The New York herald. [volume] (New York [N.Y.]) 1840-1920, 1854-09-27
TIE Report OF the Directors or the New
Haven Hnilr1ad Company.

TO THE EDITOR OF THE HERALD.
have ut last been compelled to let the public know VII It
they have been doing since the discovery Of the Schuy
Ter fraud.
How much longer their report might have lain dor.
nant il it had not been brought forth by the call for
the meeting Of the Stockholders which held last
Thursday night, II is impossible to tell But that
it has appeared tho Directors would have believe
that the delay which attended its appearance owing
prepa, alton They therefore, embo6y in It the opinion
Of two distinguished legal gentlemen the gst Of which
is thai the compspyis not liable either TO assume the
spurious stock issued by schuyler stock to respond
to The hoders Of such stock 10 the respective amounts
advs, ced by them on tie same It is this opuion,
fore and the principles which it involves that
prop :. TO spa)yze
10 the fist part f the opinion that the CON psny
Cannot assume the spurious STOCK and mske IL genu.
iIe owing to the limitation OF their charter, do
OF end TO oppose objection the fact il appa.
have required ev, the amour OF y-rbiase with
which is sts'td in the opinion Legislation would bs
eeesary corporations could crec ly contrary
tie Igh's ana privileges conferred a2o the duties i'm
posed 70 them y law.
But the question whether a corporation IS priacipsl
Is liable to innocent laird parties for the fraud OF IT.
ts which third he sufferers fro said fraud
vi'bou. any notice Of its perperaon-b.ing the real
question this for the solution of which statute
comes in to aiibe general principles Of the
mon law and the decisions OF courts must it for
us And iris question is rot touched by thu opinion of
make to it is in the third paragraph of their opinion.
WHEN they say that corporation responsible
for the unauthorized aud unlawful acts of its officers
tspscendpg their corporate powers though done co0re
c6fcii.
That is to ray, IT, and for instance, cooperation is au
thorzed to run and OF the dire ctors OF
said company order the engineer Of their boat into
another boat of opposition line and damages it, and
that SO liable because the director his au
thorty ard the epgneer and the whole world at the
ment Of his giving the order inew That he was trans
cending~ his power, and that sufficient notice
for the engineer not to obey his order See Van
derbilt agt. the Richmond turnpike Company ID
% Ccmstt ck's Reports p 479. Blu. il an sgent is
thorzd TO exercise certain continuing powers which
point of time have termination, and which, while
they ere limited in extent Gas in the case Of Robert
ling and Ietranserrng thirty thousand Of stock
yet that extent never made apps ent owing to tn,
cised, being used and sgain, las the same
shares of stock being transit rred to ndre of persons
who sre the awful holders Of It's stock, AID its
to own entities of the genuine stock issues cor
tfcates OF spurious stock to innocent parties for vsua
bic consideration without notice of its character and
without anything to designate it from The genuine,
Insist that the company is RESPONSE ,s to such innocent
parties for the damage they have suffered by the said
fraud.
1t A. exactly similar case to whore principal n
poyi agent 10 make purchases for him, generally
giving him private instructions to tie quantity and
he always appearing his general purchasing agent
several occasions anscends his auth rity to guam
thy without notice to the party whom he is pur
chasing Of the fraud he is perpetraipg Mr. Schuyler
was the special transfer agent OF the New Haven Com
shares to be -anferred but the company d nothing
inform the public TO whom those genuine shares be.
loDged but give its transfer agert unlimd authority
to transfer stock ans cancel certificates The public
therefore justified in believing that all certificate
issued by him genuine. Sr Justice story, in his
comm ntaIies agency lays down the principle involved
in the following as the recognized law the sub
jec':n authorizes to parcha ten bales Of cotton
for him. and holds out 10 oil the public that hiss uuli.
med authority to purchase tina. cotton, every
ceaing with that agent has rightto deal WITH
pcson hayitg gene al authority to that purchase;
the principal Will be boun BY his acts 9TH.
stsLdog he may have privately limited the agent
rice, quality, &c, (Story on Fgencv, p. 1to
So the retention OF fact from the public their igno
/ Of Which misguides them (such the names OF
psrsops through wLtm only good stock co1.d come J
will rtrter a company Liable for spurious issns as
the tption by principal OF the private instructions
4 which are TO govern his agent.
Looking at this subject In this light cannot assent
TO the statements made in the opron to which have
referred, TO the conclusions drawn from them,
matter how paa' able they may be to the Directors.
As The idess which lave hurriedls thrown toge
tber may however be soneous, and the opinion Of
Messrs NoJes Wood may stand fire, and as the only
claim vh the holder Of the curious stock would in
that have, will be against Schuyler himself will
venture 10 ask why the Directors did rot inform the
public before of the criminal proceedings taken by them
sesst Schuyler and whittier the publica. ion Of the
formation At this time is intended to give quietus to
the very sensible resolution ed THURSDAY evening
requiring the directors to offer reward for HIS appre
h,nsioD This question we think the public are entitled
to have answered Let have schuyler that may
put him on the witness stand and see what became OF
the two millions of dollars raised the spu Ious stock
lii any of for the Norwss accident for the
femption of bonds arriving At maturity in December
lsstY Where's Schuyler