New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1880-08-13
THE COUR7S.
DECISIONS AGAINsr TRUSTEES.
BREACHES or DUTY IN TIE MANAGEMENT or III
RlNp srKFEr SAVINGS BANK.

BREACHES or DUTY IN TIE MANAGEMENT or TIE
BOND STREET SAVINGS BANK.
Justice Van Worst rendered two more deci
sons yesterday IN Supreme Court, Special Term On de-
murrers 10 the complaint, actions brought by willis
s. Paine receiver of th. insOyent Bond street Savings
Bank against its trustees to recover for the losses re-
suitilg from alleged breaches OF duty in the manage
ment of the banks afir-. In suit Of the receiver
against Erastus Mead and others, Justice Van Worst
held that a loan of $4,000 made by the trustees 10
B-jlmtn ". Wright PAYABLE on dom on the security
Of bond ami mortgage on premises caei Bosc0Oel"
Wetclcster County under the facts al egel an
III gal and grossly negligent act The sum loaned OK
ce ded thu amount thai the charter directed should loo
invested I'm tlat manner and upOn vacant and I'M
productive land worth Nv 0-Hle sum loaned. the
TRANSACTION" the opinion reads, was ct that time en-
tered on books OF the bank and although made 10y
the bank officers presumed 20 have been done with
the know edge aud consent of the trustees. They
legally chagcabo viva notice of The acts OF tie OG
and about the bushes. of the bank. especially when
they are entered the books and Il they would escape
liability they must diss rom and oppose Illegal
tmpru ient ac-ion aud se.kt) remove officials who DO
tncm The trustees are responsible FOR ne acts or Off
GERS whom they place aud retain IN position As the
complaint charges the trustees with knowledge aud ag
proya of the act they rendered liable, tie Justice
finds. n therefore gives Judgment the plaintiff
on the demurrer
Others Justice Van Worst remarks mat what he decided
u the OF Paine, receiver, against Bowman and
others (repOrted IN last Tuesdays TRiBUNEl 20 the
liability or the trustees OF the Bond street Savings
Bank must be regarded the law OF the far
they correspondcd with other. But tlis pre-
scented features peculiIr to itself The complaint
contained two causes OF action L. the fast, the de
PENDANTS sought to De held ldoe Tor an alleged
breach OF Ti~t ia 2DpgUpEItJg tac money OF tho bank
HE purchase O. Nc Juuis ana mortgages tor $1,000
each made b} on" DJunrlv, the mprgtEcs being upon
property m Naudc rDilt-aye, BrovAi51. 1ese bonds
aud nOrtgag were owned uV George ". dead, a trus
OF the bank, aud purcna-ct rom hin by tie
bank with IFS Dis. BY the direction OF he truslses.
The OF the de tnd1utS VINO dcurrd NOicd tor
and approved the purchase II alIeg ~ the con-
Daint that The nOltEagrd premises were not productive
property aud that It's value uncertain contingent
and speculative dependent upon the completion OF
building thereon That me premises not worth
twice the amount Of the mortgages.
justice Van Worst assigns the 10 lowing as the reasons
for holding that the purchase OF the mortgages
ultra wires. - They purchased from trustee.
such dealing by trustees with cO-irus Is Itself,
open t. just cOn but tue transaction Is IN violation
OF the biOn cOntan In scctlOn o toe charter
of the bauk. If cd that trustee shall directly
indirectly borrow any Of tue funds Of the bank in
any manner use the same except To necessary
rent expenses Trustees VINO sanction sucn use o. the
money by Co-trustec, equally with HIM violate the
law The force the prohibition is not avoided by
sorting purchase from trustee Of MORTGAGES,
stead 81 oanng money to him thereon. Where the
substance OF statute IL Violated the form which
gwen . the transaction Ia immaerlal. II also
violation OF the The charter which pr0hb
tied lending more than 100000 to one individual
bond and mortgage. Buying mortgages much
within the prOhIblfloI as lending money and taking
mortgages. In addition the mortgages upon
productive properly not worth double the amount.
required by the charter" In Cns also judgment
given for the plaintiff on the demurrer.