The New York herald. [volume] (New York [N.Y.]) 1840-1920, 1855-01-30


the courts In the manufacture Of evidence to assist
them In the investigation that must follow; neither
from transfers Of these fraudulent certificates Order
of special term should be affirmed and mandamus de.
MED, with costs.
Supreme Court.
THE EMPIRx CITY BANK CAsE-MoTIoN FOR A RE.
CRIvER GRANTED.
DECISION BY HON. JUDGE ROOSEVELT.
MAN. 2a.-In the Matter Of the Empire City Bank =
BY the 9Th article Of the present constitution of thu
State which went into operation the LIST Of January
lS47 1t provided among other things-and the pro-
vision shows the prevailing grievance of the tmss-that
the stockholders in every corporation and joint stock
ISOLATION for banking purposes, issuing bank notes
any kind Of paper credits to circulate money should
be individually responsible to the amount Of their re-
specve shares Of stock for all it debts and liabilities
and that suspension Of specie payments by any per-
son. association corporation issuing bank notes Of any
description" should thereafter directly indirectly BE-
sanctioned by law On the 9Th of April 1849-to give
full effect to the constitutional injunction and to
force the responsibility thus declared and "to provide,
las expressed in the titls for the prompt payment Of
demands against such corporations and associa
the Legislature passed act under which tho present
proceeding has been instituted. And to prevent II
would seem, all possible question evasion, the act In
series Of thirtytwo elaboratey drawn sections not
only prescribed the In which "such responsibility
i
should be enforced Sin other manner 0as Of these
sections allows judgment on any oebt exceeding one
~ aSnsrs sgans. Tue eoiporaon o,
sworn statement OF facts, shall certify that there is
good defence Another directs that upon satisfactory
proof to Judge OF the Supreme Court that execution
actually issued though not returned, cannot be col
ected che shall NJ make an order declaring the
insolvency OF such corporation or association"
And, even without first rsorting to the ordi-
nary method OF judgment and execution
operation, however, as has been stated OF only
twenty days-the creditors in days after ere
fusa Of payment may apply TOR order under which,
upon hearing Of the parties ON short notice il the
Judge oeermine that the corporation association Il
mot clearly solvent, shall make further order de-
clarng 1t "nsolvent" rst aiming any further exercis
Immediately" appointing receiver Is the Empire City
Bank then under the evidence before me, 'c .ary sol
vent The existing officers, chosen only month
two ago, know out little of ITS affairs. The President
indeed, from his declaration almost bs literally
their short and limited acquaintance with the insitu
ton appear from the lists before me, have partici-
pated In it's accommodations" to the extent OF few
thousands But the late cashier who, IL is said, knew
the institution well and had also share of its favors
although summoned has not attended, shed light
the cloudy II not obscure, portions his
He has deemed ssary-perhaps not easy
even to defend himself, and that against cnarge,
among other msfeasance on the face OF the
books Of having permitted director loan
pirate to himself more than hall the capital and two
three Others large portion Of the residue Enough,
however, appears, Notwithstanding the much to be
GREETED absence Of the late cashier 10 enable the Court
as seems 70 me- very promptly to determine that the
leading indication 1t has suspended payment. Second,
before the suspen unavailable ts assets and
so pressing the demands upon tuem that although
thorzed itself only TO loan at per per annum
was borrowing frequently aud in large amounts in the
aggregate more than $4,000, at the rate In some
stances, OF i've per cent per month. Third although
banking institution and bound TO the punctu
atty II refused TO pay Its undputsc debts for and
even for twenty DAYS and upwards after demand
Fourth It suffered judgments against IL TO be recovered
ano executions upon them TO be issued, and 10
remain, and 10 be retarncd, unsatishel, either
in al mr. n mart allnUa d tnft Ian
again its business TO be issued, and when that, a
compromise with the creditor, was withdrawn dis.
solved, or supposed to be- Immediately executed with
out security To three individuals, two Of them II not
all debtors TO the institution and selected by directors
all its property and effects, TO the nominal amount Of
nearly halt Million 10 pay its creditors To say that
such On institution Of whose history the above is
between ts nominal assets and its real liabilities is
'clearly solvent" and that the Judge should officially
determine IL to he So involves proposition utterly at
variance with ths common use Of language and with the
whole spirit Of tile particular act whose pr ,visoas
called upon interpret and especially with that
provision which makes unsatisfed execution In such
conclusive evidence of insolvency aud the only
necessary basis tor judicial declaration to that effect
Whatever may be the meaning OF the term
In other econs and in other statutes its meaning
In the statute before US can admit OF dispute and
that meaning, II Ia obvious, IL nothing less
than inability unwilngness 70 pay promptly AZ in
dieated by actual non-paymsnt persisted In or con-
execution. This view, IL will BE- observed dsposes Of
the recital OF solvency in the assignment II may that
that the assets If nursed BY friendly hands, win ult
Hatey, after the usual dsays and indulgence, yield
enough as that Instrument Processes 10 Contemplate
10 pay all the creditors in full besides surplus for the
benefit Of the stockholders But the very execution OF
the instrument under the crcumstances Il an admis
son Of present inability and Of the nsucency OF the
assets allowed TO be disposed Of in the regular
TO meet the cemsnds upon them else Il Ia amis
sion fatal 20 tine legality Of the Instrument that
made ior the and benefit Of the debtor and 70 de-
lay and hinder the creditor" Assignments made for
such purposes, even by solvent debtors, are void
S the statute o. frauds and stn more So
void by the statute OF 1sS0 II allowed 20 stand wnen
made BY such institutions In contemplation Of bank
ruptcy, they would nuly In effect the whole scope OF
the act. They would in such case, operate not q q
fraud merely on the creditors but a fraud on the
law superseding In practice every part Of the plan
its constitutional duties for will recoected that
the individual responsibility q the stockholrs
be enforced :" Ia other manner than that pro-
scribed by the act that unless the original assets
appointed under ts provisions there be resort
In OF deficiency, 70 the supplementary liability OF
the stockholders And i may be-for charity does not
forbid the supposon-thst 70 escape su IA liability
Of the inducements 10 the execution Of the assign
ment. II IL receiver. aud q receiver only that IL 20
convert the assets Of ths association into cash with
the least possible delay" and within ninety days
his appointment 10 declare dividend. And u Ii only az
ter such DIVIDEND rather within thirty days after its
being decaredthat tbs Judge can refer 10 referee
90 notice To all persons concerned, TO apporton the
claims remaining unsatshed among the individual
stockhoderr and 10 report the proper judgment 20 be
rendered against them and oricr confirming such
report 10 the only Judgment against the individual
stockholders that rendered and the mode pre-
serioed for entering and executing IL the only manner
In which the constitutional liability imposed upoa such
signment defeating all theee objects both legislative
and retaining effect after refusal OF
ment the whole control IN the hands Of the ockhoder
debtors, and shielding them from the claims
dtors b. permitted 10 stand At any rate 70 stand
in the way OF the prescribed seton o. the courn