, 1873-09-28
.1ndre Drun1nond on Treas1lror
gcnnl1non's Sct-OH.
T,osses Under Policies Not Allowable
Against Subscriptions to
Stock.
Unpald Subscription Is Trust-Fnntl'.'
The Stakeholder Must Pay Up
Ills Stock,

- ,s.u Asauneo of tho Mutual 8ecurity Insur
.noa oompauy, defendant" delivered In tho United
Btatss Circuit Court, nbort week a8o' |
osrtan rn Jss q q liz Assignee Company The
aht aought to DO set of - foows: A. he TINE
tho n Chicago on tns sh nncs n% e Of
aeant o Company es indemnity lot ,c ,osa y mr.
sustained oss o largo n n, nnlces and for
ssaS S;es he mss ooany Mnm is ae rha
tho rendered The nv s orea asa
s To- mhs 1s'Enssa 1Esnsa Te a tic s's eS
tgssnst asno ms or oeree asains for these
doans Toy md tho rs nsx,sa srose as fa tho
heir esuSscrpons in ono to gtvs n9tes with
5Gs1 ss,roa Us Pss When oo OF Ao
wss subscribed md PER cont sad P'1Sa t. cam o
Inc remainder @ aa of tho so oq%sl sn
scr;Scrs for oonsiderabo amount Of tho stock md
5aid in iustalen md gave M nose5 ~
This has mover been wholly paid by tho plaintiff, anu,
II tho tino Of tho decroo Of bankruptcy be wes n,
dotea 70 t1,o Company Tor pnfs OK LID 1''''''p'A
rho oti,er demand WIS follows: From the organl-
s1Gn Of the nD of tic Executive md r.
uaucisl Committee, and ono Of iH chief managors'
tho nsini proposed to tako tho hount hold It sub-
Ps IT 10 Ss y a noafd
1ao, od money an interest Tas credited Vt .ga On
ss ssn s In fss % ct s s
~ for aomo years. There were other n9sots when in
,pssT It st stsea4g s ass' md Sf'n deposited
c1odit NJ Of tho oomrauy in tic n1eolentce'
Natonnl Bank, Of which tho plaintiff was rEss,aont;
las Hs further cai was made on no sto0k aubseT.
ion, and Afterwards, what obtained, - vol %
%oeh.nes stts6 h.tena Bank to t tho pant
Thoso was alwnys Treasurer Of tho Company and a
iSu IN g IT, md Was Treasurer M 1t tho tne ro oct
and o. 1871. In 1870 the plaintiff objected to psyinS
aonoy pn sS' Of dsei the conpany wss permitted to re
main H. his s va as oresa t. the o So s
nv caeh yoar at first 10 pcr cent interest," and tor tho
ear ending July 1sI or cent s In95e FEY as tha anng
made from time to time With interest credited Tho ,s
Company, Comp treatc the money IN tue hands of & tho
stock or c9n 9seo asse m or cSsn aa a
~ sno Inn citI treasurer. 1t tle tirno Of tho ro
ho paintiu had n his htan" y paSr .! aa te ls
%os sslsmaa Sy tSo snnG TINT ct he tine Tho
nas ol ee of asses be a nude
svances the to enable 1t to pay hs na aae r.:
rght to Rot 81 his osses Under policies the oom
psny agans ills subscription TO- ,ho stock IL r. .toa one
wh9t fs III pni coapny o'S @ Gny
o unirtiT On hia pocIcs Of Insurance Ia debt duo
T1S osa ases hna tas e
as ave areay ecsd il s ssss Ct DEahS D1;an,
the rcauIt woud be- to pay tho plaintiff bis Gain
against tho Company IN preference to othos ~ IT,
stso Creating he corporation charter author
lied tho Company to commence business On tS mr
vided the payment Of the remainder of tho Htock "nI
secured. .,u,o,,,a ~, ator,,
hs s E. p.2mnS # TIT T's sesursS s
Stand II ho pace Of ha money i waa stu intendst
fund to protect the s0sso oi ne IN %h
ho fund could he mae available IN case o. necessity
ind which has boen followed in nis easo 81 ." a us
os obocton to tho stockhoder inaistng that hs lou
pn policy should bo an answer to G9l = m 10 e1 Pc
@Rssdiaey Rssd hs to refand 10 Il the loss
ts .e.oG IT, but whcre tho Company is tnsolyent On
bankrupt 1t Ia different. Some ono must sustain aa
Ssa and Who hi Las aqss0I no paid IL eh %
WIG nays Ss, o RoS;y s;,to On " %hs Il
s T. Il. or sas h. Baa is
oes snd KIT eTs i @
tween the two cases. We haye the right TO 9aago
causes from their easf ana 70 ..nson Tesion
produces much LOSS o tho general creditors Of @ Il
anss sy .as tssas ssse fsisat 1sp
isw @ or equity. Where rarty s.5s 6eEsows III fro
Se Is al ordinary debtor Of he Company qhd the,
doubtful On general principles Of ethes bat II ~ Il
of te capital Of lie ooupany md hold It. III trust
hs tsu 'rfSF" S uuder S4' .hs II ''
case, to Ply himself IN tho wy ho ger sseks .
eir ed.nnago .asaSs IT s ID dusiasy rson
erepce over the other creditors, not warranted BY
ss ses RunsPss u f
eoSF Of sS It Il see Sc s sy ss
gsnGs''s g. sse-o oa:''y ytechnesly ecoa lav vii
relations f taS parfa nay sonss mot 99
comrt Of equity for relcf, mud wo hnk ho should
do equity, by ahinR good his SHIRE Of the a';sF saF
ia creiit aud were enabled to Htart III business.
equity because he s sr;n.D II oe S ssi'5 e.
rsfs psay IS II insolycnt M aud il bankruptcy
lte Enssh authorities were sitea by
the case In favor Of tho aet-oH.
Tue f,rat wua--1n re Duek%orsl1, lay ", NeR
onSnssry 1pRfs Els cass Sssfs
tho various statutes referred to. Tho purity haa
ucrbed for certain shares Of sock i &c sopany m,
assignment for the benefit Of ht4 @ creditors. Mish M
fsSss9sa sween tho u Of tue Company
der tbs winngnp aet, ana tho Trustees ~ under ;l,.
.et.oa heSlebs from tho Company t. tls la1tIy a
calls for tito subscription, nui tho Court held tat
s ss ~ss ons Il osans s ns isS esfsa
within tho statute in bankruptcy ~ to sot.on; It
se''Sf csen aaiuaeps ''s tSS e esss at ts wou
10 allowed, because tho true conAtruction OF
nj Sn' aSt sts'''ns g. Court o'ts E!sty