Nashville union and dispatch. [volume] (Nashville, Tenn.) 1866-1868, 1868-02-20

Term, 1857.
Reported for the Union and Dispatch. by S. J.
Henderson. Attorney at Law
The Bank Of Tennessee and branches we're To-
Heated AZ certain points designated by an art Of
the Legislature. and could only be ren1Oved
BY the power that located them" EFi#
The President and Directors had no authority
70 remove the assets to places not designated
by law" r....
The act Of the Legislature passed July, 1861,
authorizing the bank 20 receive Confederate
Treasury notes in discharge Of the debts due
the bank, was null and void from the begin.
ming"
Whether or not Illegal currency voluntarily re-
eeived in payment Of the debts due the bank
i an executed contract within the rule settled
by TINS court, "a Cold. 473, depends upon the
residence Of the parties at the time payment
was made. III at the time Of payment one Of
the parties resided within the lines of the Con-
tederste military forces and the other within
the territory permanently held by the military
forces Of the United States, it would not be
binding on the bank"
Bank Of Tennessee e. q. N. Woodson =, al
The Chancellor in this case pronounced
a decree for the complainant Ia the Chan
cery Court at Clarksville, from which the
defendant appealed TO this court
The facts necessary 10 be stated are az
follows: On the 18th Of June, 1860, +. w.
Thomas and Montgomery Davil being in
debted TO the Bank of Tennessee, at the
branch located at ClarksVille, in the sum
Of S25,095, by four notes for $8273, each
payable in Elk, twelve, eighteen and twenty
fonr months F.. w. Thomas conveyed to
the President and Directors of the Bank
ten acres Of land adjoining the town of
Clarksyile 10 secure the payment Of the
debt. a power was reserved in the deed
authorizing Thomas 10 lay off said land in
lots and sell the same for the payment of
the debts specified. On the 7th Of july,
1860, Thomas having divided said land in
lots, sold the defendant, Woodson, three of
the lots at the price Of 81, ,474 II, for which
sum he executed his three notes for SIS24
each, due the 18th of April 1861, 18th of
January 1852, and 18th Of July, 1862, pay
able TO II. w. Thomas or order, and were
by him Endorsed and delivered to the
bank in September, 1861. The first note
not being paid, il was placed in the hands
Of an attorney for collection. In February,
1862, about the time Of the fall of Fort
Donelson, the assets Of the Branch
Bank of Tennessee at ClarksviIle we're
removed by the Cashier, by the advice
and consent of the President and Di-
rectorH, TO Chattanooga, TO prevent them
falling into the hands of the Federal
forces. From that place they we're af-
terwards removed to the State of Geor-
gia, and held by the Cashier until the
close of the war, two of the notes thus held
against the defendant were carried to Chat
tauooga. Woodson continued to reside in
the county of Montgomery, Tennessee, until
the close Of the war. After the removal of
the assets TO Chattanooga, the business Of
the bank was discontinued, except the
Cashier having charge of the assets received
in payment Of the notes owing by its
debtors. The Cashier continued in the
custody and control of the assets until tbev
were returned to the State.
The Federal forces occupied the town of
Clarksyille permanently. About the first
Of January, 1863, and from that time until
the close OF the war, il was garrisoned by a
strong military force. In August, 1863, the
defendant, Woodson, and +. W. Thomas,
who was a resident of the town Of Clarks-
vile, procured w. F. Lndly to 20 10
Chattanooga, where the assets of the bank
were. They gayehim Confederate treasury
notes, with instructions to pay of their in.
debtedness to said bank, and on the 10th
day of August, 1863, the said Lindly, as
ths agent of the said Woodson and Thomas,
paid to the Cashier of said branch bank
tie said notes in Confederate treasury
notes. and he delivered to him two Of the
notes, and executed a receipt against the
note that had been given to an attorney 10
si,e upon. AT the time OF said payment
the Federal forces occupied and held nos
session of the county of Montgomery and
CITY of Nashville and other parts Of the
territory of Middle Tennessee. Chatta-
nooqa was in the possession and military
occupation of the Confederate forces. Upon
the return of the assets of the bank to the
State, after the organization of the State
government, Samuel Watson, in pursuance
Of law, was appointed thu assignee of the
bank, and filed this bill TO have delivered
mp the notes and enforce the collection by
selling the real estate upon which lien was
retained for the payment Of the purchase
money. Woodson in his answer admits the
material allegations of the bill, insists the
payments were bona tide and made to the
proper officer, that he had the right to re-
ceive payment and deliver up the notes,
and the receipt executed by him for the
note in the hands Of an attorney was a
valid payment, and brings the case within
the rule settled BY this court of an executed
contract.
In the determination Of the questions
arising upon this record, il becomes neces-
sary 10 look to the charter to see the object
and purpose of its creation the power
and authority in its agents or officers for
ils control and management, and the rela-
tive status Of the parties At the time of the
alleged payment Of the notes. The Bank
of Tennessee is public corporation, chart
cred for the benefit Of the State Its CAPT
tai stock consisted in part Of the common
school fund, which the State held as trustee
Coz the purpose of educating the children
Of the State, and the surplus revenue of
the United States deposited with the
State under an act OF Congress
approved June 23d, 1886, for the repay
ment of which the faith and credit Of the
State stood pledged, whenever required by
the Secretary of the Treasury, etc, etc.
No portion of It's stock is private. 1t is,
therefore. public corporation, acting upon
the funds and credit of the State, in con
formity 10 its charter, for the convenience
and advantage Of the public Furman,
Green & Co. as Nichol. 3 Cold.
Its charter is a general public law, and
all persons within the limits of the State
are presumed TO know the purpose of its
creation and the nature, character snd ex
tent of its powers. The principal bank
and branches were located at certain points
designated by an act of the Legislature,
and could only be removed by the power
that located them. Its officers were trus-
tees vested with limited power to act with
an the scope Of the authority conferred, for
tn convenience and advantage Of the pub
lie. The power Of the President and Di-
ractors being limited, and giving rational
exposition of them, il cannot be pretended
they had authority to remove the
assets TO points or places not designated
| by law, Tor purposes not contemplated by
the act Of the Legislature and not within
the legitimate scope of the charter. We
think, therefore, the removal Of the assets
Of the bank 10 Chattanooga was illegal and
not warranted by the provisions Of the law
creating the institution and locating lis
branches, and Is governed by the principles
analogous to those settled by the Supreme
! Court OF the United States in the case OF
| Minor IS. the Bank of Alexandria. /
Petire, 73; though We think this stronger