Court Opinion

ID: 7972820
Source: CourtListenerOpinion
Date Created: 2022-09-09 00:56:48.26031+00
Date Added: 2024-06-11T16:34:49.386981
License: Public Domain

LOVELY, J.
This is an action by the receiver of the insolvent Allemannia Bank to recover an assessment which was made against the stockholders of that concern by the district court of Ramsey county. The defendant denied liability, and the cause was tried to the court upon its merits. There were findings of fact, and, as a conclusion of law, it was held that defendant was liable for the amount claimed. A motion for a new trial was denied, and this appeal is from that order.
There was ample evidence to sustain the facts as found by the trial court, to the effect that defendant was the owner of ten shares of the capital stock of the Commercial Bank of St. Paul, afterwards reorganized as the Allemannia Bank. The sale was made more than a year before the latter’s insolvency, for a valuable consideration, and in the ordinary course of business, to its president, Albert Scheffer, who was requested by the owner, in good faith, to cause the proper transfer to be entered on the books of the bank, which he promised to do. It was also found, upon sufficient evidence, that notwithstanding such request the officers of the bank failed and neglected to enter the transfer of the stock upon the books of the bank, and that the same stood in the name of defendant; also that the by-laws of the bank provided that all assignments of stock shall be entered on the books of the bank.
It is insisted that, upon these findings, the court erred in its legal conclusion that defendant was liable for the assessment made against him, under the provisions of section 2501, G. S. 1894, and the interpretation given thereto in Harper v. Carroll, 66 Minn. 478, 69 N. W. 610, 1069, for the asserted reason that it was the duty of the defendant to effectuate a valid assignment of his stock, by having an entry thereof *267on the stockbooks of the bank as provided in its by-laws, and that his failure in this respect forecloses his right to now insist that the transfer can be recognized in this action.
We have examined the case of Harper v. Carroll, supra, with considerable care, and find that this decision does not necessarily rule or control the case at bar. It is true it was there held, under the statute referred to, that the failure to have the transfer entered by the transferer one year before the insolvency forbids the owner of the stock to assert his immunity from the statutory stockholder’s liability, but it does not appear that any effort was made by the stockholder to have the assignment entered, or that he ever requested this to be done of any officer or clerk having authority to attend to that matter.
It cannot be doubted, but must be assumed, that the transfer of such shares should be entered by the officers who have charge of the stock-books, to complete an effective transfer, for the benefit of the bank and the public. This is required by law, but, in the way in which banking concerns do their business, it would be very unusual and impracticable for the transferer of bank stock to stand over the officer in charge of the stockbooks, and enforce obedience to his request in that respect. We doubt if anything more is ordinarily done to secure such entry than to make a quiet request therefor of the proper person, when the owner of the stock generally accepts a promise of compliance, and goes his way in confidence that it will be fulfilled. What men ordinarily do is the test of prudence, and the principles of ordinary business conduct cannot be overlooked or ignored in laying down the rules of law that govern in human concerns. So it must be held that all that can be required of the assigning stockholder is the absence of any reason to doubt the good faith or intention of the bank officer, who promises to enter the transfer. Whitney v. Butler, 118 U. S. 655, 7 Sup. Ct. 61 ; Matteson v. Dent, 176 U. S. 531, 20 Sup. Ct. 419; Hayes v. Shoemaker (C. C.) 39 Fed. 319; Earle v. Coyle (C. C.) 95 Fed. 99.
Under the findings in this case, there can be no question of the good faith of the transfer; nor any doubt, either, that the request was made to a proper officer — the president of the bank — to have the assignment entered, which was agreed to; and the finding that the- officers of the bank neglected to enter the same as requested implies dereliction on their part to perform their duties, and leads necessarily to the con*268elusion that the defendant had done all that was required of a prudent man to protect his rights. We are inclined to follow the manifestly just rulings of the federal courts to which we have referred upon this question, for it is quite desirable.to secure uniformity on all questions-affecting commercial law.
It is urged that, in support of the conclusion of law, we should go-to the entire evidence, to ascertain and discover facts which would sustain the legal conclusions as against the findings of fact. We have-held, upon our views of the necessity of orderly judicial procedure, that, where the court has found essential facts which are sustained by evidence, the only question to be considered in this court on review is-whether such findings support the conclusion of law. The ultimate-facts as found must be adopted — that the transfer was made in good faith, and in the ordinary course of business, and failed to be entered through the neglect of the bank officers — which finding impliedly excludes the inference of neglect by defendant. The construction which we have given to the findings has led us to the conclusion that the trial court erred in adopting the conclusion that the transferer was liable for the stock which he had assigned in substantial compliance with the provisions of the by-laws of the bank and the statutes of this state.
Order reversed and cause remanded, with direction that the conclusion of law be amended to conform to the views herein expressed.