The New York herald. [volume] (New York [N.Y.]) 1840-1920, 1859-12-18
More OF the Schuyler Frauds.
SUPERIOR COURT SPECIAL TERM.
Before Hon Judge Woodruff

Dno. Ao-'o"' o. 'ts-A.lruf and Oth>ss u.s. The Nev
Harm Railroad Company,-This was vr-sA. NAM
quits arising Of the immense fraudulent issue Of stocks
in the New Haven Railroad. The theory upon which q
recovery in this case is claimed is expressly except.
cd from tho decisions nade the Court of Appeals,
n"s - A. schuyler frauds
NO attempt will be made 10 reargue any proposition de-
cded In those cases. and our effort simply show that
the principle upon which this action brought has no.
only not been disturbed in those cases. but left
untouched brief statement OF the facts in the two
cases will Of itself present the difference in the conc
necessarily DO arrived at In the case at bar Mr.
Morris has in his possession certificate Of stock regular
upon Its face, and invites loan upon this security from
the plalntiH they agree TO this upon condition that
these shares shall be transferred them The attorney
Of Mr. Morris (who also the agent OF the plaintiffs in
the defendants leave transfer these shares to the
plaintiffs. He is there informed that these shares
stand IN MT. Morris name, upon tho defendants
The attorney surrenders the certificate to the transfer
agent, who prepares the transfer from Morris to the
plaintiffs, which Is signed by Morris attorney and
transaction perfectly valid upon its face made by par
ties conessed authorized perform this duty then takes
place. by which the plaintiffs are represented the de-
enoahts DOCKS as the holders and of these two
hundred and seventy shares In the the Mechanics
sank me whole transaction ended with the delivery to
the bank by Ky Of his certificate OF the shares no ac
on or representation upon this certificate ever having
been made by the defendants their transfer agent
snail attempt to show that the last cited was decided
against the plaintiffs because stopped Just there: and
that the Mechanics Bank had applied to the agent Of
the defendants for nfo nation, within the scope of the
covers conferred upon him. and that agent had received
the certificate hereupon the stock nv thai
certificate had actually been transferred TO the bank and
ey nad made the loan upon the faith OF that representa-
the Court would have held the defendants bio The
following suggestions will not be qucstioncd-That the
at OF transfer In this case within the express duties
o. tne transfer AGENT that II tho shares held by Morris
mad been valid shares he could not have transferred
neln 70 the plaintiffs In any other way through any
other ocer on the part of the defendants the 23d OF
June 1904 than by the way and through the officer by
whom the act was done that the receipt of stock GER
uncate by corporation and the transfer Of the shares
Wncn appear to be represented by the certificate by the
person IN whose name they stand the books to the
uaDsferee, are representations the tr Ansferee that
, me party making the assignment is the owner of
me NUMBER OF shares stated In the certificate, and
mas the night to transfer the same, upon the faith of
which the transeree has right to rely, far at least
az against any defence which the corporation up
passed upon the untruth OF those Representations. H.
thep these defendants who can only sneak through
agents mas an agent appointed to perform specific duty,
rom "nom alone certain facts DO ascertaned and
this agent makes to third parties
ng these Facts confessedy within the scope Of his specific
duty upon the faith Of which innocent party parts
with bis money, the consequence is inevitable that the
corporation estopped from relying upon the alsity Of
sn II pre- as thei, defence By looking caro-
point decided by the Court the Mechancs Bank case
we viii see very clearly the exception this case makes to
H. IDe propositions settled In that were Those
which made the certificate In the hands of Kyle void
independent Of the fact that he was prvy to the raud
power issue certificate for shares Of stock cIcan
upon the conditions precedent Of transfer on the books
BY some previous owner and the surrender Of that own
er cerncate He was the transfer agent merely ana
MS powers were expressly limited to that part OF the
business Of the corporation BE had general certifying
nor any power at Ill to certify except as ucden
as an incidental power could only DO exercised up
on the conditions named" This proposition, which is
does NOT touch the bar Ia the exception and
that gives all its strength to our support.
s.a Inc cse now being argued before Judge woodruby
Noyes ana 1alinadge FOR the railroad company.