not a director, and consequently not present at the time of the settlement with William Petrie, in December, 1839, and the information he possessed on that subject was derived from Col. William H. Shelton, who informed him that about the time it was necessary for Petrie to go to New Orleans to try to secure the iron for the completion of the railroad, Petrie was afraid to go lest he might be garnisheed by some creditor of the company, on account of his indebtedness to or contract with the company, and that therefore the company had a settlement with him and gave him a receipt in full, and his liabilities on account of the non-completion of the road were transierred to his brother, F. H. Petrie; that Governor Lynch, as president of the company, asked William Petrie how much Brandon money he would take and complete the road, and he replied, one hundred thousand dollars. Governor Lynch counted out that sum, and then handed him twenty-five thousand dollars more to insure the completion of the road ; all of which was received by William Petrie, and all the liability for the completion of the road was transferred from William to F. H. Petrie. Col. Shelton said Petrie never returned the money to the company. The company, in 1839, was embarrassed, and has not improved since. The legislature passed a law to appoint commissioners to settle the affairs of the company; commissioners were appointed, and the company have had neither president nor directors since.
    John W. King proved that he was a director of the Mississippi and Alabama Railroad Company during the years 1837 and 1838; that the company undertook to construct a railroad from Jackson to Brandon, and entered into a written contract with William Petrie to build it. The work was only partially done, no part of the road being finished. That of his own knowledge he knew nothing of the settlement between William Petrie and the Company, made in the latter part of 1839. But ho states that he was an acting directo! of the Jackson and Brandon Railroad and Bridge Company, and a meeting of the directors of that company was held some time in the spring of 1841, for the purpose of ascertaining whether William Petrie intended to carry out his contract for the completion of said road, or not. Several members of the board of directors of the Mississippi and Alabama Railroad Company, and William Petrie were invited to attend said meeting. Col. William PI. Shelton and other directors, and Petrie attended as requested. At the meeting Petrie claimed to be entirely released from any further performance of his contract, and he produced a paper purporting to be a settlement or receipt from the Mississippi and Alabama Railroad Company, by which it appeared that, in consideration of an advance of f>15,000, his brother, F. H. Petrie, was to finish the road and deliver it complete to the company, or he was to finish it at his own expense, and retain the possession of it until out of the first profits of the road he had received that sum, witness could not state which. William Petrie then stated that he, or his brother had failed to complete the road, because the company had failed to procure the right of way, and he had been forbidden by the owners of the land on the route, or some of them, to proceed with the work, and because the iron for the 
      road had not been received as was expected. Col. Shelton’s statement did entirely concur with William Petrie’s. He, Shelton, said the settlement was made for the protection of Petrie on a contemplated visit to New Orleans in relation to, the business of the railroad, and to secure him from molestation while there. That in consequence of the delays and disappointments Petrie had met with from the difficulties in procuring the right of way, and losses suffered on the money he had received, although he had received as much or more than the amount originally agreed upon for the completion of the road, yet in consideration of these facts the company, anxious to secure the speedy completion of the road, agreed to give him a further advance of $15,000, and furnished him with Brandon money, considered equal to that amount of par funds; and receipts were passed as upon a final settlement. Still it was understood that Petrie was to go on and finish the road and furnish everything. Petrie admitted he had received the Brandon money, and considered it his own, and he still had the most of it, as he had not been able to use it on account of its continued and rapid depreciation. At the time the road was worked on, .the land along the route was owned by Richards & Washington, William Petrie, Payne & McKay, R. Downing, James Gourley, Richard Cordell, William H. Martin, Thomas Kinku, William Bailey, T. J. Coffee, H. K. Moss, Dow Kinker, Miller M. Gar-diner, and William D. Hathorn. Witness and William C. Harper, in 1841, undertook to ascertain how far the right of way had been relinquished by the said owners, and they could find no relinquishment from any of them except James Gourley and O. C. Dow for part of the forty-acre lot now owned by H. K. Moss, and a part of the tract now owned by M. M. Gardiner was relinquished by Alexander Mathewson. Witness further testified, that the condition of the Mississippi and Alabama Railroad Company in 1839 was not good, and has since then grown rapidly worse, and is now defunct. The company has ceased to do business since the passage of a law repealing its charter, and since then has had neither president nor directors.
    Wright Ford proved that he was present at the meeting of the directors of the Jackson and Brandon Railroad and Bridge Company, in 1841, spoken of by Mr. John W. King, and he folly corroborates the testimony of Mr. King, as to what occurred at that meeting. He further proved, that the Mississippi and Alabama Railroad Company were in a failing condition in 1839, and has been growing worse ever since; their charter was repealed in the winter of 1840, and since that time they have neither had a president nor directory, and the company are now wholly insolvent.
    Charles Lynch testified, that in 1839, a final settlement relative to the bridge and railroad, took place between Petrie and the company. That he was present at the meeting when the settlement was made, and acted as the presiding officer of the board of directors; that he was appointed a director only a short time prior to the settlement; and not having had anything to do with making the contract with Petrie, and not knowing what had previously taken place between Petrie and the company, deponent took no active part in the settlement, but left it mainly with the other members of the board, to whom the whole transactions were familiar. He does not recollect whether the settlement was reduced to writing or not; that the books of the company are not in his possession, nor does he know in whose possession they are, and he cannot, therefore, state any items of the account. Pie could not pretend to say whether the company, at the time of the settlement, were solvent or insolvent; yet he could state that it was represented at the time by the officers who kept the books and accounts of the company, that the debts due them far exceeded their liabilities. Deponent could not say positively, but, according to the best of his recollection, the notes of the company were worth in the market, at the time of the settlement, about twenty, or twenty-five cents on the dollar. No bridge over Pearl river has been completed, though a great deal of work has been done on it.
    •Being cross-examined, he said there was no fraud or collusion between Petrie and the directors of the company, in making the settlement, and, so far as he knew, it was fair and bona fide. 
      At the time of the settlement he heard Petrie complain of the company, and state that he had suffered by their failure to comply with their part of the contract. During the investigation of the accounts there was some excitement and warmth manifested; and after the settlement was completed he heard Petrie complain that the company had not allowed him as much as he was entitled to. He has no distinct recollection of the cause assigned then, by Petrie, for not proceeding and com-, pleting the work; but he is under the impression that the cause then assigned, was, that the company could not, or would not, furnish him with the means necessary for that purpose; and after that time he heard Petrie say he was stopped by the owners of the land through which the road passed, and prevented from proceeding with the work. There was a great' deal of work done on the bridge and railroad, by Petrie, but he had not sufficient knowledge of those things, to say in what the chief cost and labor on the work done consists. He could not say whether there were any judgments against the company at the time, or not.
    George Adams testified, that, in 1839, he was present when the president and directors of the Mississippi and Alabama Railroad Company and William Petrie had a meeting, to settle their accounts for building a railroad from Jackson to Brandon. The directors and Petrie were seated around a table, with their accounts spread out before them, and he was seated at some small distance from them. He had been previously called on by the company, and gave them legal advice; but on that occasion they did not ask, nor did he give any advice. He examined none of the accounts, nor can he give any of the items of either of them; nor can he say what took place during the settlement. But' after it was over he heard Petrie, or some of the directors, or both, say that it resulted in a balance in favor of Petrie; the amount of the balance he does not recollect. Deponent cannot undertake to say whether, at the time of the settlement, the company were solvent, or insolvent; but it was the opinion of the directors, or some of them, often expressed to deponent, about that time, that if the company could collect what was due them they would have sufficient means to pay their debts, and have al least a million and a half dollars over. The notes of the company, he thought, were worth when the settlement was made, about twenty-five or thirty cents on the dollar. The bridge over Pearl river was not then completed; but Petrie had done a great deal of work on it. He could not say whether there were any judgments against the company at that time, or not.
    On cross-examination, he said- he knew of no fraud or collusion between Petrie and the company, in making the settlement; and, so far as he knew, it was fair and bona fide. He heard Petrie complain of the company, and say he'had suffered by them ; but in what way, or to what extent, deponent could not say. After the settlement he heard Petrie say the company had not allowed him as much as he was entitled to. He understood to assign as a cause why he could not proceed with and complete the bridge ánd railroad, that the company would not, or could not, furnish him funds necessary; if he assigned any other reason, or cause at the time of the settlement, deponent does not recollect it.
    On behalf of the defendants the depositions of Robert G. Crozier, William H. Shelton, Thomas J. Coffee, William G. Bullock, Henry K. Moss, John T. Blow, Hamilton Washington, Frederick H. Petrie, and Thomas P. Falconer, were taken and read in evidence.
    Robert G. Crozier proved that he was appointed a director of the Mississippi and Alabama Railroad Company in 1837, "and he continued to act as such for several years; that the company made an agreement with William Petrie, a true copy of which is exhibited with the bill, to build a railroad from Jackson to Brandon ; that Petrie purchased slaves, and placed them on the road according to the agreement, but never executed any mortgage on them to the company, to his knowledge ; that the company never owned, or claimed any slaves or other property purchased by Petrie, except the right to a mortgage on the slaves for the performance of the contract; that Petrie worked on the road until he was stopped by the owners of the land through which it passed. There was a final settlement between the company and Petrie, made in good faith and without any fraud, as he believes, when William Petrie was discharged, and it was understood that F. H. Petrie, should complete the road, and retain the use of it until it paid him a balance of 15,000 dollars. William Petrie was paid in the notes of the company, and made great sacrifices in getting par funds for them, and the company agreed to make up the loss to him. Petrie frequently complained of the want of faithfulness of the company, in keeping their part of the contract. At the time of the settlement the company were indebted to Petrie, according to his account, though the balance claimed was compromised. When Petrie entered into the contract with the company he was, as deponent believes, in very good pecuniary circumstances, and stood well as an efficient engineer, and worthy man. On being cross-examined, he said he believed the contract made by the company with Petrie was made in good faith, and intended to be carried out; he thought Petrie quit work on the road in 1839; deponent could not state the value of the road when Petrie quit; no part of it was finished; he believed Petrie abandoned it in consequence of the failure of the company to procure the right of way ; he could not say how many of the owners of the land through which the road passed were engaged in stopping Petrie from working -on it, but he knows Hamilton Washington, who was one of the owners of the land on Pearl river where the railroad bridge was to be built, refused to suffer Petrie to work on it any longer, unless Petrie would pay him $6000. The company abandoned the road, temporarily, because they had not funds to carry it on; and because they were not able to get the right of way from the owners of the land. Deponent could not tell how much money was paid Petrie, nor why the company agreed to pay $15,000 for the completion of the road. He was not present at the final settle-■ ment, and could not say what pledges were made by William Petrie, for the completion of the road. Petrie was paid in the notes of the company, and had to make sacrifices in getting good funds for them; and deponent has frequently heard the company say they would lose the discount. He knows of his own knowledge, that the company several times failed to furnish Petrie with par funds, and entirely failed to get the right of way. He knew Petrie well, and his services as an engineer, five or six years ago, would have commanded six or seven thousand dollars a year. Deponent said he did not think the entire superstructure of the road was finished, though it was nearly all done; there are no turnouts, turning platforms, side roads, water stations, nor warehouse made; he understood a locomotive and tender, and some cars, had been built for Petrie, but he could not say whether they had ever been received or not. He further testified that some railroad iron had been purchased, but he did not know who paid for it, though it was attached in New Orleans by the creditors of the company, and he thought it had been sold.
    William H. Shelton testified that he was appointed a director of the Mississippi and Alabama Railroad Company, at the commencement of its operations, and continued as such as long as the company did any business as a bank; that he has examined the agreement filed as an exhibit to the bill, and believes it to be a true copy of the agreement entered into by Petrie and the company; that Petrie was employed as an independent contractor, to build the road. The company never had any right or interest in the slaves and other property bought by Petrie to carry on the work, except by virtue of a mortgage, or mortgages, executed by Petrie to the company, on a portion of the slaves, to secure the faithful performance of his part of the contract. Petrie executed one or more mortgages to the company, in conformity with their agreement, which were recorded on the books of the company, and subsequently delivered up to Petrie. William Petrie worked on the road until he suspended for the want of funds, which the company had promised to furnish him; but failed to do so from inability. F. H. Petrie afterwards undertook to carry out the contract of William Petrie, and worked until he was stopped by the owners of the land through which the road passed. He further testified, that during the presidency of Charles Lynch, the precise date he could not recollect, there was a -final settlement -between Petrie and the company. During the settlement it appeared that the account against William Petrie had been improperly kept, by order of the cashier, under -the head of “ Railroad Expenditures,” and he was charged with.various, amounts,, not. properly chargeable to-him. Upon a review .of the whole matter, taking into consideration the losses sustained'by-Petrie» by> being delayed in the work for want opfunds, loss on uncu-rrent money, injury sustained by -freshets, ■ decay of timber, &c'., it was agreed by the company, that if William Petrie would complete the work, according to his contract, the company would release all claims against him, and pay him out of the receipts, of the road, after it was complete, the sum of $15,00Q. William Petrie’s health not being good at that time, his brother, F. H. Petrie, proposed to fulfil his contract, and the company-agreed he should do so, upon William Petrie’-s- -pledging himself for his, F. H. Petrie’s faithful performance. F. H. Petrie commenced his labors soon afterwards, iand continued to work until he was stopped, as above stated.,. Deponent .never heard, of William Petrie’s having purchased, any property for the com-, pany, and does not believe he ever did ; there never was any agreement made, or any understanding existing, that the property purchased by Petrie should be held in trust for the company ; nor was there any fraud intended or committed in the settlement of the account; it was a'fair.and open settlement, made by a majority of the board of directors, and although objections were made to some charges in the .accounts, on both sides, yet, in conclusion, all expressed satisfaction,. with the result, and claimed nothing from Petrie, except the. completion of the road. And when that was done-he was entitled, as> before stated, out of the first receipts, to the sum of $15,000., Deponent’s acquaintance with William Petrie commenced with» Petrie’s engagement as engineer for the Jackson and Brandon, Railroad and Bridge Company, and his recommendations and references then placed him on elevated ground, as a gentleman and an efficient engineer; and .he was,.represented as having some capital, and his credit was very good. The negroes purchased by Petrie were paid for in the notes of the company, upon Petrie's drafts; and he complained of having to pay higher prices for the negroes, on account of the character of the funds in which the payments were made. Much the largest portion of the advances made to Petrie for other purposes than the purchase of negroes, was in the same kind of funds, and he often complained of the trouble and loss he sustained on that account. And deponent has always thought that those losses should be made good by the company, but he does not know of any specific understanding that Petrie was to dispose of the money, and only account for the net proceeds, except in one instance; in that instance he drew a hundred, or a hundred and twenty-five thousand dollars, in the notes of the company, and took them to New Orleans, for the purpose of getting the railroad iron ; and he was" instructed to use the money to the best ad vantage, and account for the net proceeds. In the final settlement, however, the losses sustained by William Petrie upori other advances, were taken into the account. Petrie alwaysmanifested a desire to finish the road, and complained of the company’s failing to comply with their part of the contract.
    On being cross-examined he testified, that he did not know of any other contract being made between Petrie and the Mississippi and Alabama Railroad Company than the one filed as an exhibit to the complainant’s bill, unless the settlement be considered one on taking F. H. Petrie as a substitute for William Petrie. There was a written contract between Petrie and the Jackson and Brandon Railroad and Bridge Company which he thought was done away with by the contract with the Mississippi and Alabama Railroad Company ; that he does not recollect how many mortgages were given by Petrie to the company, though he was under the impression there were two or three, and they were handed to the cashier for record in a book kept by the company for that purpose, and one or two were so recorded, but the record of them in probate clerk’s office was neglected; they were ultimately given up to Petrie by the order of the board of directors. He does not recollect, and not having the books before him he cannot now give the number of negroes mortgaged. For a history of the proceedings of the board, of directors held on the 7th day of March, 1840, he refers to the exhibit filed with the deposition of John T. Blow. The contract made with Petrie was made with a bona fide intention on the part of the company of prosecuting the work to completion. From the ledger of the company it appears that William Petrie has, upon his checks and drafts, drawn the sum of $294,794 91, and a charge is made against him of $17,266 95, for railroad iron, which was taken from him in New Orleans, and which, if he is properly chargeable with it under the contract, will swell the sum to $312,061 86. On the 18th day of November, 1839, he is charged with the further sum of $125,000, which is the same that was furnished him when he was about to start to New Orleans for the railroad iron, and which he was authorized to dispose of on the best terms he could. On the final settlement, Petrie stated that not having been able to get the iron he had not disposed of the $125,000, and he accounted to the company for it at 18 cents on the dollar. Deponent could not say how many slaves were purchased by Petrie, nor what those purchased cost. In 1838, Petrie addressed a letter to deponent, as president of the company, stating something like the amount that had been expended on the road up to that time; deponent had not a copy of that letter before him and he could not give the particular items of expenditure ; the only one he remembered was, $159,000 for slaves, though there was probably other property included in that item. The principal part, and perhaps all of the money expended came from the company. It appears from the ledger, above referred to, that up to the 27th day of July, 1838, Petrie had drawn upon checks and drafts $234,030 83. The company have never either abandoned the road, nor released William Petrie from its completion, further than to agree that F. H. Petrie might fulfil the contract, upon William Petrie’s guaranteeing that he should do it in good faith. After that agreement, F. H. Petrie commenced work on the road and bridge at Jackson, and continued until he was stopped by Washington, and other owners of the land through which the road passed. He could not say precisely when F. H. Petrie commenced or quit work, nor the value of the road when he quit. No work has been done on it since, and in its present unfinished state he did not consider it of any value. Thé railroad iron was bought at the request of William Petrie, and Messrs Humphreys and Biddle charged the company for it $17,266 95, and the company paid it. The iron was shipped to New Orleans in the name of “William Petrie, contractor, &c.,” and was attached in New Orleans as the property of the company and has never been received. Deponent does not believe that according to the original contract the company were- indebted to William Petrie at the time he stopped work for want of funds; but in the early part of the year 1838, Petrie asked an extension of time for the completion of the road, and for reasons then assigned and deemed satisfactory by the board, he required an advance of forty or forty-four thousand dollars in par funds, to be paid in instalments all falling due in the year 1838, the board thought they could meet the payments, and therefore promised the advance, but in consequence, of the pressure of the company in 1838, they did not furnish more than $10,000, and that was paid in a certificate.of deposite of the Bank of the United States, and is improperly charged on the books at 15,000. Deponent supposed, until he examined the books, that the agreement to give the extension of time and make the advance spoken of, had been recorded, but he has not been able to find any record of it, and he therefore' only speaks of it from memory. He knew that Petrie presented his petition in writing, which was marked at the board, “agreed to,” and handed to the cashier. The present impression of deponent is, that this advance was asked and granted over and above what Petrie could have claimed, under his contract as due him. Before Petrie went to New Orleans a partial and not valid settlement was made, and several documents given him in special trust to guard and protect him from the New Orleans calaboose; but the final settlement, so far as deponent knows or believes, was bona fide and made in good faith, and in the firm confidence on the part of the company that the railroad and bridge would be completed by F. H. Petrie, according to the then understanding with as little delay as possible. For a copy of the resolutions passed on the 10th day of September, 1839, he refers to the deposition of John T. Blow. . Those resolutions were passed according to the best of his recollection, in consequence of the representations of William Petrie that without something of the kind to take with him, he might be garnisheed in New Orleans as a debtor to the company, and a copy of the resolutions was handed to him when he left for New Orleans for the purpose of attending to the release of the' railroad iron. There was no written obligation taken from F. H. Petrie, or William Petrie as his surety. Deponent knows nothing of the value of William Petrie’s services as an engineer, further than that he received, as engineer of the Jackson and Brandon Railroad and Bridge Company, a salary of $7,500 per year.
    William G. Bullock testified, that he always understood the slaves and other property purchased by Petrie were his property, and the company never had or claimed any ownership of them so far as deponent knew or ever heard; Petrie never acted as the agent of the company, but as an independent contractor. Petrie was paid principally in the notes or issues of the company, on which he made repeated sacrifices to get par funds, and once, by agreement with the company, when the notes were greatly depreciated, sold them for their market value. Petrie was anxious to complete the road, and often complained that the delay of the company to furnish him the means to progress with the work was subjecting him to heavy losses. Deponent knew nothing of Petrie’s pecuniary circumstances, but his character as an honest man was unimpeachable; he was a trustworthy gentleman, and a capable engineer. On being cross-examined, he said he was connected with the company as bookkeeper and teller, and kept part of the account in which Petrie’s checks and drafts were charged, under the head of “ railroad expenditures.” He copies from the books, and files with his deposition the account against Petrie, from which it appears that Petrie is charged with $451,556 11. The $125,000 furnished Petrie when he visited New Orleans to release the railroad iron, and $17,266 95 for the purchase of the iron, are charged in the account. On being re-examined by the defendants, he stated that there were between forty and fifty thousand dollars improperly charged in the account to Petrie.
    Thomas J. Coffee testified, that he was appointed a director of the Mississippi and Alabama Railroad Company in December, 1836, and continued to acf as such until the charter was repealed by the legislature; that he has examined the agreement exhibited with the bill, and is satisfied it is a true copy of. the contract between Petrie and the company for building a railroad. The company never had any right or interest in any slaves or other property purchased by Petrie, except by virtue of a mortgage or mortgages executed by him to the company upon a portion of the slaves. Petrie executed one or more mortgages to the company which were recorded on the books of the company, and subsequently cancelled and given up to him ; that he worked upon the road until he was prohibited by the proprietors of the land through which the road passed; that there was a final settlement between Petrie and the company, at which time the company acknowledged themselves indebted to Petrie in the sum of $15000 whenever the road should be completed; and he was, when completed, to retain possession of- it until the profits should pay him that amount, and then deliver it up to the company in good order. After the settlement the company had no claim or interest of any kind in the slaves and other property bought by Petrie. He does not believe there was any fraud intended or committed in the settlement. It was agreed that F. H. Petrie should finish the road in lieu of William Petrie, and retain it until it paid him $15000. When Petrie made the contract with the company he owned fifteen or twenty slaves, was unembarrassed, and sustained a high character as an efficient engineer and a trustworthy man. Petrie was paid principally in the notes of the company, upon a portion of which he frequently represented to the directors he was compelled to submit to serious loss, and in the final settlement those sacrifices were taken into consideration, but anterior to that time deponent has no knowledge that Petrie was authorized by the company to make such sacrifices, except in one instance, when he drew about $100,000, to redeem the railroad iron attached in New Orleans. Petrie manifested a desire to finish the work, and often complained of the company’s failing to comply with its part of the contract. Deponent does not know of any other contract between Petrie and the company except that exhibited with the bill. He knows that Petrie refused to act in any other capacity than that of contractor. On cross-examination he testified, that there were two or three mortgages executed by Petrie to the company, but he did not think they were ever recorded in the probate office, and presumed it was through the negligence of the officers of the company. He could not say how many negroes were mortgaged, nor where the mortgages now are unless they are in the possession of Petrie. By reference to the books of the company he said it appeared that the directors met on Ihe 7th day of March, 1840, and he referred to the deposition of John T. Blow for a history of the proceedings of that meeting. Pet,rie purchased about 140 or 150 negroes, but deponent does not know whether they are the same involved in this controversy. Nearly all of the superstructure of the road has been finished, though no turnouts, turning platforms, side roads, water stations, or warehouses have been built, and no locomotive, tender, or cars have been furnished. The iron was ordered from Liverpool to build the road, but he does not know how much was paid for it. William Petrie gave up the road to his brother, when the company had a final settlement with him, and the company have abandoned the road ever since the legislature repealed their charter. The contract with F. H. Petrie was only verbal; the road has never been finished nor delivered to the company. Hamilton and Fairfax Washington at Jackson, threatened to prevent by force the prosecution of the work on their land. The superstructure was everywhere else completed except at the depot at Brandon, where M. Gardiner, another proprietor of the land, objected to the continuance of the work. He further stated that he visited William Petrie at his residence shortly after he commenced building the road, and he then told deponent he owned several valuable negroes, and was worth about or upwards of $20,000, and was unembarrassed. Deponent cannot say what his estate is now worth.
    Frederick H. Petrie testified, that William Petrie undertook to build the road in the character of an independent contractor, and not as the agent of the company; that he purchased the negroes, horses, oxen, &c. in his own name, and for his own use, and always considered them his own property, subject only to the mortgages in favor of the company as security for the performance by William Petrie of his contract with them. The mortgages were executed and are filed as exhibits to William Petrie’s answer. Petrie worked on the road two years and nine or ten months, and then ceased for want of the right to proceed. About seven-eighths of the whole road were finished when Petrie ceased to work on it. In December, 1839, a final settlement was made between the company and Petrie, at which time the company were found to be indebted to Petrie in the sum of $15,000 for the completion of the road. William Petrie was discharged from the further prosecution of the work, and it was agreed that deponent ^should finish the road for the $15,000, and if the company were not prepared to pay it, he would retain the possession of the road until he was paid out of the tolls. At the time the contract between William Petrie and the company was made, Petrie’s pecuniary condition was very good, his character beyond reproach, and his reputation as a civil engineer equal to that of most men. Since the settlement the company have never asserted any claim whatever to the negroes and other property purchased by Petrie, but have regarded it as Petrie’s, freed from the mortgages. Deponent does not know in what kind of funds the company paid Petrie, but believes they paid him in their own notes, which were below par at the time, and that at one time Petrie was authorized to dispose of them at their market value. He knows that Petrie was anxious to finish the road, and frequently complained that he was delayed to his sermus injury on account of the failure of the company to comply with their contract; and on the final settlement he relinquished the balance he claimed to be due, solely for the sake of a compromise. On cross examination, deponent testified, that Petrie encountered lime stone rock in excavating the ridge near Brandon. lie cannot say precisely, hut thinks the wooden rails are laid on the whole road except about seven-eighths of a mile nearest to Brandon; that deponent worked on the road about three months, and employed from sixty to eighty hands, all belonging to William Petrie, and he thinks their labor was worth from nineteen hundred to twenty-five hundred dollars. He states that he is interested in this case only to the extent of his lien on the slaves for the payment of $29,000, and he does not depend on the result of this suit for the liquidation of that claim.
    John T. Blow testified, that he was elected a director of the Mississippi and Alabama Railroad Company in 1839, and served until some time in 1840; that the company never had any claim or interest in the negroes and other property purchased by Petrie save what they acquired by the mortgage executed to them on some of the negroes in pursuance of his contract. Petrie worked on the road two years and upwards, the whole route was graded, and' the superstructure laid down except within a mile of Brandon, and about half that distance at the termination of the road at Jackson, when Petrie was driven away by the landholders. On the 21st day of December, 1839, there was a'final settlement between Petrie and the company, when' Petrie was released from the further prosecution of his contract, his mortgages cancelled and given up, and everything settled to the entire satisfaction of the parties; at the same time a contract was made with his brother, F. H. Petrie, to complete the road, for which the company were to give him $15,000. At the time of the settlement, William Petrie was-not indebted to the company, nor did they claim any ownership over the slaves and other property. Petrie was paid chiefly in the notes of the company, and he must have made considerable sacrifices in using them, as they were greatly depreciated when most of them were paid him. So far as the knowledge of deponent extends, and he has had every means of knowing, having served in the institution from its commencement as clerk, and recorded the contract between Petrie and the company, he believes the contract was made and fulfilled in good faith on the part of Petrie. Being cross examined, he said he knew of but one mortgage given by Petrie to the company, that one deponent recorded on the books of the company, but he does not believe it was ever recorded in the office of the probate clerk. There was a meeting of the directors held on the 7th day of March, 1840, and the following is a true copy from the books of the proceedings of that meeting, to wit:
    
      “ Jackson, March 7th, 1840.
    “ The board met agreeably to adjournment; present, Charles Lynch, President, William H. Shelton, Thomas J. Coffee, Thomas P. Falconer, H. K. Moss, and John T. Blow; John T. Blow acting as secretary.
    “ Resolved, that the president and directors of the Mississippi and Alabama Railroad Company have had under their consideration the last act of the legislature, to repeal the act incorporating said company, and have come to the conclusion, without denying or admitting its constitutionality, to submit to and confirm so much of the repealing act, as contemplates the repeal of the banking powers and privileges of said company; but protest against the constitutionality of such repealing act, in relation to the powers and privileges and property required in the railroad, by and under the act authorizing and incorporating said company; and they consider themselves authorized to go on as a railroad company and complete said railroad, on which they have already expended upwards of $300,000 ; that by a resolution of the board passed and recorded long prior to the passage of said repealing act of the legislature, to wit, on the 21st December, 1839, a transfer was made of all bills receivable, held by said company, for the purpose of paying the debts and claims against said company; and the president and directors will proceed in the name and right of the said railroad company to manage its affairs for the purpose of paying its debts and completing said road, if practicable, and will rely for their justification and the protection of the property and rights of the stockholders, in said company, upon the 10th section of the 1st article of the constitution of the United States, and the 19th section of the 1st article of the constitution of this state, and they might justly claim the protection offered, even by the late legislature of Mississippi in an act passed subsequent to the act repealing the charter of this company, which expressly exempts and saves from repeal the charters of the several banks of this state which have completed in whole or in part any .railroad or work of internal improvement, and that such bank shall only forfeit and surrender their banking privileges, which privileges this board has long since ceased to exercise ; and they will not exercise any banking power or privilege hereafter; but the powers, rights, and privileges of the corporation as a railroad company, they will endeavor to maintain under the national and state constitutions and the charter of said company, which they feel themselves bound to do for the interest of the stockholders and the benefit of the public.” The amount of expenditures named in said proceedings, so far as the same are in compliance with the contract of Petrie, deponent believes to be correct. The contract with Petrie deponent believes was made in good faith.' He knows of no money placed by the company to the credit of Petrie in Philadelphia or elsewhere; Petrie commenced work on the road in 1837, and his brother quit in the spring of 1840. The superstructure of the road was nearly finished; there’were no turnouts, platforms, side roads, water stations, nor warehouse built, and no cars, locomotive nor tendér procured; nor has the bridge over Pearl river been finished. The road, he believes, has been abandoned by the company but he cannot say when they came to the conclusion to abandon it; William Petrie has not worked on the road since he was discharged on the 21st day of December, 1839, though his brother has worked on it since then under the contract made with Him; and since he quit work nearly all of the timbers have decayed ; Petrie was stopped from working by H. Washington at one end of the road, and M. Gardiner at the other. The railroad iron was purchased in Liverpool by Messrs. Humphreys & Biddle, by order of the company, and charged to the company; it was attached in New Orleans by the creditors of the company, and has since been sold under the attachment, as deponent has understood. The accounts between Petrie and the company were settled in the usual way, each party producing their account in writing. When the final settlement was made, Charles Lynch, T. P. Falconer, William H. Shelton, T. J. Coffee, R. M. Hobson, H. K. Moss, John T. Blow, and R. G. Crozier were the directors present. According to Petrie’s account the company were then indebted to him about $30,000; but being in bad health and anxious to close his business with the company, he agreed, for the sake of compromising, and closing his accounts, to relinquish the balance claimed, upon their discharging him from his contract and permitting his brother to complete the road and retain possession of it until the profits paid him $15,000. On the 10th day of September, 1840, there was a meeting of the directors, and the following is a true copy of the proceedings- of that meeting, to wit:
    “Whereas, under a contract entered into by this company with William Petrie, being dated on the , 183 , this company undertook among other things to furnish money to the said Petrie to purchase negroes, iron, cars, &c. to enable him to construct the railroad from Jackson to this place; and whereas, the said Petrie on his part, obligated himself to construct the said railroad for a certain amount of money therein named, to applied to the payment of the advances made to him under said contract, and furthermore mortgaged to this bank all the negroes purchased to work on said road for the purpose of securing to the company the faithful construction of the railroad and for the payment of such balance as may appear against said Petrie, after the railroad is fully completed and delivered to this company; and whereas, questions have arisen whether said Petrie can now or at any time before the completion of the railroad be considered as a debtor to this company, and if so, in what kind of funds the same is to be paid; Resolved, therefore, that this company do not consider Petrie indebted to the company at this or any future time until the railroad is completed, and when that event takes place this company never have and never will claim in payment any other funds than their own issues for the said balance, if any may appear against him upon a final settlement, after the railroad is completed and received by this company, .or the job abandoned by the contractor.” The pledge made by William Petrie, that his brother, P. H. Petrie, should complete the road, was a verbal one; it was to have been drawn up in writing, but the directors never held a regular meeting after that time, and it was never done. F. H. Petrie proceeded to work on the road under the verbal contract, and continued until he was prevented by Washington from going any further. In the final settlement made on the 21st day of December, 1839, the cost of a locomotion was charged to Petrie; the resolutions passed by the board on that day are as follows, to wit: (These resolutions are the same exhibited with William Petrie’s answer, and are not therefore inserted here.) Being re-examined by the defendants, he knew of some items improperly charged to William Petrie, that appeared in the account under the head of “ railroad expenditures.” There was one item of $8,000, which was paid to F. H. Petrie for surveying the route from Paulding to Mississippi and the harbor at that place ; another item was for expenditures on the Jackson and Brandon Railroad and Bridge Company; and there were still other items not properly chargeable to William Petrie, under his contract. The book-keeper, to save the trouble of opening a separate account against William Petrie, kept the whole account of expenditures under one head.
    Thomas P. Falconer testified, that he was appointed a director of the Mississippi and Alabama Railroad Company at its commencement, and continued a director as long as they continued to do business; but living a hundred miles or more from Brandon, he seldom attended the meetings of the board, and his knowledge of their actings and doings’ was consequently very limited. He has examined the copy of the agreement made by the company and Petrie, exhibited with the original bill, and he believes it to be correct. Petrie did work on the road in pursuanee of his contract, but how long he worked, how much he did, and why he ceased, deponent could not say. The negroes and other property purchased by Petrie were purchased in his own name, for his own use, and as his absolute property; the company never had or claimed any interest in them, so far as deponent knows or believes. Deponent believes Petrie acted in good faith as the contractor of the company. There was a final settlement of the accounts between Petrie and the company, and deponent believes there was at that time a balance in favor of Petrie, but how much he does not know. On cross-examination, he stated that he had answered the direct interrogatories from his own knowledge and recollection of the facts acquired in his capacity as a director. He does not know how much money the compaay expended on the road. The contract required Petrie to build the road, and if released from it, deponent does not know when, nor how it was done; he cannot say whether the final settlement was reduced to writing or not, he never saw it, ándifit was reduced to writing, he doesnot know who has it now.
    Hamilton Washington testified, that he claimed the land over which the road ran for about three-quarters of a mile, or a mile, and had never granted the right of way to the company; that when he purchased the land in the fall of 1839, Petrie was proceeding to construct the railroad, without the company having acquired the right of way from the previous owners, and without their taking any steps to acquire it from deponent; he, Petrie, had committed a good deal of waste, and was committing more when deponent required that the work should cease, or the right of way be acquired in a legal manner. Neither was done, and he went upon the land to stop the trespass by force; the workmen left the road, however, upon being required to do so, and thus rendered force unnecessary. About that time, he cannot say whether it was before or after the hands were sent off, he was informed that the work would go on, and the workmen be protected by an armed force; he made preparations to resist such force, and sent a friend to Mr. Petrie, requiring that if such intentions were entertained he should name the time when the attempt would be made, that deponent might be on the ground to meet it. Mr. Petrie was made to understand fully that he could not go on with the work unless the right of way was legally acquired, or he could take on the ground a larger armed force than deponent was able to resist. Deponent notified Petrie that he was a trespasser and liable for all the damages he had committed, though no legal steps had been taken by deponent to render him liable. Being cross-examined, he said he had.never examined the road sufficiently to say rvhether that part of it passing through his land was as nearly finished as the balance of it, or not; when he stopped the hands they had completed, or very nearly completed laying the rails of the bridge over Pearl river, one end of which rested on deponent’s land; the piers only were built, and no work has been done on it since the hands were driven off, as above stated.
    Henry K. Moss testified, that he was appointed a director of the Mississippi and Alabama Railroad Company on the 15th day of February, 1837, and continued to act as such until the charter of the company was repealed by the legislature; that he has examined the copy of the contract made by the company and William Petrie, for building a railroad from Jackson to Brandon, exhibited with the original bill of the complainants, and he believes it to be correct; that the company never had or claimed any right or interest in the slaves and other property purchased by Petrie to build the road, except such as they acquired by the mortgage executed to them by Petrie in pursuance of his contract; he purchased the" property in his own name and for his own use, and never held them in trust or for the benefit of the company. He executed a mortgage on the slaves in favor of the company, which was subsequently cancelled and given up, In the month of December, 1839, there was a final settlement of accounts between Petrie and the company, and after that time the company did not claim, nor did they have any interest of any kind in said slaves. At the time of the settlement the company were indebted to Petrie, and he agreed to release the balance in his favor, if they would come to a final settlement with him and release him from his contract. They agreed to do so, provided F. H. Petrie would undertake to complete the road for $15,000, and upon F. H. Petrie’s agreeing to do so, the final settlement with William Petrie was made. William Petrie worked upon the road in pursuance of his contract for two years and a half, or more, when he was forced to quit in consequence of the refusal of the owners of the land through which the road passed, to grant the right of way; he ceased to work on the road in December, 1839. Deponent cannot compute the amount of work performed, but the road was nearly completed from Jackson to Brandon. Petrie was paid in the issues of the company, except in two or three instances when good funds, to a small amount, not exceeding fifteen or twenty thousand dollars, were paid him, and he made repeated sacrifices in using the money. Deponent knows the loss sustained by Petrie on the money paid him by the company, was frequently the subject of conversation between the members of the board of directory, and sometimes at the board; and it was considered that in justice and equity, some allowance ought to be made him on account of such loss, when a ijnal settlement took place; deponent does not think that any specific agreement was made that Petrie might procure pat-funds by selling the notes of the company at the market price, to finish the road. On one occasion, however, $125,000 in the issues of the company were advanced to him, for the purpose of procuring the iron, with the understanding that he was to be charged therefor only what the issues might bring in the market. William Petrie was very anxious to finish the road, and repeatedly complained that the company delayed him to his great loss. Deponent was not fully acquainted with the pecuniary circumstances of William Petrie when he made the contract to build the road, but knows he possessed some twelve or fifteen negroes, a carriage and horses, &c., and had a considerable amount of money. His letters and references proved him to be a gentleman of the first respectability, and an efficient engineer. On cross-examination he stated that he knew of no other contract between William Petrie and the company than that exhibited with the bill; that of his own knowledge he could not say what property was embraced in the mortgage or mortgages given by Petrie to the company; he never saw them, and what he has said in reference to them was stated upon information derived from others. By reference to the minute book of the company it appears that there was a meeting of the directors on the 7th day of March, 1840, and for what was done at that meeting he refers to the copy of the proceedings given in the deposition of John T. Blow. The amount therein stated as having been expended on the railroad he believes is rather under than over the true amount. Deponent knows the company contracted with Petrie with the bona fide intention of prosecuting the road to completion. William Petrie commenced work in March, 1837, and quit about the 21st of December, 1839, when he was succeeded by his brother F. H. Petrie, who continued the work until March, 1840, after which the whole or a part of the negroes were employed in the cultivation of cotton. The railroad iron was bought and paid for by Humphreys & Biddle, charged by them to William Petrie, and the price of it deducted by the company from his contract; it has never been received either by Petrie or the company, and he don’t know, of his own knowledge, what has become of it, though he has heard it was attached in New Orleans. He cannot state the time when, and the particulars wherein the company failed to comply with their contract, but knows they did frequently fail to do so. William Petrie gave a verbal promise that F. H. Petrie should finish the road at the price stipulated ; the contract has not been fulfilled, nor has the road been delivered up to the company. In the final settlement the losses sustained by Petrie on the money paid him by the company were taken into consideration; the company were not in the habit of making up losses sustained by those who borrowed money from them, but that justice was extended to Petrie, their only contractor.
    The defendants also read in evidence, at the hearing of the cause, the transcript of the record of a suit brought by Martin Gardiner against William Petrie and others, in the circuit court of Rankin county.
    
      Upon the foregoing pleadings and facts the chancellor rendered a decree setting.aside and annulling the settlement alleged to have been made on the 21st day of December, 1839, between William Petrie and the company, and appointing Jacob F. Foute a commissioner to take and state an account between the parties, and directing that the commissioner, in taking and stating the account, should charge the executors of William Petrie with all payments and advances made to him, and to allow them the value of the work done under the contract by William Petrie, to be estimated with reference to the amount to be paid for the whole work. The chancellor also appointed F. S. Hunt as receiver, to take possession of, manage and control all the slaves and other property mentioned and described in the pleadings in this cause, and hold the same subject to the final decree of the court, unless the executors of William Petrie should, within ten days from the date of the order, execute bond with such security as should be approved by the chancellor, in the penalty of sixty thousand dollars, conditioned for the forthcoming and delivery of the property, to answer the final decree in this cause. The executors gave the bond required and retained the possession of the property.
    By the report of J. F. Foute, the commissioner appointed to take and state an account between the parties, William Petrie’s executors are charged with $414,535 98, and credited with $216,016 80, leaving abalance against them of $198,519 18. Exceptions were taken by the defendants to the report of the commissioner, which were referred to David Shelton, who sustained several of the exceptions, and overruled the others, and reported a balance of $73,147 34 against the executors.
    Upon the coming in of Shelton’s report, the defendants appealed to the chancellor, who confirmed the report, and upon the final hearing it was ordered and decreed that the alleged settlement between William Petrie and the company, on the 21st day of December, 1839, be set aside, vacated and annulled, as fraudulent and void ; that the complainants have and recover against the executors of William Petrie the sum of $73,147 34, with legal interest thereon from the 4th day of June, 1844, until paid, and that execution issue therefor, to be levied of the goods and chattels which were of the said William Petrie in the hands of his executors; it was further ordered and decreed that the agreement entered into between William Petrie and the company for building the railroad, be held andconsidered as a mortgage upon the slaves mentioned in the complainant’s bill, as well as those mentioned in the answer of the defendant, William Petrie; that the executors of Petrie pay to the complainants, within ten days from the date of the decree, the above named sum of $73,147 34, with interest, and on their failure to do so, that the mortgage be foreclosed and the property sold for the pay ment of the judgments due the complainants. F. S. Hunt was then appointed a receiver, to take possession of the property, &c. The defendants being dissatisfied with the final decree of the chancellor, prayed an appeal to this court. In this court the appellants moved to supersede the order of the chancellor appointing a receiver. Pending this motion it was agreed by the counsel engaged in the cause that if it should become necessary for the court, on the hearing of the motion, to investigate the whole merits of the case, that the court might decide the whole case on the full merits involved.
    [The arguments of the counsel on both sides far exceeded the length prescribed by the rule of court. They consisted principally in elaborate reviews and examination of the facts developed by the testimony in the case, in connection with the charge of fraud in the settlement of the bank with Petrie. To give a synopsis of the points made would be impracticable, without overstepping the limit prescribed by the court, and violating the rule established by the legislature. The authorities cited by each counsel, are therefore only inserted.]
    Hughes, for appellants.
    Story’s Plead. § 40, § 46 ; Mitf. Plead. 67, note; 2 Paige R. 396; 1 Hawks, 509 ; Mcllvaine v. Willis, 9 Wend. 548 ; Brinkerhoffv. Brown, 4 Johns. Ch. R. 671; 3 J. J. Mar. 63; 1 Dana, 516 ; 2 Ibid. 98 ; Rev. Code, 201, § 25 & 26 ; Laws of Miss. 1838, 341, 342, 343, ch. 78; Hogan v. Laicas, 10 Peters, 400; 
      Smith v. Smith, 1 Paige, 391; Hadden v. Strader, 20 Johns. 554-556 ; McDermott v. Strong, 4 Johns. Ch. R. 687; Edmeston v. Legree, 1 Paige, 637; Beck v. Burdett, l Paige, 305; Weed v. Pierce, 9 Cow. 722 ; 2 Kent’s Com. 232-235 ; Balsford v. Burr, 2 Johns. Ch. R: 166 ; Acts of 1840, 21, 22; Const. U. S., Art. 1, § 10; Trustees of Dartmouth College v. Wood, 4 Wheat. 518; Payne v. Baldwin, 3 S. & M. 672; Commercial Bank v. Atherton, 1 S. & M. 641; Dyche v. Rigg, 2 S. & M. 606; Edmeston v. Lyall, 1 Paige, 637 ; Bank of Maryland v. Huff, 7 Gill & Johns. 448.
    
      Quitman and McMurran, for appellees.
    I S. & M. Ch. R. 282 ; l'How. R. 560; Perry v. Nixon, 1 Hill Ch. R. 335; Harrison v. Battle, Dev. Eq. R. 537; 1 Paige R. 305 ; 4 Johns. Ch. R. 687; 10 Yerg. 317 ; 3 Munf. R. 358, 384; 8 Wend R. 339; 1 Story’s Eq. PI. 37; 1 Hill, 302; 1 Bland’s Ch. R. 251, 271; 20 Johns. R. 554; 2 Stew. R. 378; 4 Cow. R. 384; 7 J. R. 477; 13 Serg. & Rawle, 25.
    
      Evans, on the same side.
    4 Johns. Ch. R. 677; 5 How. 625 ; 20 Johns. R. 568 ; 2 Rev. Stat. (N. Y.) 173, § 38; Mclloaine v. Willis, 9 Wend. 548 ; McDermot v. Strong, 4 Johns. Ch. R, 687; Perry v. Nixon, 1 Hill’s Ch. R. 335 ; Beck v. Burdett, 1 Paige, 309 ; 2 Story’s Eq. 297, §■ 1031; 2 Kent’s Com. 582; 4 Ibid. 139 ; 8 Johns. R. 96 ; 1 Pick. 389 ; 4 S. & M. 153 ; Ferguson v. Lea, 9 Wend. 258 ; Aslor v. Hoyt, 5 Wend. 617; Hart v. Ten Eylce, 2 Johns. Ch. R. 100; 2 Phill. Evid. (Cow. & Hill,) 200, and cases cited; Ibid. 205, 206.
    
      W. Thompson, on same side,
    delivered an oral argument.
    
      W. Terger, for appellants.
    
      Shaw v. Lewistown T. P. Co. 3 Penn. R. 445 ; Bruner v. Miller, 4 Taunt. 445; Lucas v. Godwin, Bing. N. C. 737; 2 Aikins, 427 ; 7 Johns. 476; 1 Shepley, 60; Chitty on Con. 78, (5th Am. ed.) and cases cited ; 9 Pick. 298; 3 Johns. 528; 13 Wend. 71; 14 Johns. R. 330; Chitty on Con. 88; Angelí & Ames on Cor. 117, 121, 122, 126, 165, 170, 171, 220; Fletcher v. United States Bank, 8 Wheat. R. 357; 12 Ibid. 68; 2 Kent’s Com. 233; 1 Edwards R. 84, 513, 573 ; 6 Call, 308 ; 3 Cowen, 445 ; 3 Mason, 308 ; 6 Johns. Ch. R. Ill; 2 Leigh, 149; 3 Peters, 114; 1 Bibb, 168 ; 2 Ibid. 449 ; 2 Randall, 442 ; 2 Paige, 478 ; 3 Dana, 5 ; 6 Munford, 406 ; Addison’s R. 56 ; Douglass v. Houston, 6 Hammond, 162; 1 McCord’s Ch. 167; 2 Johns. Ch. 312; Hopkins R. 79; 1 Bibb, 306; 2 Litt. 222; 6 Yerg. R. 185; 7 Price’s Ex. R. 274; Act of 1840, ch. 2, p. 21; 4 Wheaton, 518; Riggs v. Dyche, 2 S. & M. 606; 6 Gill & Johns. 363; 7 Ibid. 448; 1 Younge R. 507, cited 1 Am. Eq. 151; Daubney v. Cockburn, 1 Mer. 624; Whelan v. Whelan, 1 Cow. R. 577 ; 5 Ibid. 547.
    
      George S. Yerger, on the same side.
    1 Cow. R. 711; 10 Yerger, 59, 105; Donovan v. Finn, Hop. R.; Oldham v. Erwin, 6 Yerg.; 7 Exch. R. 103.
   Mr. Chief Justice Sharkey

delivered the opinion of the court.

This case is presented to us on a motion to supersede the order of the chancellor appointing a receiver. The chancellor also made a final decree, from which respondents appealed, so that the whole case on its merits is in this court by appeal. It is agreed that if it should become necessary for the court to investigate the merits on this motion, the decision will be regarded as settling the whole controversy, and the case has therefore been argued at length on the whole of its merits.

The record is very voluminous, and has necessarily required much time in the examination. The complainants in the court below had recovered judgments at law, for very large amounts, against the Mississippi and Alabama Railroad Company, a corporation generally known as the Brandon Bank. Executions issued on these judgments, which were levied on a number of negroes, by the sheriffs of Rankin and Hinds counties. William Petrie claimed the negroes, and gave bond to try the right at law, but before the trial the complainants filed their bill, seeking to transfer the controversy to the superior court of chancery, and, by the aid of that court, to have the property subjected to the satisfaction of their executions, on the ground that the company had an equitable interest in it. It is charged in the bill, that Petrie’s claim originated in a fraud so complex, that the aid of a court of chancery is necessary to detect it; that the directors, who are made defendants, managed the affairs of the bank in a faithless manner, and used it as the means of acquiring fortunes to themselves, the negroes in question constituting a part of the property of the bank, and that they combined with Petrie and others to create false claims and titles to the property thus acquired, that they might abstract it from the creditors. To accomplish this object, they had combined with Petrie to defeat the title of the bank, by causing the books to be sent away or mutilated so as to destroy the evidences of fraud; that Shelton and Petrie also used their influence in sending off witnesses, so that a fair trial could not be had at law; that these negroes were purchased with the money of the bank, but subjected to Petrie’s claim under pretended articles of agreement entered into between Petrie"and the bank, in reference to the construction of a railroad from Jackson to Brandon. The substance of the agreement is set out, and it is made an exhibit to the bill. It is also alleged that when this contract was made, ’Petrie was very poor, and that he purchased the negroes with the money, or on the credit of the bank, and instead of investing $100,000, he laid out $159,000 for negroes, paying nothing out of his own pocket; that from poverty he arose to affluence without paying anything. The bank has paid Petrie $442,755, or about $238,755 more than the amount the road was to cost, no part of which has been finished; Petrie worked about two years, and then abandoned the road entirely; that Petrie’s claim being fraudulent, the property is subject to the mortgage which he agreed to give. The prayer is, that an account may be taken between Petrie and the bank, and after allowing him a fair compensation for his labor on the road, that he be decreed to pay the balance to the complainants, and that the mortgage be foreclosed ; that the contract be set aside, and for such other and further relief as the complainants may be entitled to. There is also a prayer that the defendants may each answer all the allegations of the bill, and also the special interrogatories propounded, thirty-one in number.

Petrie, in his answer, denies all fraud; admits that he purchased the negroes with money furnished by the bank, as it was bound to do under the contract, and avers that he purchased them as his own property, and paid the amount advanced him by work on the railroad ; he admits that the road is still unfinished, but says that it is owing to the fault of the bank in not furnishing funds as it was agreed, and in not procuring the right of way; that he was anxious to have completed the road, but was prevented from doing so for want of the necessary funds, and by landholders on the road, who had not received anything for the right of way. He denies that he received the amount stated in the bill, or more than he was entitled to, and exhibits his account with the bank, by which it appears that he received $298,021, which sum he avers was mostly paid in the issues of the bank, then much depreciated, and that he suffered great losses in consequence thereof. He finally relies on a settlement with the corporation, made in December, 1839, by which he was discharged from the obligations of his contract, his-mortgages cancelled, and his. brother substituted as a contractor to finish the road, for which he was to receive the sum of $15,000. The ahswers of the other defendants who did answer, do little else than to deny the frauds charged.

Proof was taken on both sides, and the release or discharge of Petrie of December, 1839, was set aside, an account ordered, and a final decree rendered for $73,147.

As the transactions between the Brandon Bank and Petrie are exclusively the subject of this investigation, it is necessary that the conditions and stipulations of the contract out of which these transactions grew, should be noted. It would seem that there was another corporation in existence, created for the purpose of erecting a turnpike or railroad from Jackson to Brandon, called the Brandon Railroad and Bridge Company, which joined in the contract made with the Mississippi and Alabama Railroad Company by Petrie. A previous contract had been made between Petrie and the first named corporation, to buiid a bridge over Pearl river,' and a turnpike over the low ground adjacent thereto. It seems to have been the object to merge the first contract in the second, or at least' to make it part of the second. Petrie agreed in the last contract to do all the grubbing, grading, &c. necessary to the completion of a railroad from the depot lot in Jackson to the western bank of Pearl river; and from the termination of the bridge on the east bank to Brandon ; to furnish all the materials, including iron; to put down the whole superstructure, with the necessary turns-out, turning platforms, side roads, water stations, road crossings, &c.; to build a frame warehouse and engine house at Brandon, and to furnish a locomotive engine of the most approved construction, a tender and eight cars, and to put the road in complete operation. This contract was not to be so construed as to include the building of the bridge over Pearl river. After stating the width of the road, the contract proceeds to recite that the Jackson and Brandon Railroad and Bridge Company had abandoned their scheme, and thereby released and conveyed to the Brandon Bank their rights and privileges, timber, &c. on the track.

In consideration of Petrie’s covenant, the bank agreed to pay him $204,000, and an additional sum of not exceeding two dollars per cubic yard, for excavating rock, the first payment of $ to be made within one month after the commencement of the work; the other payments at intervals of about thirty days, as money might be required for the prosecution of the work, and for the purchase of iron and an engiue, of which Petrie was to determine. Besides the above-mentioned terms of payment, the bank agreed, at the expiration of thirty days, to invest Petrie with power to draw bills of exchange on the bank, for $100,000, in instalments of $20,000 each, which sum was to be applied in the purchase of slaves to work on the road, who were to be mortgaged to the bank, with all other property owned by Petrie, to secure the performance of the contract. The work was to be commenced in one month, and finished within two years, and if sooner finished, Petrie was to have the right to the use of it until the time expired.

It was also understood that if Petrie failed to use diligence and energy in the prosecution of the work, or should fail to give assurances that he would complete it, the president of the company was invested with power to declare the contract abandoned, and to re-let the work, which declaration should exonerate the bank from liability, and subject Petrie to damages.

By the contract-with the Bridge Company, Petrie agreed to erect a bridge over Pearl river, of a given description, with two tracks, one for the railroad, and another for ordinary use, for which he was to receive $37,500. He was also to construct a road from the termination of the bridge, in an eastwardly direction, to the termination of the swamp, and to build all necessary bridges, for which he was to receive for the embankment, forty-four cents per cubic yard, and for the bridging ten dollars per foot lineal.

The discharge set up by Petrie is contained in certain resolutions adopted bykhe board of directors, by the first of which William- Petrie was released from that part of his contract, by which he had obligated himself to furnish a locomotive engine, the price thereof, $7000, to be placed to his credit. By the second resolution, the cashier was required to cancel the mortgages given by Petrie. The third contains a preamble stating that the company were under obligations to furnish Petrie with a certain amount of par funds, to enable him to complete the road, and being unable to do so, therefore it was resolved that Petrie be requested to finish the road at his own expense, and retain the use of it until the profits should re-imburse him for. any balance that might be due after the completion of the road.

A difference of opinion seems to exist between counsel, in reference to the construction of the contract, in one important particular; that, is, whether Petrie was to receive the sum contracted to be paid him by the Bridge Company, in addition to the sum of $204,000. The parties to the first contract joined in the second, which refers to the first contract, and all the rights acquired by the first, were assigned or transferred by the second, and it was therefore made a part of the second contract. The Brandon Bank was substituted in the place of the Bridge Company, to carry out the original contract; to receive the benefit resulting from its performance, and of course took upon itself the obligation to pay for the work. There is one clause in the contract which declares that the Bridge Company had abandoned the scheme, and that all the rights and privileges were assigned to the Brandon Bank. The president, and directors of which, thereby contracted with Petrie “ to construct the railroad aforesaid, from the points aforesaid, in the planner and form aforesaid.” The whole of this clause seems to refer to the contract between Petrie and the Bridge Company, and to adopt its provisions as the contract between Petrie and the bank. Besides, it- is expressly stated in the second contract, that the building of the bridge was not included. Petrie then was to receive $204,000 for the railroad; an additional sum for excavating rock, which is charged in the accounts at $4584. He was also entitled to receive for the bridge tile sum of $37,500. If he proceeded to work on the turnpike, which he had agreed with the Bridge Company to construct, then he was entitled to be paid for embankments and bridges, according to that contract. On this last point the case is involved in some doubt. The amount claimed for embankments and bridging, is $29,709, besides pn additional sum of $6000, on account of a debt due him from the Bridge Company. The aggregate amount of these several sums is $281,783. It seems probable the turnpike was to be finished, as the bridge was to be built with a partition, one side to be used for ordinary purposes of travel, and the other for the railroad. The clause of the contract, too, above referred to, seems to embrace the whole of the contractas made with the Bridge Company. It follows that Petrie was to have received, for completing the work, an amount much beyond that assumed by the complainant’s counsel as the true one. Having settled, then, the construction of the original contract between the parties, we proceed to the contract of settlement and discharge, because, if that be valid, it is conclusive, and we need not inquire how far the first engagement has been performed, as the discharge must be considered as an admission of performance, or a waiver of non-performance — a final adjustment of the whole matter.

First, then, as to the legal effect of the contract of settlement, and second, as to the evidence of fraud on which it is attacked.

First, it is contended that the release was not made with due solemnity, so as to be binding. The doctrine is now entirely exploded, that corporations can contract only under their corporate seal. They may contract by vote entered on the books of the corporation, and binding contracts may be implied from corporate acts, without either a vote, a deed, or writing, and they are bound by all contracts made by their agents within the scope of their authority. 2 Kent’s Com. 5th ed. 288 to 292. It is said, in an approved treatise on the law of corporations, that “ the course of modern decisions seems to place corporations, with regard to their mode of appointing agents, and making contracts in general, upon the same footing with natural persons. They may appoint all their agents, and make all their contracts by deed ; but are no more compelled so to do than individuals.” Ang. & Ames, 110. So far, then, as the resolutions go, which were adopted by the board of directors on the 21st of December, 1839, they are undoubtedly binding; but there is a part of the contract which does not appear in the resolutions, to wit, that F. H. Petrie should be substituted as a contractor to finish the road, instead of William Petrie, and receive the sum of fifteen thousand dollars, with privilege to retain the road until that sum should be paid him. This part of the agreement rests in parol, but is established fully by every witness who has spoken on the subject, in addition to which F. H. Petrie, with the knowledge of the corporation, did proceed to work on the road, and continued to do so for some time after this settlement. The circumstances are abundantly sufficient to raise an implied contract on the part of the corporation in favor of F. H. Petrie. It is said, moreover, by some of the witnesses, that it was intended that this contract with F. H. Petrie should be reduced to writing, but that perhaps was omitted. The first resolution released William Petrie from his obligation to furnish an engine; the second directed that his mortgages should be cancelled; and the third, after admitting in a preamble that the corporation had failed to suply him with par funds, requested that he should proceed ,to finish the road at his own expense, and retain it until he should be repaid by the profits. These resolutions amount to an abandonment of the contract, by substituting new terms and conditions inconsistent with the original agreement. The last resolution, construed in connection with its preamble, left the completion of the road entirely at the discretion of Petrie. He might finish it or not, as he pleased. The understanding, however, seems to have been that the road was to be finished ; but it was to be finished by F. H. Petrie, and William Petrie gave his verbal promise that it should be finished by his brother. This whole transaction, then, as disclosed by the resolutions and by the parol proof, amounted to a settlement with Petrie, and it seems to have been the action of the entire board of directors. It -is spoken of by all the witnesses as one entire transaction, made by the concurrence of the directors, whilst in the meeting which adopted the resolutions. Not only then was this ádjnstment entered into with sufficient solemnity to make it binding on the corporation, but its legal consequence was a discharge of Petrie, and a settlement of balances.

Second, was it fradulent as to creditors'? It is not one of those cases in which the fraud is apparent from the subject-matter of the contract alone, or from the circumstances and conditions of the parties contracting. If there was a device to take an unconscientious advantage of the creditors of the corporation, it must be gathered’from the proof introduced in the cause, either direct or circumstantial. The superiority of a court of chancery over a court of law in the investigation of questions of fraud, consists in its power to elicit from the parties concerned, a conscientious disclosure of the circumstances, and thus to penetrate their motives. When’ the question depends upon the testimony of third persons, a court of law, through the aid of a jury, may accomplish all that a chancellor can. The merits of this case do not depend upon the testimony of the parties to the record alone, but disinterested persons have been examined by both parties; of course their direct testimony must be considered as entitled to great weight in the conclusion. It is not denied, that strong presumptive evidence of fraud will outweigh positive proof against it. But it is not to be presumed from slight circumstantial evidence, especially when it is opposed by unquestionable positive testimony. The testimony on this subject was given in answer to the interrogatories propounded to the witnesses examined hy respondents. R. G. Crozier, the first witness examined, .states that he does not believe there was any fraud in the settlement. William H. Shelton states that the settlement was fair and open, made by a majority of the directors, and that no fraud was intended or committed. He gives the circumstances of the settlement, and says that it appeared that the accounts against Petrie had been improperly kept, and amounts improperly charged to him; that upon a review of the whole matter, delays in the work, loss by uncurrent funds, &c., it was agreed, that if Petrie would finish the work, the corporation would release all claims against him; and it was further agreed, that F. H. Petrie should finish the work, William Petrie becoming responsible for his performance. Thomas J. Coffee makes identically the same statement. John T. Blow says that he had no knowledge of fraud. He was at the board when the settlement was made ; that it was final and satisfactory to all parties. H. K. Moss gives the same history of the settlement as that given by the other witnesses, and states that there was no agreement for the purpose of deceiving or defrauding creditors; that Petrie was not then indebted to the company, but on the contrary the company owed him, and he agreed to relinquish the balance if the company would make a final settlement. This was agreed to, if F. H. Petrie would agree to finish the road for $15,000, and on his agreeing to do so, the final settlement was made. F. H. Petrie also states, that at the date of the settlement the corporation owed William Petrie $15,000, which sum he was to receive for finishing the road, and William Petrie was discharged,

Charles Lynch, a witness for complainants, states that he was present, and the presiding officer of the board, when the settlement was made relative to the building of the bridge and railroad ; that Petrie then stated that the corporation had failed to comply with its engagements; that some excitement and warmth occurred in the investigation and settlement, and after it was completed Petrie complained that he had not been allowed as much as he was entitled to. He knew of no fraud or collusion between Petrie and the directors; and, so far as he knew, the settlement was fair and bona fide. George Adams, another witness for complainants, who was the attorney of the corporation, and present at the settlement, gives the same answer to the cross-interrogatory, that was given by Governor Lynch. The whole of the direct proof then, goes directly, and in the most unqualified manner, to negative the idea of fraud.

We have said that fraud may be. established by strong circumstantial evidence, even against positive proof denying it; there is no direct or positive proof of fraud, but all the witnesses, deny its existence; what then are the circumstances from which it can be inferred 1 Every case in which fraud is charged, must be determined upon its own peculiar circumstances. The forms in which it may be perpetrated, are as varied as human ingenuity is boundless. It is odious to the moral sense of mankind, as well as to the law; hence it is seldom to be found where there is not some strong motive for its perpetration. The bill charges fraud on all the directors generally, and the amended bill charges that the settlement was fraudulent. If there was any such thing, it was of course committed by all the directors present at the meeting of December, 1839. There were eight members present. It is difficult to believe that these eight persons would lend themselves to fraudulent purposes, and it is still more difficult to believe that they would falsely swear that the transaction was fair, if it were not so. It is scarcely probable, either, that a device could have been practised by part of them, without detection by the others. All of these individuals have been sworn except one, and have testified to the fairness of the transaction. Most of them seem to have had so little interest in the matter as to have suffered a pro confesso. These may be but slight circumstances, but they should not be overlooked. The great point relied on is, that Petrie received more than he was to have received for completing the work. If the directors were so regardless of their duties to the creditors, as to give him a much larger sum than he was entitled to or claimed, it might amount to a fraud in law. The doctrine is no doubt true, that a voluntary release of securities held by a corporation would be void as to creditors. But what was Petrie entitled to, and what has he received 1 The contract shows what he would have been entitled to on completing the work. The aggregate of the sums, under both contracts, amounts to upwards of $281,000; the various estimates of the amounts received by him, prove that it is next to impossible to ascertain the amount he did receive. He states in his answer that it was $298,021, and makes his account with the corporation an exhibit to his answer. By the 29th specific interrogatory in the bill, he was required to state, at what times and for what sums he had checked or drawn on the bank, and was also required to state all the items of money drawn for, or advanced to him. In answer to this interrogatory, he refers to the account made an exhibit to his answer, and states that it shows all the money ever received by him from the bank. This answer, being a direct response to the interrogatory, is evidence as well for Petrie as against him, and must be regarded as conclusive, unless it is shown to be false. Alexander v. Wallace, 10 Yerger, 105; Woodcock v. Bennett, 1 Cow. 711. Nor is it to be discredited, or any presumption indulged against it on account of its being the answer of a party interested : per Thompson Justice, in Clason v. Morris, 10 Johns. R. 524. On this subject, Shelton stated that he had not the control of the drafts and checks of Petrie, but from the ledger of the bank then before him, it appeared that Petrie had drawn the sum of $294,794 91, and if he was properly chargeable with the price of the railroad iron, which had been taken in New Orleans by an attachment against the bank, it would make the additional sum of $17,266 95, which, added to the sum appearing on the ledger, swells it to $312,061 86 ; at the same time he stated, that by-mistake of the cashier the accounts of Petrie had been improperly kept under the head of Railroad Expenditures,” and that in this way improper charges had been made against him. Petrie was bound to pay for the railroad iron, and was therefore responsible to the bank for it, but he was certainly not chargeable with railroad iron which was sold under an attachment against the bank in New Orleans ; so that Shelton’s testimony places the sum received by Petrie near his own admission. It cannot be doubted but these charges, made in the books of the bank, were for the nominal and not the actual value of the money. The witness also mentioned another sum of $126,000, given to Petrie when he was about to start to New Orleans, which he was authorized to sell at its market price, which he accounted for at eighteen cents in the dollar, making twenty-two thousand five hundred dollars. The book referred to by the witness was an unsafe reliance, as it is stated by several of the witnesses that the accounts were improperly kept, by making improper charges against Petrie.

The witness, Bullock, appended to his deposition an account or'statement of Petrie’s liabilities, at which he placed the sum at $451,666 11. He was book-keeper and teller, and states that the account contained improper charges to the amount of 40 or $50,000, and mentions several items improperly charged to Petrie. This account contains also the charge of $125,000 spoken of by Shelton, which Petrie was authorized to sell at what it would bring, which was settled for at eighteen cents in the dollar. This reduces the account $102,500. The railroad iron is also charged at $17,266. If we add to these sums $40,000, the lowest estimate made by the witness for improper charges, we have an aggregate of $159,766, which, deducted from the amount of the account, shows the sum received by Petrie to have been $291,790, being less than Petrie admits he received. The testimony of this witness then corroborates the answer of Petrie.

T. J. Coffee, in his deposition, says nothing as to the amount received by Petrie, except to refer to a paper marked C, attached to Blow’s deposition. By reference to this exhibit, it is found to be a resolution of the directors, in which it was determined to be inexpedient to abandon the project of completing the road, after having expended upwards of $300,000 on it. This resolution is in round numbers ; it does not refer to items,, and proves nothing. It was at best but a rough estimate of the expenditure.

Blow also states that improper charges were made against Petrie, and in answer to an inquiry as to the amount received by Petrie, he refers to exhibit D to his answer, which is not found attached. He states that at the settlement made in 1839, Petrie brought the bank in debt about $30,000, but for the sake of a settlement, he being in bad health, he relinquished his claim; and he also states that the cost of a locomotive was then charged against him. Moss makes the same statement as to the balance in favor of Petrie at the settlement. In all this mass of testimony, there is nothing which enables us to fix, with certainty, the amount of money received by Petrie, at a sum which varies much from his own statement. The accounts seem to have been so loosely kept as to place certainty out of the question. We cannot say that the answer of Petrie is satisfactorily disproved, and must therefore adopt it as evidence of the true amount.

But it is argued that this amount was received by him in par funds, and that it was more than he was entitled to for the completion of the road, which is still unfinished. The witnesses all say that he received his payments, in the notes of the bank, which were greatly depreciated, except 10 or $15,000, which he received in par funds. They unite also in stating, that he sustained great losses in consequence of being compelled to receive depreciated currency. It is also said, that by his own account, before referred to, it appears that he received the amount therein stated in par funds. This is a mistake of counsel. It is stated positively in the answer that the sum received by him was mostly in the notes of the corporation, which were at a discount; that he received them at par, with a few exceptions noted in the account current made an exhibit to the answer. This is the same account before noticed, and by a reference to it, deductions are only made in two or three instances on account of uncurrent money, one of which is the check for $125,000, which he was authorized to sell at its current price, for which he has charged himself $22,500. The answer in this particular is fully sustained by the witnesses, all of whom testified that his payments, with a very small exception, were received in the notes of the Brandon Bank, and that he sustained heavy losses and suffered great inconvenience as a consequence. The contract was for the payment of so much money ; it was not a compliance with it to pay in depreciated paper; the bank was bound to make good the amount lost by depreciation. The current value of the notes at the time received, was the extent of his legal obligation as a debtor to the bank.

Another circumstance, from, which fraud is attempted to be inferred, is the extravagant allowance made by the directors to Petrie, on the final settlement for damages, as an evidence of which the paper called his approximate estimate of the advanced cost of constructing the Jackson and Brandon'Railroad, Turnpike and Bridge, on account of the failure of the company to comply with their engagements,” is referred to. This document was the subject of severe comment, and certainly it bears some evidences of extravagant and even unfounded estimates. But some of the charges are undoubtedly such as might well be made under the circumstances; for instance, $39,000 loss on $260,000 of uncurrent money. Loss of $4000, by being compelled to purchase on credit at advanced prices, in consequence of the failure to supply par funds at the time agreed on; and the loss arising from a year’s detention over the time the work was to have been finished. If these losses were occasioned by the bank, justice required that some compensation should be made. But a complete answer to the argument on this subject is found in the fact that the directors did not allow all of this claim. Blow and Moss, and perhaps other witnesses, state that the directors refused to allow all the claim for damages. Governor Lynch proves that Petrie complained very much, after the settlement, that his claim had been unjustly curtailed. And notwithstanding part of his claim was rejected, it seems that he still brought the bank in debt. Moss and Blow both say that there was a balance due him of $30,000, and this too, after charging him with the price of a locomotive engine, which sum he agreed to relinquish, for the sake of a settlement and discharge. Shelton says it was agreed, if Petrie would finish the road, the company would release all claims, and allow him $15,000, with liberty to receive the profits until they should pay that amount. Coffee says the company acknowledged that it would be indebted in the sum of $15,000, when the road should be finished. It seems then that Petrie had preferred claims against the company, some of which, at least, were founded in justice. He had been engaged in the performance of a heavy contract, and was occupied nearly a year longer than the time agreed on. He had worked on with the approbation of the company, which was making its payments in depreciated paper. He had obstacles to encounter from the owners of land, and from other causes. Is it so remarkable that unforeseen claims should have originated, and is it an evidence of fraud that in the settlement of these claims, mutual concessions should have been made, for the sake of compromising the difficulty ? It is but the common case of a job of work costing more than was anticipated. Even supposing that he was allowed more than he was strictly entitled to, that of itself is not a fraud; there must be a device to injure others, or the act must be so grossly extravagant and wasteful as to amount to fraud in law. Petrie had received about $298,000; all of that sum, except 30 or $40,000, was in depreciated paper. Judging from what the witnesses, say, he must have lost near $30,000, or perhaps even over that sum. This item alone reduces the actual amount received by him, considerably below the price of the work. It is stated also that the directors had previously determined to make up his losses in this respect. The extravagance of the allowance, then, is certainly not so glaring as to furnish evidence of fraud.

It was urged that there was too much informality in making this settlement for it to be valid; that accounts in writing were not made out on both sides. Some of the witnesses testify that accounts on both sides were presented. We must then suppose the fact was so. But suppose it were not so, what better guide was there to a correct understanding and full disclosure of the .mutual liabilities than the books of the bank? If they were correctly kept, they contained every item of charge and discharge. An account taken from the books cannot be better than the books themselves. Such a circumstance, then, would prove nothing.

But it was assumed in argument, that fraud was conclusively established by the circumstance that Petrie engaged in the contract a poor man, and abandoned it unperformed, in something less than three years, with slaves worth $136,000, and other property, for which he owed nothing. This position is not altogether sustained by the testimony. If it were so, it would be a suspicious circumstance, but still not conclusive. To hold that such a fact was conclusive evidence of fraud, would be to establish a rule destructive of all speculations, and dangerous to many of the property-holders in this state. But as this is a legitimate argument in the pursuit of the object, it becomes necessary to look at all the prominent facts in the case, that we may be certain this sudden change of condition cannot be accounted for on fair principles. On the two contracts Petrie was to have been paid $281,000, in round numbers, at such times as he might require it. Of this sum he invested $136,000 in slaves, being $36,000 more than he agreed to invest in that way. These slaves, when purchased, belonged to him .individually. Every witness states that he never bought any for the company, and that the company had no right or interest, whatever, in the slaves, except to have them mortgaged as a security for the performance of the contract. Mortgages were given on part of them, but afterwards cancelled. With these slaves Petrie commenced the work on the road, having still $145,000 to furnish materials, and to support his slaves. The road was to have been completed in two years, but he was engaged nearly three. The whole of the grading was done; the rock excavated; thé embankments made, and the wood work all laid, ready for the iron, except about a half or three quarters of a mile. The materials for. the houses and bridge were ready, though not on the ground where they were to be erected. The piers or butments of the bridge over Pearl river were built, and in short the road was so nearly completed as to require but $15,000 to finish it, exclusive, as we must suppose, of the railroad iron, valued at $17,000. And, if we believe the witnesses, Petrie was still anxious to finish the work. Was there any fault or fraud, on his part, that it was not completed according to the contract? The witnesses all say that the fault was not his, but that it occurred by the failure of the company to supply him with par funds, or by the failure to procure the relinquishments to the right of way. These are assigned as reasons, and the proof is too clear to admit of doubt, that much the largest part of the money he received was in depreciated notes. It is equally well established, that he was impeded in his progress, for want of the right of way. Counsel have relied on discrepancies in the statements of witnesses on this subject, for the purpose of destroying the effect of their testimony. We see nothing that will justify us in disregarding the evidence. That the company failed in another important particular, is beyond question. The iron was purchased for Petrie, but attached for the debts of the corporation, and sold. Although the bank was under no obligation to purchase it for him, yet it was under obligation to furnish him such funds as would buy it. This, it seems, it could only do by applying part of a sum of money then in the hands of its merchant in England, which was accordingly done, and it should have been relieved by the bank from the attachment for its debts. Here we may remark, that there was no impropriety in Petrie’s asserting title to it under such circumstances. Notwithstanding these failures, it was assumed in argument that the company had complied with all its engagements, as a proof of which it is said that in twelve months he had received a sum of money equal to the whole amount of the contract; at the expiration of two- years he had received $273,410, and by the 18th of November, 1839, the full sum of $298,000, in par funds, according to his own answer. We repeat, the answer does not admit the reception of par funds: and even if these amounts had been received at the times specified, still the instalments may not have been paid at the times they were required. Although a gross sum may have been received during the whole year, yet great inconvenience may have resulted from a failure to pay at the particular times it was required. But it is not true that Petrie derived all his wealth from the profits of this job. By a specific interrogatory he was required to state what he was worth when he commenced the work, in answer to which he estimated his wealth at $20,000. This answer is corroborated by the witnesses, besides which we have positive evidence that he borrowed near $30,000 from his brother, and gave a mortgage to secure the payment. We have, then, to deduct about $50,000 of his fortune from the total amount; and the balance is what he made by the job. Taking into consideration, then, the total amount he was to have been paid for the job, and the means he took to accomplish it, it would naturally be expected that he must have left it with a number of slaves. Then, when it is remembered that about $50,000 were derived from different sources, the circumstance of his wealth loses much of its force, as an evidence of fraud. . Besides, it may have been, and probably was, a very good bargain on his part; but it was not on that account fraudulent. He may also, on the settlement, have been allowed a few dollars more than he was entitled to; that would not vitiate the contract. A court of chancery cannot interpose, merely because the bargain was imprudent, or because a party may have been paid something more than he was entitled to. As inadequacy of price will not vitiate on the one hand, neither will exorbitancy of price vitiate on the other. There must be some ingredient of fraud.

Much reliance was also placed upon the letter of Petrie to Shelton as president of the corporation, in which it is said he represents the negroes purchased by him as the property of the company. We do not understand the letter as containing any such admission. It seems to have been a reply to a request made of Petrie to state how much had been expended on the railroad. He gives the items for which the expenditures had been made, but does not represent these items as the property of the bank. He says for slaves purchased, so much had been expended, but does not disclaim his own title to the slaves. The bank was, according to this letter, so much out of pocket for the road, but it could not own both the road and the slaves. If it owned the slaves, it >vas not so much expended, but so much changed from money into property, and if the bank charged itself for the expenditure and owned the property, it was entitled to be credited for the property, so that the accounts ought to have been balanced. Yet we find, in the commissioners report, an amount stated as having been expended on the road. If the negroes belonged to the bank, the letter was not true, because their value had not been expended by the bank on the road, but was so much expended in property. If, on the other hand, the negroes were Petrie’s property, then the bank had expended their value on the road.

A resolution of the board of directors, adopted on the 10th of September, 1839, was adverted to in the argument as an evidence of fraud. It was passed about the time Petrie was to start to New Orleans to release the railroad iron, and ils object was to prevent his arrest. It declares that the bank would not consider Petrie its debtor until the road should be finished, and then if any balance should remain due, he should be at liberty to pay in the notes of the bank. The resolution, unexplained, amounts to but little, and the explanation does not tend to establish fraud as to these complainants. It proves a profuse disbursement of the notes of the bank in an effort to release the railroad iron, as it was then that Petrie received the $125,000 check, which, considered at par, would have made Petrie debtor to the bank. How far this transaction might have been considered fraudulent as to New Orleans creditors, on whom it was intended to operate, we need not inquire. This was evidently the resolution referred to by complainant’s witnesses, King and Pucket, and explains their testimony.

We have thus noticed the positive testimony in reference to the charge of fraud in the final settlement, and also the facts and circumstances from which it is attempted to. be inferred. It may have been a fraudulent settlement, although we cannot perceive it. We are to be guided by the direct or positive proof, and by such legitimate deductions from the circumstances as they seem to us to warrant. There may be much in the transaction calculated to excite suspicion, but we cannot yield to mere suspicions against positive proof uncontradicted and unimpeached.

A few remarks will be added in reference to the propriety of the decree on the cáse as it was supposed to have been made out. The complainants are judgment creditors, seeking to subject equitable assets of the bank, or a debt due to it, whichever might turn out to be the case, and to have them appropriated in satisfaction of their judgments. They charge fraud in the original contract by which the bank acquired the equity, and seek to vacate it. Of that, however, there is no proof. They then charge that by this contract a mortgage was to have been given on negroes and other property, which vested an equitable interest in the bank, and, being creditors, that they have a right to the benefit of this mortgage. The contract examined sustains the charge thus far; Petrie did agree to buy slaves and to give a mortgage on them as a security for the performance of the work. When a party agrees to make a security in future, that is construed in equity as an equitable mortgage. But Petrie complied with the contract in this respect by executing the mortgage; the equitable mortgage was merged in this, and when the contract by which the express mortgage was cancelled was rescinded by the chancellor, it restored the mortgage. It would, seem, therefore, that the bill should have been framed and the decree made on the mortgage. But suppose all was right in this respect, and we are not disposed to controvert it, how is the decree sustained by the equitable mortgage? That mortgage was not given to secure a debt or money ridvances to be made to Petrie, but to secure the performance of a covenant, the non performance of which sounded in damages merely. The mortgage was not necessarily forfeited because Petrie did not complete the work. The right of the bank under this equitable mortgage, depended upon the amount of damages it sustained in consequence of the non-performance of the work; to that extent the mortgage was a security. How were the damages to be ascertained ? By arbitration, as agreed on in the contract, or by the verdict of a jury. A court of chancery has no power to assess damages. It was a contract containing mutual undertakings; in a suit at law the company would have been compelled to prove the performance of conditions, otherwise no damages could have been recovered, and of course the mortgage must have remained inoperative. In common cases of a mortgage of personal property, it is said that on forfeiture the right becomes absolute in the mortgagee; but in this instance what was a forfeiture ? It was a thing unascertained.

But what was the professed foundation of the decree against Petrie in this instance ? An account was taken to ascertain how much money he had received over and above the amount he was entitled to; whatever that was, on the principles of the decree, he was debtor to the bank. The commissioner reported him in debt so much ; the report was confirmed, thus declaring him to be a debtor to the bank, and a decree passed for the amount, which is also a decree of foreclosure, and directs that in case of non-payment, the property shall be sold. Now Petrie had given no mortgage to pay a debt. The contract made n© provision for advances beyond the amount agreed on, nor did it make any provisions for security in case-such advances should be made, and the contract must govern. If, then, Petrie did receive more than he was entitled to, he was debtor to the bank, not by mortgage, but by simple contract. With all deference to the. opinion of the chancellor we cannot see how a decree of foreclosure could follow. If a man give a mortgage to pay one debt, or to do a specific thing, can that mortgage be foreclosed for the non-payment of another debt not intended to be secured, or the non-performance of another thing? It would seem not. If this view of the subject be correct, the negroes were not involved in this controversy. The chancellor in inquiring whether Petrie’s liability was such as might he pursued in equity, ahd whether the complainants were authorized to file a bill for that purpose, says, “ it seems now to be the rule in England, that in order to render a conveyance void, made by a debtor, it .is necessary that the conveyance should embrace property liable to be seized by execution at law, and applied to the payment of the debts of the grantor. As a consequence of this doctrine it has been held, that a voluntary transfer of stock, choses in action, or other property not liable to be taken in execution, is good, notwithstanding the provisions of the statute of 13 Elizabeth.” Without acknowledging this principle, we would merely remark that the most that was transferred or relinquished by the contract which was set aside, was an undefined, unascertained, and uncertain claim for damages, and an alleged balance of indebtedness.

We have laid the account taken in this case out of view, as that could not be brought in to aid the decree which' preceded it. The case has been considered as it was presented to the chancellor before, the decree setting aside the contract of discharge. If that was wrong on the pleadings and proofs, then the account was improperly ordered, and its result cannot change the prior aspect of the case. Our conclusion on the merits of the case, renders it unnecessary for us to say anything on the technical questions discussed, and equally unnecessary that we should express any opinion as to the kind of funds Petrie was bound to pay.

As counsel have agreed in this case that an investigation on the merits should be final, and that investigation having been made, the decree is reversed and the bill dismissed.

Mr. Justice Thacher.

I have participated in the examination of this case, and concur in the judgment of the court as contained in the opinion of the chief justice.