The San Francisco call. [volume] (San Francisco [Calif.]) 1895-1913, 1895-12-10

July 1883 $40 992 81 was sufficient to pay in full
the balance then remaining due on the note Paoou
and Mackay were directors of the NeVaua n"nA'
and each owned about one-half Of its STOCK 49,,
The theory of plaintiffs case is that fIoou
ana Mackay formed conspiracy 70 s go p ~ tlla
OF Patton's note by inducing the directors OF tiie
mining company whom they contributed, ~ vote
Patton gratuity of $4,000, which the min Ia,
company did not owe. it being understood tft .,e
money, when paid. would be turned over W the
bank in payment of Patton's note s,,,o,.
MY views as to the relations OF flood anu 10y
to the directors of the mining company have. been
stated in the opinion this day filed IN the case Oh
$3.50 and it is unneces sary to repeat them here
If Patton had been without other means 10 pay ms
note to the bank 1t would look very mucn as II tle
U,UOU was given to Patton for the DeneLt VI tHe
bank.
1t appears, however, that at the time OF the pas
sage OF the resolution and of making the seveIai
payments. the bank held as security for fattons
note the following securities, viz: tooo shares VI
shares OF Consolidated California and Virginia
Mining Company, bonds of the southern racine
Company or Arizona TO the amount OF PoO,VoO anu
200 shares OF stock of Anglo Nevada insurance
Company.
The evidence is that at the dates last mentioned,
the Southern Pacihc bonds were worth S32.10O
and the stock Of the Anglo Nevada Insurance
Company held by the bank was worth $Z!. boU,
making together S54 800, or several Thousand Gol-
lars more than the balance due on the note. Inc
bank held. in addition, 1900 shares OF STOCK or the
Consolidated California and Virginia Mining Com
pany and 1000 shares of the Combination Mining
Company. Patton died in 1892, leaving an estate
appra ED Mt over 100000.
AS the note or Patton was amply seCureu, Gne
money was paid to Patton for his own dement, and
not for that of Flood or Mackay. AS stockholders
OF the mining company they were losers by the
transaction. AS stockholders OF the bank they
We're not gamers.
From beginning to end Mackay is not shown TO
have had anything 10 do with the transaction, or
even to have known anything about IT, The sole
ground of his alleged liability is that he was a
stockholder IN the Nevada Bank.
1t is claimed on the part of plaintin that when
Patton extinguished the fire he was merely per-
forming his duty as superintendent, ana That the
ma N on ne mo
salary for such service was without consideration
and in excess OF the power OF the board OF direc-
tors. This question might have been more prop
erly tested in an action against the directors or
Patton. The present suit is against Mackay alone.
l am of opinion that the board had power to au-
thorze the payment.
quote from the testimony Of Mr.. Fish as fol-
lows: "There had been talk OF hiring other men TO
extinguish the fire. and Mr.. Patton SAID he could
do it, but he should want extra compensation. He
was instructed to go ahead. That was before he
tried put out the fire. / reported it to the board
OF directors we talked it over among ourselves"
Although no formal agreement was made with
Patton before he began the work OF extingulshing
the fire, the board Of directors had the power to
raify afterward the acts Of the president OF which
they knew at the time and 10 which they made no
objection.
After the fire had been put out Patton demanded
compensation for his services. Acton on the part
In explanation OF the delay Mr.. Fish SAYS: Per
haps we were waiting to see whether the fire was
completely extinguished, though L think that we
were pretty we'll satisfied
Fish further testfes that before leaving for Aus
tralia In August, 1887, Patton instructed him to
deliver the money to Mr. Berry when 1t was paid.
Berry testified follows: 'At the time Mr.. Pat
ton left for Australia held his power OF attorney,
and he told me before his departure that the Con
sodated Virginia Company had promised to pay
him $50,000 and he had directed them to pay it
to me as his agent. He said: When they pay that
amount you apply il TO my debt TO the Nevada
Bank of San Francisco. In case they do not pay it
and the bank demands their mony, you sell my
securities bonds and the insurance stock and
the other securities thereto pay that note"
According to the evidence Mr. Floods only con-
necsion with the matter that upon being con-
suited in reference to paving Patton $4,000 for
his services he expressed himself as satisfied with
| that amount, adding that the company was lucky
to get of so cheap. That the payment was not for
the benefit of either Flood Mackay has aready
| been shown
The resolution of April 3, 1888, has. since
its adoption, been spread upon the minutes of the
board OF directors AT page Is of the printed an
nual report of the mining company for the year
1888, which distributed among the stock
holders is the following item OF disbursement re-
erring the payment of Patton. Fire extinguish-
ment $780, 600"
Under the circumstances of this case no fraud or
concealment being shown and particularly when
some OF the principal actors therein have died.
think that acqulescence by the stockholders for
three years and eight months, which elapsed be-
fore the commencement OF this action, should be
deemed ratification of the transaction complained
of and bar to any right which they would other
wise have had TO set it aside
|. Judgment for defendants.
The attorneys in the case were: For the
plaintiff, II. G. Sieberst and Judge Regens-
burger of council; for defendants, W. L. f.
Deal and Edmund Tauzsky and George R.
Wells.