Richmond dispatch. [volume] (Richmond, Va.) 1884-1903, 1889-01-26
4tb Hughes. aos, and the authorities cited in
the nI,ininn
r.crs rs rpg ALEXANDRIA CASE.


the opinion.
FAcrs ID TIRE ALEXANDRIA CASE.
We will now, continued Judge Lacy, pro-
ceed to briefly review the facts OF this case.
10 which this well-established rule OF law
to be applied.
The question arises In this case as between
the directors aud the dcpositors, not between
the directors and the stockholders. The Dy-
laws OF this bank prescribed weekly meet.
ings. It's conceded that these were scarceiy
ever held. the answers admitting that formal
meetings were not held. The decree OF fbe
Circuit Court OF Alexandria city that II ap-
pears 10 the Court that there has been no
such derelictou OF duty on the part oil the
directors or any OF them as to fix upon them
personal responsibility cannot be sustained
upon any sound principle whatever. upon
what principle can Andrew janet
son be held not to be personaiiy
liable for the acts already detsiled
concerning hIml The Commissioner reports
that he took 81. 1913 out OF the cash-draw-
er: that be withdrew without authority the
bonds OF the bank deposited elsewhere,
caused their sale, and appropriated the
money to his own use; oyerdrew his account
S3H. Ga. and in other ways converted to his
own use the property Of the bank, aggre-
eating sI1,713.97. The passenger railway
was allowed 10 Oyerdraw its sccount 10 the
amount OF thousands -Sll ,3l4.01 at one time.
The notes OF the company were discounted
10 the amount OF $1,000, and ut maturity
neither protested, renewed, collected, nor
sued on: and the overdrait was allowed TO
Increase for year and more without security
until It reached e. $50 4J. which was entirely
lost TO tue tank; he being president OF thls
company part Of the time and Que oil the
bank directors being president OF the COM
pany the other part OF the time In question;
while the treasurer OF the railway COM
panv was the cashier OF this savings
bank StilsOn was allowed to withdraw the
sole valuable security for his note OF S2.OOO
aud that was lost. lie lent his brother
S3,3l1 .G2 practically without any security,
and that was lost. and actually lent him
Sl.211.62 Il fer months before the bank closed
its doors: lending t. Robert Jamerson with no
security except worthless endOrsers $1,000
when be had already gone to protest ON q
note OF $500. But the co-directOrs seek 10
escape responsibility for all this. including
the large loss to the Washington aud Ohio
railroad, by claiming TO have no actual
knowledge Of Il at all. Did they exercise or
binary diligence to inform themselves, as
their duty certainly required that they
shouIdI They were required to meet week
ly bv their own by-laws. They did not al
Hays meet semi-aunualy, meeting some
times once year "a we have stated.
DUTIES OF DIRECTORS.
The directors, continued Judge Lacy,
were in duty bound to cause the books
OF the tank 10 be examined at regular
intervals. This they never did at all
throughout their whole career, nor did they
ever call for a statement OF their accounts
with other banks. Their vaults snd their
cash.drawer were emptied by Illegal abstrac.
tons and insolvent loans, and they admit
that they never knew IT,. and plead this as
their exculpation. The stock subscribedior
was not paid up, as has been stated, and yet
such part AS was paid up was treated as a
loan and interest paid on 1t; and alarge part
bad never been paid up at the time OF the
SUSPENSION. and some of ii has not yet been
paid up. Having bank with 50 small a
nominal capital, with empty vaults and
despoiled cash-drswer, they owed at the sus-
pension OF the bank to depOstoTs who bad
intrusted 10 them their money $j3,0G3.63,
on which they have been able to pay only 10
per cent.
II these directors had any duty to perform
whatever toward their depOsltors, the re-
cords OF this case do not show its perform
ance. They plead ignorance. One OF their
number was the president OF the Washing
ton and Ohio railroad in ITS last hours and
knew its condition and secured himself, but
the notes OF the bank were allowed TO sleep
unprotested, unsecured, unrecorded, uncol-
lected, aud unsucd on.
One OF their number was the president OF
the Alexandra Passenger Railroad Com
pany and knew IFS condition.
One OF their number was the brother OF
-. 4 flnA "
insolyent at the time OF the loan OF thousands
TO him without security.
1t is difficult 10 concede that they could
have been ignorant Of all this; but suppose
they were, their duty required that they
should have looked well Into all these mats
ters, and il they have neglgently trusted
them TO others and loss has occurred, should
It fall upon them or upon the dep0sitors who
had trusted them aud whose trust they bad
accepted and TO whom they had solemnly
promised such care aud attention as was TO
be expected OF good business-menI
We think the record shows that these di-
rectors, and all Of them, have been guilty OF
such negligence in the premises as makes
them personally liable for the losses caused
by their negligence, and we are OF opinion
that the Circuit Court OF Alexandra city
erred in holding them eNonerated.
While this is true, there is nothing in the
record which shows any bad faith or tends
to show any dishonesty on the part OF some
OF these gentlemen, who appear to have con-
fded their duties to others aud to have
been betrayed by them; but this was such
negligence as will fix liability upon them.
Their act in assuming this attitude 81 trust
and confidence was voluntary and led to the
confidence which has resulted in loss. We
are Of opinion TO reverse the decree OF the
Circuit Court OF Alexandria city, appealed
from, and 10 render such decree here as the
said Court oughf 10 have rendered.