Alexandria gazette. [volume] (Alexandria, D.C.) 1834-1974, 1889-01-28
n.c,sion in the Bank Case.

+, delivering the opinion in the case
,bs Farmers and Mechanics Savings
81 Of This city, after reciting that the di
80 had been grossly negligent in the dis
If their duties, and were therefore
80 .a,n.ible to the depositors for the money
aastsd away, said
~ csono better close the discussion
,f,. olsstiou than By citing the case OF
up' monk against Bnsseux, much relied on
,'' no counsel loc tho appellant, VINO says:
" u, ,,.afion has been toe subject oflnves-
and ia}jo!.i differentiation by the
.} : o,e, Iircul; Court for the Eastern
No., NJ V,rgiuin. Judge Hughes, in an
Vrt,,st. opiuion stating the law with great
t .'0.'3 cieafncss, exhibiting a clear and
examination of all the authorities,
"a the defendant directors liable upon
ms GROUND Gross nattentlon and negll-
'' slowing fraud or misconduct on the
NJ npcnt-. officers, or CO directors,
ai.S., could have been prevented II they
"a ciyen ,riipary care and attention 10
'" ~ .Iesl This opinion is not only the most
...,.r,,, examination hut the ahest exposl-
,.a n tbe iaw upon the subject the writer
Nv. ,sao abe 10 ilS, a:ter examining many
-,,o,iti,- and he might we'll be content to
~, The laH of this case upon the opinion
ofJulse Hughes
". will. continued Judge Lacy, pro-
.ad IA briefly review the facts of this
o c,.e 10 which this we'll established rule Of
law /. to be applied.
onesiinc arises in this case rs between
IN. directors and the depositors, not between
,S. directors end The =tockhoders. The by
nus AZ ANS bank prescribed weekly meet
t. capce de.! that these We're scarce
f. ever held the answers admitting that
f.,rql NEE. ings were not held. The decree
,f.t. Circuit court Of Alexandria city that
ts,r4ar- 20 he Court hat there has been
n, .art dgrt4iriion OF duty on the part OF
H. diroctnr- or any Of them a. 10 llX upon
tl,,o pfrsouaj responsibility cannot be sus'
famed rpou aoy sound principle whatever.
I-poa rhN, principle can the president be
held NOT to he personally liable for the acts
already detailed concerning him The
Commissioner reports that he withdrew
without authority bonds of the bank dep0D'
lied elsewhere aud caused their sale that
taoyerlrew his account and in other ways
converted the property OF the bank, aggre
gazing 81 1885. The passenger railway
WAS al.Owed to overdraW its account TO the
4 amount of thousands $ll ,3lI ~ at ore
y time. The no rs Of the company were dis-
& coun ed to the amount Of S. 800 aud ut nla
4 m.itfWere neither protested, renewed, collec-
y eI.nor sued en-. The overdFsft was allowed
81 oucrpa-c for year and more without &c
y curly until il reached s. $50 Is, when was
q entirety lost to he bank the president OF
the bank being president OF this company
y mart oi tle lime Mud one OF the bank direct
s on being president Of the company the 9th
Il er part O The time in question, while
y ht treasurer of the railway compa
II nv was the cashier Of this savings
Il bank. sli-on was allowed TO withdraw the
s soIa valuable security for his note OF ~ 0O0
q snd that was lost The president. lent his
81 bro,ler Ssh - practically without any
81 security ard thai ~ ~ lost, and actually lent
& hm Il II o. tc}c months beiore the bank
= closed It, doors lending To his brother
6 with no security .Xcept worthless endorsers
81 $500 when ne had already gone to protest
&. on uJie Of $500 But the co directors seek
4 lot-cap. responsibility for all thia. incluG-
81 icg tie large loss TO the Washington and
~ 0aO railraad, by claiming to have no actual
knowledge otil at al. DID they exercise
Il ordinary diligence to inform themselves, as
their duty certainly required that they
@ should they we're required to meet week
"a Why their own bylaws. They did not al
# ways meet seml-annually, meeting some
a times once year MS We have stated.
Is The directors, continued Judge Lacy,
81 were in duty bound to cause the hooks of
s. The bank to be examined OF regular inter
~ ys, This they never did at ali through
out their whole career, nor did they ever
IS call tor statement Of their accounts with
other banks Fheir vaults and their caeh-
S drawer were emplied by illegal abstractiors
@ sld m-oiyent .uaus, and they admit that
Hey never knew i and plead this as their
1u.p!on The stock subscribed Tor WAS
# not paid M as has been stated, and yet
'u'o part a. was. paid up was treated as q
oal aodlnlorest paid on t.; and large part
nAd reyer been pei up at the tiDe OF tie
'u'pfus.on sad some of has not yrt been
iaN ny iasug a bank With so small o
,0IuinaI capital, with empty vaults and
lvpoliei ca dfWeer, they owed at the sus-
ri'lou OF the eank 20 depositots who had
unlisted to Ien their money $53 ,063 63,
VI "hichloc> have been able 10 pay only 10
Per cent.
=. th'se directors had ANY dnty to p. 'orm what
wy .'"i d IhelT depositors. The records of this
IA ho SLOW Us performance They plosd IT,
IL .AA.e vne of thcr number was the president
@ Ie VS.. mgton and ONO railroad in its last
~ .s aii Suew It's condition aud secured him
lHi ihe rocs OF the hank were SLOWED to
& ~ UNPUBLISHED. unsecured. unreccl,lcd uncol-
"a '',ea' sn1 uu-ued on
que OF tiell number was the president of the
Ks AA.a19 Passenger Railroad Company and
AleT t condition
M 'Ds OF their numb, was the brother of a debtor
81 VS. nso.ycnt 81 the time of the loan OF
@ l. , To HIM without security
"'Ai.ut To conceive that they could have
30 r sHersnt of all ths Int suppose they were
M ,.1 .y required that they should have looked
M i,,. .u'a at these matters, and if they neg.
Is ,-..' trusted hem 10 others and loss has oc-
e, sngu,' 1t I'll upon them or upon the de-
M - VINO hal trusted them and whose trust
y5.' .,a1 e't'el aud to whom they had solemn,
& an, rVl0,#'l such care aud attention rs was TO be
g.,'o OF s'''i businessmen?
M s1'lH the record shows that these director
E fan them have been guilty of such negti.
& 'ae premises as makes them personally
Itce. al.