New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1893-03-10
THE RAILROAD COMPANY MUST PAY.

DECISION by THE COURT OF APPEALS IN RI
GARD TO FORGED STOCK CERT FIcArEs
Inc Court OF Appeals has affirmed the decision q
the supreme Court In the suit brought by the rlnA
Avenue Bank against the Forty second ST. and Grand
ST. Ferry Railroad Company to on certfcates
VI the railroad company fraduleDtly issued by Eben
S. Allen, a former president Of the company. The
court holds that the railroad company Is liable for
the stock Tie decision Is Of interest 10 all oicera
OF corporations and stockholders, as II defines us
liability Of corporations in the case Of fraudulent
issues by officers w.rn one names an
forged
Eben 5. Allen Is now serving fourteen years term
In Sing sing Prison for his part la the affair." He
entered the employ Of the railroad company In 1863
as a car starter and worked himself up be- secre.
tary treasurer and transfer agent In 1854. In that
year he formed partnership with Frederick ".
IIoicle carry the iron business under the nans
Of Allen & Co.. still maintaining As connection With
the railroad company. Hofee owned one-fortieta
part OF the iron business. The iron company BE-
came pressed for money and Allen issued TO IIofee
certificates Of stock OF the railroad company. fs
certificates said their face that they We're not valid
unless signed by the president and secretary, Allen
signed his own name secretary and forged tint Of
Charles Curtis. at that time president. ...
Hofele raised money the certificates which repre-
scented par value OF several hundred thousand
the Fitch Avenue Bank security for a loan. Tie
bank sent the certificate around 10 the Office Of the
company for Identification. Allen there to To
ccive IT, prom it all right, and TIE bank Loaned
Tie money about $4,000. The bank aftervayd
loaned money Oh u certificate for fity shares pre-
scented by HOfele. one day certificate was sent
TO the railroad Office for Identification when Allen
was not IN An Investigation followed, resulting IN
Aliens conviction and sentence in August 1862
Hofele not prosecuted.
The Filth Avenue Bank brought suit TO recover
On the two certificates. Judge IruaA decided that
the railroad company was liable for the first cer.
tiicatc which Allen had identified. but not liable for
e.. second which had 10: been so identified. Iht
ruilroad company appealed from the decision on the
leo share certificate. The Court Of Appeals holds
that the railroad company IS liable. Notwithstanding
the forgery of the presidents signature on the ground
that Allen In countcrsguing authenticated The GER
tiicate The opinion goes on "a say: II TIE pres.
dent should forge maine u the TREASURER 70 ose2
and cCunterslcn Il and put II In circulation and use
the proceeds Tor his individual benefit, We apprehena
n woud not be doubted that This wound Dc resatue0
NJ a certificate Of the due execution OF tne eheeM ~
far as 10 render corporations respohs.u,.ee 10 az
person Woo innocenty and In GOOD lai'n oecams
the owner Of IT. l.. a., 49,.
The general interest in the opinion Is IN us oear
Ing ON The utility OF the precaution usually aKen
signed by moro than officer, Its special ral4.
may be the pushing OF other suits against os NJ
rcod company by the other holders VI tne i@eo
certificates Issued by Ailen